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Oral Answers to Questions
(8 years, 11 months ago)
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Bob Blackman (Harrow East) (Con)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Tracey Crouch)
My hon. Friend will know that bridge is not currently designated as a sport. The High Court will consider a judicial review on the definition of sport from the English Bridge Union in September, to which the Government will respond accordingly.
Bob Blackman
I welcome my hon. Friend to her post. Her prowess on the football field is well known, but I wish to address the issue of mind sports. At the moment, Sport England refuses to fund bridge, chess, go and other mind sports. Her predecessor was investigating this, but will she update us on what progress has been made to ensure that Sport England does recognise mind sports for their ability to train the mind?
Tracey Crouch
I am grateful to my hon. Friend for his kind words. As he rightly said, Sport England does not currently recognise the term “mind sports” and does not provide funding to games such as bridge and chess. As I mentioned, the High Court is considering a judicial review of the definition of “sport” from the English Bridge Union. I recognise that many of these games are enjoyed by many people and that the mental agility required in this activity can help with conditions, bringing many health or wellbeing benefits. I therefore suggest that if he would like to seek funding support for these games, he does so through the Department for Education or the Department of Health.
Alex Chalk (Cheltenham) (Con)
The Secretary of State for Culture, Media and Sport (Mr John Whittingdale)
The Government have committed nearly £27 million to the roll-out of superfast broadband in Herefordshire and Gloucestershire. This should take superfast broadband coverage to an additional 130,000 homes and businesses across the two counties, providing almost 93% coverage by the end of 2017. Small and medium-sized enterprises in Gloucester and Cheltenham are now eligible for a grant of up to £3,000 to improve their broadband connectivity under the broadband connection voucher scheme.
Alex Chalk
I thank the Secretary of State for his answer. None the less, a significant number of homes and businesses in Cheltenham fall between two stools, being, apparently, not sufficiently rural for Fastershire to see fit to step in but too rural for commercial providers to consider it viable to extend broadband provision. Will he meet me to discuss how we can help those stuck in limbo and cut this Gordian knot?
Mr Whittingdale
First, I congratulate my hon. Friend on his election to this House and commend him for his efforts on behalf of his constituents in order that they obtain superfast broadband. He will be aware that 96% of Cheltenham will already have access to it by the end of 2017, which is above the national target, and many small and medium-sized enterprises can also benefit from the broadband connection voucher I mentioned. We are examining ways of extending the reach beyond that 96%, but I would of course be happy to meet him and some of his constituents to discuss what more we might do to help.
Mr Speaker
Order. I note the ingenuity of the hon. Member for Sherwood (Mark Spencer), but Nottinghamshire is a little distance away from Gloucestershire and Herefordshire.
Mr Laurence Robertson (Tewkesbury) (Con)
May I support the words of my hon. Friend the Member for Cheltenham (Alex Chalk) and remind the Secretary of State that many rural villages, certainly in my constituency, still do not have sufficiently strong broadband connections? That hampers people who are running small businesses from home, as well as children who are trying to use the internet to learn. What can he do to speed up the provision in those small villages?
Mr Whittingdale
I understand my hon. Friend’s concern for his constituents, particularly those in more rural areas. As he may be aware, under phase 1 of the broadband scheme we expect to reach 87.1% of premises across the whole of Herefordshire and Gloucestershire by December 2016, and under phase 2 we hope to extend that to 92.8%. Those in the more remote areas may still prove to be outside, and we will be looking at alternative means by which we can reach them with superfast broadband, but, again, I am happy to talk with him further about this.
Heidi Allen (South Cambridgeshire) (Con)
The Secretary of State for Culture, Media and Sport (Mr John Whittingdale)
More than 2.5 million additional homes and businesses now have access to superfast broadband as a result of the Government’s intervention. We continue to add 40,000 more homes and businesses every week.
Heidi Allen
I feel that I am about to gatecrash a party, but we have exactly the same situation in South Cambridgeshire. Connecting Cambridgeshire is doing a fantastic job of rolling out broadband across much of the constituency, but our roads are at gridlock—a happy consequence of our economic success—and it is vital that we keep people working in local hubs and from home. I, too, am interested in what other technologies we might explore to reach those people who are missing, so please may I come along too?
Mr Whittingdale
I congratulate my hon. Friend on her election and she is a very welcome party guest. The Government are investing more than £8 million in Connecting Cambridgeshire, which will increase coverage in her constituency to 94% by 2017. As she pointed out, there will be some areas that are much harder to reach and it might not be possible to do so by the traditional methods, so we are running pilot projects to explore other ways in which we can bring coverage up to reach even the furthest parts of her and other hon. Members’ constituencies. I would be happy to talk to her further.
Nigel Mills (Amber Valley) (Con)
Mr Whittingdale
My hon. Friend is completely right that although fibre will, we hope, supply superfast broadband to the overwhelming majority of premises in the country there will be some for which it is not practical. That is why we are piloting alternatives through our three pilot projects testing fixed wireless technologies in rural areas in North Yorkshire, North Lincolnshire and Monmouthshire. These are being run by Airwave, Quickline and AB Internet. We will consider the results to assess the best way of extending the programme still further into the most difficult areas.
Matt Warman (Boston and Skegness) (Con)
Mr Whittingdale
Again, I congratulate my hon. Friend on his election. I know that in his capacity as a former technology editor he brings a particular expertise to our debates on this subject. He is absolutely right that there will be some cases where, for the time being, it will not be possible to extend superfast broadband. I hope that we will eventually be able to do so, but in the meantime I entirely agree with him that it is important that people should be aware of that position. We are introducing a seven-digit postcode checker, which is now on the gov.uk website, so that people can be made aware of that position.
Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
I am pleased to tell the hon. Lady that 97% of UK homes and businesses already have access to 2 megabit per second broadband, up from less than 90% in 2010. We hope that all homes will have it by the end of 2015.
Meg Hillier
I welcome the Secretary of State to his position. I had hoped that he and the Secretary of State for Business, Innovation and Skills would form a dream team to tackle the nightmare of broadband coverage in this country, including in areas such as mine in Shoreditch. Can the Minister explain why millions of pounds of public money has gone in and yet, as we have heard from other hon. Members today, there is still a serious problem across the UK with what should be a 21st century utility?
Mr Vaizey
I will suppress my personal hurt that the hon. Lady would prefer to deal with the Secretary of State rather than with me, although we have dealt with her issues in Shoreditch over many months. I am pleased, for example, that in her constituency many businesses are taking advantage of broadband vouchers, that Virgin Media is rolling out broadband and that BT is investing in broadband. Across the country, more than 2.5 million homes are covered by our very successful programme.
John Howell (Henley) (Con)
Mr Vaizey
The other day I received an e-mail of congratulations from one of my hon. Friend’s constituents thanking me for the broadband that is being delivered to his constituency. As his next door neighbour, I know that the Oxfordshire broadband team is doing a fantastic job in rolling out broadband to thousands of homes across Oxfordshire.
Andrew Gwynne (Denton and Reddish) (Lab)
It would be quite nice to have decent internet access from these Back Benches from time to time. We are talking about universal broadband in the country, but while that is important to many of our constituents, a large number of people still not do have any digital access, and with the closure of libraries and other facilities where there is digital access, a real social exclusion issue is developing in parts of the country. What more can he do to make sure that all our constituents have access to digital technology?
Mr Vaizey
I am sure, Mr Speaker, that you have taken note of the hon. Gentleman’s comments about wi-fi in the Chamber. Digital inclusion will form part of our new digital implementation taskforce, and I am pleased that at the end of the last Parliament we set aside more than £7 million to put wi-fi in libraries. I agree with the hon. Gentleman that we need as many community spaces as possible where people can access the internet.
Damian Green (Ashford) (Con)
The Minister will have got the point from the last 10 minutes of exchanges that decent broadband speed is now a utility expected in every household, like running water and electricity. How effective does he think that the current programme is in filling in the gaps that, especially in rural areas, make it almost impossible for people to set up successful businesses where they are most needed?
Mr Vaizey
As I have already said, I think that the programme has been successful. We have passed more than 2.5 million homes. By the end of 2015 we should have 90% superfast broadband coverage in the UK, which compares well with almost every other country, and puts us at the top of the tree of the big five in Europe.
Helen Goodman (Bishop Auckland) (Lab)
Hon. Members are right; this is a problem. As I recall, there was a big underspend—£75 million—on the super-connected cities programme. Would the Minister like to reallocate that to speed up broadband roll-out? I offer him this idea free, gratis and for nothing.
Mr Vaizey
I am extremely pleased to have a free, gratis and for nothing suggestion from the second candidate for the chairmanship of the Public Accounts Committee who has participated in questions this morning. I suspect that whoever wins that chairmanship will want to investigate broadband and will take note that the super-connected cities vouchers scheme has now taken off like a rocket, with 24,000 businesses now benefiting. In fact, we are going to spend the money by the end of this year.
Sir Alan Haselhurst (Saffron Walden) (Con)
While I rejoice for the people of Cheltenham—the town in which I was educated—who may be reaching 96% coverage by 2017, I have to worry about the people of my constituency and other parts of rural Essex where, as my right hon. Friend the Member for Ashford (Damian Green) has just said, there are now serious gaps. The way business is being done in this country now means that people are spending part of the time at home. That is not to mention the farming community; the Government insist on providing so much information through high-speed broadband that it is essential that we accelerate the programme.
Mr Simon Burns (Chelmsford) (Con)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Tracey Crouch)
The Government have announced over £1 million of funding for Waterloo 200—the organisation supporting the commemoration of the battle of Waterloo. It has planned a number of high-profile events, including a service at St Paul’s Cathedral on 18 June 2015. In addition, £1 million has been made available to support the restoration of the Hougoumont farmhouse, and the Ministry of Defence is sending bands and guards of honour to various events.
Tracey Crouch
I am sure that my right hon. Friend will agree that this has been an exciting project. In addition to the service at St Paul’s, Waterloo 200 has planned an education programme in 200 schools, to introduce children to the history of the battle, and a descendants campaign. They are also involved with the planned re-enactment of the battle in Belgium. In addition, a number of exhibitions are being held in the United Kingdom and Europe, and I am pleased that many of the events have benefited from heritage lottery funding.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
“Scum of the earth”—that is the term Wellington used not for politicians, but for the soldiers who bravely fought at Waterloo. Can we not have more celebrations here in Westminster for the defeat of a cruel dictator, which ushered in 99 years of peace—we have not done that since—and especially about Hougoumont, where 5,000 men died that day? I challenge every Member of the House to visit Hougoumont and learn about that.
Tracey Crouch
I am grateful to the hon. Gentleman for his comments. Of course, he will know that there is a very good picture of the battle in the Royal Gallery, which for reasons of sensitivity we occasionally have to cover. I am sure that all the planned events will be much appreciated.
Mr Speaker
I am sorry; I am getting ahead of myself. Let us hear from Mr Simpson—not that he was present on the occasion.
Mr Simpson
Alas, Mr Speaker, I was not, but my hon. Friend the Member for North East Somerset (Mr Rees-Mogg) was. I congratulate the Minister on her appointment. What will we do to celebrate the two thirds of the Duke of Wellington’s army that were, in fact, not British? Some 36% of His Grace’s army were British, of whom about one third were Scots and Welsh—the Scots were fighting for the Union—but 45% were Germans; not Prussians, but Hanoverians and others. I think that we should give credit to what, ultimately, was the first NATO army.
Tracey Crouch
My hon. Friend is a great military historian, and I often listen carefully to what he says about these battles. As he knows, the battle obviously took place with a coalition. Events are being planned across Europe, and we are working with various Governments across the whole European Union. A number of events are taking place in Scotland, including regimental exhibitions at the National Army Museum in Edinburgh.
Diana Johnson (Kingston upon Hull North) (Lab)
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
The Government strongly support the fair distribution of funding for culture and arts across the country. Indeed, last week in Hull the chief executive of the Arts Council announced that the amount of lottery funding to bodies outside London would increase from 70% to 75%.
Diana Johnson
May I first congratulate the Minister on his re-appointment? I want to refer to what Darren Henley said in Hull on 28 May:
“If local authority funding is widely withdrawn, there will be little our limited funds can achieve. And no net gain to our increased investment of Lottery money outside London. It will be in vain.”
As the Minister has mentioned, Hull will be UK city of culture in 2017, but we have already lost a quarter of our council funding. Does he really think that we will see any progress on closing the unfair disparity between the north and London?
Mr Vaizey
The hon. Lady’s point is well made to Labour councils up and down the country, which is that they must maintain their investment in culture instead of withdrawing it. It is a partnership, which is why the Chancellor of the Exchequer was pleased to give the Ferens Art Gallery in Hull £1.5 million to help it host the Turner prize, but that is accompanied by local authority investment of £3 million. The message to all those Labour councils is that they must support their local arts organisations—particularly those of the hon. Member for Rhondda (Chris Bryant).
Graham Stuart (Beverley and Holderness) (Con)
It is indeed good news that the Turner prize will be presented in Hull. It is not always popular on both sides of the House, but what more can the Government do to encourage other such events to support Hull as the city of culture, and to ensure that Hull benefits from that in the long term?
Mr Vaizey
I know that my hon. Friend, who is standing to be the Chair of the Culture, Media and Sport Committee, is an aficionado of the Turner prize, as well as many other cultural events. He will know—I do not need to tell him—that Derry/Londonderry benefited from a huge range of events, from the BBC and other cultural organisations, and I expect Hull to benefit in the same way.
Mr Ben Bradshaw (Exeter) (Lab)
I am sorry that the Secretary of State is not answering this question, because only a couple of months ago, when he was the Chair of the Select Committee, he authored an excellent report highlighting the scandal of the imbalance in funding for the English regions compared with London. Now that he is in a position to implement it, will he?
Mr Vaizey
I am afraid that this is the second time that Opposition Members have asked for the Secretary of State to respond. Unfortunately, they have to put up with me, and I apologise for that. I am pleased that the chief executive of the Arts Council took note of the excellent report put forward by the Select Committee. As a member of that Select Committee, the right hon. Gentleman should be aware that civil servants now pore over these reports as though they were sacred texts.
Rehman Chishti (Gillingham and Rainham) (Con)
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
It’s me again, I’m afraid.
This is a very serious subject. Obviously, we are deeply concerned about the destruction of cultural heritage in Syria and Iraq. Discussions are taking place across Government to ensure that we take a joined-up approach towards those horrific acts of cultural vandalism.
Rehman Chishti
I thank the Minister for that answer. Specifically what are the Government doing to stop the illicit trade in cultural artefacts abroad that helps finance terrorism?
Mr Vaizey
My hon. Friend is absolutely right to say that we have to stop that illicit trade. We work with partners in the global coalition to put in place international sanctions to prevent the illegal trading of Syrian and Iraqi antiquities. We also have an effective legal framework to tackle the illicit trade, including specific legislation for antiquities from Iraq and Syria.
John Nicolson (East Dunbartonshire) (SNP)
I congratulate the Minister on his reappointment. What support can we give through our museums, universities and galleries to protect and preserve artefacts already removed from areas under ISIS control?
Mr Vaizey
If you will indulge me, Mr Speaker, I would like particularly to welcome the hon. Gentleman to the House, although he did defeat a colleague of mine from the coalition Government. He is an old friend; I hope that that does not hurt his career in the House.
The hon. Gentleman’s point is well made. The British Museum, for example, leads the way in helping to preserve antiquities that have been saved from looting. All our museums, working with both the Department for Culture, Media and Sport and the Department for International Development, will continue that work.
Mr David Burrowes (Enfield, Southgate) (Con)
Mr Vaizey
I hope that we will get on with it very soon, to be frank. I spend my time making the case to ministerial colleagues for introducing that important legislation to allow us to ratify the convention at the earliest opportunity. The destruction in Iraq and Syria highlights the importance that we must place on safeguarding cultural artefacts from armed conflict.
Robert Jenrick (Newark) (Con)
I echo the comments that we heard a moment ago. Everyone who campaigns on this issue agrees that the two foundation stones that are necessary if the UK is to have credibility are, first, to ratify The Hague convention and, secondly, for the Government to put money where our words have been for many years, by creating something such as a cultural protection fund to protect and support the brave men and women on the ground, under the auspices of great institutions such as the British Museum.
David T. C. Davies (Monmouth) (Con)
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
I congratulate my hon. Friend on increasing his majority as part of the best result for the Conservatives in Wales for more than 30 years. The House will want to take note of that truly fantastic achievement.
The Government are committed to supporting Welsh language and culture, in partnership with many bodies—including, of course, Welsh language programming with S4C.
David T. C. Davies
The Minister will no doubt be aware that the National Eisteddfod is the biggest Welsh language cultural event in the world. Next year it is coming to Monmouthshire. Given that Welsh is derived from old Brythonic, which was spoken across the whole of what is now the United Kingdom, and that the Minister has mentioned his role in funding Welsh language television, will he or one of his colleagues consider an invitation to visit the National Eisteddfod in my constituency next year?
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
Diolch yn fawr, Mr Llefarydd. The Minister’s Department provides nearly £7 million to S4C—down by 93% since 2010. When will the Government announce their financial intentions for S4C so that the channel can move ahead with commissioning?
Mr Vaizey
I think I had better put that point in context. A large part of the funding for S4C—some £74 million—comes from the BBC, so S4C is extremely generously funded, and unlike many media organisations it has secure funding going forward. When my right hon. Friend the Member for Basingstoke (Mrs Miller) held the office of Secretary of State, she ensured that S4C was protected from any cuts when we had to make cuts.
Susan Elan Jones (Clwyd South) (Lab)
Diolch yn fawr, Llywydd. The Government’s handling of the finance and governance of S4C during the previous Parliament was an unmitigated disaster. They failed to listen to any elected representatives in Wales, failed to listen to Wales’s excellent Welsh language campaigning organisations, and even failed to listen to the channel S4C itself. It could not possibly be any worse, so may we have a reassurance from the Minister that when it comes to renewing the BBC charter, proper measures will be put in place to protect Welsh language broadcasting this time around?
Andrew Rosindell (Romford) (Con)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Tracey Crouch)
Mr Speaker, as you and, indeed, my hon. Friend will be aware, the state opening of Parliament is a designated day for flying the Union flag on Government buildings, but not Parliament Square. The ceremonial arrangements for the state opening of Parliament are a matter for the Palace of Westminster and the Earl Marshal, and any changes cannot be made without their approval.
Andrew Rosindell
I thank the Minister for her reply, but will she assure the House that never again will we have the shameful spectacle of empty flagpoles in Parliament Square for the state opening of Parliament on the arrival of Her Majesty the Queen? Will she agree to meet me and representatives of the Flag Institute to ensure that we get the flying of flags in Whitehall and in Parliament Square right for the future?
Tracey Crouch
I know that my hon. Friend is a great expert on these matters, and the Secretary of State and I have some sympathy with his views on the state opening of Parliament. I have therefore asked my officials to raise this issue with the Earl Marshal to look into the possibility of flying the Union flag on the square for future state openings and to establish what the associated costs would be. In the meantime, I would be very happy to meet him and the president of the Flag Institute to discuss it further.
Andy McDonald (Middlesbrough) (Lab)
Flags can undoubtedly be a powerful demonstration of pride in our culture and our economic vibrancy. Does the Minister agree that companies that fear an exit from the EU should be encouraged to fly the European flag to demonstrate their commitment to the single market, together with the Union flag, which they might replace on St George’s day with the English flag, on St Andrew’s day with the saltire, on St David’s day with the ddraig goch, and on St Patrick’s day with the tricolour?
Tracey Crouch
I would like to say that I am grateful to the hon. Gentleman for asking that question, but that would not be true. Designated days for flying the Union flag are decided by Her Majesty the Queen, and any changes to designated days are for Her Majesty to make. It would therefore be an issue for the Department to discuss with Her Majesty.
Michael Fabricant (Lichfield) (Con)
The Secretary of State for Culture, Media and Sport (Mr John Whittingdale)
I have no plans to meet FIFA officials at this stage. However, I did meet the chairman and the chief executive of the English Football Association yesterday, and I intend to keep in close touch with them on this matter and, indeed, on other matters relating to football in this country.
Michael Fabricant
My right hon. Friend might like first to thank the Americans for finally exposing the corruption in FIFA that we have all suspected has been endemic for the past 10 or 20 years. Will he speak to his colleague the Foreign Secretary to see whether there can be a re-analysis with Qatar as to whether the World cup should be held there? Precisely what should our relationship with FIFA be, because Blatter’s departure is not necessarily going to mean that corruption has ended?
Mr Whittingdale
I agree with my hon. Friend. In order to achieve the reforms that all of us believe are vitally necessary in FIFA, the first requirement was a change in leadership. We have now obtained that, but that is the beginning of the process and certainly not the end of it. It is for the football associations of the home nations to work with other football associations that are equally determined to see change, in order to ensure that the new leadership is properly committed to achieving those changes.
In response to my hon. Friend’s second question, on Qatar, that is a separate matter. The Swiss authorities are continuing to investigate the bidding process that resulted in the decision to give the 2018 games to Russia and the 2022 games to Qatar, and we await the outcome of those investigations.
Clive Efford (Eltham) (Lab)
I welcome the Secretary of State and the sports Minister to their new posts.
The investigation into FIFA will go on, but the fight for its heart and soul will start now that Sepp Blatter has announced he is standing down. I wonder about these people at the top of FIFA and whether they have ever actually been to a football match for which they bought their own tickets, whether they have followed a football team week in, week out, or whether they have pulled on a football shirt and played in a match. We really need to get rid of these people at the top of the game.
Is the Secretary of State satisfied that Government agencies that are investigating the possibilities of corruption involving UK financial institutions have all the resources they need and that they are doing all they can to root out any criminal activity that may have taken place? Will he say exactly what he can do to ensure that we root out corruption in FIFA?
Mr Whittingdale
In the first instance, that is obviously a matter for the Serious Fraud Office and other investigatory bodies in this country, but I have spoken to the Attorney General about it. We will of course ensure that all the resources necessary to carry out a thorough investigation are available to those bodies and we will work closely with the Swiss and American authorities, which are leading on this matter.
On the reforms necessary in FIFA, we are absolutely committed to working through the FA and other football associations to ensure that the new leadership of FIFA is utterly committed to carrying out the sweeping reforms that are so obviously necessary.
Richard Graham (Gloucester) (Con)
The Secretary of State for Culture, Media and Sport (Mr John Whittingdale)
This has been a turbulent week for football, with the allegations of corruption eventually leading to the long overdue resignation of Sepp Blatter, and there have obviously been continuing revelations, even today. However, this weekend we once again get to concentrate on what makes the game great, as the women’s World cup kicks off in Canada. I am sure I speak for everyone present, even some of the newly elected Opposition Members, in wishing England the very best of luck ahead of their first game on Tuesday.
Richard Graham
I congratulate the Secretary of State on his response to and leadership on the FIFA governance crisis, which is in stark contrast to the efficient arrangements for the world’s third largest sporting event, the rugby world cup—coming soon to great venues such as Kingsholm in Gloucester. If FIFA decides in its wisdom that the winter World cup proposed in Qatar should not go ahead, will my right hon. Friend confirm that our nation would be in a position to host it here?
Mr Whittingdale
First, I join my hon. Friend in looking forward to the rugby world cup, which many Members are anticipating with eager excitement. On his second question about the decision to hold the 2022 World cup in Qatar, obviously we are watching the investigation, but at the moment that decision stands. If it were decided to change that, I think that, as the chairman of the English FA observed, if Russia hosts the World Cup in 2018, it seems very unlikely that another European country would host it in 2022. However, if FIFA came forward and asked us to consider hosting it, we have the facilities in this country, and of course we did mount a very impressive, if unsuccessful, bid to host the 2018 World cup.
Mr Speaker
Brevity is of the essence—we have a lot to get through. I hope that people will take note.
Chris Bryant (Rhondda) (Lab)
You always say that before I start, Mr Speaker. [Laughter.] And you know about shortness, don’t you?
I have already welcomed the new Secretary of State, but I welcome the new sports Minister very warmly. I liked her predecessor enormously, but when she was appointed I just wanted to run around and give her a hug. I am very pleased. It is a delight to see the new arts Minister, the hon. Member for Wantage (Mr Vaizey), in his place. He looks remarkably like the old arts Minister, except that he has lost his beard. Perhaps that is how he managed to survive. Honestly, it is a delight to see him in his place.
Chris Bryant
No, he does not get a hug. If he really wants one, he can ask for one later, and so can the hon. Member for Wellingborough (Mr Bone).
Chris Bryant
Easy tiger! Sorry, Mr Speaker.
With the news from Chuck Blazer and Jack Warner, is it not increasingly evident that FIFA is a stinking sink of corruption that has polluted everything it has touched? Would it not be wholly inappropriate for any money to pass from the UK broadcasters in respect of the 2018 or 2022 tournaments, unless and until Blatter has actually left, rather than just declared that he is leaving, FIFA is reformed, and the 2018 and 2022 bids rerun?
Mr Whittingdale
I thank the hon. Gentleman and welcome the love-in between the two Front Benches, but I am sure it will not last.
I share the hon. Gentleman’s astonishment that, even today, there are new claims being made by Jack Warner. This saga becomes more murky and distasteful by the day. As I said earlier, however, the World cup is a separate matter and we await the outcome of the investigations. If there is evidence that the bid process was corrupt, the case for rerunning it will be strong. However, if the World cup goes ahead, it would be unfair to tell English fans, and indeed fans of the other home nations if their sides qualify, that they cannot watch their sides compete in the World cup because the broadcasters will not purchase the sports rights to cover it. That is a separate matter. The important thing is that we get this all cleared up long before the World cup in 2018.
Mr Speaker
The equally important thing is that we speed up. I do not want Back-Bench Members to lose out. Let us have a very brief exchange, please, between the two Front Benchers.
Chris Bryant
Right. Well, talking of the licence fee, when the Secretary of State was Chair of the Culture, Media and Sport Committee, he said that the Government should get on with charter renewal as fast as possible. I note that it is only 576 days until the charter runs out, so will he get on with it? Can he give us a little clue as to his own inclinations? He was Mrs Thatcher’s toy boy and Norman Tebbit’s special adviser. He calls himself a free-market Conservative and, like Nigel Farage, thinks that it is debatable whether the BBC should even make “Strictly”. He says the licence fee is “worse than the poll tax”, but I think he always supported the poll tax, so is Auntie safe in his hands?
Mr Whittingdale
I am pleased that normal service has resumed between the Front Benches. On the BBC licence fee and the charter renewal process, the hon. Gentleman is absolutely right to say that there is a tight timetable. However, I hope we will be able to renew the charter on time, by the end of 2016. As for the licence fee, he will have to await our conclusions. I would say that I very much agreed with him when he observed of the licence fee:
“Elements of it are regressive, because everyone must pay it, so it falls as a greater percentage of income on the poorest people”. —[Official Report, 9 March 2005; Vol. 431, c. 1558.]
Martin Vickers (Cleethorpes) (Con)
The Parliamentary Under-Secretary of State for Culture, Media and Sport (Tracey Crouch)
I have fond memories of my time in Cleethorpes while I was at Hull University. Towns like Cleethorpes contribute a great deal to the tourism economy. We will continue to promote such areas through various marketing campaigns, and will create sustainable growth and jobs through the coastal communities fund.
Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)
Mr Whittingdale
I am aware of the hon. Lady’s long-standing interest in this matter. She and I share a determination to ensure that fraudulent ticket sites are cracked down on. Measures have been taken to do that. She is right to refer to the statutory review, which was set up as a result of legislation. It has to report within a year and we await its findings with considerable interest.
David T. C. Davies (Monmouth) (Con)
Mr Whittingdale
As my hon. Friend is fully aware, the BBC is under a duty, as are other news broadcasters, to be impartial in its coverage and that should mean giving airtime to both sides of every argument. I do not wish to interfere in the editorial independence of the BBC, something I think we all value. Nevertheless, I am sure it will have heard my hon. Friend’s remarks.
Mr Jim Cunningham (Coventry South) (Lab)
Tracey Crouch
As a Tottenham fan, I find it very difficult to talk about Coventry positively—I am still suffering a broken heart from the 1987 FA cup. We take football governance incredibly seriously and are looking at issues such as financial sustainability. The situation at Coventry raised some real questions. We have met some of the football authorities already. We will be meeting the Football League shortly.
Mr Speaker
As an Arsenal fan, I find it not difficult but quite impossible to talk positively at any time about Tottenham.
Bob Blackman (Harrow East) (Con)
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
I visited one of the libraries under threat with my hon. Friend. I know that when he was the leader of Brent Council he fought very hard to keep libraries open. They were subsequently closed by the Labour administration. I will review the council’s plans to close its libraries, as I do with every authority that seeks to close libraries.
Ian C. Lucas (Wrexham) (Lab)
Mr Vaizey
The hon. Gentleman and I are meeting shortly to discuss local television, so perhaps we can add that to the agenda. I know he is delighted with the groundbreaking deal put in place by the former Secretary of State to increase mobile coverage to 90% of geographic areas in the next two years.
Philip Davies (Shipley) (Con)
Tracey Crouch
I congratulate my hon. Friend, and indeed the former Member for Bradford South, Gerry Sutcliffe, on all the work they have done to ensure that mixed ability rugby is played in the area. If my diary permits, I would be delighted to attend.
Kerry McCarthy (Bristol East) (Lab)
Is the Minister aware of the campaign by the Writers’ Guild, “Free is NOT an Option”, which is based on a survey that found that TV writers are increasingly being asked or pressurised to write scripts for free, even when they are established writers who have previously written for the same show? What can we do to ensure that creative work is valued in the same way as other work?
Mr Vaizey
I am aware of that very important campaign. I find it absolutely astonishing that many independent production companies, which make millions and millions of pounds, cannot be bothered to pay a decent wage to people who contribute to their work. I will certainly work with the hon. Lady to encourage them to do so.
Mrs Maria Miller (Basingstoke) (Con)
Mr Whittingdale
I agree entirely with my right hon. Friend. It is now absolutely essential that new estates should, as a matter of course, be linked up to superfast broadband. I commend Hampshire County Council for the actions it is taking to achieve that. My hon. Friend the Minister for Culture and the Digital Economy is meeting my hon. Friend the Minister for Housing and Planning to discuss what further measures we can take to ensure that other local authorities follow Hampshire’s lead.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
The north-east continues to lose out when it comes to lottery funding. What will Ministers do to ensure that there is greater transparency around the national lottery, so that we can keep up the pressure to shift money out of London to the regions?
Tracey Crouch
Since the national lottery was formed, it has raised more than £33 billion for good causes and made more than 450,000 grants across the UK. I will perhaps reassure the hon. Lady by saying that 70% of all grants have been awarded outside London and the south-east.
Suella Fernandes (Fareham) (Con)
Mr Whittingdale
I congratulate Kern Ltd in my hon. Friend’s constituency on benefiting from the scheme, along with the 24,000 other businesses across the UK that have similarly benefited. The scheme has proved extremely popular, and that is why we are extending it to 28 more cities and increasing its budget by £40 million.
Mr David Hanson (Delyn) (Lab)
Bill Esterson (Sefton Central) (Lab)
Carolyn Harris (Swansea East) (Lab)
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
The Leader of the House of Commons (Chris Grayling)
The ministerial code is clear: when Parliament is in session, the most important announcements of Government policy should be made in the first instance to Parliament. I have reminded my Cabinet colleagues of that.
Mr Hanson
On 21 May, the Prime Minister, in a speech to journalists outside this House, gave details of every aspect of the proposed immigration Bill, a full week before that Bill was announced in the Gracious Speech last Wednesday. Whatever the view of the Leader of the House on that, is it not better that Members of Parliament are the first to hear a new policy, so that they can either praise it or ask questions about it in this House?
Chris Grayling
With respect to the right hon. Gentleman, the House was not sitting at that point, and during the past couple of months political leaders of all parties have made detailed statements to the media about their plans for the next five years; fortunately, only one party is able to put its plans into effect. We will ensure that we continue to treat Parliament with the respect it deserves.
Bill Esterson
In the previous Parliament, the ministerial code was clear that Ministers should come to the House first, but it was largely ignored. Early signs are that the same thing is happening in this Session. Can the Leader of the House tell us when the code will be published in this Parliament, whether it will be enforced properly and whether Ministers will come to this House and not go to the press first?
Chris Grayling
The ministerial code will be updated shortly. Labour Members have certainly changed their tune since they were in government. I remember in my first years in this place, when I was in opposition, all those occasions when not only this House but the occupant of No.10 found out in the newspapers what the Chancellor of the Exchequer was doing.
Carolyn Harris
Last week, as many as 17 Bills announced in the Queen’s Speech had already been briefed to the press. I concur with my right hon. and hon. Friends: does the Leader of the House agree that Members of Parliament should be the first to know these things?
Chris Grayling
Again, with respect to the hon. Lady, all these measures were in our manifesto. Our first Session is about enacting that manifesto, on which we were elected. If she wants to find out more about our plans, she just has to read that document.
Luciana Berger
I heard what the Leader of the House said about statements that might have been made before this House was in session, but it was on Monday that the Prime Minister announced details of the Government’s Childcare Bill not to this House but to the media. Does the Leader of the House agree that the Prime Minister was wrong to do so?
Chris Grayling
That was not a fresh announcement; we set out our plans for childcare weeks and weeks and weeks ago. Simply to repeat things that we have announced weeks ago seems to me to be entirely normal.
Mr Philip Hollobone (Kettering) (Con)
My right hon. Friend the Leader of the House is a distinguished occupant of his office, but he is not simply the Government’s representative in this House; he is also the representative of this House to Her Majesty’s Government. What will he do to enforce any breaches of the ministerial code with regard to releasing information to the press before this House hears it first?
Chris Grayling
My hon. Friend is absolutely right, and I do take that very seriously. I regard myself as the Leader of the House representing all Members. Of course, it is a matter for the Prime Minister to enforce the ministerial code, but as I indicated a moment ago, I have already reminded my colleagues about the importance of making announcements to Parliament.
Philip Davies (Shipley) (Con)
It is important that statements are made to the House first, but it is more important that the policies announced are proper Conservative policies and that when they have been announced, they are seen through by the Government. In that spirit, will the Leader of the House confirm that the Government will crack on with repealing the Human Rights Act and not shilly-shally over it?
Chris Grayling
I can confirm, as the Prime Minister did this week, that that is absolutely our intention.
Pete Wishart (Perth and North Perthshire) (SNP)
The leaking of information to the press before it comes to the House is increasingly frustrating the public. This question is as much for you, Mr Speaker, as for the Leader of the House: is it not time we started thinking about sanctions for Ministers who indulge in this behaviour—for example, not being able to give the oral statement in the House?
Chris Grayling
I have no doubt that my colleagues will be making extensive statements to the House about their policy plans, the changes they are enacting and the issues they face. However, given that this is the first Conservative Government for far too long in this country, I ask the hon. Gentleman at least to treat current Conservative Cabinet Ministers as innocent unless proven guilty.
Mr Andrew Turner (Isle of Wight) (Con)
The Deputy Leader of the House of Commons (Dr Thérèse Coffey)
The Government currently have no plans to bring forward changes to the sitting hours of the House.
Mr Turner
A large majority of Members are simply unable to get home in the evenings, and we did not come to London to be given lots of free time. As we have so many new Members, may we ask again whether it is the will of the House that we sit later on Tuesdays and Wednesdays? I would certainly vote in favour of such a proposal, and I know that many other right hon. and hon. Members would agree with me.
Dr Coffey
Hon. Members had the opportunity to vote in the previous Parliament, and I suspect that my hon. Friend and I were in the same Lobby at the time. The Procedure Committee revisited the situation, and could do so again if Members made representations to it, but I repeat that the Government have no plans to change the sitting hours of the House.
Nic Dakin (Scunthorpe) (Lab)
I welcome the hon. Lady to her post; I am sure she will perform extremely well, as she has in other posts. The Procedure Committee considered this matter in the previous Parliament, but does she agree that it would be opportune for the Committee to pick it up again when it is reconstituted, so that current Members can comment on the sitting hours of the House?
Dr Coffey
I thank the hon. Gentleman for his welcome, and I congratulate him on, and welcome him to, his new position too. It is not for the Government to determine the business of the Procedure Committee; it is up to the Members selected to serve on the Committee to do that.
Mr Speaker
Before I call the hon. Member for Bassetlaw (John Mann) to ask Question 4, it might be helpful to new Members if I remind the House that, to avoid any possibility of compromising our security, we do not discuss operational security matters on the Floor of the House. The question is perfectly in order, but hon. Members should take account of this constraint in their further exchanges.
John Mann (Bassetlaw) (Lab)
Sir Paul Beresford (Mole Valley)
The short answer is none. The slightly longer answer is that viewing a Member’s emails can be done lawfully only with the consent of the Member, where a circuit judge has made a production order requiring material to be produced, or pursuant to a search warrant and in accordance with the Speaker’s protocol on the execution of a search warrant and the precedent of the House of Commons. Thus, no member of staff, including the parliamentary security director, has both the ability and the authority to view or authorise the viewing of Members’ emails.
Mr Peter Bone (Wellingborough) (Con)
The Deputy Leader of the House of Commons (Dr Thérèse Coffey)
There was an absence of consensus on this issue at the end of the previous Parliament, and there is still no consensus at the beginning of this Parliament. The Government therefore have no intention to bring forward proposals.
Mr Bone
I did not follow that, because there is now a Conservative majority in this House and it has always been Conservative policy to have a business of the House Committee. In welcoming the Deputy Leader of the House to her new position, I note that she is an ex-Whip, and she knows that such a committee would remove a lot of work from the Whips Office as well as being beneficial to the House. Will the Government reconsider their position?
Dr Coffey
My hon. Friend knows that the proposal was in the coalition agreement, and that after our great victory there is no longer a coalition. That said, there is still an absence of consensus on how a House business Committee would really work. I hope my hon. Friend welcomes the extra hour for Westminster Hall debates, so that there are plenty of opportunities for Members of all parties to continue to hold the Government to account.
Kevin Brennan (Cardiff West) (Lab)
Sir Paul Beresford (Mole Valley)
The House generated £441,000 in net sales from the hire of catering and event facilities to third parties between January 2014, when such hire was permitted, and May 2015. This was from a mixture of corporate, wedding, private and charity events that took place when the House was not sitting. Smaller amounts were raised from other activities, including charges for filming on the estate. It is not possible to identify separately the amount of income raised from the corporate sector.
Kevin Brennan
Is the hon. Gentleman as concerned as I am that it is unhealthy for our democracy if this House becomes more and more dependent on hire fees from corporate interests? Will he therefore look again at this policy of hiring out our facilities to the very people who caused the financial difficulties that the House is trying to meet?
Sir Paul Beresford
I ought to remind the hon. Gentleman that the matter was looked at carefully by the Administration Committee; it was looked at by the Finance and Services Committee; it was looked at by the House of Commons Commission; and it was agreed by the House. The hon. Gentleman may find that he is in a slight minority on this issue.
NHS Success Regime
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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Andy Burnham (Leigh) (Lab)
(Urgent Question): To ask the Secretary of State for Health if he will make a statement on the success regime.
The Parliamentary Under-Secretary of State for Health (Ben Gummer)
I welcome the success regime, details of which were published by Monitor yesterday. The purpose of the success regime is to improve health and care services for patients in local health and care systems that are struggling with financial or quality problems. It will build on the improvements made through the special measures regime, recognising that some of the underlying reasons may result from intrinsic structural problems in the local health economy. This will therefore make sure issues are addressed in the region, not just in one organisation.
The regime is designed to make improvements in some of the most challenged health and care economies. The first sites to enter the regime—North Cumbria, Essex and North East and West Devon—are facing some of the most significant challenges in England. They have been selected based on data such as quality metrics, financial performance and other qualitative information.
Unlike under previous interventions, this success regime will look at the whole health and care economy: providers, such as hospital trusts, service commissioners, clinical commissioning groups and local authorities will be central to the discussions. It will be supported by three national NHS bodies, whereas existing interventions tend to be delivered by individual organisations and to concentrate on one part of a health economy—for example, the commissioning assurance framework led by NHS England that concentrates solely on commissioners, or special measures led by NHS England, the Trust Development Authority or Monitor, which focuses on providers.
Together, Monitor, TDA and NHS England, with local commissioners, patients, their representatives such as Healthwatch England and health and wellbeing boards will aim to address systemic issues. The national bodies will provide support all the way through to implementation, with a focus on supporting and developing local leadership through the process.
Andy Burnham
As we have just heard, this announcement has far-reaching implications for people in Essex, Cumbria and Devon. It was being finalised on Tuesday, when the House was engaged in a full day’s debate on the national health service, yet there was not one single mention of it during the debate. What are we to make of that, and why was the Secretary of State not here to make this announcement to the House? Why does he think that it is always more important to make announcements in television studios or to outside conferences than to Members of Parliament in the House of Commons? That is not acceptable. People in Cumbria, Essex and Devon will be worried about what the Minister has just said, and what it means for health services in their areas.
First things first. Can the Minister confirm that services in those areas are safe and sustainable? Are there enough staff, and will work be undertaken immediately to deal with staff shortages? Are plans being drawn up to close A and E departments, or other services, as part of this process? Could it mean mergers between organisations, and job losses?
We welcome action that means taking a broader view of challenged health economies—indeed, my hon. Friend the Member for Copeland (Mr Reed) has long called for such action—but what will the new regime mean for local NHS bodies? Will it be possible for NHS England to overrule them? The House will recall the last occasion on which the Secretary of State tried to take sweeping powers to close health services over the heads of local people in south London. It did not end well; indeed, it ended with his being defeated in the High Court. Can the Minister assure us that patients will be consulted before any changes go ahead?
Is not the fact that NHS is taking drastic powers over whole swathes of the NHS in three counties a sign of the failure of the Government’s plans for local commissioning, and evidence of five years of failure of Tory health policies? Is it not evidence that care failures are more likely, not less likely, on the Tories’ watch?
This is no way to run a health service, and no way to treat Parliament. The Minister, along with the Secretary of State, is trying to shift the blame for things that have gone wrong in the NHS on their watch—for problems that are of their making. We will not let the Secretary of State do that. He should have been here to do Members who are affected by this announcement the courtesy of giving them answers, and I ask his junior Minister to relay that to him directly after the debate.
Ben Gummer
The shadow Secretary of State has spoken at length—in his answer to his urgent question—about NHS bodies. He has spoken about local commissioners, about NHS England and about the Department of Health, but Members will have noted that there was one group of people about whom he did not speak, and that was patients. It is extraordinary that, once again, he has come here to speak, again and again, about structures—about the NHS and its bodies, about jobs, about providers and about deliverers—but not about the people who are being failed at local level, namely patients in Essex, west and north-east Devon and north Cumbria.
Let me deal with the right hon. Gentleman’s points in detail. First, he made accusations about television studios. I think it is a bit of a cheek to make such claims—and I should tell the House that the Secretary of State will very shortly be addressing the NHS Confederation.
Ben Gummer
The urgent question was submitted this morning.
Coming from a shadow Secretary of State who is, one might suspect, using urgent questions and the subject of the NHS not to address issues relating to the quality of care, but for his own political reasons—as he always has—this was a shameless attack. It reflected rather badly on the right hon. Gentleman himself, rather than reflecting on the cause that he should seek to pursue: the better care of patients, which lies at the heart of what NHS England is attempting to do. If he had read what Simon Stevens said when he announced the plans yesterday to the NHS Confederation, he would have noted that they are being drawn up, co-ordinated and, in part, led by local commissioners rather than—as was the case before—by monolithic centralised bodies headed by bureaucrats. This process is being led, locally, by clinicians, who are being supported and helped by NHS England and professional regulators.
The right hon. Gentleman asked about staff shortages. I am surprised that he mentions that, given that he was in part the author of the staff shortages that hobbled the NHS at the end of the previous Administration and that led in part to the problems at Mid Staffordshire that we have been seeking to address. Only this Government, in their previous incarnation, promised to correct that situation, in part through our pledges on GP numbers over the next five years.
The right hon. Gentleman asked about plans for accident and emergency departments and about job losses. I would say to him that it is different this time. These plans are being drawn up by local commissioners, who are now beginning the process of working out how to improve their local health economy. This is not a plan that will be devised centrally in Whitehall, imposed on local areas and announced as a done deal for local people. I know that that is what the right hon. Gentleman is used to, but in this instance it is a genuine conversation between local patients and local commissioners with the aim of improving their local health economies, and it will be supported by national bodies.
The right hon. Gentleman asked about south London and about consultation. I was a candidate in a constituency that had a solution imposed on it, during his tenure as Minister for Health, without any decent consultation. That proposal was eventually thrown out. The previous Government never consulted local people properly when he was in control, but we have changed that. These local plans will involve local people, patient bodies and health and wellbeing boards from the outset.
The shadow Secretary of State asked about the powers of NHS England, about localisation and about the co-ordination of local services. I ask him once again to go back and read Simon Stevens’s speech. He will see how things have changed. This is not about decisions being made by politicians in Whitehall. I dare say that the right hon. Gentleman does not know the solution to the problems in the local health economies in Devon, Essex and Cumbria—
Ben Gummer
I am so glad that the shadow Minister is such an augur of knowledge. I will tell him who knows the solution: it is the patients and the local clinicians. They will provide the answers and make the changes. We want patient care to be improved for local people to provide excellence in the local NHS—excellence delivered and excellence for patients—and we were supported at the general election in that mission to create a world-class NHS.
Mr Speaker
Order. I understand that there is a high-spirited atmosphere in the Chamber and a great deal of interest in this subject, but I remind Members that brief questions and brief answers should be on the subject of the urgent question—namely, the success regime. It is with that matter that we are dealing this morning.
Dr Sarah Wollaston (Totnes) (Con)
I welcome the additional support for struggling health economies, even if it is a classic example of NHS newspeak to call it a success regime. Will the Minister reassure the House that, in looking at a wider approach to health economies, he will also look at the funding formulae for health and for social care, which do not adequately take into consideration the impact of age or rurality?
Ben Gummer
I thank my hon. Friend for her typically gracious welcome for the proposals. She understands why this matter requires a whole-system approach at local level. I can confirm that the NHS will be studying every single aspect of the local health economy and all that that entails.
Mr Ben Bradshaw (Exeter) (Lab)
Is it not disgraceful that in the health debate on the Gracious Speech two days ago the Secretary of State had nothing to say about the financial crisis affecting the NHS and refused to answer my questions about his plans for Devon, and that this announcement was made to the media yesterday with no details of how it is going to affect patient care or the quality of services in my area? The Minister is very keen on quoting Simon Stevens, but Mr Stevens told BBC Radio Devon this morning that this chaos was a direct result of the fragmentation following this Government’s reorganisation of the health service. When is the Minister going to admit that that reorganisation was a disaster, and when are the Government going to get a grip on the spiralling financial crisis in our NHS?
Ben Gummer
I heard the right hon. Gentleman’s comments during the debate on the Queen’s Speech, and I know that he has taken a keen and detailed interest in the problems in his local health economy. I know also that he has been very careful and keen to include local commissioners and those who understand what is happening on the ground. That is why I had hoped he would be pleased about the introduction of the success regime, which will build on the financial consultations and discussions that have been going on, will involve local commissioners and, importantly, will provide the back-up of national regulators and NHS England. I did not hear the comments of Simon Stevens on local radio but I did read his speech, in which he made the opposite point to the one that the right hon. Gentleman suggested. The reforms that were brought in, far from being as the right hon. Gentleman characterised them, have saved £1.5 billion in this year, in addition to the £5 billion previously—money that is being invested in care in his constituency.
Mr Simon Burns (Chelmsford) (Con)
I am grateful to the Minister for the statement. How will my constituents in mid-Essex and the local health economy in mid-Essex see the results of what is going to be done under this regime? Can he assure me that it will examine the funding formula for health care per head of the population in mid-Essex, which has historically been skewed away from mid-Essex towards other parts of the country?
Ben Gummer
My right hon. Friend will be aware of the hospitals in Essex that have been placed in special measures. He will also be aware that focusing on one or several particular institutions is not sufficient to sort out the problems in the wider local health economy. That is why the success regime is being brought in—to try and deal with those systemic issues. Once the success regime has been concluded, I hope that his constituents will rapidly see an improvement in the service that they receive and that they deserve, wherever they are in the county.
On his second point about funding per head, he will know that NHS England has already started to look at that and, in some instances, address it. I have the same problem in my constituency in Suffolk, and it needs sorting out in the medium term across the country.
Dr Philippa Whitford (Central Ayrshire) (SNP)
The Minister talks about consulting commissioning groups locally, but why is he not willing to listen to groups of doctors across the country who talk about the point I made on Tuesday—fragmentation? We need integration. Local authorities are having their budget taken away, which means cuts to social care. Social care companies are one thread away from bankruptcy. We need to fund both sides of that, yet we are running round looking at structure. We need to move and look at outcomes. I have heard the Minister talk about “Five Year Forward View”. In Scotland we are already doing that as part of 2020 Vision: look at the patients, as the Minister says.
Ben Gummer
I take this opportunity to congratulate the hon. Lady on her entry into the House and on her maiden speech, which I enjoyed listening to in the Queen’s Speech debate. In England we are addressing the issues surrounding social care and its integration with the health service. That is why we have introduced the £5 billion better care fund. Under the success regime, far from looking at structure, we are trying to see how we can better link up services. That is why local councils will be a key partner at the table in the discussions.
John Stevenson (Carlisle) (Con)
I welcome the announcement, which I see as an opportunity to review the whole health economy in north Cumbria. It is a chance to review the strengths and weaknesses of health care and patient care in and around Carlisle and north Cumbria. However, will the Minister confirm that this will not hinder other developments, such as the acquisition of the Cumberland infirmary by Northumbria NHS Trust?
Ben Gummer
It is such a pleasure to see my hon. Friend return to the House. I know that he has been a tireless campaigner for the people of Carlisle. The success regime, as I said in answer to previous questions, will look at every single part of the local health economy, and every single partner in those discussions will be locally based or national regulators and NHS England.
Sue Hayman (Workington) (Lab)
I am desperately concerned about the state of our health services in west and north Cumbria, as are many of my constituents. Many people told me during the election that they want their services delivered as close to where they live—as close to home—as is possible. That is challenging in west Cumbria. I hope that the success regime recognises that, and that we stop talking and consulting and actually have action to deliver the services where people live. That is challenging because of recruitment, and those issues need to be taken into account. I would like the Minister’s assurance that that will be part of the success regime, because without it there will be no success.
Ben Gummer
I welcome the hon. Lady to her seat. She is right in much of what she says, and the entire purpose of the success regime is to take action, rather than just to keep on publishing PowerPoint presentations. We will be addressing every single part of the failures in her local health economies, and that may well include recruitment.
Sir Alan Haselhurst (Saffron Walden) (Con)
If a major feature of the success regime is ensuring that there is adequate care in the community, so that people who no longer need to be in acute beds can be released safely and comfortably and to the assurance of their relatives and family, is that not something to be welcomed?
Ben Gummer
I thank my right hon. Friend for that, and he has got to the nub of the point in a way that the shadow Secretary of State did not. This is about patient care and the excellence we expect from it. That is precisely why I agree with him that success regimes will be successful only if we ensure that we are improving patient care, and that might well include improving access to care at a local level.
Heidi Alexander (Lewisham East) (Lab)
I am confused: the NHS success regime is not about success—it is about failure. Will the Minister confirm that services in the areas affected are delivering safe care? Should patients be worried?
Ben Gummer
The hon. Lady should not be confused because the success regime is indeed dealing with local failure and we intend to turn it into a success. That is the point of what we are doing. We have made these decisions where the NHS has assessed areas as having quality and financial problems. We intend to address them rather than just talk about them, which is why I am so glad that this will be locally led, finding local solutions to local problems.
Mr Gary Streeter (South West Devon) (Con)
This intervention affects every one of my constituents, and if it improves their patient care of course I welcome it. The Minister has done extremely well from the Dispatch Box in one of his earliest outings, but can he tell us the timescale of this intervention and how we will measure whether or not it has been a success?
Ben Gummer
I thank my hon. Friend for his kind comments. He should be aware that success regimes will begin imminently, but we have no set timescale for them yet, because that will be determined by the plan drawn up in the initial stages by local commissioners. Again, that goes to the root of what we are trying to do; this is going to be a plan led by local clinicians, commissioners and providers, in order to provide a local solution.
Derek Twigg (Halton) (Lab)
There are real concerns in the north-west generally about deficits and problems with patient care and safety if those deficits continue. Let me ask the Minister a specific question on the issue before us today: who will have the final say in these areas? Will it be commissioners or will it be NHS England? If it is the commissioners, will they be able to call for more funding, and will the Government meet that?
Ben Gummer
The hon. Gentleman should know that the success regime will be co-ordinated by local commissioners, supported by NHS England, the TDA and Monitor. They will come together with a plan, which will then be implemented. The only way these success regimes will work is if they are owned by everyone who makes decisions locally. [Interruption.]
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
I welcome this announcement. As my hon. Friend will know, Basildon hospital has been making good progress in improving patient care, but that has been at a cost. This regime will allow it not to have to choose between balancing the books and providing a safe environment. Can he confirm that patients and the public will be involved at every stage of this process, so that they can suggest any changes that may be necessary to achieve the success we are after?
Ben Gummer
They will not just be involved; they will be central to the discussions. The jeers and taunts from Opposition Front Benchers give the game away: they expect a decision to be made centrally—that is what they want. That is the only way they think. Conservative Members believe that local people should be central to that decision and that we should fix the whole local health economy, as opposed to trying to deal with individual trusts as they encounter problems.
Diana Johnson (Kingston upon Hull North) (Lab)
Will the Minister explain how the problem of chief executives who are not performing properly will be dealt with under this regime? Let me give him an example. Under the coalition Government’s watch the chief executive at Hull, who was disastrous, was moved to Harlow where he is now earning £170,000 a year. He had the help of the TDA in that move and left a disastrous situation in Hull.
Ben Gummer
I was not aware of that situation and would very much like to talk to the hon. Lady about it afterwards. If the facts she states are true, that is indeed wrong. The whole point of the success regime is to get away from the idea of being able to change one chief executive or commissioner in one provider in a challenged health economy while expecting to see a change to the whole system. We are trying to correct the system so that local care for local people is improved.
Johnny Mercer (Plymouth, Moor View) (Con)
If this intervention improves healthcare for my constituents, I will welcome it very much. However, will my hon. Friend clarify the impact on Derriford hospital in my constituency and whether the intervention will put any new management into our hospital?
Ben Gummer
I thank my hon. Friend for his question and welcome him to this place. To repeat the answer I have given several times so far—[Interruption.] Those on the Opposition Front Bench say that I do not know, but I must explain to them once again that this is not about a Minister sitting in Whitehall making a decision having never visited an area. That is what the right hon. Member for Leigh (Andy Burnham) did when he tried to destroy local services in my constituency and other places in Suffolk. This is different. It is about trying to fix problems in these challenged local health economies, which in some places have been present not for months or years but for decades. We are trying to ensure that the decisions are corrected and made by the local commissioners and clinicians.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
Ministers will be aware of the plight of the Barts Health NHS Trust, which is in special measures. Part of its problem is the weight of the interest on its private finance initiative, a new Labour policy that I did not support. It is having to pay that back at £500,000 a month. Surely a success regime for Barts and other hospitals burdened with PFI debt would be a serious attempt to renegotiate those PFI agreements.
Ben Gummer
I am so glad that the hon. Lady welcomes the success regime and the potential it might have. I spoke to one of her colleagues the other day about the troubled hospitals that she mentioned and I was about to invite her in to have a discussion about them, as we must try to find out what the core issues are with Barts Health NHS Trust. She raises an interesting point about PFI, however. One reason we are struggling in some cases, and why we have struggled over the past five years to provide the funding within the NHS that it requires, is the enormous NHS PFI debt that was loaded on to it by the previous Government and that has cost it billions of pounds over the past 10 years.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I thank my hon. Friend for his very thoughtful comments and replies. Does he recognise that one of the problems for the Devon clinical commissioning group is that it covers a large rural community and also Plymouth, the largest conurbation west of Bristol? We need to find a way in which this can all work to ensure that the city of Plymouth gets looked after and that levels of deprivation and so on are considered.
Ben Gummer
My hon. Friend makes the point better than I did. How do we sort these problems out using the local knowledge that he has just demonstrated rather than having a Minister in Whitehall with a map thinking that he or she can make the decision themselves? The success regime seeks to harness that local knowledge and the local solutions.
Helen Hayes (Dulwich and West Norwood) (Lab)
It is simply not acceptable that an announcement of this magnitude should have been made without first being debated in this House. As I understand it, the success regime applies to a number of areas of the country but not to London. My local hospital, King’s College hospital, has a deficit well in excess of £40 million. It is nigh on impossible in parts of the constituency to see a GP when people need to. We have a crisis in the NHS across the country. What is the comprehensive plan to address that? We need that rather than a piecemeal intervention in only parts of the country.
Ben Gummer
I welcome the hon. Lady to her place. She will not know that there was an Adjournment debate at the end of the last Parliament on precisely this issue. I invite her to seek such a debate if she wishes to discuss local issues with me or other Ministers. The success regime has been devised by Simon Stevens and NHS England. It will be clinically led, fulfilling our desire to see the NHS led by doctors, not Whitehall bureaucrats.
Will Quince (Colchester) (Con)
I welcome the announcement. Colchester general hospital is in special measures. One of the biggest issues facing our hospital is the recruitment of nursing staff. Will my hon. Friend give an assurance that county-wide recruitment will be included as part of the success regime?
Ben Gummer
Every single aspect that is troubling local health economies, including recruitment, I understand, will be within the scope of success regimes.
Bill Esterson (Sefton Central) (Lab)
Having listened to the Minister’s answers, it seems to me that patients have every right to be worried about whether care is safe in the NHS. Does he not realise that, unless the Government reverse the cuts in social care, the problems in patient care will not be resolved anywhere in the NHS—not just in the areas covered by the so-called success regimes?
Ben Gummer
May I gently remind the hon. Gentleman that this Government and their predecessor changed the culture of trying to suppress bad news, whether on care or money, and instead tried to understand what was best for patients, even when that meant facing up to difficult decisions? That is precisely what NHS England is doing with the success regime, and that is why we are addressing seriously challenged local health economies, rather than pretending that there is not a problem, which I am afraid was the attitude of the Labour Front-Bench spokesman when he was in power.
Mr Speaker
Order. I must say that it is a pleasure to welcome back to the House the right hon. and learned Member for Rushcliffe (Mr Clarke), who when he celebrates 45 years in the House this month will I think be approaching the mid-point of his parliamentary career.
Mr Kenneth Clarke (Rushcliffe) (Con)
At this crucial mid-point, thank you very much, Mr Speaker, for that unusual way of calling me.
Does my hon. Friend the Minister recall that the whole purpose of introducing the purchaser-provider divide many years ago, which was developed by the Labour party and is now known as local commissioning, was to concentrate on patient care, patient outcomes and local priorities? Will he therefore, with this welcome announcement, continue to stick by NHS England, allow it to do that, and resist the blandishments of the shadow Health Secretary, who seems to pine for the days of centralised bureaucracy and is still feebly trying to weaponise the NHS for party political purposes?
Ben Gummer
It gives me particular pleasure to respond to my right hon. and learned Friend. He was an exceptional Secretary of State for Health because he understood the centrality of local decisions by patients and their doctors and commissioners. I confirm that we will continue to allow local commissioners to make the decisions, rather than try to wrest power back from them to Whitehall, which is precisely what the shadow Secretary of State did when he was Secretary of State.
Melanie Onn (Great Grimsby) (Lab)
Is not the fact that these drastic steps have been taken a sign that care problems are becoming more likely under this Government and not less?
Ben Gummer
I welcome the hon. Lady to her place. I only hope that she does not have the same contempt for her constituents that her predecessor seems to have expressed. It is interesting how it all comes out afterwards. I repeat to the hon. Lady that the decisions will be made locally by local people and local commissioners in response to local problems, and where they arise we will seek to address them.
Helen Whately (Faversham and Mid Kent) (Con)
I have heard that trusts in my constituency were potential candidates for this regime. Will the Minister please make it clear that, unlike some previous oversight regimes, this regime will enable local health care organisations to work together to solve their problems and will involve not just scrutiny but more support?
Ben Gummer
I thank my hon. Friend for her question. I am delighted to see her in her place. She has experience and expertise in this area. She will know that elsewhere in the country, before 2010, local commissioners, doctors and providers often came up with good solutions, but then strategic health authorities would come in with a completely different answer and override all of them. That is what we are seeking to avoid.
Mr David Anderson (Blaydon) (Lab)
The Minister is right that patients are key to this, but so are the people who deliver hands-on services. He has mentioned the role of clinicians a number of times, but what about the voice of care workers, nurses and other people on the front line? Will they be listened to, and will their representative bodies, such as trade unions and colleges, be listened to, or will they be completely and utterly ignored, as was the case with the Health and Social Care Bill?
Ben Gummer
I am glad that the hon. Gentleman has made that point. The success regime will not work unless every single part of the local health economy contributes to it, including the vital component of local care workers.
Sir Peter Bottomley (Worthing West) (Con)
The early stages of these exchanges would have been better had the Opposition asked how the Government will respond to the deficiencies shown in the Care Quality Commission report. I recommend that all Members read the article in The Guardian today by Diane Taylor and Denis Campbell, which sets out the problems that this is tackling. Will my hon. Friend ensure that those areas where there are no major problems, such as Coastal West Sussex, are given support and not overlooked, and that resources are not taken away from them, because they are as under-resourced as others?
Ben Gummer
This is not about moving resources around the country. I must say that I differ with my hon. Friend on his views about the CQC. It was a complete basket case when the Government came to power in 2010, but it has since been turned around and is now providing exceptional inspection regimes, which is changing the whole nature of safety and quality in the NHS. I hope that it will continue to improve.
Geraint Davies (Swansea West) (Lab/Co-op)
The Minister says that there are systemic issues in Devon, Cumbria and Essex. Did the National Audit Office confirm that, and did he know that before the election? Why did he not reveal his hand then to say that he would intervene in one or more of those areas, or is he simply playing politics with patients’ lives?
Ben Gummer
The hon. Gentleman should know that there have been issues in those areas not just for months and years, but sometimes for decades. We have sought in the first instance to deal with problems with providers, which is why in two of the areas we have hospitals in special measures, or formerly in special measures. We are now seeking to fix the problems in the wider local health economy, led by local people. We are getting on with that, rather than just talking about it, which is what happened before.
Mr David Nuttall (Bury North) (Con)
If the success regime is extended to other parts of the country, what will be the impact on the proposed devolution of healthcare to Greater Manchester?
Ben Gummer
I do not at this stage anticipate—I have received no indication from NHS England—that the success regime will be extended in any way. I repeat that this is a particular intervention by local people, in co-ordination with NHS bodies, to fix local NHS problems. It they arise elsewhere in the country, I am sure that local people will want to look at them too.
Karin Smyth (Bristol South) (Lab)
I congratulate the Minister on what is possibly the fastest reorganisation the NHS has ever seen. Which of those local organisations is in charge, and who will be accountable for deciding what constitutes success?
Ben Gummer
I welcome the hon. Lady to her place. We are now repeating discussions we had in the previous Parliament, because I am afraid that the Labour party still does not understand that these decisions are not being directed from Whitehall. I know that is uncomfortable for them, because what they want to do is pull a lever and hope that something happens at the other end, but that does not work. The only way to get success is by having local clinicians, supported by national bodies, providing the solutions that local people deserve.
Mr Peter Bone (Wellingborough) (Con)
In North Northamptonshire we had a problem with the A&E at Kettering hospital. Local commissioners and three hon. Members—my hon. Friends the Members for Kettering (Mr Hollobone) and for Corby (Tom Pursglove) and I—all worked together to produce a plan, which the Minister has taken up. That is a precursor to the success regime, and it shows that local commissioners, local hospitals and MPs can solve problems by working together. Will the Minister continue to look on that favourably?
Ben Gummer
The care of my hon. Friend’s constituents, including Mrs Bone, is always a prime consideration. He has shown what Opposition Front Benchers should understand, which is that working across parties, as he did in his part of the world, can bring about co-ordination and success. I only wish that those on the Opposition Front Bench, on what should be a clean slate, would do the same.
Dr Tania Mathias (Twickenham) (Con)
Is the success regime a 21st-century way of improving the NHS? If so, may I ask the Minister always to seek to improve the NHS, which has to be constantly moving and improving for the sake of every patient? Will he, like the Secretary of State, visit Teddington memorial hospital in my constituency, where a local initiative has vastly improved our out-of-hours service?
Ben Gummer
I welcome my hon. Friend to her seat. I hope to make a whole series of visits soon and I will certainly talk to her about her hospital. She will have noted that the very first speech given by my right hon. Friend the Prime Minister was about the NHS. That reaffirms our commitment to the NHS. We were the only major party to commit to the NHS’s own plan for success over the next five years. That is why the Conservative party, to be frank, is the only one that can now be called the party of the NHS—[Interruption.]
Jeremy Lefroy
Thank you, Mr Speaker. Will my hon. Friend confirm that at the heart of the success regime will be the provisions of the Health and Social Care (Safety and Quality) Act 2015 on integration and quality?
Ben Gummer
It must have been a great pleasure for my hon. Friend to have taken personal possession of the 2015 Act, which he helped steer through Parliament and piloted himself. It is a significant contribution to the cause of patient safety, which lies at the heart of the Government’s vision for the NHS.
Dr Andrew Murrison (South West Wiltshire) (Con)
I congratulate my hon. Friend on his obvious grip on complex material. To what extent will the success regime take account of Kate Barker’s report on health and social care, recently published by the King’s Fund?
Ben Gummer
I thank my hon. Friend for his kind comments. The success regime is locally based but must take into account the developing national opinion on the integration of health and social care. However, those can be properly integrated only on the basis of local considerations; this is not something that we can design from the centre, as some would wish.
Fiona Bruce (Congleton) (Con)
I thank the Minister for confirming that the Health and Social Care (Safety and Quality) Act 2015 will be at the forefront of the minds of those implementing these plans. The 2015 Act was passed by the House in the very last days of the last Parliament. Does not the fact that the Opposition have asked this urgent question today show that they have already forgotten the central tenet of the Act: that patient care and safety will be at the forefront of everything that the Government do?
Ben Gummer
I repeat to my hon. Friend the observation that I made earlier: it is interesting that in his opening contribution, the right hon. Member for Leigh did not make a single statement about patients and their centrality to what we are trying to do. The NHS has devised its own plan for its own success over the next five years, and the safety and care of patients lie at the heart of it. Only one party is supporting that plan, and that is why the Conservatives are the only party backing the NHS.
Mr Philip Hollobone (Kettering) (Con)
I congratulate my hon. Friend on his response to the urgent question and the new Government on acting so swiftly. Having listened to the exchanges across the Floor of the House today, I think it would be particularly sensible and grown up for Her Majesty’s Government, first, to admit that there are geographical parts of our NHS that are not working as well as they might and, secondly, to seek local holistic solutions to put them right as soon as possible.
Ben Gummer
As so often, my hon. Friend is on the money. He has described exactly what NHS England is trying to achieve with the success regime.
David Morris (Morecambe and Lunesdale) (Con)
Thank you for calling me, Mr Speaker; my knee is giving way.
Would my hon. Friend like to come to Morecambe bay to see an excellent initiative run by Dr Alex Gaw called Better Care Together which is a pointer for the success regime? I should also say that, according to Labour, the NHS is always in crisis—but it never says what from, unless it is hospital closures that do not exist.
Ben Gummer
My hon. Friend has a particular local experience of a failing hospital, and I welcome him back to his seat. I hope to come to Morecambe bay at some point soon and I look forward to seeing with him the local initiatives that he has mentioned.
Point of Order
Andy Burnham (Leigh) (Lab)
On a point of order, Mr Speaker. I apologise for testing your patience; I would not have done so were it not an important matter. During the previous exchange, news reached me that the Secretary of State is in Liverpool announcing the scrapping of the 18-week target, presumably because the Government know they can no longer meet it. I was not in business questions, but I am led to believe that the Leader of the House said that Ministers should always make major announcements to this House, and that he had indeed reminded them of their duty to do so. What advice could you give me about making sure that this edict sticks? Before the Minister leaves his place, should he not confirm to this House whether the 18-week target is indeed to be scrapped?
Mr Speaker
There are three points to make. First, the right hon. Gentleman has expressed his concern forcefully in his own way, and it is on the record. Secondly, it would not be appropriate to ask the Minister to respond, because we cannot have interrogation through point of order and the continuation of debate. Thirdly, I can reassure the right hon. Gentleman on one point: he has not missed anything said on this matter at today’s business questions for the very simple reason that business questions is about to happen—so he was perhaps ahead of himself. He has made his point and it is on the record, and we will now proceed to business questions.
Business of the House
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Ms Angela Eagle (Wallasey) (Lab)
Will the Leader of the House give us the business for next week?
The Leader of the House of Commons (Chris Grayling)
During our short debate last night I had the opportunity to extend my congratulations to the Chairman of Ways and Means on his re-election. May I add my congratulations to the other two Deputy Speakers on their election?
The business for next week will be as follows:
Monday 8 June—Second Reading of the Scotland Bill.
Tuesday 9 June—Second Reading of the European Union Referendum Bill.
Wednesday 10 June—Opposition day (1st allotted day). Subject to be announced by the Opposition in due course. I also expect my right hon. Friend the Prime Minister to make a statement following the G7 summit.
Last week the shadow Leader of the House was eager—indeed, over-enthusiastic—about Thursday’s business. She was keen to find out what was happening, and I can now tell her that it is indeed this:
Thursday 11 June—Second Reading of the European Union (Finance) Bill.
Friday 12 June—The House will not be sitting.
The provisional business for the week commencing 15 June will be:
Monday 15 June—Consideration in Committee of the Scotland Bill (day 1).
Tuesday 16 June—Consideration in Committee of the European Union Referendum Bill (day 1).
Wednesday 17 June—Opposition day (2nd allotted day). Subject to be announced in due course.
Thursday 18 June—Consideration in Committee of the European Union Referendum Bill (day 2).
Friday 19 June—The House will not be sitting.
Ms Eagle
I thank the Leader of the House for announcing next week’s business.
I would like to start by associating myself with the many tributes paid yesterday to Charles Kennedy, who has died far too young. He was known for his wit, once quipping:
“Paddy Ashdown is the only party leader who’s a trained killer. Although, to be fair, Mrs Thatcher was self-taught.”
We will all mourn his passing.
I congratulate my right hon. Friend the Member for Chorley (Mr Hoyle), my hon. Friend the Member for North East Derbyshire (Natascha Engel) and the hon. Member for Epping Forest (Mrs Laing) on their election and re-election as Deputy Speakers of this House. Members across the House will be relieved that their enthusiastic campaigning for support will now cease—although I will make no such promise to my Labour colleagues.
I am concerned that the Cities and Local Government Devolution Bill has been introduced first in the other place despite its significant constitutional implications. This is against usual practice. While we support greater devolution, we have real concerns about the impact of this on effective scrutiny of this Bill. Will the Leader of the House set out why this decision was taken, and will he assure me that he will guarantee that there is adequate time to scrutinise the Bill properly when it finally comes to the Commons?
Yesterday the government published the 2014 league table for Ministers’ replies to questions from MPs, and I am beginning to wonder whether it might help to explain the reshuffle. The Communities and Local Government Secretary was the worst offender, and the former Justice Secretary—the Leader of the House—replied to just under two thirds of letters sent to him on time. Will the Leader of the House therefore set out what guidance he will be giving to himself on how he can improve his performance? May I also suggest that Members use the opportunity that business questions affords, because they are unlikely to get a written answer from him any time soon?
It is less than a month since the election, and the façade of Tory unity is already beginning to crack. This week alone, the Defence Secretary has publicly warned the Treasury that he does not see the need for any more cuts to his Department. The Secretary of State for Work and Pensions is reportedly infuriated at the Prime Minister’s lack of clarity on child benefit cuts—an emotion we all shared after yesterday’s evasive performance at Prime Minister’s questions—and we have had complete chaos on human rights and on Europe, including a predictable call from the right hon. Member for Wokingham (John Redwood)for an end to collective Cabinet responsibility. And we have only been here two weeks!
We will debate the European Union Referendum Bill next week, so I wonder whether the Leader of the House would answer some straightforward questions. The Prime Minister has said repeatedly that he has a list of demands for Europe, but he will not tell us what they are. Will the Leader of the House set out when he will publish that list, and will treaty change feature on it? The Tories are split down the middle on whether to vote yes or no in the referendum, so are Cabinet Ministers going to be allowed to campaign to come out of the European Union and stay in their jobs?
Last week, the Foreign Secretary said that leaving the European convention on human rights was not “on the table”. Last October, the Leader of the House said the UK should be prepared to withdraw and yesterday the Prime Minister said he would “rule nothing out”. Will the Leader of the House tell us who is right: the Prime Minister, the Foreign Secretary or him?
This week saw the welcome departure of Sepp Blatter from FIFA: a leader past his best, who had just won an election but decided to quit—it is easy to see why the Prime Minister used to be such a fan. Jack Warner, a former member of FIFA’s ethics committee—which must compete with “compassionate conservatism” for oxymoron of the year—said:
“Mr Cameron is a knowledgeable man…I certainly trust his knowledge of football.”
That is news to me, because I did not think that the Prime Minister knew his West Hams from his Aston Villas.
This week we learned of a serious security breach at the heart of Government. Staff at No. 10 were alarmed as an unwanted visitor was seen roaming the corridors—and no, it was not the former Deputy Prime Minister trying to get back in; I am told it was a heron. Perhaps it was fishing for a salmon, or a sturgeon or even a grayling. The incident gave rise to an interesting poll on the Daily Mirror website, which asked readers who they would rather lived at Number 10—a heron or the Prime Minister? The last time I checked, the heron was winning by 94% to 6%.
Chris Grayling
The hon. Lady started by referring to her own deputy leadership campaign. This week it has been a relief to learn, for her sake, that her sister, the hon. Member for Garston and Halewood (Maria Eagle), is supporting her campaign. As the shadow Leader of the House knows, Labour leadership contests and siblings do not always go together well, so it is a pleasure to know that Sunday lunches in the Eagle household can continue harmoniously.
This week we have also seen the surprise entry into the Labour leadership contest of the hon. Member for Islington North (Jeremy Corbyn), who I am sorry not to see in his place. One of my colleagues suggested to me that perhaps that opened up an opportunity for the hon. Member for Bolsover (Mr Skinner)—I am pleased to see him in his place—to stand in the deputy leadership contest, as part of a joint ticket.
There has been an interesting new development on the Labour leadership front today, with the news that the former Foreign Secretary is set to make a return to this country this autumn, when he will make a keynote speech at the conference of the Institute of Directors. As somebody once said, “I wonder what he meant by that.”
The hon. Member for Wallasey (Ms Eagle) asked why the Cities and Local Government Devolution Bill had been introduced in the other place. I regard the other place as an extremely important part of our democratic process. It is important that it plays a prominent role in debating the key issues of this nation. It is entirely right and proper that it is scrutinising a Bill of this importance. There is no shortage of crucial business in this House for the next two months. I am absolutely satisfied that it is the right thing to do, and I assure her that when the time comes there will be plenty of opportunity for this House to debate what is an extremely important measure and something that this Government are proud of.
On letters and parliamentary questions, I remind the hon. Lady that when I was first elected to this House in 2001, there was no five-day target and Members could wait weeks and weeks before getting a reply from Labour Ministers, so I will take no lessons from them about their record in government on responding to Members of this House.
The hon. Lady talked about Conservative party unity. Last night, every single Conservative Member of Parliament who was eligible to do so voted in the first Division of this Parliament. However, there were 15 Labour MPs missing. Where were they? On the subject of divisions, you might have noticed, Mr Speaker, the rather interesting body language in the healthcare debate on Tuesday between two of the candidates for the Labour leadership. They were trying very hard not to look at each other.
The Opposition talk about divisions on the EU, but it is the Labour party that is all over the place on EU policy; we are united. We fought the general election on the platform of a referendum and we will hold that referendum. We also fought the election on a platform of scrapping the Human Rights Act and we will scrap the Human Rights Act.
I will conclude by going back to where I started—with the hon. Lady’s deputy leadership campaign. She has produced a video to support her campaign and the soundtrack is that great Liverpudlian song, “All Together Now” by The Farm, which contains a particularly moving verse that might be deemed apposite:
“The same old story again
All those tears shed in vain
Nothing learnt and nothing gained
Only hope remains”.
That is the Labour party today.
Mr Speaker
Order. As experienced Members know, it has been my usual albeit not invariable practice at business questions to try to accommodate everyone who wishes to take part. Unfortunately, given that well in excess of 50 hon. Members wish to contribute to the subsequent debate, I fear that some Members will be disappointed in business questions today. To maximise the number of contributions, brevity from Back Benchers and Front Benchers alike is imperative. The tutorial on this matter will be led by Dr Julian Lewis.
Dr Julian Lewis (New Forest East) (Con)
You always do that to me, Mr Speaker.
At this time of the year, when the thought of the D-day landings is very much in our minds, may we have a statement from a Defence Minister on the position of defence in the nation’s priorities?
Chris Grayling
My right hon. Friend is a powerful advocate in this place for our armed forces and Ministers always listen with great care to what he says. Defence questions next Monday will be the first of what will no doubt be many opportunities for him to continue to articulate the importance and heroism of our armed forces.
Mr Speaker
Forgive me; this will, I hope, be the last intervention from the Chair. For the benefit of the House, I should emphasise that the third party spokesman has acknowledged rights on this occasion, as was the case when the Liberal Democrats were the third party, so I hope that there will be proper forbearance and tolerance as I call Mr Pete Wishart and allow him to develop his line of questioning.
Pete Wishart (Perth and North Perthshire) (SNP)
I am very grateful, Mr Speaker.
May I pay my tributes to Charles Kennedy? I was with him on the night of the tuition fees vote when we left the building through the back door, as thousands of angry students descended on the House. Even though Charles had not voted for the tuition fees measure, he told me, “Pete, if you fly with the crows, you get shot with the crows, and tonight you are with the crows.” I can report that we made it to Waterloo station safely.
The Leader of the House does not know how excited SNP Members are that the first Bill is the Scotland Bill on Monday. I am very grateful to him for giving us an extra day to improve the Bill, because improvement it needs, as I think he knows. We want to see all the Smith proposals in full, but that is just the baseline—the very minimum that we expect to improve the Bill. It is fantastic that we are getting such time to debate it and that the first Bill in the House is about getting more powers to Scotland. I hope that he is listening to the many representations from the Scottish Government and that he will accept the mandate of the 56 SNP MPs out of 59 as we try to improve the Bill. That is the way to do it—a Bill is brought in and we have First Reading, Second Reading, and then long debate and scrutiny.
I just wish the Leader of the House would do the same for English votes for English laws, something with such significant constitutional implications. There is not even a Bill, just a change to Standing Orders. Will he tell us a bit more about what he intends to do with EVEL? Will we get to amend it? Will we get to scrutinise it? How will scrutiny be exercised? What about the House of Lords? There are 100 Scottish peers down the corridor—will it be English votes for English Lords? Where are we on that sort of thing?
I noted that there was no discussion or debate on the Queen’s Speech about reform of the House of Lords. The only thing that the Leader of the House wants to do is put more of his cronies and donors into that already overstuffed House. Ermine-coated, never been voted—let us get rid of the House of Lords. It has almost a thousand Members, and the public need reassurance that we will have some sort of reform.
We are almost three weeks into the House’s business, and we have not yet had a departmental statement. May I suggest that the first statement should be a clear statement of what the Government intend to do about the Mediterranean crisis? They should be willing to play a bigger part and take seriously their responsibilities, particularly when it comes to assisting refugees.
Chris Grayling
To take the last point first, the Foreign Secretary was of course in the House earlier in the week, and there was plenty of opportunity for the hon. Gentleman to raise with him that issue and other issues related to international affairs.
May I associate myself with the hon. Gentleman’s comments about Charles Kennedy? His untimely death is a great loss to Scotland, and this House has shown itself at its best in the cross-party recognition of the contribution that he made.
With regard to the Scottish National party’s well-advertised desire for more powers for Scotland, I say to the hon. Gentleman that in the Government’s view, the Scotland Bill will deliver a major change for Scotland and a significant enhancement of the powers of the Scottish Parliament and Scottish Government. Some of the arguments that the SNP is making simply do not add up. It wants much greater power and full fiscal autonomy, but it simply has not addressed the fact that were it to have that, it would have to choose between massive spending cuts and substantial tax increases in Scotland, neither of which I think the Scottish people would wish for.
I suggest that the hon. Gentleman should sometimes go down and have a listen to the quality of debate in the House of Lords. We have in that place people with immensely important expertise, who bring something to the quality of debate in Parliament. I have to say that I disagree with his view of that House.
I finish by referring to reports that I have seen today, and rumours that I have been picking up around the House, about the time when Members take their seats in the mornings. I understand that both Labour and Scottish National party Members are looking to come in earlier and earlier in the morning to secure their seats, possibly even earlier than 7 o’clock in the morning. It has been suggested to me that, to accommodate that, a trolley service of breakfast might be provided to Members in the Chamber to enable them to come in that early. I simply say that I do not think that would be consistent with the traditions of the House.
Mrs Maria Miller (Basingstoke) (Con)
New house building is an important priority for the Government, and buying a new home is the biggest purchase that most of our constituents will ever make. Will the Leader of the House make time for a debate to examine the quality of new house building and how the current system is working to expose substandard building companies that fail to deliver the quality of new build houses that we would all expect?
Chris Grayling
That is an important issue, and I praise the work that my right hon. Friend has done in her constituency, where a substantial amount of new housing has been built in recent years. Of course, the people who buy housing and find themselves in possession of properties that simply are not up to scratch go through an immensely difficult time. I simply suggest to her that she use one of the mechanisms available to her, such as Adjournment debates or Communities and Local Government questions when they come up, to keep making her important point and ensure that the message gets across to both the Government and house builders themselves.
Kelvin Hopkins (Luton North) (Lab)
At the time of the 1975 in/out referendum on the then Common Market, the Prime Minister, Harold Wilson, very wisely agreed that the Labour party would have a free vote. I hope that that wisdom will be observed by all parties when we come to make a decision again. Will the Leader of the House be advising the Prime Minister and his Chief Whip to observe that wisdom in future?
Chris Grayling
I think this is very much a matter for the Prime Minister. We have barely started the renegotiation and the European Union Referendum Bill has not even had its Second Reading, so I think these matters are for the future.
Rebecca Pow (Taunton Deane) (Con)
The town of Wellington is in my constituency and the famous Wellington monument is prominent from the M5 as one goes south. The town will be having lots of celebrations for the 200th anniversary. May we have a debate to celebrate and discuss this wonderful anniversary? Might the Leader of the House find a little pot of money to restore the wonderful Wellington monument, which is in such great need of an upgrade?
Chris Grayling
I hate to disappoint my hon. Friend, but I do not have a budget from which I could give her that small amount of money. There will, however, be many opportunities to lobby those of my colleagues who do have such a budget. I commend her for the work she is putting into her constituency to celebrate this great anniversary of a great moment in our history. The anniversary is being celebrated in a variety of ways around the country, including with the production by the Royal Mint of a celebratory coin, although I gather that on the other side of the channel there has been some resistance to producing a euro coin to celebrate the same event.
Louise Haigh (Sheffield, Heeley) (Lab)
Does the Leader of the House share my concern about the news that the BBC is due to air a programme entitled “Britain’s Hardest Grafter” which has been dubbed “The Hunger Games for the unemployed”? May we have a debate on whether the BBC is fulfilling its objective to air programmes of quality and distinctiveness?
Chris Grayling
The hon. Lady makes an important point. It is certainly the case that challenges in our society should not be used to create show business opportunities. I would always ask broadcasters to approach their work on analysing life in this country and elsewhere with the utmost caution and sensitivity. She will have the opportunity to raise this issue with the Secretary of State for Culture, Media and Sport in a month’s time, and, of course, she can always ask for an Adjournment debate on this subject.
Maria Caulfield (Lewes) (Con)
My constituents in Lewes, whether from Seaford, New Haven, Lewes or Wivelsfield, are experiencing acute rail delays and poor service due to both Network Rail and the train operator. Will the Leader of the House make time for a debate to discuss these severe issues, which are affecting all MPs in Sussex, to see if we can improve the service and communications to rail passengers?
Chris Grayling
I have every sympathy with my hon. Friend and her constituents. These issues are partly being caused by the necessary improvement works at London Bridge; an investment in the future that is absolutely vital and will be enormously beneficial, but is disruptive while it happens. Nevertheless, she is aware that there have been some real issues concerning services on the Southern routes, and the company needs to address them. I urge her to raise this question again at Transport questions next Thursday.
Keith Vaz (Leicester East) (Lab)
May we have an urgent statement next week on the plight of 25 British citizens who are trapped in Sana’a? The civil war in Yemen has so far cost 1,000 lives. Does the Leader of the House agree that there is an obligation to try to help our citizens in need? May we have a debate on this very important issue?
Chris Grayling
I share the right hon. Gentleman’s concern about what is happening in Yemen. We have every reason to be concerned about events in many parts of the middle east at the moment; it is an area of enormous challenge for the international community. He will, early next week, have an opportunity to raise this issue directly with the Foreign Secretary at Foreign Office questions, and I encourage him to do so.
Henry Smith (Crawley) (Con)
May we have a debate on education funding? West Sussex is the second-lowest funded area in the country, yet there are many demographic pressures in constituencies such as Crawley.
Chris Grayling
I have every sympathy with my hon. Friend. I represent the county next door, where there are also significant demographic pressures—we are going through a baby boom. These are tough times for the public finances, but I encourage him to talk directly to the Secretary of State, who has proved very thoughtful and very receptive to discussing these issues with colleagues.
Mr Mark Williams (Ceredigion) (LD)
First, Mr Speaker, I thank you for affording us the opportunity yesterday to pay tributes to the much-missed Charles Kennedy.
As we move towards the summer, may we have a debate on the case for reducing VAT on tourism? It is a policy pursued by all but three countries in the EU; it was endorsed by two Select Committees of this House in the last Parliament; and many regional and national economies of the United Kingdom would benefit immeasurably from it.
Chris Grayling
I assure the hon. Gentleman that there will be an opportunity for such a debate. As the Chancellor has already indicated, between now and the summer there will be an additional Budget statement, and the hon. Gentleman will have the opportunity to raise this issue at that time.
Tom Pursglove (Corby) (Con)
The contaminated blood tragedy is affecting families the length and breadth of Britain. May we have a debate in Government time on the difficulties that my constituents and other Members’ constituents face in trying to access appropriate treatment and support?
Chris Grayling
This issue has affected constituents of Members across the House. It is a matter of great concern for this Government and it was addressed by the Prime Minister and the Secretary of State for Health in the last days of the last Parliament, and I know that the Department of Health is working carefully on it. I encourage my hon. Friend to pursue further opportunities to discuss this matter, either here or in Westminster Hall, and to continue to ask for updates from the Secretary of State at Health questions.
Paula Sherriff (Dewsbury) (Lab)
May I request a debate to address the promise made by the Chancellor just a few days prior to the election that constituencies such as my own—Dewsbury—will be identified as enterprise zones within 100 days of the new Parliament? Many businesses in my constituency are struggling significantly and would undoubtedly welcome a period of zero business rates.
Chris Grayling
The Chancellor of the Exchequer will undoubtedly have taken note of the hon. Lady’s comments; I will make sure that his team are aware of what she has said. Of course, we are not yet 100 days into the new Parliament. Nevertheless, I point out to her that Dewsbury, and indeed the whole area of west Yorkshire, has benefited enormously from the economic progress that we have made in recent years, with falling unemployment and more businesses being created. Of course there is further to go, but what we have seen is a real step in the right direction for the country and the area she now represents.
Philip Davies (Shipley) (Con)
May we have a debate on the deficiencies of the Legal Aid, Sentencing and Punishment of Offenders Act 2012? We may need two days to go through them all, but one pressing matter is that the
“Offence of threatening with article with blade or point or offensive weapon”
set out in the Act applies only when it happens
“in a public place or on school premises”.
It misses out many occasions when threatening with a knife takes place either in the home or on other private property. Can we ensure that this Act is amended as soon as possible, to make sure that violent offenders do not escape justice through a loophole that should not exist?
Chris Grayling
As ever, my hon. Friend makes an important point about crime and justice matters. I will ensure that my colleague the Lord Chancellor is aware of what he has said. I am no longer able to provide a direct solution to the issue that he raises, even though, as he knows, we share many views on criminal matters. However, I will ensure that the Ministry of Justice is aware of what he has said.
Stewart McDonald (Glasgow South) (SNP)
The Leader of the House will be aware of a leak in the press at the weekend that HS2 Ltd says there is no business case to take the project up to Scotland. Scottish National party Members would welcome the opportunity to make that case to the Government. So can he—acting in the spirit of his party’s much-vaunted “one nation” approach to politics—ensure that we have an urgent statement on this issue?
Chris Grayling
First, we regard High Speed 2 as a crucial part of the future infrastructure of the United Kingdom. I am not aware of any plan that has been brought before this House to change the plans that we set out in the last Parliament, but the hon. Gentleman will have two opportunities next week to raise this issue—once in Scotland questions and once in Transport questions—and I hope that he will take them.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
May we please have time in this Chamber to debate rural broadband? We are still not getting BT to pull its weight; it is doing part of the work in constituencies across this country, but it is not fulfilling its obligations, including its contractual obligations. The time has come for this House to speak out on this matter and secure the future for rural people.
Chris Grayling
The House has debated this matter extensively and will continue to do so, and I encourage my hon. Friends to continue raising the matter. My hon. Friend’s comments will have been heard by the Department for Culture, Media and Sport. The new Secretary of State is a long-standing and experienced Member who does not take prisoners, as the BBC knows—and I have no doubt that BT will have the same experience.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
As my right hon. Friend the Member for Leigh (Andy Burnham) has just mentioned, the Secretary of State for Health announced in Liverpool this morning that the 18-week target for elective operations will be scrapped. Does the Leader of the House recognise that this shows absolute contempt for this House and our democracy? Did he know about the announcement, and what will he do to ensure the accountability of the Executive to the country’s elected representatives and, in turn, the people?
Chris Grayling
It is important to put on the record that the Secretary of State has made no announcement today. The news story that has emerged has come from the senior official at NHS England who has responsibility for the area under discussion. While it is the responsibility of Ministers to make statements to the House about decisions they personally take, where the NHS has been put under the operational control of the experts best placed to run it, as is the case now and has been argued for over many years, it is not always for Ministers to announce the decisions they take.
Dr Andrew Murrison (South West Wiltshire) (Con)
May we have a debate on the workings of the neighbourhood planning process in the Localism Act 2011? The intent of the Act is to bring decision making closer to communities, but that does not appear to be happening in Warminster in my constituency, so I would welcome an early debate.
Chris Grayling
I have listened carefully to my hon. Friend. The process is clearly a new development as part of the Act designed to ensure that local communities have as strong a say as possible over the future development of their areas. I will ensure that the Secretary of State for Communities and Local Government is made aware of my hon. Friend’s comments, and I hope he will take advantage of the Adjournment debate system to bring forward a debate as soon as he can.
Stephen Kinnock (Aberavon) (Lab)
Parc Slip open-cast mine in my constituency has been closed for several years and is a dreadful scar on the landscape. Will the Leader of the House make time for a much-needed debate on the fate of open-cast mines across the country?
Chris Grayling
I welcome the hon. Gentleman to the House. I know that he might have to do some additional campaigning elsewhere in the next few weeks—having just finished one election, his family has another one to fight.
I am aware of the legacy of coal mining, including open-cast mining, in the area the hon. Gentleman represents. In a recent visit to the valleys, I was impressed with how the hills were returning to nature in many places, but he makes an important point about the impact of open-cast mining, and I hope that he will take advantage of the many opportunities available to him to bring a Minister to the House or raise a question directly with Ministers at Question Time to ensure that this issue is firmly on the agenda.
Julian Sturdy (York Outer) (Con)
In welcoming the Government’s commitment to end many new subsidies for onshore wind farms, which have marched across Yorkshire like a plague of locusts in recent years, including a number of applications on green-belt land in my constituency, will the Leader of the House provide a clear timeframe for when these proposals will be implemented?
Chris Grayling
One of the many reasons why I am delighted that we now have a Conservative Government, not a Conservative Government with Lib Dems attached, is the issue of onshore wind farms, which, in my view, has to be handled with the utmost care. I know that the new Secretary of State for Energy and Climate Change is looking at this matter carefully. I will ensure that my hon. Friend’s concerns are drawn to her attention, and I expect her to bring forward a new approach at an early opportunity.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
Further to the question from my right hon. Friend the Member for Leicester East (Keith Vaz), I and many other Members have in recent weeks received urgent pleas for help from British nationals stranded in Yemen. I wrote to the Foreign Secretary about the matter in April and was informed that there were no plans to evacuate British nationals from the country. It is heartbreaking to have to reply to these cries for help with such a response. May we please have an urgent statement about what more the Government can do to ensure the safe return of British nationals stranded in Yemen and neighbouring countries, such as Djibouti, Saudi Arabia and Oman, as the situation remains extremely volatile?
Chris Grayling
I hear what the hon. Lady says, and I will ensure that the Foreign and Commonwealth Office is aware of the concerns raised today. Ministers will be before the House on Tuesday, when I would encourage her to raise the issue with them directly.
Mr Nigel Evans (Ribble Valley) (Con)
You will know, Mr Speaker, that there are few more shocking or grotesque practices than supermarkets throwing away 50 million tonnes of food as waste every year. Today, the chief executive officer of Tesco, Dave Lewis, has announced that Tesco will stop this practice and ensure that the food goes to charity. Will the Leader of the House arrange for a Minister to clarify what is being done to ensure that, if Tesco can do it, all the other supermarkets can do it so that this grotesque practice can be stopped, and to ensure that if they refuse to do it, we will consider bringing in legislation, as has happened in other countries?
Chris Grayling
I listened carefully to what my hon. Friend had to say. He is, of course, absolutely right: it is inexplicable and indefensible that good food should be thrown away. He is absolutely right, too, that the step taken today is a positive one. I will ensure that my colleagues in the Cabinet Office are made aware of what he said. There will shortly be an opportunity to raise the issue directly with them at Question Time but, before that happens, I shall make sure that they are made aware of my hon. Friend’s message.
Albert Owen (Ynys Môn) (Lab)
The Leader of the House will be aware that the women’s institute is celebrating its centenary this year, and he may be further aware that it was founded in the pioneering county of Anglesey, at Llanfairpwllgwyngyllgogerychwyrndrobwllllantysiliogogo goch—I will help Hansard later! May we have a debate in Government time on this important organisation and the things it has done at local level, national level and international level? Will the right hon. Gentleman, along with Mr Speaker and the House authorities, use his good offices to provide an exhibition for this fine organisation?
Chris Grayling
I had no idea that the women’s institute was founded in the village with the world’s longest station name, which I visited last year—but I will not even start to seek to pronounce it in the way that the hon. Gentleman clearly can and does so well. Collectively and across party, the whole House should pay tribute to the women’s institute for the work that it and its members have done for this country over many decades. It has been the backbone of our voluntary sector for a very long time. I was delighted to see its achievements celebrated at the palace recently. This provides an opportunity for the hon. Gentleman to bring forward what would be an ideal subject for an Adjournment debate.
Mr Speaker
Order. With short single-sentence supplementary questions and the continuation of the Leader of the House’s exemplary brief replies, I will not say that we will get through everybody, but we will make a pretty good stab at it.
Jason McCartney (Colne Valley) (Con)
Places of worship in Kirklees were targeted 132 times by thieves in the last three years. There have been many stone thefts, and last night Scapegoat Hill Junior and Infant School had tiles stolen from its roof, just days after the scaffolding required to make repairs after previous thefts had gone. May we have an urgent debate on the scourge of stone thefts that are blighting our communities?
Chris Grayling
I am very sympathetic to those who have experienced both stone and metal theft. We have, of course, legislated to toughen the penalties for metal theft. What I did for the business community in my previous role was to provide an opportunity for them to explain in detail to a court the impact of the loss of what might sometimes appear to be a small amount in value terms but can be enormously important to the organisation involved. I encourage my hon. Friend to bring the issue forward for an Adjournment debate so that a Minister comes to the House to address it. I express my sympathies to those who have been the victims of this theft over the past 24 hours. Stealing from a place of worship is one of the most despicable crimes one can imagine in our society.
Neil Gray (Airdrie and Shotts) (SNP)
In the light of the eye-watering projected costs and at a time of austerity, will the Leader of the House undertake to make a statement on the renovation of the Palace of Westminster to explain how Members, and indeed members of the public including my constituents in Airdrie and Shotts, can scrutinise the process?
Chris Grayling
An independent report into the condition of the building has been prepared and it will be made available in the next couple of weeks. There is an extensive discussion to be had across both Houses of Parliament about how to respond to the needs and challenges. This is an iconic building—an enormously important building, not just for our democracy, but for our nation and as a source of tourist revenue from around the world. We should cherish it and look after it. We have to deal with the reality of fiscal austerity and challenging financial times but I would be very reluctant indeed to see anything happen that left this building with an insecure future.
Bob Blackman (Harrow East) (Con)
Many of my constituents have contacted me about a threatened neo-Nazi demonstration in the neighbouring borough of Barnet. Although I support freedom of speech, anti-Semitic hate crime is completely unacceptable. Can my right hon. Friend facilitate a statement by the Home Secretary about what action she is going to take to prevent such hate crimes, which threaten the Jewish way of life?
Chris Grayling
I shall be happy to raise the issue with my right hon. Friend the Home Secretary. Let me, however, make it absolutely clear that anti-Semitic crime in any form is unacceptable, and—like anti-Islamic crime, and crime against any other religious group—should be treated with the maximum toughness by our justice system. As my hon. Friend says, while we should generally cherish free speech, free speech that encourages hatred or violence will never be acceptable in our society.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Is the Leader of the House aware that thousands of children throughout the country who suffer from special educational needs, and autism in particular, cannot be assessed or treated? May we have a debate about that very soon?
Chris Grayling
All Members of Parliament have probably had far more exposure to special needs, and developed a far greater understanding of them, since being elected. I certainly have, and I recognise the importance of getting the arrangements right. I believe that this issue concerns the Education Secretary. She will be answering questions in the House on Monday week, and I am sure that the hon. Gentleman will take advantage of that opportunity to raise the issue directly with her.
Mr David Burrowes (Enfield, Southgate) (Con)
Can the Leader of the House confirm that next week’s Government business has passed the family test, and that family impact assessments will be published alongside legislation?
Chris Grayling
Next week’s business includes the European Union Referendum Bill on Tuesday and the Scotland Bill on Monday, and I think that the family test will feature less centrally in those Bills than it will in some other measures. However, the Chief Whip and I have noted what my hon. Friend has said, and Ministers in all Departments should do so as well. Getting things right for families is central to protecting the fabric of our society, and we should always work towards that end.
Steve McCabe (Birmingham, Selly Oak) (Lab)
May we have an urgent debate on the Government’s decision, announced just hours after the general election, to limit access to the higher rate of work support for deaf people who earn more than £27,000? That is not a cap on benefits; it is a discriminatory cap on career opportunities for the deaf.
Chris Grayling
Changes in the welfare system will, of course, be included in legislation that will be laid before the House in the coming months. The hon. Gentleman will have an opportunity to make his case when that time arrives, as will his party.
Chris White (Warwick and Leamington) (Con)
Following the successful introduction of video games tax relief, which was announced in last year’s Budget, and the contribution that the video games sector makes to our economy—not least in my constituency—may we have a debate about how we can help the industry to grow further, so that it is on an equal footing with the United Kingdom film industry?
Chris Grayling
I pay tribute to my hon. Friend for the work that he has done in supporting a sector that is enormously important to our economy. We are world leaders in that sector, and we should work to maintain our position. Even many Members are enthusiastic participants in the products of the video games industry. The Chancellor of the Exchequer—who is, of course, preparing his Budget—will be in the House on Tuesday week, and Members will have an opportunity to make representations to him about the issue then.
Nick Smith (Blaenau Gwent) (Lab)
May we have a debate on pay for care home staff? Social services bosses say that the system is in crisis. We need the very best staff to look after our older people.
Chris Grayling
I do not think anyone could disagree with that. It is very important for us to have quality staff, quality support and quality service in our care homes. The hon. Gentleman will have many opportunities to raise the issue directly with Ministers, but in many instances care is provided by private companies, some of which are good and some of which are not. As Members of Parliament, we should always seek to highlight poor performance in the care sector when we encounter it, because we can play a role in ensuring that standards are raised.
Gareth Johnson (Dartford) (Con)
I do not know whether the Leader of the House has had the displeasure of using the Dartford crossing recently. If he has, he will have noticed that the free-flow system there seems to have improved the flow of traffic. However, the administration of the scheme through the Dart Charge has exasperated many of my constituents. May we please have a debate about the charge, and about the frustrations that are being experienced by my constituents and people in the surrounding areas?
Chris Grayling
I understand the issues that my hon. Friend and his constituents are facing. I myself have used the Dart Charge on a number of occasions in recent weeks when, for reasons I cannot quite recall, I spent quite a lot of time driving to Essex—to places such as Thurrock and Basildon, which are still represented by Conservatives. My hon. Friend will have an opportunity to raise the matter with the Secretary of State in Transport questions next Thursday. The scheme has the potential to make a real difference, but it needs to be got right.
Diana Johnson (Kingston upon Hull North) (Lab)
In the light of the publication of the Shrewsbury report on the baby ashes issue earlier this week, and of the fact that this is an issue in many constituencies up and down the land, including my own, where the family of Mike and Tina Trowhill have been affected, may we please have a statement from the Government on what assistance they will offer to local councils to carry out independent inquiries into what happened to babies’ ashes in those local areas?
Chris Grayling
This is an enormously sensitive issue, and our hearts go out to the families affected. They have had to go through not only the trauma of losing a child but the aftermath that the hon. Lady has described. I know that my colleagues are carefully considering that report, and they will seek to deal with the matter sensitively and appropriately. They will come forward with their response in due course.
Mr David Nuttall (Bury North) (Con)
May we have a statement on what steps the Government are taking to ensure that the welcome changes designed to prevent nuisance phone calls are actually having an effect? It was quite apparent during the general election that the problem had certainly not gone away, and that these persistent unwanted phone calls were continuing to blight the lives of my constituents.
Chris Grayling
I absolutely agree with my hon. Friend. Work is under way to try to curb this practice, but we are dealing with people who are constantly looking for new ways to do this and who are working around the law. I myself have been the victim of these calls. When I was Secretary of State for Justice, it sometimes came as a bit of a shock to the person making a nuisance call to my mobile phone when I told them that I was the Minister responsible for regulating the sector and asked them for the name and address of their company. They normally hung up on the spot. It is a serious nuisance, however, and we must continue to work hard to address it. I know that my colleagues will do so.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
I want to raise a small but important matter. Yet again, this place will take its summer break a month after midsummer, which will coincide—accidentally, no doubt—with the English school holidays and stretch long into the autumn. Could we not have a shorter parliamentary break that coincided with the Scottish and the English school holidays? This would help Members with children, and it would also help all MPs to get round to some of the events in their constituencies.
Chris Grayling
Of course we will always seek to provide recess dates that work as well as possible for Members across the House. The hon. Gentleman talks about holidays, and every Member of Parliament deserves a holiday, but to allow the narrative to continue that says recesses are holidays does a disservice to the House. They provide the time that we all need to spend in our constituencies, working on our constituents’ behalf.
Mr Speaker
Order. Let us see whether, with extreme self-discipline, we can accommodate everyone by 12.15, at which point I would like to be able to move on.
Graham Evans (Weaver Vale) (Con)
My right hon. Friend will be aware that the report on the failings at the Emstrey crematorium in Shrewsbury, where babies’ ashes were not returned to their bereaved parents, was published earlier this week. The report found that at least 60 families were believed to have been affected by these failings. May we have a debate on the failings at the Emstrey crematorium, and on the lessons that could be learned by local authorities to prevent such failings from happening again?
Chris Grayling
As I said a moment ago, this is an enormously sensitive and difficult issue that we need to treat with enormous care and respect for the families involved. The Government will respond to the report in due course, and it is really important that we get this right.
Mr David Anderson (Blaydon) (Lab)
May we have an urgent statement from the Secretary of State for Health on when young boys in this country who are suffering from Duchenne muscular dystrophy can expect to have access to the drug Translarna? The drug is readily available across Europe, but its approval has been delayed in this country because of bureaucratic arguments within NHS England that are a direct result of the health service reforms. The Prime Minister and the Secretary of State for Health in the previous Government guaranteed to me and the parents that this matter would be speeded up, but it is still being held up today.
Chris Grayling
I know that this issue has already been raised with Ministers this week, and that they take Members’ views on it seriously. I will ensure that the hon. Gentleman’s concerns are once again passed on to my colleagues in the Department of Health today.
Mr Andrew Turner (Isle of Wight) (Con)
There is a troubling example of poor development in an area of outstanding natural beauty in my constituency. Will my right hon. Friend consider finding time for a debate on the subject, and in particular whether there should be restrictions on the use of retrospective planning permissions in AONBs?
Chris Grayling
I am always concerned when I hear about planning going wrong in the way I suspect it has done in my hon. Friend’s constituency. It may be most helpful to Ministers if he could produce a short summary of what has gone wrong and pass it to them. That will enable them to look at the regulations and see whether anything needs to be changed.
Paul Flynn (Newport West) (Lab)
The House was at its best yesterday, but also at its worst in another degrading spectacle of Prime Minister’s Question Time, which was an exchange of insults and non-responses. May we debate early-day motion 51, which seeks to reinvent the format for Question Time so that it retains the robust questioning but is carried out in an atmosphere of calm and mutual respect?
[That this House is appalled at the demeaning and deteriorating spectacle of Prime Minister’s Questions; notes the widely expressed public revulsion at this ill-mannered, pointless exchange of insults; and calls for its reinvention into a new format in which the Prime Minister can respond to questions in an atmosphere of calm, respect and dignity.]
Chris Grayling
One of the things that make this one of the great debating chambers of the world is that there are lively debates between the two sides. I would never condone insults across the House, but I think we would lose something in this Parliament if we did not have a vigorous and sometimes challenging debate of the kind that we see regularly.
Martin Vickers (Cleethorpes) (Con)
The Queen’s Speech contained reference to a reduction in the subsidies for onshore wind turbines. This has caused some uncertainty among businesses serving my local community that deal with offshore wind. May we have an early statement to reassure them that there is no uncertainty about continuing subsidies for the offshore renewables sector?
Chris Grayling
I shall draw the attention of my right hon. Friend the Secretary of State for Energy and Climate Change to the concerns that my hon. Friend has raised. I know that the prime concerns of those on the Government Benches are to protect our countryside and ensure that onshore wind is handled sensitively. I shall ask my right hon. Friend to address the issues that my hon. Friend has raised.
Mary Glindon (North Tyneside) (Lab)
I and the hon. Member for Waveney (Peter Aldous) have contacted the new Secretary of State for Energy to ask her to continue with the successful cross-party oil and gas promotion group, which had notable achievements in the previous Parliament. May I urge the Leader of the House to speak to the Secretary of State and ask her as a matter of urgency to make a positive decision on this request?
Chris Grayling
I have noted the hon. Lady’s comments and I will make sure that my right hon. Friend is aware of her concern.
Jeremy Lefroy (Stafford) (Con)
My thoughts and those of the Under-Secretary of State for the Home Department, my hon. Friend the Member for Staffordshire Moorlands (Karen Bradley), are very much with those seriously injured at Alton Towers in Staffordshire. We would like to praise the community first responders, who were so quickly on the scene. May we have a debate about community first responders and in particular the issues surrounding markings on cars, which my right hon. Friend knows about, because they are causing great concern to my constituents and those of my hon. Friend?
Chris Grayling
I have been aware for a long time of the fine work done by first responders in my hon. Friend’s constituency. In a past role in opposition I made a number of visits to the Staffordshire ambulance service and learned about the work done by first responders. Clearly, this week was a moment when that work was enormously important. Our hearts go out to the young people affected in that tragic accident. We wish them all the very best for their recovery. I praise all those involved in the rescue efforts and hope all the lessons that can be learned are learned. I encourage my hon. Friend to use the Westminster Hall or the end of day Adjournment debates to find an opportunity to put on record the importance of the work done by first responders and to make sure that Ministers are aware of the issues to which he draws the attention of the House today. I am aware of them and believe they are very important.
Valerie Vaz (Walsall South) (Lab)
My 82-year-old constituent was refused a blue badge, despite having had one for the past 10 years and having a progressive condition. May we have an urgent statement on and a review of the blue badge guidance to stop this unfairness?
Chris Grayling
The blue badge guidance always has to be fairly tight in order to ensure that people cannot abuse the system. One of the things that we can all do as constituency Members of Parliament is challenge the local authorities when they get it wrong. I have done so in the past and I know that the hon. Lady will do so now to ensure that the right decision is taken.
Mark Spencer (Sherwood) (Con)
The Leader of the House may be aware that Thoresby colliery will close in July this year. Will he encourage the Secretary of State for Business, Innovation and Skills to come to the Chamber to make a statement about the measures that will be put in place to assist the employees there in retraining and reskilling so that they can move on to jobs elsewhere?
Chris Grayling
Extensive support is now available across government for those unfortunate enough to be caught up when a business closes, be that support through Jobcentre Plus or the skills development work done in the Department for Business, Innovation and Skills. My right hon. Friend the Secretary of State will be in this House in a couple of weeks’ time. I encourage my hon. Friend not only to raise these issues then, but to go directly to the Department now to make sure that the teams there that can help in these matters are ready and available when the change comes.
Andy Slaughter (Hammersmith) (Lab)
The Leader of the House’s views on human rights law and conventions are at least clear—he is against them. But could he clarify the Prime Minister’s view, which has moved this week from support for the European convention on human rights—reportedly—to now contemplating leaving it? In the absence of a Bill, may we have an early statement or debate so that we can explore the full range of the Tory party’s views on this matter?
Chris Grayling
The Conservative party’s policy on human rights has not changed since last October. What we do not know is where the Labour party stands, because it says it wants to defend the human rights legal framework as it is, yet on prisoner voting Labour Members will line up to say that they do not want to give votes to prisoners. Those two things are not compatible and Labour needs to decide where it stands, because at the moment it is all over the place.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
In September 2014, the Conservatives gave a commitment that we would scrap the 15-year rule for British ex-pats so that these people could vote in elections. What progress has been made on that? What is the timetable for making sure it happens?
Chris Grayling
That is a clear manifesto commitment and we will deliver it at an early date. I cannot give my hon. Friend an exact timetable, but I can assure him that it is in our plans and it will happen sooner rather than later.
Mr Stephen Hepburn (Jarrow) (Lab)
Will the Leader of the House secure an urgent, early debate on the future of NHS walk-in centres, which were opened by a Labour Government and a quarter of which have been closed by this Government? The one in Jarrow is due to close, because of unaccountable management, and 27,000 people are going to be dumped on local GP surgeries that are already overburdened.
Chris Grayling
The hon. Gentleman has already had the opportunity this week to raise this matter, in Tuesday’s health debate. This Government have already increased spending on the health service and we are committed to spending a further £8 billion extra on it. We are, as yet, uncertain what his party’s policy is.
Stuart Andrew (Pudsey) (Con)
My right hon. Friend will be aware of the flawed review of children’s heart services in the previous Parliament. Although much can be welcomed in the new review, access to units is still omitted from the standards, which is causing concern. May we have a statement or debate as soon as possible so we can ensure that the review is first rate this time?
Chris Grayling
First, I pay tribute to my hon. Friend for the work he has done on behalf of his constituency and West Yorkshire on this deeply sensitive matter. The concern he has shown is typical of the approach he has taken as a constituency MP and it is one of the reasons he was so successfully re-elected to this place. There will be many opportunities in the coming days to requisition debates so that Ministers come to address these issues, either in Westminster Hall or in this Chamber, and I suggest he take advantage of those.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
The Government announced a bus Bill to allow some local areas to re-franchise services. In Tyne and Wear, similar plans are already under way, but Ministers have consistently failed to back them. May we have a statement from the Department for Transport about what, if any, implications this planned legislation has on our existing proposals?
Chris Grayling
The bus Bill will be an important part of our devolution plans and we will be introducing it in the near future. The hon. Lady will have an opportunity in next Thursday’s Transport questions to raise the issue directly with the Secretary of State, and I am sure she will take advantage of that opportunity.
Mr Philip Hollobone (Kettering) (Con)
May we have a debate on the importance of local arts festivals? The forthcoming weekend sees the first ever Kett Fest, a spontaneous celebration of local arts, culture and music in the town of Kettering. Although supported by the relevant local authorities, it is—rightly—drawing on only a minimal level of public funding, and its success will be almost entirely due to the individual initiative, enthusiasm and endeavour of a large number of public-spirited individuals who are proud of the town in which they live.
Chris Grayling
I know that Kettering is a town with a very strong community spirit, and what my hon. Friend describes is this country at its best, with people coming forward to deliver change or events that really bring communities together. It is great to hear of such a good example and one that is not simply dependent on public finance to deliver real community togetherness.
Ms Margaret Ritchie (South Down) (SDLP)
Will the Leader of the House give consideration to a statement on submarine activity in the Irish sea that has already interfered with fishing efforts? The latest incident took place on 15 April, when the boat and fishing gear of one of my constituents was destroyed.
Chris Grayling
I do understand the concerns about this matter, including in the fishing community. There will be Defence questions on Monday, and the hon. Lady will have the opportunity in topical questions to raise this issue then, should she choose to do so. Of course, she will have other such opportunities this summer.
Mr Peter Bone (Wellingborough) (Con)
One unintended consequence of the general election is that we have a gap in our Question Times, as there is now no need for Deputy Prime Minister’s questions. One very talented Minister, who has a lot to do with the running of this House, has been sitting silently on the Front Bench. May we have a statement from the Leader of the House on instituting a Question Time in future for the Chief Whip? We could then ask him how he united the Conservative party on Europe, how he got every single Conservative Member through the Lobby and how he has had no rebellions.
Chris Grayling
My hon. Friend is absolutely right to praise the Chief Whip, who has made a brilliant start in his job. I would, however, have been slightly worried if he had had a rebellion in his first vote. There is a long tradition in this House, only occasionally broken, of Chief Whips simply getting the job done, rather than advertising what they are doing. I suspect that my right hon. Friend will prefer to keep things that way rather than change the practice of the Chief Whip remaining a silent participant in the House.
Andrew Gwynne (Denton and Reddish) (Lab)
Will the Leader of the House now answer the points made by the shadow Leader of the House on the Cities and Local Government Devolution Bill? A great many Members, on both sides of the House, from Greater Manchester, Birmingham, Liverpool, Leeds and Hull wanted to speak in yesterday’s oversubscribed debate on devolution to the cities and regions in England. There is clearly a great demand here, and it is doing this House a disservice to start the Bill in the other place.
Chris Grayling
First, it may be appropriate to wish the hon. Gentleman a happy birthday. May I point out to him that there is an Opposition day next week, and the subject of that debate has not been announced yet? A couple of Opposition Members have expressed an interest in discussing the issues he raises, so there is an ideal opportunity for them and they should speak to the shadow Leader of the House.
Wayne David (Caerphilly) (Lab)
Later this month, the Government will receive a report from the Electoral Commission on the completeness of the electoral registers, in preparation for full implementation of individual electoral registration. May we have a report, and a debate in this House, on that very subject?
Chris Grayling
I believe the new approach to electoral registration has been absolutely the right thing to do. We are a society and a democracy that prides itself on being clean and free from fraud, but that has not always been the case in recent years. The reform takes us a step nearer having a fraud-free system. The House will of course have the chance to study the Electoral Commission’s report when it is published, and the hon. Gentleman will be able to raise the issues when he chooses to do so.
Debate on the Address
The Economy
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:59 - The House divided: - Ayes: 278 / Noes: 325 - Question accordingly negatived.
17:14 - The House divided: - Ayes: 60 / Noes: 318 - Question accordingly negatived.
17:29 - The House divided: - Ayes: 326 / Noes: 279 - Question accordingly agreed to.
Mr Speaker
I inform the House that I have selected amendment (e) in the name of the Leader of the Opposition and amendments (a) and (b), which will be moved formally at the end of the debate.
I should advise the House that 53 hon. and right hon. Members are seeking to catch my eye in the debate and I am sorry to say that inevitably some will be disappointed. Depending on the length of the Front-Bench speeches, I will make a judgment on how exacting the time limit on Back-Bench speeches will need to be. We need to hear and probably will hear fully from the shadow Chancellor and the Chancellor, treating all the issues, but if they feel able to tailor their contributions in a utilitarian spirit to minimise unhappiness and to maximise their colleagues’ happiness, they will, I think, be widely applauded.
Chris Leslie (Nottingham East) (Lab/Co-op)
I beg to move an amendment, at the end of the Question to add:
“but regret that the Gracious Speech fails to provide a strategy to build the productive economy that the country needs; note that a fragile recovery and stagnating productivity harms living standards and makes it harder to reduce the deficit; believe that every effort should now be concentrated on supporting middle- and lower-income working people; further note that the Gracious Speech is a missed opportunity to tackle the principal causes of rising welfare costs that flow from a low wage, high rent economy; further believe in the pooling and sharing of resources across the UK as the best mechanism for delivering social and economic change; urge the Government to pursue sensible savings in public expenditure as part of a balanced approach and not an ideologically-driven attempt to shrink public services beyond what is needed to address the deficit; and call upon Ministers to spell out where their cuts will fall and who will pay for their unfunded election pledges.”
I welcome the Chancellor to his place. Very few people serve two full terms as Chancellor and I am sure that the whole country will be grateful that he does not plan to do so either. Although he might have his eye on another job, I congratulate him on his reappointment to this one. Of course, we should not ignore the fact that he has a fancy new title to illustrate his role in the EU renegotiation process. He is now the First Secretary of State, no less, following in the footsteps of John Prescott and Peter Mandelson. Let us hope that his ministerial counterparts are suitably impressed.
The Chancellor must now deliver negotiations with other member states to convince the public to opt decisively for Britain to remain a member of the European Union. It is important to secure stronger rules so that welfare payments go only to those who have contributed to our system, but in my view we also need greater devolution from Brussels, an overhaul of the EU budget and far greater accountability of the main institutions of the European Union, which still feel too distant and out of touch. It is also essential that he agrees that we need a comprehensive independent risk analysis of Britain leaving the European Union. It needs to be carried out by the Bank of England, the Treasury and the Office for Budget Responsibility and it needs to be published in ample time for the public to consider it in full before the referendum.
Although this is not the Queen’s Speech that I wanted the House to be debating, I reassure everybody and remind the Chancellor that we will be a vigilant and responsible Opposition, watching closely the choices he still has to make and holding him to account at every step.
James Morris (Halesowen and Rowley Regis) (Con)
The shadow Chancellor talks about being a responsible Opposition. In the spirit of responsible opposition, will he admit the errors in his previous economic policy, in which he predicted that unemployment would rise and that we would have no growth? He was comprehensively proved wrong in the election. Has he had time to reflect on how he might recalibrate his economic message?
Chris Leslie
I have had plenty of time to reflect on the result of the general election. Obviously, we are disappointed with it and we will review our policies accordingly, but it is now our job to ask questions and scrutinise what the hon. Gentleman and those on his Front Bench plan to do. I shall come shortly to my observations about that.
Let us not neglect the subject at hand, which is the Queen’s Speech. The headlines have, of course, now been spun and the rhetoric from Ministers has started. They are trying in vain to make all the right noises about fairness and even a one nation Government, but let us pause for a moment, walk through the measures in the Queen’s Speech and cut through the spin.
The tax-free minimum wage for those working 30 hours sounds fine until we realise that it is already tax free. The real question is why there is no action in the Queen’s Speech for the low paid, such as incentives for a living wage, which even the Mayor of London supports. I do not know whether he is in his place, but perhaps he will join us later.
As for the rest of the spin, the household benefit cap, although it is necessary, is only a drop in the ocean of the overall welfare bill, saving less than one 10th of 1%, and is a total distraction from the root cause of escalating welfare costs for the taxpayer in recent years, the low-wage nature of our economy.
What about devolution to a northern powerhouse? If it is genuine, that is all well and good, but local communities have heard these promises before and they know that when the Chancellor talks about devolution it is usually code for shifting the consequence of cuts and not the power to deliver services.
Stuart Andrew (Pudsey) (Con)
At a meeting of the leaders of northern cities on Monday, the Labour leader of Manchester City Council, who has many years of experience, said that the north is working together better than it ever has before. Does that not show that the northern economic powerhouse is a reality and that it is working?
Chris Leslie
The clue was at the beginning of the hon. Gentleman’s intervention. Labour leaders do work well together in local government, and when we hear the Chancellor’s response to this debate they might find that there are a few surprises and a hidden agenda with a bit of a sting in the tail for them over the next few months.
What about the rest of the spin in the Queen’s Speech, such as extending the right to buy? Everyone is in favour of home ownership, of course, but the scheme proposed by Ministers is so badly thought through, throwing housing associations into chaos, that even the Mayor of London—for it is he—has called it the “height of insanity”.
There was a further piece of spin, of course: a tax lock designed purely to stop the Chancellor raising VAT again. Do not get me wrong, we welcome any effort by the Chancellor to legislate against his own record and his own worst instincts, but this legislation does nothing more than prove that he does not even trust himself on tax. Of course, it does not give any guarantees about other stealth tax rises elsewhere, nor does it prevent him from acting on his other instinct of always prioritising tax cuts for the very richest over those for those on middle and low incomes—[Interruption.] Conservative Members are all shouting from the Back Benches, but the Chancellor’s eyes are down on his notes. Is the Chancellor planning to cut that top rate of tax from 45p on earnings of more than £150,000? I will give way to the Chancellor if he can clarify for us whether that is his plan. Will he cut that rate of 45p for those earning £150,000, or not?
Graham Evans
Why in 13 years of the Labour Government did they not increase the top rate from 40p to 50p?
Chris Leslie
We have heard those arguments. I was asking the Government whether they plan to cut the top rate of tax of earnings of £150,000 from 45p, and perhaps down to 40p, and there is silence from the Government Benches and from the Chancellor. Perhaps he will come to that later in his speech.
The Queen’s Speech was high on rhetoric but was in reality the usual combination of diversion and distraction. As ever with this Chancellor, there is more than meets the eye. All the rhetoric is just the tip of a Tory iceberg, with 90% of their real agenda hidden below the surface, still invisible from public view. That agenda will not even be partly revealed until the emergency Budget on 8 July. Until then, serious questions remain unanswered about what drives the Government, and in what direction.
The trajectory of overall cuts set out in the March Budget goes beyond what is needed to eradicate the deficit by the end of the Parliament. According to the Institute for Fiscal Studies, the Queen’s Speech still leaves us totally in the dark about more than 85% of the Chancellor’s planned £12 billion of welfare cuts. Just this morning, the IFS criticised the Government for giving a
“misleading impression of what departmental spending in many areas will look like”.
Frankly, there is growing disbelief across the country that the Chancellor can protect those in greatest need while keeping his promises to the electorate on child benefit and disability benefits. My hon. Friends will not have failed to spot during Prime Minister’s Question Time yesterday how the Prime Minister, when challenged by my right hon. Friend the Member for East Ham (Stephen Timms) on the question of disability benefits, digressed into all sorts of reminiscences about the campaign trail and how much fun it was going to various meetings. The Prime Minister promised that
“the most disabled should always be protected”
and I will be looking to the Chancellor and the Secretary of State for Work and Pensions to keep the Prime Minister’s promises. The Government might have secured a majority, but they did not secure a mandate for specific cuts to departments or services because those were never explained or set out before the election. Nor have we ever had an explanation of how they will pay for their multi-billion pound pledges on tax and services or, crucially, for the NHS.
The Opposition agree with yesterday’s OECD assessment that a fair approach is the right one to take—sensible savings and protection for those on middle and lower incomes. Cuts that decimate public services would be too big a price to pay, especially as they may even result in higher costs in the longer term. We also heard how 8,000 nurse training places were cut in 2010. The use of agency nurses then proliferated to fill the gap. Is it any wonder, therefore, that NHS trusts now face a deficit of about £2 billion? Part of the reason the deficit is so big is that productivity has been so poor. Britain has the second lowest productivity in the G7, and output per worker is still lower than in 2010. This should have been at the top of the Chancellor’s agenda throughout the last Parliament, but he did not even mention it in his last Budget speech. For the Tories, it seems that productivity just springs magically if the Government just get out of the way, unrelated to any fiscal or policy choices that they make.
Mark Garnier (Wyre Forest) (Con)
The shadow Chancellor will know that many pundits have been looking at that productivity puzzle. The Treasury Committee has examined it for the past five years. If the Governor of the Bank of England, economists and everyone else does not understand that productivity conundrum, will he share with us where he thinks the lack of productivity comes from?
Chris Leslie
I will come to that in a moment. The hon. Gentleman must also be staggered that the Chancellor did not even mention it in his Budget speech. That was an omission that the Chancellor needs to correct. We take a different view of where productivity comes from because, for us, it depends in part on having decent infrastructure and public services—motorways that flow freely and trains that commuters can actually get on, tax offices answering business queries efficiently rather than keeping companies’ staff waiting on hold, employees who are off sick able to get treated swiftly in a decent NHS, an education system that supports a work force and provides training in high-quality skills. Each of these is crucial for our future economic productivity, and each depends on the Chancellor making the right fiscal choices for this Parliament.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Will my hon. Friend push the Chancellor a little harder on productivity? The recent report from the Chartered Management Institute said that management and skills were at the heart of productivity. The Government have not tackled those, and a culture has grown up in which even when managers fail to meet targets they still get their bonus.
Chris Leslie
My hon. Friend makes a good point. According to the OBR, if productivity growth per worker was closer to 4%, our national debt would be £350 billion lower by the end of this Parliament. There is a connection between the choices that are made in fiscal policy and the productive nature of our economy.
The OECD confirmed just yesterday in a sobering reality check for the Chancellor that continued weak productivity could lead to a higher than expected budget deficit, and he should listen to the OECD.
Damian Green (Ashford) (Con)
The shadow Chancellor rightly says that infrastructure is important. On the day when, by coincidence, the Crossrail tunnel is completed, will he not bring himself to recognise that, even at times of great public spending restraint, the last Government continued and, I am sure, this Government will continue with essential infrastructure spending on rail and roads, which lays the foundations for future long-term prosperity, but is difficult to do if the Government run up an unsustainable deficit?
Chris Leslie
The civil service used to have a phrase for things like this. It was a brave decision of the right hon. Gentleman to defend his Government’s record on infrastructure. Many projects that were started under the previous Government have still not been completed. Would it not be better if we rose above party political picking out of which infrastructure project should proceed and tried to have a more mature debate about how we plan infrastructure in this country?
The Chancellor knows that Sir John Armitt’s report on infrastructure was widely received across the business community and that all sorts of parties wanted to find an independent approach to infrastructure planning. I still believe that that would be a better, more grown up way to plan for infrastructure.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
Why did the Labour party announce in its manifesto that it would put on hold the dualling of the A359, which is very important to delivering good transport links to the west country and my constituency?
Chris Leslie
Of course individual choices have to be made, but it would be better if they were made on the basis of need and evidence, not simply on whether the hon. Gentleman has the ear of a particular Minister at a particular point in time. That is the old way to plan infrastructure, and he knows in his heart that we should reform it.
The choices that the Chancellor makes in the emergency Budget in July will be crucial for productivity and therefore crucial to the health of the economy and public finances. I want to know whether the Chancellor will set out a sensible approach to deficit reduction by prioritising the areas of public spending that raise productivity. Why do we not ask the OBR to report on how the options for the spending review might impact on productivity and living standards and to set out the impact of the different choices that the Chancellor could make? He will have our support if he wants it to do that work. As the OECD suggested yesterday, the uneven profile of his planned fiscal pathway poses real risks, and higher productivity would give greater scope to protect working families, while still balancing the books. So these are the choices that he must confront. Is he still planning to double the pace of cuts, regardless of the impact on productivity, or is he now planning to moderate that pathway? The Chancellor has wiggle room here, even within his own fiscal rules.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
I thank my hon. Friend for giving way. He is making an excellent speech. I want to follow up on a point made by my hon. Friend the Member for Huddersfield (Mr Sheerman). According to the CMI report, leadership and management are a key issue for this country, and we have seen nothing in government strategy on that issue. How much does my hon. Friend think that that should also be part of our review of why we have such problems with productivity in this country?
Chris Leslie
This is at the heart of the Chancellor’s policy choices. Is he looking not just at how much but how spending is taking place? He can choose to ensure that where spending has to be prioritised decisions lean towards supporting growth and productivity and the skills that will in turn get us into that more virtuous cycle.
Chris Leslie
I will give way in a moment. Not to take a reasonable and measured approach, when the Chancellor clearly has scope to do so, would suggest that he is influenced much more by Conservative ideology than by economic judgment. That is what it always comes down to with this Chancellor. Is he focusing on securing the long-term needs of the economy or on securing his own long-term future; is he focusing on the country or on his Back Benchers; is he focusing on his current job or on a future one?
Kevin Hollinrake (Thirsk and Malton) (Con)
Does the shadow Chancellor agree that the best way to drive productivity is to increase competition and that 800,000 new businesses created in the last Parliament will drive productivity in this country?
Chris Leslie
Of course competition is essential, but so are important public services that support businesses and enable them to optimise the outputs from the inputs to the production process. That is the crucial point that we have to focus on.
John Mann (Bassetlaw) (Lab)
Does my hon. Friend agree that one of the issues with productivity is that we have become obsessed with mergers and acquisitions for short-term profitability, rather than allowing industry to invest for the longer term as economies such as Germany have been doing?
Chris Leslie
Long-term investment, especially production process technology and business investment, is crucial, which is why the stop-start approach of recent years from the Treasury has seen us underperform in business investment into the productive economy. It is essential.
Andrew Bridgen (North West Leicestershire) (Con)
Governments should try to encourage increased productivity in the private sector, but it is down to business confidence and reinvestment decisions. Although business confidence is now the highest it has been since 1992, investment dropped off in the run-up to the general election, because business was scared that there would be a hard-left socialist Government.
Chris Leslie
I know that the hon. Gentleman wants to make his political points, but I think we have a duty to ensure that we examine far more forensically the drivers of economic productivity and the growth that will help us to repair the public finances more successfully. That is the agenda we have to follow.
These are serious times, and we needed a serious Queen’s Speech agenda to address Britain’s long-term economic challenges. We should not forget that progress in our economy is still fragile and the recovery is still too constrained. The economy remains fraught with pressures, which have been heaped on the shoulders of many working people. For example, the number of people who have to work a second job in order to get by has increased dramatically in recent years, and a record number of pensioners are returning to the labour market. Indeed, the number of over-65s in employment has increased by more than 8% over the past year alone. The Office for National Statistics says that our share of high-skilled jobs is falling. The Government’s vision for Britain is one of a low-wage, bargain-basement economy. That is not the vision of a party for working people.
Gareth Johnson (Dartford) (Con)
I am listening to the hon. Gentleman carefully, but he has said very little about job creation under the previous Government. Will he take this opportunity to recognise that we now have record numbers of people in work in this country, which contrasts with the fact that no Labour Government, from the time they came into power to the time they left, have ever managed to bring down unemployment?
Chris Leslie
I do not know whether the hon. Gentleman has seen the ONS report published yesterday, but it shows that we are losing high-skilled employment in this country and that gradually it is being replaced with low-skilled employment, which is a real worry. We need to ensure that we compete in the world on the basis of a high-skilled, virtuous cycle. I think that he would be complacent if he ignored what is happening in our economy.
Chris Leslie
I cannot remember whether I have given way to the hon. Gentleman already but, given that he is being so polite and persistent, I will give way one last time to him.
Christopher Pincher
I am obliged to the hon. Gentleman. He likes to give the impression that sweetness and light always surround him, but he might like to look behind him occasionally. He must recognise that no one will take his talk about deficit reduction seriously when sitting behind him is his former leader, who less than a month ago said that the previous Labour Government did not spend too much.
Chris Leslie
When it comes to deficit reduction, let us never forget that the Chancellor of the Exchequer promised to eradicate the deficit by the end of the previous Parliament. We have passed that deadline, so he has broken that promise. He should put his hands up and admit that, when it came to his promise on the deficit, he failed.
We now need focus to address our economic challenges, not a Chancellor distracted by his own political ambition. We need a concerted drive to boost productivity; a balanced recovery reaching all corners of the country, with no sector left behind; a meaningful effort to tackle the root causes of higher welfare costs, low pay and insecure working conditions; a guarantee that any scope for tax cuts should be focused entirely on middle and lower earners; and a commitment to reject an ideological drive to shrink public investment. That is the approach Britain needs. That would be a genuinely one-nation approach.
Instead, we had a Queen’s Speech that focused on short-term political headlines, rather than long-term economic gain. It was designed to lay political traps for the Chancellor’s opponents as part of a grand political chess game, rather than to focus on productivity and balanced growth. This obsession with short-term, narrow political gain is the Chancellor’s curse. He is the Chancellor for whom productivity means kicking the Home Secretary off her Cabinet Committees. He is the Chancellor for whom a long-term plan means a move next door. He is sticking with the family business and measuring up the wallpaper for No. 10 already. That is his real agenda. Cold and calculating, he is the iceberg Chancellor, with hidden dangers beneath the surface. He is putting productivity and public services are risk, prioritising the very richest above those on middle and lower incomes, pitting one nation against another. Britain did not vote for a hidden agenda. I urge the Chancellor to put the ambitions of Britain above his own.
The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
I rise on the last day of the Queen’s Speech debate to support a programme for government that stands full square behind the working people of this country. It unashamedly backs the aspiration of working people to own their own home. It unflinchingly supports the businesses, especially the small firms, that provide the jobs that working people depend on. It unfailingly stands on the side of parents who want what every parent wants for their child: good education in a great school. It understands that the best way to support the incomes of working people is to let them keep more of their income tax-free. Our programme for government is unwavering in its determination to deliver sound public finances and the economic security that they bring for working people, because without that security nothing else is possible. We were elected as a party for the working people, and we will govern as a Government for the working people.
Mr Osborne
I will give way in a moment, but let me first make some progress.
Of course, this is the day we vote on the Queen’s Speech, deciding whether the legislative programme it proposes should proceed into law. We were told four weeks ago by the pollsters and pundits that this day would be one of great constitutional drama. Would the party leader who managed to cobble together enough votes in a hung Parliament manage to survive the test of the vote tonight? As always, we are taking nothing for granted, but I am reasonably confident that we will have the votes tonight, because what the pollsters and pundits did not reckon on was the good sense of the British people, who did not want to put at risk everything that has been achieved over the past five years and who want to continue with a long-term economic plan that is working for this country.
Let me say—I mean this sincerely—that it is very good to see the former leader of the Labour party here today. I think that he earns everyone’s respect by coming to the House so soon after the election defeat, and I understand that he wants to take part in the debate. Despite the fierce arguments of the general election, I do not think that anyone ever doubted his personal integrity or the conviction with which he made his arguments. It is good to see him back in the Chamber.
Let me also put on the record my thanks to the former Chief Secretary to the Treasury, the former Member for Inverness, Nairn, Badenoch and Strathspey, who lost his seat at the election, with whom I worked incredibly closely. He gave great public service to this country. Of course, that is not to say that I am sorry to have a Conservative Chief Secretary. It is fantastic to have my right hon. Friend the Member for Chelsea and Fulham (Greg Hands) in that role, along with the new members of the Treasury team.
The measures set out in the Queen’s Speech represent the next stages of our long-term economic plan, because we on the Government side of the House know that the job of repairing the British economy is not yet done, and that the work of preparing our country for the future has only just started.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
Does support for hard-working people include sanctioning those who are in work but on low wages and in receipt of tax credits?
Mr Osborne
If the hon. Lady is talking about benefit sanctions, I think that it is perfectly reasonable to ask people who are capable of work to turn up to job interviews and to make sure that they are doing everything possible to look for work. We support them while they are doing that, but the taxpayers of this country expect them to search for work.
The economic situation at the beginning of this Parliament is vastly better than the one we inherited at the start of the last Parliament. Back then, debt was soaring; today, it is projected this year to fall as a share of our national income. Back then, millions were looking for work; today, 2 million new jobs have been created. Back then, we were in the grip of an economic crisis; this week, the latest forecast is that the UK will be the fastest growing of any of the G7 economies—not just in 2014, but now in 2015 as well. That we have come so far in five years is a testament to the effort of the working people of Britain.
Clive Efford (Eltham) (Lab)
One of the myths that the Conservatives have been very successful with—I credit them for it—is the suggestion that debt soared under the last Labour Government from 1997 onwards. However, according to the House of Commons Library, debt in 1997 was higher than it was in 2007-08, just before the banking crisis hit. Yes or no?
Mr Osborne
The idea that the last Labour Government did not leave the country with a debt crisis is laughable. The fact that the Labour party is starting this Parliament making the same argument that it made in the last one shows how much it needs to learn and listen.
Mr Speaker
Order. We deal with these matters in an orderly and sequential manner. The Chancellor is seeking to respond to the intervention; the hon. Member for Eltham (Clive Efford) can always try his luck again in a moment. Ministers should not be hectored in these circumstances. Let the Chancellor reply first.
Mr Osborne
The point I make to the hon. Gentleman is that national debt started rising in the very first years of the beginning of this century—in 2001 and 2002. It rose through the boom years, when the Labour Government should have been paying down the debt and should not have been running a deficit. One of the things on which the various leaders of the Labour party all seem to agree at the moment is that the deficit was too high going into the crash.
Mr Osborne
I do not know who the hon. Gentleman is going to vote for in the Labour leadership contest; the hon. Member for Islington North (Jeremy Corbyn) may be the one person still sticking with the line that he is pursuing.
Mark Garnier
The subject of debt is incredibly important, but debt is not just national; there is household debt as well. Does the Chancellor agree that the £1 trillion rise in household debt between 1997 and 2008, taking it up to £1.47 trillion, was one of the most pernicious acts of the Labour Government? It damaged households immeasurably and is the biggest crisis that we have to deal with.
Mr Osborne
My hon. Friend is absolutely right. There was no institution looking at overall debt levels in our country.
Mr Speaker
Order. If the Chancellor wants to give way, he will, and if he does not, he will not. A Member should not continue to stand in an attempt to intimidate a Minister or anybody else into giving way. [Interruption.] Order. A Member should not continue to stand as if their intervention was inevitable. Seriously, that is an established point of parliamentary procedure. The hon. Member for Eltham can have a go, but if the intervention is not accepted, he will have to resume his seat.
Clive Efford
On a point of order, Mr Speaker. For the record, I want to apologise—I did not want to intimidate the Chancellor.
Mr Speaker
Whether the hon. Gentleman wanted to or not, I am happy to concede that he was not doing so.
Mr Osborne
I am not feeling particularly intimidated by the hon. Gentleman because he is spouting the same old anti-aspiration, anti-sound public finances nonsense that we have heard from the Opposition for the past five years.
Let me make progress and come to the central point. We have to tackle the endemic weaknesses in the British economy that no Government have been able to solve in the past: we are not productive enough and we do not export enough, save enough, train enough or build enough.
Mr Osborne
Let me make a little progress before I give way to my hon. Friend. We do not see enough of the prosperity and opportunity produced by our economy shared across all parts of our United Kingdom. The Queen’s Speech addresses those weaknesses head on. The housing Bill will ensure that more new homes are built and that tenants of housing associations get the opportunity to buy their own homes.
Mr Osborne
But it is anti-aspiration to deny working people in housing associations the right to buy their own homes. That will be an early, key test of whether the Labour party has learned anything from its massive election defeat.
The enterprise Bill supports the small businesses that are the productive engine of the modern economy. The High Speed 2 Bill commits us to the vital modern transport infrastructure that we need. The Childcare Bill supports the working parents—especially the working mothers—who have never had the backing that matches their contribution to our economy. The full employment and welfare Bill delivers the 3 million apprenticeships and creates the work incentives in our welfare system so that every citizen who can work is able to.
Yesterday, we discovered that the UK had climbed up the global employment league table, overtaking Canada to have the third highest employment rate of any of the major advanced economies in the world, on the path to full employment that we have set out. There is the promise of further devolution, delivered in the legislation, to Scotland, Wales and Northern Ireland. Then there is the Cities and Local Government Devolution Bill, which helps to dismantle the failed model that says that we have to run the entire country from the centre of London. Instead, it empowers our great cities across England and adds to the foundations of the northern powerhouse that we are building.
That is the agenda that we offer—full of ambition, brimming with ideas, not afraid of the future but excited about what it can bring. What of the alternative? The Labour party has taken the unusual approach of erecting the headstone first and then conducting the post-mortem. What conclusion has it reached? The shadow Chancellor just said that this is not the Queen’s Speech that he would have wanted. The Queen’s Speech that he does want is not entirely clear. He said that Labour’s economic policy was not credible; that its spending policy meant that it spent too much; that its tax policy was punitive and, in his word, “crude”; that its housing and rent policy was unworkable; that its energy policy meant higher energy bills; that its European policy was anti-democratic; and that its business policy was anti-business. Other than that, it was all okay!
Mr Osborne
I will give way, but I should properly welcome the hon. Gentleman, along with the rest of his shadow Treasury team. One of the great pleasures of doing this job has been the opportunity to work with four different shadow Chancellors. I wish the hon. Gentleman the same success as his predecessors enjoyed.
Chris Leslie
Very funny. I asked the Chancellor about an issue of substance—whether he is planning to cut the 45p rate of tax on earnings of £150,000. Is he able to rule that out as unfair and inappropriate?
Mr Osborne
There was a very good intervention which pointed out that there was a 40p rate for almost the entire period of Labour government. But let me say this. My tax priorities are clear: to raise the tax-free personal allowance to £12,500 and the higher rate threshold to £50,000. Those are my priorities and they will be reflected in the Budgets presented from this Dispatch Box.
The shadow Chancellor is a thoughtful man. Last weekend, he gave an interview to The Guardian, in which he tried to pinpoint what went wrong. This was his conclusion:
“It’s the Which? magazine strata of society that somehow we just didn’t understand”.
To be honest, I would stop worrying about Which? magazine and start focusing on which leader. There are four members of the Labour Treasury team. Three have backed different potential Labour leaders and the shadow Chancellor has led from the front by deciding that he is not going to back anyone at all. The truth is that it does not matter which of the leaders they pick—none of them understands the aspirations of working people because, in the devastating words of the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper), Labour has become the “anti-worker” party. That is what she said. That is a quote that I suspect we will hear again in this Chamber in the coming years.
Mr Osborne
Does the hon. Gentleman agree that the Labour party is the anti-worker party?
Bill Esterson
The Chancellor has talked about his priorities. May I ask him about his priorities for the £12 billion of unfunded spending cuts? Will he confirm today what the Prime Minister refused to confirm yesterday? Will he be cutting benefits for people with disabilities—yes or no?
Mr Osborne
As the Prime Minister made very clear yesterday, we will follow the principles that we followed in the previous Parliament, when we protected the most vulnerable in our society and actually increased the amount we were able to give to the most disabled in our country. In every single intervention about economic policy today, in the different debates we have had since the Queen’s Speech, and at Prime Minister’s questions, Labour Members have demanded more public spending, complained about a public expenditure cut, or implied that there should be higher welfare bills. That is what we have heard about over the past few days—more spending and higher welfare bills that can be paid for only by more borrowing and higher taxes on the working people of this country. That would undermine the security that we have restored to our economy.
Graham Evans
I wonder whether the Chancellor is aware that, as I speak, IBM is signing a multimillion-pound contract in my constituency of Weaver Vale on high-speed computing, in partnership with the Science and Technology Facilities Council at Sci-Tech Daresbury—the enterprise zone. Does he agree that this has happened only because of our long-term economic plan for reducing the deficit and cutting taxes, that the British people know that only the Conservatives are the party of business, and that the whole world knows that Britain is open for business?
Mr Osborne
Let me say how fantastic it is to see my hon. Friend back in his place, because he has fought so hard for his constituency in delivering the Mersey Gateway bridge, the rail improvements in his constituency, and, as he mentioned, the major investments in science at Daresbury, including in high-performance computing. Today’s announcement from IBM shows what happens if we get our science and technology policy right as a country—we attract investment from all over the world.
Mr Speaker
Order. The hon. Gentleman has been here for 36 years, and he ought to know that you do not pose the question before permission to make the intervention has been granted. I think the Chancellor has acceded to the intervention; let us now hear what it is.
Mr Sheerman
The right hon. Gentleman knows that I try to play fair in these things, but on his question about my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), I think a sense of humility is needed in this Chamber today. The Tory party has just got 30% of the popular vote; the Labour party got 31%. A hell of a lot of people in this country did not vote Conservative and did not vote Labour, and if we are not looking at why we do not enthuse the people, we are not doing our job.
Mr Osborne
I could not tell whether the hon. Gentleman agrees with the right hon. Member for Normanton, Pontefract and Castleford that the Labour party is the anti-worker party—but we will find out.
Mr Osborne
Actually, I would much rather give way to the new Member for Taunton.
Rebecca Pow
This Government are committed to infrastructure investment to benefit business. As my right hon. Friend said earlier, the Labour party, in its manifesto, was going to axe the upgrade of the A358, not realising that linked to that upgrade is the development of a new IT business park in Taunton on which depend many jobs and the future of our economy. The Conservative party understands that this is to benefit business; clearly the Labour party does not.
Mr Osborne
It is fantastic to see my hon. Friend here representing Taunton. She has already made an impact and made sure that the A358 is absolutely in the Government’s road programme. For all that we heard from the shadow Chancellor about investment and the like, the Labour party announced during the general election that it was cancelling the A358, and indeed the A20, which showed that it did not care about the south of England at all, or about investment in the south-west of England. That is pretty astonishing.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
The Chancellor will of course be aware that Scotland rejected the cuts agenda—the austerity cult that he is the high priest of—and we now have 56 out of 59 MPs. I see from the front page of today’s Financial Times that the OECD agrees with the SNP on spending and says that his cuts agenda is a danger to the economy of the UK. Will he take some economic lessons from the SNP and perhaps improve the performance of this Government?
Mr Osborne
If we had listened to the SNP there would be a massive hole in Scotland’s public finances because of the price of oil. We are obviously going to be hearing a lot more from SNP Members in this Parliament because of their numbers. If there are cuts that they oppose, let me point out that the Scottish National party in Holyrood has the power to increase taxes to increase spending. It has the power to increase income tax already and it is getting more powers next year to do so. When it comes to complaints about public expenditure, it is time for the SNP to put up or shut up.
Let me turn to economic security and public spending. Economic security is at the heart of everything. Without economic security, families cannot be supported, people cannot buy homes, businesses dare not invest, and jobs are not created. Without economic security, there are no aspirations, no opportunities, no hopes, and no ambitions. We cannot have economic security in a country that borrows too much and spends too much and does not live within its means. When confronted with the synthetic cries of Labour Members who claim to be standing up for the poorest in our country, let us also recognise this: the people who suffer most when Britain cannot pay its way, spends more than it can afford and sees security give way to instability are not the richest in this country but the poorest. When the economy fails, it is the poorest who lose their jobs and see their incomes cut and their dreams shattered. That is what we saw five years ago when there was no money left. For as long as Labour Members fail to understand that, they will remain the anti-worker party.
Economic security is at the heart of everything we offer, and it will be at the centre of the Budget I present to this House on 8 July. The budget deficit is less than half what it was, but at 4.8% it is still one of the highest in the world. Our national debt as a share of national income—
Mr Osborne
I will give way to my hon. Friend and then make some progress because I know that lots of people want to give their maiden speeches.
Mr Osborne
I absolutely will do that. I remember my visit with my hon. Friend to his constituency to meet some of the small businesses on the high street who depend on the people in this House delivering economic security and stability for this country, and that is what we are determined to do.
The global economy is full of risks at present. We should be redoubling our efforts to prepare Britain for whatever the world throws at us in the coming years, not easing off. The time to fix the roof is when the sun is shining. So in the Budget and in the spending review that follows, we will take the necessary steps to eliminate the deficit and run the surplus required in good times to bring debt sustainably down. That is what we promised in the election, and it is what we aim to deliver in government. I am not going to pretend to the House that these will be easy decisions, but nor will I pretend to the public that we can avoid taking them—we cannot. We have a structural budget deficit—we spend more than we collect in taxes—and that is not going to be fixed by economic growth alone. We have to bring spending down so that our country lives within its means.
As with any challenge, the sooner you get on with it, the better, and that is what we do today. Over the past five years we have brought a culture of good housekeeping to Whitehall. In every year of the previous Parliament—
Mr Osborne
I will make a little progress, if the hon. Lady does not mind. As I say, lots of Members want to get in on this debate later.
In every year of the previous Parliament, Government Departments kept their spending not just within budget but well under budget. Outside key protected areas like the national health service, those budgets have been reduced year on year to more sustainable levels. At the start of this Parliament, it is important that we continue to control spending in the same vein. Two weeks ago, my right hon. Friend the new Chief Secretary asked Government Departments to seek further savings beyond the £13 billion of savings that they are already delivering this year. I can report today that together we have got straight back to the task in hand. We have found a further £4.5 billion of savings that we can make to the Government budget this year, including sensible asset sales. Some £3 billion of these extra savings come from finding more efficiency in Whitehall Departments and from the good housekeeping of coming in under budget. The breakdown per Department is being published by the Treasury today.
There is another component to this: I am today announcing that the Government will begin selling the remaining 30% shareholding we have in Royal Mail. It is the right thing to do for Royal Mail, for the businesses and families who depend on it, and, crucially, for the taxpayer. That business is now thriving after we gave it access to investment from the private sector in the last Parliament. There is no reason we should continue to hold a minority stake. That stake is worth about £1.5 billion at current market prices.
Of course, share prices fluctuate and the final value will depend on market conditions at the point of sale. We will sell our stake only when we can be sure that we are getting value for money, but let us be clear: holding over £1 billion of Royal Mail shares in public hands is not a sensible use of taxpayers’ money. By selling it, we help that important national business to prosper and invest in the future, while we use the money we get to pay down the national debt and pay less interest on that debt as a result. It is a double win for the taxpayer, for we on this side never forget that it is not our money or the Government’s money; it is the money that people work for and pay in taxes, and entrust to us to spend wisely.
Chris Leslie
I warned in my earlier remarks about the Chancellor’s hidden agenda. Before he went into the section on Royal Mail, I think I heard him announce upwards of £4.5 billion or more of in-year cuts to public services. [Hon. Members: “Savings!”] I think he called it “good housekeeping”. He announced in-year savings of that magnitude without coming to the House to give an oral statement or publishing them for the House, so that we can scrutinise what he has just announced. It sounds to me as though any semblance of a long-term plan has been totally ripped up, and that there is panic in the Treasury and chaos, with in-year public spending decisions being taken. Why did he not announce those in the March Budget if they were part of some sort of long-term continuum? Has he suddenly decided rapidly to change his course when it comes to public expenditure? And why do it in such a shabby way?
Mr Osborne
Only the Labour party would think it shabby to make an announcement first in the House of Commons.
Mr Osborne
The shadow Chancellor can sit down.
We set out two weeks ago that we were going to find further efficiencies and savings in Government, and that is what we deliver today.
Chris Leslie
On a point of order, Mr Speaker. It is the usual convention, if there are significant changes to the estimates and supply that support public services, that the documentation and details for every single Department are laid before the House of Commons, so that all Members can be informed of what is happening with our public services within a financial year. This is ripping up any semblance of long-term continuity, and it is a shabby way to treat Parliament and the public services.
Mr Speaker
The shadow Chancellor has spoken, but this is not a matter with which the Chair needs to deal. He has made his point and it is on the record, but the Chancellor will now continue.
Mr Osborne
We made this announcement to the House of Commons, and the detail is there for people to examine. There will be estimates debates as usual, but there is a very simple question: does the Labour party support further savings in public expenditure? If it does not, that means the Labour party wants to increase borrowing, increase taxes and take this country back to square one and repeat all the mistakes it carried out in office—and, indeed, repeat all the political mistakes that meant it went down to a historic election defeat just a month ago.
Mr Osborne
I have given way to the hon. Gentleman. He will have his opportunity.
Further savings in Departments this year, selling our stake in Royal Mail, getting on with what we promised, and reducing the deficit—that is how to deliver lasting economic security for working people, for as everyone knows, when it comes to living within your means, the sooner you start, the smoother the ride.
We continue today to deliver on our long-term economic plan. The measures in this Queen’s Speech back aspiration and opportunity, but they rest on the bedrock of economic security that our plan has delivered and continues to deliver. We have taken further steps today to prioritise that economic security. It is the security that the working people of this country elected this Government to provide, and I commend the Queen’s Speech to the House.
Edward Miliband (Doncaster North) (Lab)
May I start by thanking the Chancellor for his gracious words about me in his speech? It is an achievement to survive five years as Chancellor of the Exchequer and, indeed, to be reappointed, and I congratulate him on that.
I rise to speak from the Back Benches for the first time in nine years. I do so obviously deeply disappointed at Labour’s election defeat, for which I take full responsibility. I believe it is right that my party comprehensively examines the reasons for that defeat and does the hard and painful thinking necessary. On the day after the general election I rang the Prime Minister to congratulate him. I said, as the Chancellor said in his speech, that he had defied the pollsters and the pundits—and indeed that is true. I repeat those congratulations to the Conservative party.
In the time since the general election, I can report to the House that I have found some small consolations of losing, including spending time with my two boys, who feel that they have their dad back. However, I confess that my eldest, who has just turned six, did bring me further down to earth last week. He suddenly turned to me out of the blue and said, “Dad, if there is a fire in our house, I think we’ll be okay.” I said, “Why’s that, Daniel?” He said, “Because if we ring the fire brigade they’ll recognise your name because you used to be famous.” “Thanks very much,” I said. From my used-to-be-famous position on the Back Benches, I look forward to helping to play my part in holding the Government to account, as it is the job of the Opposition to do, and the occasion of the Queen’s Speech is the right place to start.
Whatever our profound differences over the years, I welcome the Prime Minister’s commitment in the days after the election, and repeated in the Gracious Speech, to govern for one nation. I welcome this because it speaks in historical terms to what I see as an admirable side of Conservatism, represented by Disraeli and Macmillan. It is worth reminding ourselves of the historical lineage that suggests. This is what Disraeli said in his novel “Sybil, or The Two Nations”, published 170 years ago this year, about what he was fighting against:
“Two nations between whom there is no intercourse and no sympathy; who are as ignorant of each other’s habits, thoughts, and feelings, as if they were dwellers in different zones, or inhabitants of different planets”.
For many people, that will sound like the description, in old-fashioned language, of some of what afflicts our country today: a divide between the top 1%, or even the top 0.1%, and everyone else. Facing up to that is a challenge for any Government of any colour, but particularly, if I may suggest, for one claiming the mantle of one nation.
A huge question facing all western democracies in the next five, 10, 20 years is whether we are comfortable with the huge disparities that exist, whether we are fated to have them and whether we want to even try to confront them. Personally, I believe we will have to, and I believe this is an issue for right and left.
What has changed in the debate about inequality is that, internationally and across the political spectrum, there is growing recognition that these gaps are not just bad for the poor, as we always used to believe, but bad—
Edward Miliband
No, thanks very much.
These gaps are not just bad for the poor, but bad for all of us. Last month, the OECD joined the International Monetary Fund in saying that inequality was definitively a problem. The secretary-general of the OECD said there was
“compelling evidence that high inequality harms economic growth”
and social mobility. Simply put, if the rungs of the ladder grow too far apart, it is much harder to climb them.
The old idea was that inequality was necessary for economic growth. In fact, we now know that the deep structural challenges in our economy of low productivity—which, to be fair, the Chancellor and, indeed, my hon. Friend the shadow Chancellor referred to—are bound up with high inequality. More unequal societies tend to use the talents of fewer people, and they suffer as a result.
It is not just internationally that the debate has shifted, and I applaud those on the right—some of whom are sitting on the Government Benches—who have focused on this issue. I was intrigued the other day to hear Steve Hilton, the Prime Minister’s former adviser, say that it was time to impose a maximum wage for the bankers. As you would expect from me, Mr Speaker, I see that proposal as anti-aspiration and anti-business, and I have no truck with it. [Laughter.] The serious point is that this issue will not go away and needs to be confronted.
I hope that we can move on—maybe the Government’s emphasis on one nation presages this—from discussing whether inequality is a problem to what the solutions are. There are no easy solutions in the context of a global economy, but progress can be made in the way we shape our economy and the way we approach tax and benefits. As a starting point, I urge the Government and the Chancellor, in the spirit of one nation, to look at the OECD recommendations—not just those about the pursuit of equal opportunity and skills, but those about tackling insecure work in our economy, which it specifically identifies as part of the problem, and progressive taxation, which it says is part of the answer. Perhaps that will all be in a one nation Budget in July. I wait with interest.
Within the profound and growing challenge of inequality lies the specific problem of in-work poverty. I would say that it is the modern scourge of our time. For the first time, as many people in Britain who are in poverty are in work as out of work. I believe that the left and right can agree that it should be a basic principle that if you go out to work, you should not be living in poverty. But we are very far from that in Britain today.
The minimum wage has played its part in countering the worst exploitation, but I believe it needs to do more. In Doncaster, which I represent, 28% of men and more than a third of women workers are paid less than the living wage of £7.65 an hour. The UK is one of the low-pay capitals of western Europe. There is an irony here: the Low Pay Commission is a great success, and indeed a lasting achievement, of the 1997 Labour Government—to be fair, the last Government continued to operate with the Low Pay Commission—but I fear that the way it operates has become too much a recipe for the lowest common denominator.
Countries around the world are confronting similar issues and seeking to act. There is a live debate in the United States about raising the minimum wage. Los Angeles has just passed a plan to raise the minimum wage to $15 an hour from $9 an hour over five years. I say to the Chancellor that if we are to make progress here at home, it will require us to strengthen and guide the Low Pay Commission much more explicitly. That is something that its previous chair, George Bain, has called for. Without it, I do not believe it we will be equal to the challenge of low pay.
Just as one nation requires the right approach to those who work, so it requires the right approach to those who cannot. The origin of one nation for Disraeli was rooted in the lives of the rich and the poor. Responsibility is absolutely part of a successful welfare system, but so too is protection of the most vulnerable. We will never be one nation without a social security system that supports those who need it.
I think it would repay Ministers to read some of the early speeches by the Prime Minister when he became leader of the Conservative party. On the 25th anniversary of the Scarman report in 2006, he said:
“In the past we used to think of poverty in absolute terms—meaning straightforward material deprivation. That’s not enough. We need to think of poverty in relative terms—the fact that some people lack those things which others in society take for granted.”
He continued:
“I want this message to go out loud and clear—the Conservative Party recognises, will measure and will act on relative poverty.”
That was seen as a radical departure from the tenets of Thatcherism, and it was. If the approach in the Queen’s Speech is indeed meant to be a return to the earlier incarnation of the Prime Minister’s approach, which I welcome, Ministers need to prove it and to square the circle with the Government’s proposals for deficit reduction.
Can one nation really be consistent with making those on welfare shoulder £12 billion of the burden for deficit reduction and those at the top nothing at all? Can one nation really be squared with cuts to tax credits, with their impact on working people? Can one nation be squared with a welfare system that is so often harsh, brutal and brutalising? Can one nation be squared with a country where a million people go to food banks? Those tests on inequality, low pay and a compassionate social security system are appropriate tests for a Government claiming the mantle of one nation. There are many more besides, including, of course, keeping our United Kingdom together.
Let me make this final point about the situation facing the Prime Minister. Fighting an election and winning is some achievement; how he seeks to use the mandate is what will really define his legacy. He is in an unusual position in that he has fought his last election. He is able, if he wishes, to return to what he said when he first became Leader of the Opposition and not worry about an election round the corner, with all the pressures that entails. I urge him, perhaps through the Chancellor, to follow through on his one nation rhetoric. Opposition Members will hold the Government to account at every turn for whether they are living up to their own test: one nation in spirit and deed. If that is where the battleground of politics lies in the years ahead, I welcome it and look forward to playing my part.
Mr Kenneth Clarke (Rushcliffe) (Con)
I congratulate the right hon. Member for Doncaster North (Edward Miliband) on his forceful and good speech, and on his resilience in coming here and facing the House with such dignity and distinction. I, too, pay tribute to the way in which he fought for his principles and his cause in the election. Indeed, it causes me slight annoyance that in the leadership election that has broken out in the Labour party, some of the people who a month ago were his greatest admirers, his most loyal colleagues and those closest to his cause are now busily detaching themselves and attempting to scapegoat him for the problems that the Labour movement experienced.
In my opinion, for what it is worth, the right hon. Gentleman fought a very good election campaign. It was much better than anybody expected, because of the expectations that the tabloid press had raised. I thought he put the message across very well. I thought the message was wrong, and that was the judgment of the majority of constituents in my constituency and my part of the world. It is not the case that his performance had anything to do with the result. Apart from the great events in Scotland—[Hon. Members: “Hear, hear!”] Apart from the remarkable, almost bizarre, events in Scotland—the SNP is equalled only by Syriza in Greece on economic policy—and the very welcome events in the south-west, which were also very unkind because I lost many good colleagues in government as a result, the underlying basis of the majority that we won, to most people’s surprise, was the judgment of sensible people on economic competence and our record on the economy.
I do not think the election campaign made very much difference to the result one way or the other. My part of the country, the east midlands, is thick with marginal seats. We won all of them and added gains by taking back Derby North. In the end, people saw what we had inherited economically and what we had done over the previous five years. They recognised our economic competence and accepted the message that the job had to be completed. When listening to the Labour party’s message, however it was presented, they simply decided that they could not take the risk of changing the Government. When the problem arose that the SNP would apparently be able to hold a Labour Government to ransom in what was bound, because of the tsunami in Scotland, to be a hung Parliament if Labour won, that made a little bit of difference, but the result was mainly down to economic competence.
Tom Brake (Carshalton and Wallington) (LD)
Does the right hon. and learned Gentleman feel that in individual constituencies, particularly Liberal Democrat-Conservative marginals, the fact that his party was often outspending my party by a factor of perhaps five to one made any difference to the election result?
Mr Clarke
I look forward to a little party political debate with the right hon. Gentleman again. As I have said, what decided the election was the coalition Government’s extraordinary record. It was a particular tribute to my right hon. Friend the Chancellor, closely assisted, as he said, by Danny Alexander, the former Member for Inverness, Nairn, Badenoch and Strathspey, who was an excellent Chief Secretary, in getting the affairs of the nation back in order and steering us to some of the most successful economic results in the western developed world, which is what we have now.
What concerns us now, in this Parliament, is what judgment the public and history will make of this Government when they look back in five years’ time, or whenever. That will crucially depend on whether we finish the job and deliver the modern, more balanced, competitive economy that will give our children and grandchildren greater security and a better quality of life. That is the task we have set ourselves, and it is not going to be easy.
At the moment we are all enjoying the hubris of victory, as far as my party is concerned, or the relief of being back here just opposing, as far as the Opposition parties are concerned. On the surface the task looks easy, because at the moment our economy is growing more strongly than almost any other in the western world, employment is soaring because of our flexible labour market, which we should keep that way, our inflation is low, and real pay is at last beginning to rise as the benefits of recovery get through to every level of society. However, it would be a false assumption to think that it is plain sailing from now on, that everything will continue in that way and that the risks have vanished domestically and abroad, so we can take easy measures to reward those who voted for us. The world is not like that.
I take encouragement from what I took to be the Chancellor’s message. He has announced a July Budget, because he wants to take the opportunity while the economy is growing to take some of the tough and difficult decisions that the Government still have to take. I certainly encourage him to do so. In my part of the world—Nottinghamshire, Derbyshire, the east midlands—the people who voted for us knew that there were still tough and difficult decisions to take. They were not seduced by the speeches of those whose only examples of what they intended to do were ways of spending money or rather short-term popular things. The sooner we get on with tackling the underlying problems—including, as my right hon. Friend the Chancellor has reassuringly just confirmed, the debt and the deficit—the better we will be able to get on with all the other things that need to be done, which will enable our economy steadily to get back on to a stronger and more secure footing.
Neil Carmichael (Stroud) (Con)
Will my right hon. and learned Friend give way?
Neil Carmichael
I thank my right hon. and learned Friend. Does he agree that one of the key tasks is to keep up the pressure to improve our skills agenda, so that we can ensure that our young people continue to contribute to a productive economy and increase our capacity to develop, innovate, research and develop and manufacture?
Mr Clarke
My hon. Friend anticipates some of the points I wish to make. I agree with everything he has just said. Tackling the deficit and debt, together with what he has just described and the other measures that we have committed ourselves to, is a genuinely one nation Conservative approach. Ever since I became active in politics, I have declared myself a one nation Conservative. The phrase has moved in and out of fashion a little in my time, but I have remained boringly consistent. In my view, it means free market economics combined with a social conscience, as well as a forceful internationalism that looks after Britain’s interests in the world and helps to spread our values.
On the economic front, the combination of fiscal discipline and economic competence, with measures such as taking the very lowest-paid out of tax altogether, easing the tax burden on the lower-paid, not taking people on ordinary incomes into higher rates of tax that should affect only the very wealthy, and the right to buy from those giant landlords the housing associations, which should be unlocking their resources to invest in more new social housing, gives the right one nation balance to the proposals we have put forward. As I have said, it is important that we get on with it, because this Session of Parliament is probably the best time to get some of the most formidable challenges out of the way and under our belt.
If I am sounding a little foreboding about what could go wrong, I should say that I do not foresee anything going wrong, but we will be lucky if no global shocks hit us. We have had five years of growth since 2010, with only a minor blip—not a recession—in 2012, and 10 years of uninterrupted growth would be pretty well a post-war miracle. It does not happen in the real world. We are doing better than any other western European nation, but that is based on the fact that we devalued by 25% when we had the crash—that has done us a bit of good, but not a great deal—and on a US recovery that is now looking rather feeble, as it was stimulated by quantitative easing, which is a dangerous thing. Our own recovery is not forcefully strong, and it was based on quantitative easing when that was necessary. Of course, we rely on interest rates, and they are the lowest they have been for 300 years, which is good for indebted countries.
Ian Blackford (Ross, Skye and Lochaber) (SNP)
Will the right hon. and learned Gentleman give way?
Mr Clarke
I will not, because other Members want to speak. I enjoyed what the hon. Gentleman said yesterday, and I would like to give way to him, but not at the moment.
It will be surprising if we do not face difficult times. My right hon. Friend the Chancellor has taken the deficit down to a little under 5% of GDP—far too high, and quite unsustainable, but practically half what we inherited. He paced it pragmatically, because five-year forecasts of where we will be are a complete waste of time, although people always produce them. So long as we have growth, we should press on with taking the deficit down now, because if we ever have a slowdown we will have no weapons to do anything about it. If the Chinese turn out not to have a soft landing, or if America goes wrong, we will not be able to help ourselves by having a fiscal stimulus when we have a 5% deficit. We will not be able to ease monetary policy with interest rates at practically zero. Now is the time to get on the with the task.
There is much more that I would like to say along the lines of the intervention by my hon. Friend the Member for Stroud (Neil Carmichael), because cutting the debt and deficit is not in itself a complete economic policy. It is the essential precondition for all the structural reforms that we still have to make so that we can make our economy modern and competitive. We have a long way to go, because as Members have said, our productivity performance is dreadful, our investment performance is recovering but remains rather poor, our trade and export performance is pretty dismal and we have an appalling current account deficit. In this modern, balanced economy, we have a long way to go.
We therefore require the right kind of European reform. The European Union has been the essential basis on which we have established our voice in the world and our current economic base. In my lifetime, it has had the most beneficial effect on both those things, which were in a pretty dreadful state until we joined, but it does require changes.
When the Prime Minister announced his referendum, in a very pro-European speech at Bloomberg, he set out an economic agenda for change. That remains the most essential reform that we require and desire, and it would benefit the rest of Europe, as well as us. That means completing the single market, which we have talked about and never done. It means an EU-US trade treaty, which we have an opportunity to get and which would boost investment, trade, jobs and activity on both sides of the Atlantic.
It means deregulation. The Barroso Commission talked about deregulation and got no support whatever from member states. The Governments of all member states, including Britain, tend to send people to Councils from various Departments who advocate more regulation—on transport, road safety, food safety, environmental standards, pollution and all the rest of it. Vice-President Timmermans wants to deregulate. We should compete with deregulating there by deregulating here to stimulate our economy.
Of course we can stop people coming here just to claim benefit—we have always been able to do so. There are other things we can do. The economic reforms, however, were the basis on which we started the negotiations and they remain the most important to us.
Beyond that, skills training and education reforms are still required. We have immigrants because we have to go Romania to recruit nurses—we do not train enough nurses of our own. Our construction industry would come to an end if Poles did not come here in the numbers they do. Skills training, education and higher education—every innovative business I know complains they cannot recruit people with the necessary skills to expand their business. It is one of their major constraints. We do not train and produce enough engineers. We need to get somewhere with giving STEM subjects a higher priority and so on.
I could go on. [Hon. Members: “Go on.”] No, no. This is an agenda for a Parliament. It is tough agenda. Now that we have been re-elected, we have the ability to deliver it. The precondition is that we start well, and we start with getting rid of the deficit and debt restraints while we can. In July, we need an iron Chancellor. We need a bold and radical Government. We need a Government who are going to repeat the success of the past five years, measuring up to these enormous international challenges, to show that the United Kingdom can again have one of the strongest global economies in a totally changed globalised economy and a new world.
Stewart Hosie (Dundee East) (SNP)
It is a pleasure to propose the amendment in my name and those of my right hon. and hon. Friends. It is also a great pleasure to follow the right hon. and learned Member for Rushcliffe (Mr Clarke). He talked earlier in his contribution about the bizarre events in Scotland. We tend to call it democracy. In the same way as the Chancellor spoke about the good sense of the British people, I might say that, with 56 out of 59 MPs and half the vote, we celebrate very much the good sense of the Scottish people—a true one nation in every sense.
The Chancellor spoke about the challenges the Scottish economy may face. He spoke about fiscal autonomy and what he called a massive hole. I just say gently to him that any challenges on the Scottish current account are as nothing compared with a £1.6 trillion UK national debt built up by Labour and Tory alike.
The Chancellor laid out his plans today. For our part, the last thing that the country needs, that the economy can afford and that those who have suffered most over the past five years should be expected to bear is another austerity Government. Yet that is exactly the direction of travel laid out today: a continuation of vague talk about a long-term economic plan, where none really exists; hubris about so-called economic success, most of which is contradicted by fact and a litany of broken promises; and a complete disregard of the impact his policies have had, are having and will have over the next five years on people through the UK—and that is before we even start to talk about the impact on investment for growth and on our vital public services.
We know the impact those policies have had throughout the UK. We know what has happened in Scotland specifically since 2010. We have seen the budget cut by about 11% in real terms and capital expenditure down by 34%. As a result of decisions taken by this Chancellor, the budget in Scotland has been cut by a staggering £3.5 billion in real terms. The plans announced throughout the election and reiterated today—before the bombshell of in-year cuts, which we will analyse further later—will result in a cumulative share of cuts to day-to-day spending over the next five years for Scotland worth about £12 billion at today’s levels. Those cuts to Scotland and elsewhere are the consequence of the Chancellor’s economic failure.
It is worth reminding ourselves what the Chancellor said when he took office: debt would begin to fall as a share of GDP by last year; the current account should be in balance this year; and public sector net borrowing would fall to £20 billion in the same year. Debt did not fall as a share of GDP in 2014-15, the current account will not be back in the black until 2017-18, and public sector net borrowing—the Chancellor can smirk all he likes—was not the barely £20 billion he promised: it was almost four times that at £75 billion. The Chancellor failed to meet every one of the key targets he set himself. Tory policy stifled recovery from 2010 for years into the previous Parliament. With a cumulative £146 billion of cuts still to come, we are all on track for a decade of austerity.
We know where the pain of this has been felt and we know where the pain of it will be felt. In Scotland, 145,000 households affected by changes to incapacity benefit will lose about £2,000 each.
Mr Osborne
If the hon. Gentleman, who speaks for the Scottish nationalists, opposes these spending cuts, why does he not increase taxes and use the powers available to the Scottish Government? He could then spend more money.
Stewart Hosie
We do not need to increase taxes in the way the Chancellor describes. He knows perfectly well, and I will come on to it shortly, that there is a way of managing the economy in a fiscally responsible way that allows an increase in spending while the debt and the deficit continue to fall. He may disagree with me—I respect that—but he had better respect that this is a genuine alternative vision to the cuts coming from his party.
The pain will be felt by the 145,000 households affected by changes to incapacity benefit, the 370,000 who have seen tax credits reduced, and the 620,000 families hit by child benefit freezes. It will be felt by the 120,000 people who have lost an average of £2,600 as disability living allowance was removed. I am glad the Secretary of State for Work and Pensions is here to hear this. He can perhaps begin to understand that this is not a theoretical cut in a back office, but a real cut to real people’s living standards throughout the UK. It will be felt by the 835,000 households hit by the increase in the benefit cap. Why are these decisions wrong? There is now a substantial growing body of opinion, as the right hon. Member for Doncaster North (Edward Miliband) said, that we do not simply need a growing economy to fund our welfare provision; we need to squeeze inequality out of the system to provide a solid platform to grow the economy.
Andrew Bridgen
The hon. Gentleman rightly basks in his electoral success and that of his party. Is he as relieved as I am that the right hon. Member for Doncaster North saved the best speech I have heard him give until after the general election? Will he join me in offering the right hon. Gentleman some solace, regardless of the right hon. Gentleman’s son’s remarks that he used to be famous? He will be very successful again in the future and it is far better to have been a has-been than a never-was.
Stewart Hosie
I would be slightly more gracious than that. I think that the right hon. Gentleman will make a contribution to his party’s policy development. Let us hope that it moves to somewhere progressive rather than sticking to the kind of austerity-lite position that it had before the election.
We need to squeeze inequality out of the system. The December 2014 OECD report told us that rising inequality in the UK had cost it 9 percentage points in growth between 1990 and 2010. It is an obvious fact: it is not possible to squeeze inequality out of the system at the same time as the squeeze is being put on the poorest in society, and once again this Government are swimming against the tide of informed public opinion.
The alternative to the Government plan is clear; it is the alternative economic plan that we pursued, rather successfully, in Scotland at the election. It is a plan aimed at balancing deficit reduction with increased investment in public services. We argued rightly that with a modest 0.5% real-terms spending increase between 2016-17 and the end of this Parliament we could release £140 billion for essential spending and investment over and above the Government’s plans. The alternative for Scotland is £11 billion of spending compared with £12 billion of cuts. Our plan makes sense. It is a fiscally responsible plan that protects public services, protects investment, really ends austerity and lifts the squeeze off ordinary people, but still sees the debt and deficit fall.
Iain Stewart
May I repeat the question put by my right hon. Friend the Chancellor? The Scottish Parliament already has significant tax powers and it will gain more in this Parliament. The leader of the Scottish Conservatives, Ruth Davidson, has pledged not to have tax rates in Scotland that are higher than in the rest of the UK. Will the hon. Gentleman meet that pledge, or does he want to pursue his expansionary agenda and raise taxes?
Stewart Hosie
I do not think that Scottish people should pay tax twice for services that we would have if we simply had full fiscal autonomy.
The UK Government have advocated an approach that will result in further spending cuts in the coming years to achieve the fiscal targets set out in the budget charter, but those cuts have not been spelt out in full. The Tories have not said where the axe will fall. The Chancellor said some things today, particularly about in-year cuts and asset sales in certain Departments, but nowhere near enough to explain what he plans to do. Perhaps he or one of his Ministers might decide to come clean with this House later today and tell us where the axe will fall.
Will they really restrict carer’s allowance to those eligible for universal credit, so that 40% of claimants lose out? Will they really increase means-testing for the contributory element of employment and support allowance, or of jobseeker’s allowance, which would see 30% of claimants—300,000 families—lose £80 a week? Will they remove the tax-free status of disability benefits to save £1.5 billion? Will this Chancellor and the Secretary of State for Work and Pensions really take the axe to those most in need to deliver £8 billion of tax cuts, which right now, and I have heard nothing today to change my mind on this, are completely unfunded?
I said that the UK Government plan is designed to achieve the fiscal targets set out in the charter for budget responsibility, but we know that the scale of the spending cuts plan, as set out in the March Budget, significantly exceeds what is required for the UK Government to meet their targets. There is therefore flexibility for the UK Government to meet those objectives without implementing in full the spending cuts that are currently planned for the coming years.
Based on plans set out in the March Budget, public sector net debt is projected to begin falling in 2015-16, and a cyclically adjusted current budget surplus of £35 billion is projected for 2018-19, rather than simply returning the adjusted current account to balance. Therefore, the UK Government have the flexibility to cut spending by less than currently planned while meeting their fiscal targets. I hope the Chancellor uses that flexibility wisely.
I want to move on to the real economy. As our First Minster, Nicola Sturgeon, said, there are three areas where we seek to achieve outcomes at a UK level that will benefit the economy in Scotland. First, we will continue to oppose spending reductions of the scale and speed that the Government have suggested. We believe that those would slow economic recovery and make deficit reduction more difficult.
Secondly, we do not think it is desirable for trade or business for there to be an in/out referendum on membership of the EU. However, since a referendum now seems inevitable, we will protect Scotland’s interests. We propose a “double-lock”, meaning that exit is only possible if all four nations in the UK agree to it, which would quite rightly prevent Scotland from being dragged out of the EU against the will of the Scottish people. [Interruption.] I think we have worked out what the Government mean by “one nation”, and they will need more than one nation to take the state out of Europe.
Thirdly and finally, we will seek greater powers for Scotland, to ensure, at the very least, that the recommendations of the Smith commission are met in full. However, we are seeking additional responsibilities, beyond those that the Smith commission identified, in particular greater power over business taxes, employment law, the minimum wage and welfare, to enable us to create jobs, grow the economy and lift people out of poverty. That was the manifesto on which we were elected.
Those powers will allow us to tackle one of the challenges that the First Minister, and indeed the shadow Chancellor in his speech today, have raised: that of productivity. Those comments are important, not least because they chime with what Mark Carney, the Governor of the central bank, said recently at the launch of the quarterly inflation report. He said that
“productivity growth…is the key determinant of income growth. Our shared prosperity depends on it.”
However, the Bank of England also highlighted the extent to which the UK as a whole has a productivity problem. Output per hour is below pre-recession levels; it is 13% below that of Sweden and 20% below that of Germany. In Scotland we know, and I suspect that the figures are the same for the UK, that if we can boost total factor productivity by 0.1% over a decade, we can see 1.3% additional GDP growth and additional tax yield of around half a billion pounds a year. With better productivity, living standards would be higher and the budget deficit lower.
In Scotland, we have set out how we intend to do that, based around the “four I’s” of innovation, internationalisation, investment in infrastructure and skills, and promoting inclusive growth, but we have also made it clear that promoting a more equal and inclusive society is an important part of building a stronger economy.
The Scottish Government are mitigating the consequences of this Government’s welfare reform, promoting gender equality, investing in early years education and care, and setting targets to ensure that everyone—irrespective of their background—has the chance to go to university. Essentially, that economic strategy sets out a vision of an economy based on innovation rather than insecurity; on high skills, not low wages; and on enhanced productivity rather than reduced job security. We want to climb the global competitiveness rankings on quality, rather than racing to the bottom on costs, and we want to deliver positive change in the real economy to drive changes in the big fiscal numbers. So we have to improve productivity, we need to encourage innovation and exports, and we must support business growth and job creation. There are a hundred things on which we must take specific action, not least delivering fairness in electricity connectivity charges across the grid and certainty in the tax code, and ensuring that businesses have access to bank lending.
I hope that there will be scope within the enterprise Bill to replicate many of the ideas contained within the Scottish business pledge, whereby in return for support from agencies businesses must commit to innovation, to seeking and taking export opportunities, and to paying the living wage. I also hope that there will be scope within the national insurance contributions Bill to continue to bear down on employer costs, to encourage more businesses to create jobs. There must be scope within the energy Bill to end the inequity of a £25.50 per kW charge to connect to the grid in the north of Scotland and a £5.20 per kW subsidy for any old chugger to connect in central London.
I hope that the Budget will support business investment. We have gone from an industrial buildings allowance, done away with in 2007, to an annual investment allowance of £50,000 in 2008, which increased to £100,000 in 2010; decreased to £25,000 in 2012; increased to £250,000 the following year; and increased to £500,000 the year after that. It was then temporarily maintained, but will come to a cliff edge and a grinding halt at the end of the year and revert to £25,000 on 1 January. That is not tax certainty; that is a shambles, and I hope that the Chancellor undertakes to fix it, even at a little cost, in the Budget in July.
We will be a constructive Opposition. We will support individual measures, where they merit it, and seek to mend and improve provisions where they do not. We will also be a principled Opposition, because we oppose the Tory programme of cuts. We wish to see growth and fairness in our economy and more power for Scotland, and we want to support aspiration and deliver help for those who need it most. As well as being a principled Opposition, unless or until our friends in other parties work out what their economic policy actually is, we will be the principal opposition to Tory cuts in this Parliament.
Mr Speaker
Order. Just before I call the right hon. Member for Saffron Walden (Sir Alan Haselhurst), I advise the House that the six-minute limit on Back-Bench speeches will now apply. Droves of colleagues wish to contribute, including a number of potential maiden speakers. The Chair will do its best to accommodate colleagues, and I absolutely understand why maiden speakers wish to speak, but, once and for all, may I ask Members not to come to the Chair inquiring where they are on the list or pointing out exactly how many members of their family are present? I understand these considerations, but there are wider considerations of which the Chair has to take account. We will do our best, but I am afraid that it is part of parliamentary life that, at the end of a debate, some colleagues are content and others are not. That, I am afraid, is the reality, but we will do our best.
Sir Alan Haselhurst (Saffron Walden) (Con)
I apologise to the hon. Member for Dundee East (Stewart Hosie) if I do not directly follow his remarks, tempting though that might be.
Transport has not so far been a major focus in the debate on the Gracious Speech, yet surely it is a key component of a successful economy. The speech talked about
“bringing different parts of our country together”,
which suggests to me that transport has an important role to play, as was confirmed by reference to the Government’s determination
“to legislate for high-speed rail links”—
I note it was in the plural—
“between the different parts of the country.”
I find it odd that there was no mention in the Queen’s Speech of airport capacity. It is the elephant in the Chamber. The recommendations of the Davies commission are imminent, so perhaps a decision on this matter, which is judged by many people to be vital to our economic success, will be among the other measures to be laid before us. I have great respect for Sir Howard Davies, and I am sure that his report will be accomplished and thorough, but if the Government have not steeled themselves to accept whatever he proposes, and at the same time given no indication that their decision will come before Parliament this Session, they might be subject to criticism from those in the industry concerned about the country being insufficiently open for business. I might also add—somewhat facetiously—that the sooner the decision is made the better, for otherwise the main airport operators might bankrupt themselves with the amount of advertising and promotion they are doing.
In reflecting on past years, I find it astonishing that we have allowed ourselves to get into this multi-airport situation. If it is judged too late to start again, it is certainly not too late to rebalance the economy, which is why enormous importance attaches to the concept of the northern powerhouse. I was born in Yorkshire and represented for a period a Greater Manchester seat, so I feel strongly about the need to rebalance the economy, and I feel every bit as strongly about it having served as Member for Saffron Walden for 37 years, because rebalancing will take pressure off the south-east.
Apart from a decision on airport capacity and the south-east, I would like to see Manchester airport promoted as a major port of entry into this country. It is important for business and tourism. I am afraid, therefore, that I might disappoint some of my right hon. and hon. Friends by saying that I strongly support High Speed 2 and what the Gracious Speech said about it. Also on rebalancing, it was interested to read that HS2 would bring Birmingham airport within 36 minutes of central London, given that the average time from Stansted airport in my constituency is 47 minutes. I sympathise with colleagues whose constituencies are in the path of HS2, but I remember seeing the M62 driven through the constituency of Middleton and Prestwich, and I saw Stansted airport imposed on the rural charms of north-west Essex. We can get over these things.
I suggest to the Government, however, that there is another powerhouse—the powerhouse of East Anglia—that is nevertheless served badly by both road and rail. I do not begrudge our new colleague in the House, the Mayor of London, for increasing his grip on the rail services in inner London, but I insist that we need serious levels of investment in transport, especially rail, in East Anglia. The Great Eastern and West Anglia lines out of Liverpool Street are a disgrace, and the trains that run on them are scarcely less so. I congratulate the Government on the rail revolution—no less a term is justified—that they have helped to engineer, but that revolution has still to reach East Anglia. As the economy improves, I hope that they will pay full attention to the voices of East Anglia Members, augmented as they are by representatives of industry, business and commerce, and deliver soon the improvements that our region demands. In return, the East Anglian region—the East Anglian powerhouse, as it could become—will deliver further enhancements to bolster the national economy.
Mr Michael Meacher (Oldham West and Royton) (Lab)
I pay tribute to the speech by my right hon. Friend the Member for Doncaster North (Edward Miliband), in terms of both content and statesmanship. He was a fine leader who was largely misrepresented and misunderstood, and I think he had admirable vision and conviction. He will be sorely missed, but I hope that many of his principles, convictions and values will be incorporated not only into the Labour party leadership contest but into the political debate over the next years.
I have a rather different message for the Chancellor. Underpinning the whole of the Government’s programme, which he set out today, is the theme that the Tories inherited a recession caused by Labour overspending, that they set in place a strong economic recovery, that they are within sight of dealing with the deficit and that austerity has been vindicated. All those are false. First, the recession was caused by the international recession triggered by the banks’ financial crisis; it was not caused by Labour profligacy. In truth, the Blair-Brown Government, in the 11 years before the crash—1997 to 2008—never ran a budget deficit larger than 3.3% of GDP, which was roughly the same as Germany’s, whereas the Thatcher-Major Governments racked up deficits larger than this in 10 out of their 18 years.
Secondly, we have seen the slowest and feeblest recovery for more than a century. The economy was recovering in 2010, but it was brought to a juddering halt by the Chancellor’s successive austerity Budgets—so much so that after two and a half years of stagnation, he was forced to reverse engines, to go easy on austerity and generate an artificial recovery based on a housing asset bubble, via Help to Buy. That artificial recovery lasted just 18 months until the middle of last year, and has now been punctured like a deflating balloon. In the last nine months, growth has nosedived by two thirds, from 0.9% in the third quarter of last year to just 0.3% in the first quarter of this year. If that continues, we will have an annual growth rate of just 1.25%—lower than in the eurozone.
Then there is the deficit. The Chancellor likes to claim he has halved the deficit since 2009-10. He has not. The deficit peaked that year at £157 billion. Given that the Budget measures take 12 to 18 months to work their way through the economy, Alistair Darling, in his last two expansionary Budgets, had reduced the deficit to about £118 billion by 2011—a cut of nearly £20 billion a year. The present Chancellor, by contrast, has reduced it over the last three years to its current level, which I remind the House is over £90 billion—a cut of only about £9 billion a year, which is less than half the rate of reduction of the previous Labour Chancellor.
Now we are being told that the Chancellor will eliminate the structural deficit altogether by 2018, at an average rate of reduction, according to the Red Book, of some £25 billion a year. I ask hon. Members: is that remotely credible? He promised in 2010 that he would eliminate the deficit by 2015; in the event, it has ended up at over £90 billion. The Chancellor is achieving form in his fantasy projections, or is it that the real Tory primary aim is not to shrink the budget deficit, but rather to shrink the state, shrink the public sector and transfer all public services to the private market—back to the dimensions of the 1930s?
Has austerity been vindicated? Since, according to the Office for Budget Responsibility, austerity reduced GDP growth by 1% in both of the first two years of the coalition Government, that indicates, at the very least, that austerity led to a cumulative output loss, which will never be recovered, of 5% of GDP or about £75 billion—some little short of the whole of the deficit.
What else has austerity brought about? Wages are still nearly 8% below their pre-crash level, while productivity, on which all agree our future living standards depend, is slack. Private investment is anaemic, which shows that even business itself does not believe that the Chancellor’s recovery is sustainable. The trade deficit in manufactured goods at over £100 billion a year is the worst in British history, unemployment is still nearly 2 million and household debt is now tipping £2 trillion.
It against that background that the Chancellor now forces through his cuts target, as he set it out. Growth will collapse as even the IMF today is warning. Without, this time, the adventitious halving of the international oil price, Britain will soon be at serious risk of a third recession. So much for the Government’s ludicrous “long-term plan”!
Huw Merriman (Bexhill and Battle) (Con)
Thank you, Mr Speaker, for calling me to make my maiden speech. Before I do so, I pay tribute to the speeches of right hon. and hon. Members who have spoken so eloquently, leaving me with a hard task to follow. I also pay tribute to my predecessor as MP for Bexhill and Battle, the right hon. Greg Barker. Greg worked hard for his constituents over his 14 years as their MP, and left his mark in government as a Minister of State for Energy, working tirelessly to tackle climate change. I thank Greg for the advice and kindness he has given and continues to give me.
The Bexhill and Battle constituency nestles on the East Sussex seafront at its southern face and the beautiful Weald at its northern ridge. It spans over 200 square miles where my 100,000 constituents reside in 100 towns and villages. Mine is one of those constituencies that lists just two of the place names in its title. When I promised in my election literature to put the residents of Bexhill and Battle first, this raised questions about why I was de-prioritising the needs of the 50,000 constituents who did not live in either of those two towns. The use of the word “constituency” in literature is often overlooked.
My constituency borders the East Sussex constituencies of Hastings and Rye, Lewes, Wealden and Eastbourne. As the only male MP in this cluster of blue constituencies, I pledge to be the champion for other minority groups in East Sussex.
Many in this House will be unaware that Bexhill is the birthplace of British motor racing, having staged the first ever automobile race on British soil in 1906. This race was orchestrated by the eighth Lord De La Warr and the organisation that latterly became the Royal Automobile Club. Bexhill was also the launch-pad of another engine of progress and mobility, being the location where the Prime Minister launched his leadership bid to the membership of the Conservative party in 2005.
Next year, we face a battle against the aggressors of Europe who intend to march over our land, vanquish our sovereignty and replace it with French-based custom and rule. Will our nation rise up and repel this threat, or will we be defeated and be ruled for generations from Europe? I refer, of course, to the re-enactment to celebrate the 950th anniversary of the battle of Hastings, when William the Conqueror triumphed over King Harold and his army in a field that now adjoins Battle abbey. I believe there will be another key determination on Europe during this term, and I welcome my Government’s commitment to give people a say in a more civilised manner than that accorded in 1066.
It is customary in a maiden speech to bestow the title of “the most beautiful constituency” on to the area where one serves. Having lived in this wonderful area for almost 10 years, this is an easy case to make. I am, however, conscious of my upbringing for the first 19 years of my life in the noble constituency of Buckingham. As this House knows, this is your constituency, Mr Speaker, where my mother, sisters and wider family still reside as your constituents. I think it best to surmise that the most beautiful constituencies are entitled by the first letter of their description.
I hail from a family of Labour-leaning trade unionists. Having crossed the dining room floor of 5 Gawcott Fields, Buckingham at the age of 16, I know what it takes to stand for the courage of one’s convictions and to suffer the harsh consequences of washing-up sanctions as a result. Yet while my family and I may differ in the means, the ends of giving people hope and support via an education, a job, housing, support in ill-health and strong community are the reasons I sought election to this noble House. It is also the reason I am grateful to be able to deliver my maiden speech in the segment of the debate of the most Gracious Speech that is dedicated to the economy.
For the last seven years, I have led a team of lawyers who have been unwinding the Lehman Brothers estate in Europe. This was the largest bankruptcy in world history. From a starting position of bankruptcy, £35 billion-worth of cash and assets have been recovered and distributed by our small team; the books have been balanced with creditors paid in full; and we now focus on paying a surplus. I am aware that a much more challenging turnaround has been performed by the Government team, led by those on the Front Bench. I support the balancing of the national books, returns to taxpayers and the desire to record a surplus.
Earlier this year, the Prime Minister and Chancellor visited our region to announce the south coast plan. This is a plan that has already started with the delivery of a new link road between Bexhill and Hastings. When it opens this year, it will stand ready to deliver thousands of new jobs in a 42-acre business park, with 3,000 homes to attract new labour and give local people the chance of their own home and with a new country park bringing economic regeneration to my constituency. Thanks to the investment delivered by this Government, the future is positive for my constituents in Bexhill and Battle.
However, some of the most vulnerable and troubled of my constituents will always need a safety net, always require a defender and always need to rely on someone who will bat for them in their time of need. I pledge to work with all Members of this House in order that we may together provide this role—not just for my constituents in Bexhill and Battle, but for all constituents represented in this noble House.
Tom Brake (Carshalton and Wallington) (LD)
Thank you, Mr Speaker, for calling me early in this debate and for selecting the Liberal Democrat amendment in my name and those of my hon. Friends.
I congratulate the hon. Member for Bexhill and Battle (Huw Merriman) on delivering a flawless maiden speech, and I thank the right hon. Member for Doncaster North (Edward Miliband) for delivering such a gracious speech, particularly given that he has not had much practice over the last nine years when it comes to delivering a speech from the Back Benches.
I want to speak briefly about a couple of matters that are mentioned in our amendment. First, I want to try to clarify the reason for the Conservative party’s opposition to the Human Rights Act. I think that it boils down to just two issues: foreign prisoners and prisoner voting. Members will know that the Home Secretary famously tried to kick-start her own leadership bandwagon with a Tory conference speech in which she promised to deport an illegal migrant whose removal was said to have been blocked by the courts on the basis of article 8 of the European convention on human rights, which concerns the right to a family life. She said:
“We all know the stories about the Human Rights Act...about the illegal immigrant who cannot be deported because, and I am not making this up, he had a pet cat.”
Tom Brake
Hold on. “But”, we are told,
“a spokesman for the Judicial Office at the Royal Courts of Justice, which issues statements on behalf of senior judges, said the pet had ‘had nothing to do with’ the judgement allowing the man to stay.”
So, unfortunately, it was just that: a story about the Human Rights Act—a story which just happened not to be true. If there are other aspects of the Act that the Government want to get rid of, such as the right to life or the right to privacy, I think we are entitled to know that, but at present there is no real clarity about the nature of their concerns.
I am sorry that the right hon. and learned Member for Rushcliffe (Mr Clarke) is no longer in the Chamber. I do not agree with him that it makes no difference how much a party spends on its campaign, particularly if there are ways of spending that get around the constituency spending limits, but I do agree with what he said about the European convention:
“I personally think it is unthinkable to leave the European convention on human rights…It is the way we uphold the values we strive for which are the rule of law, individual liberty, justice for all, regardless of gender. The convention is the bedrock of that.”
I also agree with the right hon. and learned Member for Beaconsfield (Mr Grieve) that the European Court of Human Rights is,
“on a daily basis, producing decisions of great importance in improving human rights in Europe which are inevitably ignored here because they tend to concern countries in eastern Europe”.
I agree with those respected Conservative politicians that scrapping the Human Rights Act and leaving the convention would be a disaster for the United Kingdom’s credibility. It would send countries such as Belarus and Russia the message that it is possible to take or leave, or pick and choose, human rights as if they were favourite dishes on a Chinese restaurant menu.
Let me now say something about the snoopers charter, which clearly has business implications. Start-up businesses would be required to collect and store data in a way that would not be in their interests. As we know, David Anderson has been examining the current surveillance and intercept laws. He handed a report to the Prime Minister on 6 May. I wonder whether the Government had time to take it into account when they presented their proposals for an investigatory powers Bill. We need to see what is in that Bill, and we also need an explanation of why the United Kingdom Government are proceeding with proposals that the Americans have just rejected. The Americans have no mandatory communications data retention requirement for communication service providers, and I think we need to know why this country has such a requirement. Do the Government believe that the Americans are putting the lives of their civilians at risk?
I fear that the new report by Sir Nigel Sheinwald may well not be released, but I urge the Government to make a copy available to the public, even if it has to be redacted. It is quite possible that the report will show that there is no need for a snoopers charter, and that an international treaty could be used instead, allowing countries to agree to release data if required to do so by the security services.
Finally, let me touch briefly on the issue of the right to buy. During the general election campaign, there was clear agreement that we needed to build more homes, but I am afraid that the Government’s proposals are very unlikely to achieve that. When asked about the right to buy, the Mayor of London said that it was
“obviously one of the issues…that it would be potentially extremely costly to this body”,
meaning the Greater London Assembly. He added:
“We would have to make up the difference. Housing associations are private bodies, as we all know. It would involve massive subsidies.”
However, in a tweet—I think that he was tweeting as the hon. Member for Uxbridge and South Ruislip rather than as Mayor—he said that the right to buy was a very good policy, and that the Conservatives’ proposals were
“a good way of ensuring it is funded.”
We need some clarity, but I suppose that those with two jobs often have to contradict themselves, and that is obviously what the Mayor has had to do.
Time does not allow me to touch on other matters, such as the Liberal Democrats’ free childcare and tax threshold. I should love to have an opportunity to discuss them on another occasion.
Chris White (Warwick and Leamington) (Con)
Thank you, Mr Speaker—not least for putting me higher up the list than you intended to yesterday.
I congratulate my hon. Friend the Member for Bexhill and Battle (Huw Merriman) on a fabulous maiden speech. I hope that, like me, he will grow to cherish the double-barrelled nature of his constituency.
I am grateful for the opportunity to support the Queen’s Speech, and, in particular, the measures that will build on the work done in the last Parliament to secure the continued growth of our economy. Whether we are talking about big manufacturing brands and household names such as Aga Rangemaster, Dennis Eagle and National Grid, or the new and exciting creative industries and companies such as Freestyle Games and Radiant Worlds, Warwick and Leamington is clearly a good place in which to do business. I also welcome Tata Technologies, which has unveiled plans to build its new European headquarters in my constituency next year.
I am delighted that the Government have announced plans to continue our economic growth by supporting business and encouraging job creation, with the ambition of achieving full employment. We have a fantastic record, on which we continue to build. In Warwick and Leamington, for example, the number of jobseeker’s allowance claimants has fallen by 74% over the last five years, and the number of youth claimants has fallen by an astonishing 82%. Tribute must be paid to employers and employees for that achievement..
Warwick and Leamington is part of a region that has a tremendous manufacturing heritage. During the last Parliament, we saw a renewed and extremely welcome focus on manufacturing and the re-shoring of that vital sector of the economy—in the words of the Chancellor,
“the march of the makers”.
Manufacturing is growing in the United Kingdom, and in the midlands in particular. It makes up 54% of UK exports, and directly employs 2.6 million people. Growth has been positive in recent years. In 2014, sales in the UK car industry in the UK were the best for nearly 10 years, which was a particularly encouraging development. In manufacturing overall, there is an average productivity increase of 3.6% a year.
I believe that the Government must ensure that the United Kingdom continues to be a place where things are designed and made. That means supporting businesses, large and small, particularly those in the supply chains. We must also address the skills shortage, and focus on training young people to be equipped for the workforce. One way of supporting businesses is to create an environment in which we can foster collaboration and support between businesses. We are already seeing examples of that in the establishment of local enterprise partnerships and the growth of city deals throughout the country. The all-party parliamentary manufacturing group, of which I am co-chair, recently published a report about skills I am delighted to see that the other co-chair, the hon. Member for Huddersfield (Mr Sheerman), is in the Chamber.
Mr Cunningham
The hon. Gentleman’s constituency abuts mine. We share an interest in research and development, and in both small businesses and major companies such as Jaguar Land Rover. Does he not welcome this development?
Chris White
I welcome it very much. I also recognise that the hon. Gentleman and I share a university. The students live largely in my constituency, but the University of Warwick is based in his. It is celebrating its 50th anniversary this year.
The Royal Academy of Engineering has reported that the country will need an additional 800,000 graduates in the science, technology, engineering and mathematics—STEM—sectors by 2020. Encouraging students—boys and girls—to study STEM subjects at school and providing clear career advice to students from a young age will help to address this serious skills gap. We must ensure that our technical and further education colleges are given the recognition and assistance they need to achieve this.
We are particularly fortunate in Warwick and Leamington to have Warwickshire College, one of the best further education institutions in the country. We are also home to many students from Warwick University which, after only 50 years, is already one of the top 100 universities in the world. I have been privileged to see the quality of the training and education that both those institutions provide. Over many years now, this has reinforced for me the importance of tertiary and further education in providing the skills and training that young people need to succeed.
In terms of further education, Warwickshire College has entered into partnerships with local employers such as Rolls-Royce and Jaguar Land Rover to provide work experience and ensure that students are exposed to the workplace throughout their education. This collaborative approach provides the best of both worlds for students. I would like to take this opportunity to welcome the new principal of Warwickshire College, Angela Joyce, to her post. I would like to reiterate the importance of support for our economy to create an environment that supports job creation and business growth. Additionally, giving our young people the skills that they need to get those jobs is just as vital, not least as we see existing and new sectors develop and grow.
Ian Paisley (North Antrim) (DUP)
I should like to start by congratulating you on your successful election yesterday to the post of Chairman of Ways and Means, Mr Deputy Speaker.
In the debates on the Queen’s Speech, I have heard “oneness” and “togetherness” mentioned on a number of occasions. That is music to my ears as a Unionist. I feel very much a part of this nation and I want to ensure that its economy grows with a spirit of togetherness. Binding us more closely into the Union will bring us closer together, allowing us to share our strengths and ensuring that our weaknesses are not made greater. Those concepts of oneness and togetherness are therefore welcome and heartening; they give us a sense of belief in the potential of what this new Government are offering us.
I am a proud to be a Member of Parliament from Northern Ireland, and from North Antrim, and as such I am bound to ask what the Queen’s Speech will specifically mean to my constituents, my people and my community. In the last Parliament, I welcomed the fact that the Government put their neck on the line and pursued a change in corporation tax specifically for Northern Ireland. They gave us the power to reduce our corporation tax rate, and I hope that the Assembly will use that power wisely and allow us seriously to compete with the nation with which we share a land border—the Irish Republic—whose corporation tax rate stands at 12.5%. I hope that the Assembly will take up that challenge and make that change, and I welcome the fact that Westminster gave us that power.
There are other things that this Government could do to enable Northern Ireland to increase its economic competitiveness and to be a stronger part of this nation. The tourism sector provides an example. I have the joy of having the Giants Causeway in my constituency. It is one of the finest natural locations for people to visit; indeed, it is the single largest visitor attraction on the entire island of Ireland. I welcome many people there each year; I just wish that they were all my voters. That attraction creates and stimulates employment and opportunity. Attracting more tourists to Northern Ireland is therefore part of the business plan for our country.
We currently have 60,000 people directly employed in the tourism sector, and a £1 billion a year spend in a country with a population of 1.7 million. That comprises £600 million being brought in by visitors to Northern Ireland and spent there, plus £400 million going out with people leaving Northern Ireland for tourism purposes. The Government could help by reducing VAT in the tourism sector, and I hope that they will look at my proposal, possibly even before 8 July. I would welcome that change, which would help small businesses in the sector.
I would also like to see air passenger duty removed altogether from domestic flights. The Government kindly reduced it for long-haul flights, which helps the airport in South Antrim, the constituency next door to mine, but I would like to see it removed from local flights. If you are really serious about togetherness, do not tax us when we fly to our nation’s capital!
The Government have done well in appointing a Minister for the northern powerhouse. Speaking as someone who represents the real northern powerhouse in our country—Northern Ireland—I hope that that Minister’s remit will be extended to allow him to look at the economic opportunities that flow from Ulster. Indeed, he could link in with Invest Northern Ireland and with our tourism, enterprise and trade to create great connectivity between the economic powerhouse being built in the north of England and the economic power base that could exist in Northern Ireland. That was certainly one of our priorities in the election campaign, and I look forward to that link being created.
The largest economic sector in Northern Ireland is agri-foods, and I hope that the Government will take a serious look at the opportunities created by our exporting our finest product—namely, food produce. One possibility could involve agricultural licences for the export trade with Asia, the far east and the middle east. Restrictions on exports are incredibly high at the moment, and I hope that our Government will make a serious effort to say to China and the middle east in particular, “Here is an opportunity for us to increase our trade and expand our agri-foods industry in Northern Ireland.” I hope that the Government will consider that opportunity.
In the weeks ahead, Northern Ireland will face a political crisis relating to welfare reform. I hope that the Government recognise that they have a serious responsibility to hold firmly to the line that the Prime Minister expressed yesterday when he said that we want to see the full implementation of the agreement that was struck in Belfast in the latter part of last year. Only by having economic sense and recognising that we cannot spend beyond our means will we be able to take Northern Ireland out of the way of the economic harm that those opposing welfare reform in our country wish on our land.
Lucy Frazer (South East Cambridgeshire) (Con)
Thank you very much, Mr Deputy Speaker, for calling me to speak this afternoon. I congratulate you on your election. I am delighted to speak after my hon. Friend the Member for Bexhill and Battle (Huw Merriman). I, too, have a specialism in insolvency, but neither of us can claim to be as expert in that subject as Gordon Brown. I am also pleased to have spoken after the hon. Member for North Antrim (Ian Paisley), who spoke so well about the value of unity.
I have listened with much admiration for a number of days to the eloquent and passionate maiden speeches on both sides of the House. It is an absolute privilege to be part of our British democracy. South East Cambridgeshire, the constituency I am fortunate to represent, has not troubled this House with a maiden speech for 28 years. It has been well served by the distinguished Sir James Paice for all that period. Sir James is an honourable, loyal and principled man, who has throughout his career stood up for farmers both within and outside the constituency. I know that he will be sorely missed in that community and many others.
Many presume that South East Cambridgeshire is a safe Conservative seat. I am not sure that there is such a thing as a safe seat of any kind any more, but even if there were, that is not a term that should be used to describe my constituency, which has had a chequered, even colourful, political history. The Isle of Ely, which falls within it, was the seat of Clement Freud. He was a man of many rare attributes, being a night club manager, a dog-food commercial actor and a Liberal Democrat, all of which fit together surprisingly well.
The constituency was represented by Francis Pym—yes, a Conservative, but not always a supporter of his Prime Minister—who once said, “Landslides do not on the whole produce effective government.” So our Prime Minister can rest assured of an effective and smooth five years. And it was the home of Oliver Cromwell, who defeated the Scots at Dunbar, incorporated Scotland into his protectorate and transported the Scots as slaves to the colonies. Now, there is an answer to the West Lothian question—but not one, of course, that I would recommend.
Standing in the shoes of such colourful and distinguished predecessors is difficult, but it has been made much easier by the charm and friendliness of the people of South East Cambridgeshire. The constituency includes the city of Ely, the town of Soham and many villages. It is the only constituency in the country that contains a racecourse, a science park and a thriving farming sector. The businesses in these areas are leaders in their fields, competing successfully on the international markets. They are part of our growing economy in the east of England. Our Government have an opportunity, if not an obligation, to support and nurture such successes, and I am delighted that our Government are doing precisely that.
But I am also mindful that economic success is not universal throughout the constituency. As the daughter of a teacher who taught in a state primary school in a very deprived area in Leeds, and the granddaughter of a headmaster who founded a technical school in Leicester, recognising as he did that academic education is not the right route for all children, I know that education can transform lives, that education is a driver of social mobility, and that ambition and aspiration are not and should be the preserve not of the few, but of the many.
Equality of opportunity is at the heart of any respectable democratic country. A good education should be available to all, no matter what background they come from or where they live, which is why it is so important that we have a fair funding formula for our education nationally—a formula that provides per pupil funding which is more consistent across the country. Ambition and aspiration are now being talked about by both major parties, and rightly so, but that should not be limited to aspiration for individuals alone. It should encompass our vision for our country. A small but great Britain has played a disproportionate role in world affairs for centuries. A strong Britain should continue to play a key role in our international affairs.
My great-grandparents fled to this country with nothing, with no possessions and no money, not even speaking the language, and Britain gave them a home. It gave them hope and it gave them a future. They integrated into our society, such that my grandfather was awarded a CBE for services to education. I am so proud to be part of this great country and to be in a position to give back to our communities. It is a huge privilege to have been chosen to represent the people of South East Cambridgeshire and I will do my utmost to serve them.
Fiona Mactaggart (Slough) (Lab)
It is a pleasure to follow the hon. and learned Member for South East Cambridgeshire (Lucy Frazer). One of the few things I like about this new Parliament is the sight of more women on all the Benches around us.
As my right hon. Friend the Member for Doncaster North (Edward Miliband) reminded us, the Queen promised last Wednesday that the Government would adopt a one-nation approach, yet in practice this Government’s approach to the economy has divided our nation. What brings a nation together? A sense of fair play, underpinned, in my view, by universal human rights, and a sense that everyone can depend on good public services when they need them. We can be united by confidence in a fair tax system and spending that is efficient, where our money is not wasted. When I was a member of the Public Accounts Committee, I was constantly struck by how many voters watched our hearings, praising my right hon. Friend the Member for Barking (Margaret Hodge) for her determined defence of the taxpayer’s pound. Their enthusiasm showed that when we in Parliament stop the Government wasting citizens’ hard-earned money, they are not in the least turned off by politics.
But politicians must be scrupulously honest about what we do. The plan to make it illegal to increase taxes looks like a rhetorical device. What is the penalty going to be? Will the Chancellor go to jail if, for example, he increases VAT on books to equalise the treatment of electronic reading material and printed books? The trumpeted plans to exempt the lowest paid from any form of income tax are an example of a policy that divides rather than unites. It has been dressed up as help to the low paid, but every study shows that the majority of the benefit goes to families in the top half of earners, whose tax bill as a share of their income will fall further than that of the poorer half of the community.
My objection to this policy is that it divides society, separating us into givers and takers—those who pay into the system and those who take out—breeding a culture of blame and suspicion. Of course, we all pay tax. We all pay VAT when we buy things, but the greatest proportion of tax, and often the most resented, is income tax. It is fairer than other taxes, all of which take up more of the household budgets of the poorest people than of those who are wealthier. Paying tax, as we too often fail to remind citizens, is a symptom of social solidarity. It is our subscription to civilised society where we can all enjoy public parks, send our children to schools where they have an equal chance to learn, and have a health service we can rely on when we are ill. One of the defining characteristics of Britain is a strong sense of fair play, but if no one explains the unfair consequences of plans to change tax thresholds, the one-nation label that the Government claim will camouflage this unfairness.
I represent a successful town. It attracts inward investment to the United Kingdom. It is an immigrant town. Slough residents are aspirational, work hard and generate wealth. It is the third most productive town in the United Kingdom, contributing approximately £8 billion to the national economy—double the UK average. However, that growth generates losers as well as winners. In our local housing market, rising prices push up GDP figures while the rest of the economy drags, and as a result home owners see their assets grow while everyone else spends unsustainable proportions of their income on rent or on struggling to buy.
The plans to sell off housing association properties at a discount—properties that are already occupied by secure tenants—is a gross example of taking assets available to the many people who have housing need, destroying the legacy of philanthropists and mutual aid societies who created those housing associations, and giving those assets to a few sitting tenants who can raise a mortgage. That is the Conservative way—to take from the many and give to the few.
GDP does not tell us how the benefits of growth are distributed—who wins within the population and who loses. Some people get no financial benefit at all. It is estimated that unpaid childcare contributes nearly three quarters of GDP. Carers of ill and disabled relatives save more than the entire spend of the national health service. Yet UK workers who are employed and paid now receive only half of GDP, whereas in 1976 the figure was two thirds. That rate of decline is unmatched by any developed economy or any other industrialised economy. The employees’ share of the economic pie is now the lowest ever recorded and it will keep decreasing because of this Government’s plans to cut in-work benefits. Other countries, most notably Scandinavian countries, have worker representatives on company boards so that meaningful discussions about sharing corporate wealth can take place. Sharing wealth equitably should be part of corporate social responsibility, and those eschewing it should not be given taxpayer-funded contracts.
I urge the Government to match their one-nation rhetoric with action. If they do, we could have an economy where hard work is well rewarded, whether it is work by a mum bringing up babies or a banker borrowing and lending. If everyone is confident that their aspiration will be rewarded, they will do as my constituents do: invest in their skills, work hard and grow our whole nation’s economy.
Mr David Burrowes (Enfield, Southgate) (Con)
It is a pleasure to contribute to the Queen’s Speech debate today and to congratulate all those who made their maiden speeches, particularly my hon. and learned Friend the Member for South East Cambridgeshire (Lucy Frazer). She made a fine maiden speech, true to the traditions of those who have gone before her in that constituency. She talked about what is at the heart of this Queen’s Speech and this Government—mobility and aspiration for all. We will continue to strive for that throughout this Parliament.
Like my hon. and learned Friend, other hon. Members have paid generous tribute to their predecessors. One tribute, however, has not been paid, and I have given the right hon. Member for Enfield North (Joan Ryan) notice that she made no mention of her predecessor. I am going to correct that wrong—that omission—and pay tribute to Nick de Bois, my former colleague, a neighbour and friend. He was a great asset to this House, and Members on both sides can recognise his contribution to this House and to his constituency. It is appropriate to pay tribute to him in this debate on our economy, because it is right to recognise his contribution to supporting our growing economy. It was Nick de Bois who initiated the jobs fairs that many colleagues have taken up throughout the country. They have provided great results, and he championed jobs and apprenticeships in Enfield. He also championed trade envoys. Again, that has been taken up by the Government and we have envoys to many different countries now. The fruits of his labour are having great effect, with us at last turning around the legacy of decades of underinvestment in exports and working with UK Trade & Investment to produce great results.
Nick de Bois has left a great legacy, as I saw when we co-hosted our latest jobs fair, at Southbury leisure centre in February. We saw hundreds of people benefiting from hundreds of jobs and having their lives transformed. We are talking not just about the stats or about plans, but about real lives that have been transformed. Many people responded to that jobs fair and told us how much they had benefited, not least from the hard work of Nick de Bois. He has left that legacy and he can be proud of it. Our Government can also be proud of that legacy, as we strive towards full employment.
The right hon. Member for Enfield North did talk about our local Chase Farm hospital, another thing Nick de Bois championed and campaigned hard on. Although she mentioned it, she missed a number of points. There is a contrast to make here with the previous Labour Government, who were full of broken and empty promises. Before the election, Nick and I secured the business case, which was signed off by the Treasury. We secured £270 million for redevelopment at Chase Farm hospital. That is significant because it means that we will have a modern, 21st-century local hospital with eight operating theatres. We will have all the existing services put together in a 32,000 square metre building.
That is very important, and what is the contrast with it? It certainly contrasts with what we heard from the right hon. Lady, who said that this was going to gut Chase Farm hospital. Far from gutting it, this is going to breathe new life into decrepit buildings left behind by the last Labour Government. The contrast is very clear: we need a strong economy to be able to have a strong national health service. We needed the strong economy to be able to ensure that this was based on taxpayers’ money—£120 million-worth of taxpayers’ money, as part of a wider £270 million deal—and not on the private finance initiative. Our local hospitals have been beset by that. The millstone around the necks of Barnet hospital and of North Middlesex University hospital was PFI. That is typical of the previous Labour Government. They maxed out the credit card and now we are paying off those debts. Sadly, our health service is struggling and challenged because of it.
I wish to highlight two areas that will have a big effect on our economy and our society. They will be a litmus test of something we talk about a lot: a one-nation party and one-nation Government. The first of those areas is the family. We now have a family test, introduced by the Prime Minister last August. It means that every Department will be held to account for the impact of its policies on the family. Will the Minister say what the impact was of the whole Queen’s Speech? A summary of that might be useful. It is important that we do not just have a tick-box exercise; the Government have had tests in the past, but this needs to have real meaning. It would be good to continue to work with The Relationships Alliance to ensure that there is real meaning and to show that we are true on our deep commitment to the family. We all know that family breakdown costs—it has been estimated at £48 billion a year, perhaps more—and it is the poorest households that get hit.
Two thirds of 15-year-olds in the poorest 20% of society no longer live with both parents. Our party, however, supports marriage loud and clear. Towards the end of the last Parliament, there was the welcome introduction of the marriage tax allowance. It is small, at £212, but it is a start and I want the Government to go a lot further. At the heart of our one-nation concern is a concern for others. Nowhere can we see that better than in our concern for strong marriages and strong families. The good support for childcare is welcome, but let us broaden that understanding and support marriage as well.
Another test is how we support complex needs. I welcome the fact that in the autumn statement there was real support for the troubled families programme, which has transformed many lives and saved a huge amount of money. We can work that model into cases with multiple needs. By working hard for strong families and those with the most complex needs, including housing, addiction and educational needs, we will pass the test and truly be a one-nation party and one-nation Government.
Chris Stephens (Glasgow South West) (SNP)
Thank you, Mr Deputy Speaker, for giving me the opportunity to participate in this debate and to make my maiden speech. I congratulate you on your re-election and praise the maiden speeches we have heard so far today from the hon. Member for Bexhill and Battle (Huw Merriman) and the hon. and learned Member for South East Cambridgeshire (Lucy Frazer), despite our political and, as has been outlined, historical differences.
I hope that you will be patient with new Members, Mr Deputy Speaker, as we get used to our new surroundings. As a trade unionist, I am getting used to the rules not just of this House but of this great city. That fact was underlined to me when I was on the London underground and my hon. Friends told me that I had to stand to the right at all times. I retorted, “Never.” However, I have been assured by many experts that that is to do with health and safety and regulation, so I can assure the House that I will comply with that request—on the tube, not in this place.
I thank the voters of Glasgow South West for giving me the honour and privilege of representing them in this Parliament. I pay a genuine and gracious tribute to my immediate predecessor, Ian Davidson. Ian Davidson served this House for 23 years, latterly as Chair of the Select Committee on Scottish Affairs. He was a strong champion for workers’ rights, including his work on blacklisting, and I pledge to take on that work during my time in this place. He was a robust debater and he was always civil and respectful to me although, as they say in Glasgow, there was always a fair bit of banter. Indeed, in his maiden speech, he said of his immediate predecessor, Jim Sillars:
“I think my predecessor made a contribution to Scottish politics which should not be underestimated or overlooked even by those who disagree with his content or style, or both.”—[Official Report, 19 October 1992; Vol. 212, c. 264.]
Let me gently but firmly associate myself with the words of my immediate predecessor, about my immediate predecessor. I wish Ian well in whatever he decides to do next.
Glasgow South West is an area rooted in the history of the struggles of the working class, with a long tradition of representatives who fought for the underdog and gave voice to the voiceless. The constituency stretches from Govan to Pollok, featuring Ibrox Stadium, the home of Rangers football club. As a proud Partick Thistle supporter—a pleasure I share with my hon. Friend the Member for Paisley and Renfrewshire South (Ms Black)—I recognise what Rangers football club means to its supporters around the world as well as in Glasgow.
The constituency also includes Bellahouston Park, with the beautiful House for an Art Lover, designed by the world-famous Charles Rennie Mackintosh. It is a site where not one but two Popes have celebrated mass, which I was privileged to attend on both occasions. The Govan shipyards are iconic and serve as a reminder that heavy industry and manufacturing should have a place in our economy.
My constituency is rich in history, but I want to highlight just one more point. Over the next three years, all the nations of the UK will commemorate the sacrifices our forebears made in the first world war. It is my belief that all aspects of that period should be taught and remembered. In Govan, the great Mary Barbour led rent strikes fighting against unscrupulous landlords who increased rents on the home front during that time of sacrifice on the western front. That might have been a century ago, but we have come full circle as the exploitation of one of the most basic human needs, shelter and a place to raise a family, is once more a key issue in this Parliament. The Remember Mary Barbour Association does fantastic work.
There is not enough time for me to tell all the stories and outline all the hopes of the people in my constituency, but I was struck by the fact that they all want the message delivered loud and clear that they and their families deserve better. We have heard much about the importance of fostering aspiration and celebrating wealth creators. I believe that everyone has aspiration, and it concerns me when the welfare debate is reduced to judging who is deserving and undeserving, seeking the politics of grievance and envy, sowing the seeds of division within our communities.
Welfare sanctions are dragging people to the point of despair, food banks are the only growth industry in too many communities, and the daily grind of low-paid workers on insecure but highly flexible contracts is a world away from the privileged workplace I now find myself in.
I was elected to speak truth to power in this place and to stand up for the real wealth creators—the low-paid, long-hours, insecure workers who keep the economic wheels turning despite the poor treatment too many receive at the hands of their employers.
I come to this House after 25 years working in public services, and almost 20 serving as a Unison activist, representing working people on a daily basis. The trade union movement gave me a political education and the confidence to stand for election, and I know that this experience is shared with other Members who did not have a privileged start in life.
We live in a global world, and I believe that a different approach needs to be taken in the 21st century. We need to step away from the 19th century world of work and the devil-take-the-hindmost approach to social security. That is an economic illiteracy that is not only immoral but ends up costing more in the long run in damage to individuals, families and communities.
We in the SNP come to this House to argue that social justice must be at the heart of the economic debate—that we should put people before profits and bairns before bombs—and, as the STUC puts it, that a better way is possible.
Jeremy Quin (Horsham) (Con)
May I congratulate the hon. Member for Glasgow South West (Chris Stephens) on his maiden speech, as well as my hon. and learned Friend the Member for South East Cambridgeshire (Lucy Frazer) and my hon. Friend the Member for Bexhill and Battle (Huw Merriman)? They all included brilliant eulogies to their predecessors’ political careers. Mr Speaker, you will not get that from me, but for the very best of reasons. Every Conservative Member of this House will be delighted to hear that the political service of my predecessor, now transformed, butterfly-like, into the noble Lord Maude of Horsham, continues in rude health in another place. I have no doubt that his distinguished career in the Treasury, the Foreign Office and latterly in the Cabinet Office will get yet more distinguished as Minister for Trade. If he is as effective at boosting exports as he was at cutting waste, we can look forward to a sustained and ever-growing trade surplus.
In addition to the wise advice of the noble Lord Maude, I am indebted to one of my constituents, the right hon. Sir Peter Hordern, for his advice. He is one of a trio of Conservative MPs who for no less than 93 years represented Horsham during the last century. Major Freddie Gough held the bridge at Arnhem. Lord Winterton went, over a career of 47 years, from being the baby of the House to being the Father of the House. I see she is in her place, Mr Speaker, and I hope that she will accept the compliment when I say that I sincerely hope that the hon. Member for Paisley and Renfrewshire South (Ms Black) will still be gracing this Chamber, for the sake of our country, in half a century’s time.
Horsham is an ancient town, represented here since 1295, but on occasion it has fallen into bad habits. “A Parliamentary History of Horsham” recalls how in the epic struggle between the Tories and the Liberals it moved on from the more prosaic forms of electoral vice to the mass kidnap of each other’s voters. The situation was improved by the addition to the borough constituency of large swathes of rural West Sussex, which we still enjoy. From Rudgwick in the west it sweeps down to Billingshurst and over to Balcombe and Ardingly, the site of the South of England Show. It contains Wakehurst Place, the country home of the Royal Botanic Gardens and the largest seed bank in the world. The north takes in Crawley Down and Copthorne, once the haunt of prize fighters and smugglers, now home to far more respectable residents.
A whole series of opinion surveys consistently rates Horsham as a great place to live and work. There may be some cynicism in this House about opinion polls these days, but I can assure the House that these, at least, can be relied on. The constituency is proud of its economic independence and benefits from a burgeoning small business sector with a vast range of entrepreneurial and innovative industries. It has prospered in no small measure from the economic success fostered by the Government. The growth in the number of new businesses over the past few years is matched in steepness only by the fall in the number of jobseeker’s allowance claimants.
I am one of few new Members who can honestly claim that, no matter how reviled the status of being a Member of Parliament, I have managed to improve my standing in the world, because I was previously employed by an investment bank. However, I have also spent time in Her Majesty’s Treasury, and would like to pay tribute to the Government’s handling of our economic recovery. The robust underpinning of the country’s economy over the past five years gives confidence to the small businesses in my constituency that under this Government they can continue to invest, expand and prosper.
Alongside economic success, Horsham has a strong social conscience; it is home to many charities and is determined to ensure that this and future generations can continue to enjoy our countryside and benefit from excellent services. The area has been subject to substantial recent development, and residents are concerned about the impact on the environment and the supporting local infrastructure, not least the provision of NHS services. That is why we welcomed the Conservative manifesto commitment to encourage brownfield development and why we were delighted to see the trenchant support for enhanced primary health care services. The current building and infrastructure concerns would be as nothing, however, were Gatwick airport to be permitted to build a second runway, the impact of which would be profound right across the constituency and far beyond.
Horsham has real concerns on which I will engage in the coming years, but at least it is certain that under a Conservative Government its economy will flourish and that, as outlined in the Gracious Speech, this Parliament will be focused on ensuring that the increasing wealth created will benefit all and that all our citizens can aspire and prosper.
Angela Smith (Penistone and Stocksbridge) (Lab)
May I start by congratulating you, Mr Speaker, on your re-election? I also congratulate the three Deputy Speakers, particularly my hon. Friend the Member for North East Derbyshire (Natascha Engel), who I think will be an excellent Deputy Speaker, fulfilling the potential she showed in the previous Parliament as an excellent Chair of the Backbench Business Committee.
I congratulate the hon. Member for Horsham (Jeremy Quin) on his eloquent maiden speech and wish him luck in his work of representing his constituents and his party in this place. I pay tribute to all the new Members who have made their maiden speeches so far. We have heard some excellent maiden speeches, delivered confidently and with real style and polish.
Today’s debate is broadly about fiscal issues relating to the deficit and debt, but growth, of course, has a key part to play in reducing the deficit. Indeed, our nation’s prosperity depends on robust economic growth. We in the Opposition absolutely understand the need for economic growth based on wealth creation. While the majority of Opposition colleagues were fighting hard for manufacturing in the previous Parliament, my hon. Friend the Member for Huddersfield (Mr Sheerman), joint chair of the all-party group on manufacturing, and my hon. Friend the Member for Hartlepool (Mr Wright) were also making the case for an industrial strategy to underpin and help manufacturing to grow its share of the economy. That has to be a key part of the way forward.
In that context, I welcome the Government’s northern powerhouse initiative. Indeed, I have long argued for the devolution of powers in England and believe that this country can be one nation only on the basis of a properly thought through devolution settlement for England. However, the real danger with the northern powerhouse project, as it currently stands, is that devolution, as promised by the legislation on the table, will become discredited unless it is accompanied by changes to the distribution of funding by central Government.
We all know that the north of England and large parts of provincial England lose out on local government funding. There are huge disparities in how local government is funded. The issue affects transport as well: transport funding from central Government is distributed on a really unfair and uneven basis—London enjoys transport investment way beyond anything enjoyed by the north of England. The danger affects the regions of the UK that are already disadvantaged in trailing behind London on GDP and economic growth; the disparities could become even more deeply entrenched unless there is an effective Government strategy to address the issue properly. We cannot ignore the danger. The north of England, Greater Manchester, South Yorkshire and the west riding of Yorkshire will not grow as they need to unless the Government address those disparities.
Finally, I want to develop a little further the argument for a more comprehensive, better thought through approach to devolution, because the other danger is that rural areas, as well as suburban areas, will feel increasingly alienated and left out by concepts such as the northern powerhouse. Every Member needs to take cognisance of that danger, and we need a non-partisan approach to dealing with it.
Let us take Greater Manchester and South Yorkshire as the classic example. Between those two city regions, there is the Peak District national park—what we call the “Dark Peak”. Nothing is on the table at the moment to integrate that area into a devolutionary settlement, yet it has a key role to play in the economic growth of the north of England. That issue must be dealt with. Of course it is true that big cities will always be the motor of our economy, but that must not mean that we ignore the contribution that smaller towns and rural areas can make or their potential for economic growth.
I finish with a good example of how this can be achieved. Among the biggest contributors to the manufacturing activity of this country are food and farming. Food manufacturing is a huge player that contributes billions to our GDP. There is no better example of how activities in rural areas and the produce of the land are transformed into the food on our plates. Those two activities, properly integrated in a devolutionary settlement, can help deliver for the economic growth of this country in future.
Mr Deputy Speaker (Mr Hoyle)
Order. I am going to reduce the time limit to five minutes, so that as many Members as possible can speak.
Peter Aldous (Waveney) (Con)
Many congratulations on your re-election, Mr Deputy Speaker. I also congratulate all the new Members who have made such excellent maiden speeches.
I support the Queen’s Speech because of its ambition and direction of travel. The Prime Minister has rightly stated that every part of this country has a stake in our economic success. Much good work was done by the previous Government, but there is a great deal more to do and there will be plenty of potential pitfalls along the way.
The Bills in the Queen’s Speech provide the framework for developing sustained prosperity right across the country and it will be important to scrutinise them closely as they progress through this House and the other place. In some cases, the devil will be in the detail; no stone should be left unturned in the pursuit of good legislation that works for the whole United Kingdom.
For too long, economic policy in the UK has been centralised and top down. My right hon. Friend the Chancellor of the Exchequer is correct in his assessment that the model of running everything from London has failed and created an unbalanced economy. It has become clear that the man in Whitehall does not know best. I support the ambition and determination to create a northern powerhouse, but it is important that all other parts of the country should have the same opportunity and access to the necessary funds.
For my part, I wholly endorse the words of my right hon. Friend the Member for Saffron Walden (Sir Alan Haselhurst) in wanting an East Anglian powerhouse. British people talk about the weather; we East Anglians talk about infrastructure. That is because we do not have very much of it, and what we do have does not work very well. In my Waveney constituency, the nearest motorway is in Holland; our railways resemble an elephants’ graveyard where trains come to die; and there are some very rural areas where broadband coverage is spasmodic, at the very least. I commend the Prime Minister for stating:
“We will make sure everyone has the infrastructure they need to succeed.”
In the previous Parliament, he and the Government that he led put their money where their mouth was. In this Parliament, we have to deliver, and get these roads and bridges built and superfast broadband made available to all.
The projects for which funding has been provided must be built on time. The preparatory work for upgrading the A47 must be carried out promptly. The 16-month period that has been suggested before any construction work begins is not acceptable. We must use the opportunity presented by the rail franchise tender to deliver better railways with reliable, fast and comfortable trains that run on time. With the third crossing project in Lowestoft, locally we will complete the necessary studies that the Government have enabled us to do and then work with them to get this very important piece of local infrastructure built.
I shall briefly mention three industries important to Waveney that have the potential to contribute a great deal to the local economy but need to overcome a variety of obstacles. First, the oil and sector faces significant challenges created by the dramatic fall in crude oil prices. Jobs are being lost, including at AKD Engineering in Lowestoft, which closes this month. The Government have recognised the problem and came forward in the Budget with proposals that restructure the taxation regime. The Office for Budget Responsibility estimates that that should boost North sea oil production by 15% by the end of the decade. That is welcome, but I urge the Treasury to work closely with the industry to bring in further measures in next month’s Budget if necessary.
The offshore wind industry can bring significant benefits to the Waveney economy, and in the past five years work has been put in place to enable it to do so. We need to get those wind farms off the East Anglian coast built during this five-year term.
The fishing industry is also in need of support. My hon. Friend the Member for Newbury (Richard Benyon) helped to reform the common fisheries policy. We now need to ensure that the small fishermen who make up the Lowestoft fleet have fair access and a fair share of quota.
The proposals announced in the Queen’s Speech are welcome, but there is much work to do. No parts of the country must be forgotten. On infrastructure, we must press on to get roads and bridges built. There must be no no-go areas as regards policy, particularly in fishing.
Helen Goodman (Bishop Auckland) (Lab)
I am pleased to follow the hon. Member for Waveney (Peter Aldous). As he described infrastructure in his constituency I began to wonder whether it had been transferred to the north-east, because we have very similar problems.
At the beginning of this debate we heard an intense political exchange about the right speed of deficit reduction. We will continue to see a big political debate about the appropriate size and scope of the public sector, but where we have consensus is on the importance of effective and efficient use of public money. Everyone wants the taxpayer to get good value for money.
We all have our stories of Whitehall waste. My low point was when I was a Minister. I was sitting in my office and two men came in to water the plants. They watered two plants, and then I pointed to another one on the windowsill and said, “What about that one?” They went over and looked very carefully at it, felt the leaves, and then said, “That’s not ours”, because plant watering had been contracted out. Before Government Members suggest that that was confined to the Labour years, I have to tell them that after tabling a series of parliamentary questions in the spring, I found that Departments are renting desks, including one Department that was paying the fabulous sum of £10,309.63 a year per desk.
If we are to get to grips with these problems, we must ask why they happen. It is important to root out waste in individual programmes, but we will succeed only if we look at the underlying patterns and problems. There are recurrent issues, including in large information and communications technology projects. For example, in past years the Rural Payments Agency and tax credits were a problem, and this Government are now running into similar issues with universal credit. Procurement capacity in Whitehall needs to be improved. It is not good, because the route to the top is through being able to write clever policy papers, not through doing good deals.
The transparency of value for money when services are contracted out is another problem. We have to hold to account the Sercos, Capitas and G4Ss of this world, because they now control billions of pounds, and they cannot hide behind the excuse of “commercial in confidence” any longer. We are seeing unnecessarily complex financial arrangements, excessive returns to bankers and consultants, and not the cheapest deal for taxpayers. Only this week, problems were highlighted in the health service, with rip-off agency fees for doctors and nurses who are being paid more than those on regular contracts, and the revolving door for senior executives. No one thinks it is acceptable for someone to retire on a Monday, collect a lump sum on the Tuesday and then go back into the same job on the Wednesday.
As a country, we are now spending £740 billion. If we can achieve an efficiency improvement of 2% on that £740 billion, the savings would amount to £13 billion. Some people would want to use that for tax cuts, whereas some would want to use it to bolster public services, but it is definitely money worth finding. Parliament, including the Select Committees, has a key part to play in that. By fulfilling our role, we can improve Government’s long-term capacity to deliver their plans to set out and do what they intend to do.
If we work in an incisive, open and transparent manner, we can raise trust in the political process. By shining a light and not being afraid to challenge those in positions of power, we can make a real difference. By doing so in an effective way, we will raise confidence in politics, Parliament and the political process, as I am sure all Members of this House want to do.
Amanda Milling (Cannock Chase) (Con)
Thank you, Mr Deputy Speaker, for giving me the opportunity to make my maiden speech as part of today’s debate. It is a pleasure to follow the hon. Member for Bishop Auckland (Helen Goodman) and I would like to congratulate all the Members who have also made maiden speeches today.
It is a real honour to be standing in this most historic Chamber, representing the residents of Cannock Chase, a constituency in Staffordshire—the county in which I was born and brought up—and to join one of the former Members of Parliament for Cannock Chase, my hon. Friend the Member for Aldershot (Sir Gerald Howarth).
My immediate predecessor, Aidan Burley, won the seat in historic fashion in 2010. Since that time, Aidan has worked very hard on behalf of Cannock Chase residents, and I would like to thank him. His successful jobs fairs helped to contribute to the significant fall in unemployment. He spearheaded the campaign to save our fantastic Cannock Chase hospital, and he campaigned for the investment that will lead to the electrification of the Chase line. I wish Aidan the best of luck for the future and for life with his wife, Jodie.
The constituency takes its name from the forest, much of which lies within the parliamentary boundaries of Cannock Chase. The Chase was designated an area of outstanding natural beauty in 1958 and comprises a wide range of landscapes and wildlife, including a herd of fallow deer. Over the years, the Chase has become a destination for visitors. Whether one is a mountain biker, a runner or a walker, there is something for everyone. Every November, the Cannock rotary holds a 10 km run through the Chase. I would welcome any Member who wants to join me on that run—the scenery is stunning.
Bordering the forest are the constituency’s three main towns: Cannock, Hednesford and Rugeley. Each has a unique character, but they have one commonality: a strong history and proud heritage in coalmining. One of Cannock’s best-known former residents and miners is a well-known Member of this House: the Secretary of State for Transport, my right hon. Friend the Member for Derbyshire Dales (Mr McLoughlin). He is well loved and highly regarded by the residents of Cannock Chase. Our mining heritage helps to explain the incredibly strong sense of community that is felt in Cannock Chase. I am proud to say that we have a wide variety of local charities, voluntary groups and community groups.
The skyline in Rugeley is a reminder of the past and a sign of the future. I am pleased to say that it demonstrates the extent to which the area has evolved and adapted to industrial change. Once, there stood two power stations and a colliery; now, there is one power station, with new industrial and business parks opposite it. It is home to one of Amazon’s distribution centres, as well as to many small and medium-sized businesses. Such small and medium-sized businesses are the engine of our economy and, more particularly, of Cannock Chase in the 21st century.
Before being elected, I had a career in business. Business is in my blood, which is why I chose to speak today. I am sure that my late father, Humphrey Milling, who was once the managing director of a local tool manufacturing business, Britool, which had its own connections to Cannock, would have been pleased that supporting local businesses is one of my key priorities. He would also have been delighted to see the election of a pro-business Conservative majority Government.
It is thriving local businesses that have created jobs for local hard-working families and that are giving opportunities to our young people. I look forward to working with local businesses, training providers and young people to help get as many of those young people as possible into work.
The Cannock Chase that I have described today is one of aspiration and opportunity. I look forward to representing the area in this Parliament to ensure that it becomes an even better place to live and work.
Matthew Pennycook (Greenwich and Woolwich) (Lab)
Thank you, Mr Deputy Speaker, for giving me the opportunity to make my maiden speech. I offer my congratulations on your re-election. It is a privilege to follow the hon. Member for Cannock Chase (Amanda Milling). I pay tribute to hon. Members on both sides of the House who have made their maiden speeches today and commend their excellent contributions.
For new Members like me, speaking in this Chamber for the first time is a deeply humbling experience. It is made all the more humbling for me by an awareness of the formidable predecessors who have represented the area that I call home and that I now have the privilege of serving in this place. It was on Blackheath in 1876, in an open-air meeting attended by 10,000 of his Greenwich constituents—“those rabid cockneys” in the words of Disraeli—that Gladstone first denounced the Bulgarian horrors, and in so doing reforged his links with popular radicalism and set himself on a journey towards a second Ministry.
It was in Woolwich in 1903 that Will Crooks, the son of a ship’s stoker who had endured the privations of the workhouse, won a spectacular by-election victory over his Conservative and Unionist opponent to become the fourth ever Labour Member of Parliament. It was Woolwich in February 1950 that gave Labour’s greatest Foreign Secretary, Ernie Bevin, a final berth from which to serve out his days as one of the chief architects of our post-war world.
Over the course of 23 years of distinguished service, my immediate predecessor, the right hon. Nick Raynsford, more than earned his place among such illustrious company. I would like to pay tribute to him, not just because it is customary but out of a deep sense of gratitude and respect. Nick’s efforts over many decades helped transform Greenwich and Woolwich, and his contribution to our national life was no less impressive. As well as an effective Minister and a skilled parliamentarian, Nick was a diligent and caring constituency MP who fought tenaciously to better the lives of his constituents. He was, I know, admired on both sides of the House, and it is both an honour and an enormous challenge to take on his mantle.
Greenwich and Woolwich has an extremely rich history, as the millions of tourists who visit my constituency each year discover. The historical centre of Greenwich is a breathtaking blend of history, science and architecture. It has been the residence of Tudor kings, was the birthplace of classical architecture in England, is the spiritual home of Britain’s maritime past, was the place where the heavens were first comprehensively mapped out, and is where the world’s prime meridian runs across an ordinary London pavement.
Yet as imperceptibly bound to its maritime and monarchical past as my constituency is, it has another proud history—one that is far too often overlooked, but which is just as inspiring. It is a history of industry, innovation, progressive social change and self-organisation, and above all of people who have come from every part of these islands and beyond living together and looking out for one another in diverse and tolerant communities.
The area was once a great manufacturing hub that teemed with the noise of shipbuilding, engineering, Europe’s biggest glassworks at Charlton and the colossal Royal Arsenal at Woolwich, birthplace of both the Royal Artillery and the Royal Engineers, which employed 70,000 people at its peak during the first world war. It has been a centre of research and discovery, which in the 1850s produced the earliest telegraph cables and the first to be laid across the Atlantic, by Brunel’s vast ship the Great Eastern. It has been a breeding ground of progressive politics, which gave birth to one of Britain’s first building societies, the Woolwich Provident, one of its first co-operatives, the Royal Arsenal co-op, and the first mass membership Labour party. It is a place whose people, confronted over the years by hardship, industrial decline, violence and sadly even terrorism, have none the less remained resilient, vibrant and optimistic for the future.
My constituency is now undergoing rapid change. Much of that change is extremely positive, but significant challenges remain, and not just how we get Charlton Athletic back into the premiership. Inequality, deprivation, poverty, endemic low pay, long-term and youth unemployment, strained public transport services and a chronic lack of genuinely affordable homes to rent or buy—all these issues will need to be tackled in the years ahead if we are to have an economy that is sustainable and works for all my constituents. I am determined to do everything in my power to make sure that they are tackled in the years ahead, and I am extremely grateful for the opportunity that I have been given by the people of Greenwich and Woolwich to be their voice in this place and the champion and servant of this great constituency.
Stephen Phillips (Sleaford and North Hykeham) (Con)
May I be the first to congratulate you while you are in the Chair on assuming your position, Madam Deputy Speaker? As it happens, this is turning out to be a Parliament of firsts for me. Last week I think I was the first Member in this Parliament to be granted an urgent question, and I am the first Member to have been called by you. I am tempted to ask whether you can enjoin the House not to interrupt me, on the basis that this is perhaps a maiden speech. I say that because, after I was granted the urgent question last week, someone at Sky kindly tweeted that a new Member had been granted an urgent question. I have obviously made an extraordinary impact on the media over the course of the past few years.
May I also congratulate all the Members who have made their maiden speeches today? They are my hon. Friend the Member for Bexhill and Battle (Huw Merriman), my hon. and learned Friend the Member for South East Cambridgeshire (Lucy Frazer), the hon. Member for Glasgow South West (Chris Stephens), my hon. Friends the Members for Horsham (Jeremy Quin) and for Cannock Chase (Amanda Milling) and the hon. Member for Greenwich and Woolwich (Matthew Pennycook). They will all obviously have fine parliamentary careers, although I remind them that in 1837, when Disraeli, whom we have already heard about twice in this debate, made his maiden speech, he ended it, after a considerable amount of barracking, with the words:
“I will sit down now, but the time will come when you will hear me.”
Well, the House has heard from all those Members today, and it is much better for having done so.
I have sat through the entirety of the debate, and if I may I would like to commend the right hon. Member for Doncaster North (Edward Miliband) for one of the finest speeches I have heard during my five years in this place. It was a speech that, in common with my hon. Friend the Member for North West Leicestershire (Andrew Bridgen), I am pleased he did not make before the election. It was a speech that, essentially, could have come from the Conservative Benches, because it was a speech about one nationism. One nationism is what this Government and this party stand for. The Gracious Speech, on which we are debating the Address, is a speech about one nation. It is a speech about this country over the next five years, and about what the Government’s plans, on which we were returned with a significant majority, are going to achieve.
Time is very limited in this debate given the number of speakers, but there are three areas on which I wish to very briefly focus my remarks. I understand that this is principally a debate on the economy, but the first area relates to the Human Rights Act 1998. A rumour has grown up on the Conservative Benches—or at least that is what I hear from my hon. Friend the Member for Newark (Robert Jenrick), who is now the Parliamentary Private Secretary to the Lord Chancellor and Secretary of State for Justice—that I am somehow going to be difficult in relation to the Human Rights Act, given my background and role as a lawyer. That rumour is misplaced.
I stood on a manifesto—I want to remind Conservative Members that we all stood on a manifesto—that said we would replace the Human Rights Act with a British Bill of Rights. That does not need to involve our withdrawal from the European convention. What we have said, and what we said in the manifesto in 2010, is that the Act can and should be replaced by a British Bill of Rights which is justiciable in the courts of this country, whether they are the courts of England and Wales, or of Scotland or Northern Ireland. That, as was made crystal clear by an editorial in The Sun last week and by what we were told on the doorstep during the general election campaign, is what the British people want.
The other thing that the British people want in relation to Europe, albeit unconnected with the European Court of Human Rights, is a referendum on the European Union. It is this party that is going to deliver that referendum. I remind everybody in the House—all right hon. and hon. Members, whether they are the most fervent Europhile or the most ardent Eurosceptic—that we are all here because we were elected in a democracy. If we believe in democracy, as we all ought to do, then giving the British people a say on whether they want to continue to be part of what the European community has become is absolutely the right thing to do.
I have already said that the right hon. Member for Doncaster North mentioned Disraeli in his speech. Disraeli also said, in a very famous passage, that he was
“a Conservative to preserve all that is good in our constitution, a Radical to remove all that is bad.”
This is a Government who have my support in relation to the Gracious Speech, because they are Conservative in relation to what is good in our constitution and they are radical in relation to what is bad.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
What a pleasure it is to be the first Member on the Labour Benches to be called by you, Ms Engel. You and I have been friends since you came to the House, and what I love about you is that you are passionate about this House. You were a great Chair of the Backbench Business Committee.
I have been sitting here since 9.30 am and have heard many excellent speeches and interventions today. There have been too many maiden speeches to mention. The secret of this place is to use it, serve the apprenticeship and then enjoy it. It is the place for hon. Members to make their reputation, hone their skills and show that they are real parliamentarians.
I wanted to talk about austerity, productivity, schools and skills, the north-south divide and the danger of withdrawing from Europe, but I probably will not be able to touch on a lot of that. I will instead start by being a little serious. Mr Speaker is sometimes very ageist and points out how long I have been in the House of Commons. My wife is just as bad. I was making my acceptance speech in Huddersfield on election night and said that I had just fought my ninth campaign. My wife said, “Darling, it’s your tenth. You fought Taunton first and didn’t get in.” I looked it up and found that I am the last Labour candidate to come second in Taunton. We came in behind the UK Independence party this year. That is quite a long history of fighting 10 elections.
However, this is the most worrying election I have been involved in. I say that not because the Labour party got a drubbing, or because there was a spectacular surge in Scotland by the Scottish National party. What was really worrying was the electorate’s lack of enthusiasm for any of us. They do not like us very much. Only two thirds of them voted and they did not vote with the great passion, saying they wanted to get to the polls, they wanted to get a Labour party or a Conservative party, or anybody else in Government. I found it very worrying that there was so little enthusiasm for the election as I knocked on doors. This is a country in which people such as the Luddites, the Chartists and the Suffragettes fought for the vote, but now we knock on people’s doors and are told, “We’re not voting—you’re all the same.” That is a terrible comment on where we are in our democracy today.
I found that the electorate were confused and depressed, and they resented and distrusted us. They wanted the leaders of our parties to be better, and I also think that all three leaders could have been a darn sight better. There was a feeling that there was no legitimacy about the election. Only 66% of the electorate voted, 71% in Scotland. As I said in an intervention on the Chancellor of the Exchequer earlier, “Don’t let’s crow about how well we represent everyone, when even the Government party is only representing such a small percentage of the British and the UK people.”
This is a year of really important anniversaries: 800 years since Magna Carta, and 200 years since Waterloo. However, I want to dwell for a moment on world war two, as it is 70 years since it ended. Faced with the challenge of rebuilding a devastated country that had been at war for six years, we picked ourselves up under a Labour Government and made the basic institutions that were to provide the foundations of the good life for so many people for 70 years. There was the national health service, which meant everybody getting the best medical treatment on the basis of need and not the ability to pay. There was the welfare state—okay, it was started after the first world war by Lloyd George, but it was made much more comprehensive after 1945 by a Government that said there should be a welfare net and that no one should fall below that level of poverty and need. Then, “welfare” meant something wonderful and not what it has been turned into now, partly sometimes in this country by the Government but particularly by the Republicans in the United States. I believe in the welfare state, and I believe in a great state.
We have a great challenge now to regenerate our economy and our country, and we will only do that by making our people happy and contented, and giving them the good life that they deserve.
Marcus Fysh (Yeovil) (Con)
Madam Deputy Speaker, many congratulations on your election, and I am glad to have caught your eye on this occasion, so as to make my maiden speech.
I am very pleased to rise today as the first Conservative since 1951 to be newly elected to serve the people of the Yeovil constituency. Therefore, this is the first of Her Majesty’s Gracious Speeches since then to be welcomed by an incoming Yeovil Conservative, a task made easier by the fact that the people of Yeovil, in making their choice, contributed to it outlining a Conservative programme.
People in my area made a decisive choice to support a future of jobs and opportunities, to continue rebuilding our national finances, and to stop burdening our young people and future generations with our mistakes and debts. Whether it is investment in defence, health, education or infrastructure to power our local growth, people understand that it cannot be done without the foundation of a strong economy and sound public finances.
My constituency sits in the middle of the narrowest part of the entrance to the south-west peninsula, on the main ancient route between London and the west country, and at a crossing of the route between Bristol and the ancient port of Weymouth. Surrounded by rich agricultural land, a series of towns and villages along these routes was fashioned from the local hamstone, giving golden warmth to travellers and inhabitants alike. The area became the natural home of successful farmers, seafarers and venturers, and it delivered a ready supply of the highest grades of flax, rope and sailcloth that powered their exploits.
In modern times, the people of Yeovil remain adventurous and resourceful. Hi-tech, modern defence industries and facilities sit beside innovative service and engineering firms, modern farms and superb tourist experiences. Hon. Members will have heard of the cutting-edge helicopters made by Westland, a great Yeovil firm that grew through Spitfire manufacture during the second world war. This year, it celebrates its 100th year, supported by a legion of smaller local suppliers.
In all parts of my constituency, in Yeovil, Crewkerne, Chard, Ilminster, South Petherton, Ilchester and all the farms and villages in between, there is a very positive spirit in all sizes of businesses and sectors. We know that with the right policies and support, we can make our area better, deliver for people in it and raise their incomes. I fully support the Government’s programme of infrastructure improvement, including the major road, rail, broadband and mobile signal projects that we are promoting in the south-west, not least the dualling of the A303 and A358, which run through my constituency, so that we can regain our place as a key regional powerhouse of economic growth in Britain, improve our productivity and enhance local people’s incomes.
My immediate predecessor, David Laws, worked hard, was polite and clear, and had a charming way, especially with older people in my constituency. He also took an interest in the young and recognised the dedication of our teachers to young people’s progress, which I also hope to do. His dry economic views smoothed the way for the formation of the coalition Government in 2010, in which he served first as Chief Secretary to the Treasury and latterly as Education Minister. His voting support for that Government and their policies was notable, and I thank him for his service.
Finally, we must reflect on why some have lost faith in our politics and try to put it right by our actions. We need in this place to be more thoughtful and humble and never to lose touch with the roots of trust of the people we represent and never stop listening to them and their hopes. To speak in this Chamber, the repository of so much human hope, past, future and present, is both thrilling and humbling. It is the Chamber’s particular part in preserving that democratic humility that we should defend above all. Our great poet, T. S. Eliot, commemorated in Westminster Abbey but resting for eternity in my constituency in a simple church in the parish of East Coker, in a poem of the same name, put it very satisfactorily: “humility is endless”.
Jo Stevens (Cardiff Central) (Lab)
I thank you, Madam Deputy Speaker, for giving me the opportunity to make my maiden speech today and congratulate you on your election. I also congratulate all hon. Members who have made their maiden speeches in today’s debate, and I am pleased to follow the hon. Member for Yeovil (Marcus Fysh).
The time constraint today means that we are short, but I hope we are also sweet. As a new Member, I thank you, Madam Deputy Speaker, and all the parliamentary staff for welcoming me and helping me settle in. Without fail, everyone has been generous with their time and patience, and I am very grateful for that.
To represent the people of Cardiff Central is a great privilege and responsibility. When I moved to Cardiff Central 26 years ago, little did I know that all these years later, my fellow residents would elect me, and place their trust in me, to be their first female Labour MP and their strong voice in this place. I pay tribute to my predecessor, Jennifer Willott, who served Cardiff Central for 10 years as a Back Bencher, Government Whip and Minister. She became a visible advocate for working parents, and I wish Jenny and her young family well for the future.
I also pay tribute to the last Labour MP for Cardiff Central, Jon Owen Jones, who served the constituency for 13 years, including as a Minister, and still lives there. He has been a source of kind support and wise advice.
Cardiff Central is a special place. While we have six electoral communities— Adamsdown, Cathays, Cyncoed, Pentwyn, Penylan, and Plasnewydd—our community is rich in history, diversity and culture and has welcomed people from all over the world to learn, work and seek refuge. We are very proud of our vibrant cosmopolitan and inclusive community.
From humble beginnings as a small Roman settlement on the site of what is now Cardiff castle, Cardiff Central is at the heart of what is now a modern, European capital city. We have grand civic buildings in Cathays Park, built by the Marquess of Bute, three universities, theatres, music venues and the Royal Welsh College of Music and Drama, whose famous alumni include Oscar winner Sir Anthony Hopkins and the legendary Ruth Jones, better known as Nessa from Gavin and Stacey. Alongside the world’s oldest record shop, Spillers, which opened in 1894, and our beautiful Victorian shopping arcades, we have a famous Caroline Street, where early and late-night city-centre revellers enjoy our special Welsh delicacy of chicken curry, arf’n’arf.
We also have the best sporting stadium in the world, the Millennium stadium, where we will welcome the world this autumn for the 2015 rugby world cup. I can assure you, Madam Deputy Speaker, that however nervous I felt just before starting this speech, my nerves are nothing like those I experience when watching my nation play in that stadium—a cauldron of noise and song—with 75,000 other rugby fans.
The subject of the debate today is the economy. In Cardiff Central, people have not felt an economic recovery. Many experience a recovery that is fragile because it is built on low-paid, insecure work. Many of my constituents work in the retail, care and hospitality sectors where insecure employment, zero-hours contracts and minimum wage work is the norm.
In order to build a strong economic recovery and to increase productivity, the answer does not lie in further weakening employment rights and protections. It certainly does not lie in exiting the European Union, a move that would threaten jobs, businesses and cutting-edge research in our universities. Indeed, it threatens the existence of many universities in Cardiff Central and beyond. The answer lies in making employment more secure, in boosting wages and productivity and in giving businesses and workers more certainty about their futures—and that includes a future in the European Union, so that they feel confident in investing, spending and job creation. That is best done in partnership with trade unions and their members across the UK. It is what responsible and successful businesses do, and it is what a responsible Government should do and promote, as the Labour Government in Wales have done.
Throughout the election, I campaigned on the need to tackle inequality head on—wealth inequality, social inequality and tax inequality. I will continue that campaign and be a strong voice for all the people of Cardiff Central. I look forward to working with colleagues here.
Nicola Blackwood (Oxford West and Abingdon) (Con)
Congratulations, Madam Deputy Speaker. As is already clear, you will find a warm welcome from all sides of the House because we know you as a champion of us Back Benchers, and we trust you.
It is a pleasure to follow so many outstanding maiden speeches. Constituents across the country will be proud to see their choices vindicated today. Those speeches take me back to my first days as an MP when I was elected in 2010. Hundreds of thousands of people had lost their jobs and for many more the prospect of home ownership was a distant dream. Others struggled to make ends meet. Our first duty in coalition was to restore fiscal responsibility to our public finances, offering this country the economic security that underpins all other policy decisions. There is nothing compassionate about paying more in debt interest than could be afforded on education. It is right to finish the job now. Once we have balanced the books, we can target investment and create the climate for all parts of the UK to realise their full potential.
Already, employment is at a record high and rising. In my constituency, youth unemployment has fallen by over 76%, but it is no good creating all these jobs if we do not offer the education and skills for local people to benefit. It is no good funding millions of apprenticeships and university places if we are not going to address skills shortages we face in engineering, nursing, construction and social care. I hope that the full employment and welfare benefits Bill reporting duties will not just be headline employment and apprenticeships figures, but that they will review progress broken down by sector and set against skills demand. That is the only way in which we will deliver the sophisticated skills strategy we need.
Oxfordshire, for example, is among the top five innovation ecosystems in the world. We have more than 1,500 high-tech firms, from start-ups to global company headquarters. We are world leaders in life sciences, big physics and space, and we employ more than 43,000 people. Not only has Oxford produced more than 50 Nobel laureates, but we are leaders in UK tech transfer. Between 2010 and 2012, Oxford university generated more spin-outs than any other UK university. State-of-the-art facilities such as the Diamond synchrotron and the Culham Centre for Fusion Energy, and access to our hyper-skilled labour pool, make us disproportionately attractive to tech industry.
Even in Oxford, however, businesses struggle with the skills shortage, housing costs, and digital and physical infrastructure, and those are the constraints that we must overcome. The Chancellor has rightly zeroed in on weak productivity, but the British scientific community is the most productive in the world. With just over 3% of the world’s research and development spending, we produce more than 6% of the world’s publications and 16% of its most cited papers. Our researchers translate funding into great science more effectively than anyone else. Yet despite recent increases, we still lag behind our international competitors in R and D investment, ranking only 12th in the EU.
Commercialisation is another issue. Despite Innovate UK’s excellent reputation, tech firms outside London speak of a chronic shortage of early-stage investment capital, and a mismatch between longer lead-in times—especially for biotech—and the impatience of capital investors. Incentives for individual investors de-risk investments, and we have a growing angel network in Oxford, but there are no breakthrough, throwing-down-the-gauntlet-to-Silicon-Valley solutions. I hope that the Treasury will explore incentives for pension funds and insurance companies—those with long-term perspectives —to invest directly in tech firms. Globalisation means that a single disruptive technology can create a worldwide paradigm shift in what seems like an instant: think Uber and taxis, Netflix and DVDs. Our STEM ecosystem needs to be the most agile and responsive in the world.
In five years of representing what I consider to be the vertex of our golden triangle, I have learnt a few things: for instance, that one should always go to a surgery prepared for an impromptu tutorial on wave particle duality and that we need to develop a policy for our STEM ecosystem as a coherent whole. We have come closest to that with our growth deals, which is why we in Oxford are particularly excited about the genuinely transformative possibilities of the cities and local government devolution Bill. We feel that if Cambridge has been granted devolved powers to retain business rates, we should have those powers too.
It would be deeply disappointing if, in his efforts to rebalance the economy, the Chancellor overlooked counties which already power the economy, but still have much more to give. The exam question should be not “Are you doing OK?”, but “How much better could you be doing?” Just as the education Bill will tackle both failing and coasting schools, this Government programme should aim to unlock the full potential of every local economy and community in Great Britain.
Mr Jim Cunningham (Coventry South) (Lab)
I congratulate you on your election, Madam Deputy Speaker. You and I have known each other for many years, and it is, to say the least, a pleasure to serve under your stewardship.
A number of Members have quoted Disraeli in the context of “one nation”, but Disraeli had something else to say. He said that if the Tory party was nothing else, it was “organised hypocrisy”. We did not hear that quotation today.
When the Chancellor opened the debate, he did not explain to us where exactly the Government would make the £12 billion of welfare cuts. I think that they owe us an answer to that question, and I hope that we shall hear one from whoever winds up the debate. They are also going to try to make tax cuts amounting to £7 billion. We are all for tax cuts, but the needy should not suffer as a result.
Someone said earlier that one of the growing industries in this country was the food bank industry, and there is a lot of truth in that. I was amazed to discover recently that some 18,000 people in Coventry are using food banks. Moreover, many people are on low and, it might be argued, poverty wages, and rely on benefits. That is quite an indictment, quite apart from what was said in the last Parliament about zero-hours contracts. That is another scandal. Those contracts might suit some people but they do not suit the majority of people who want to own their own homes. This Government talk about a property-owning democracy, but what chance do those people have of getting on to the housing ladder when they cannot get a mortgage because they are earning poverty wages on zero-hours contracts? That is another thing that this Government should answer for.
We have rehearsed the argument many times about who was responsible for the deficit. The thinking public, and the world at large, know that the economic crisis started in America with Lehman Brothers. Someone mentioned Lehman Brothers earlier, so I shall not rehearse that argument further. It has also been claimed that the manufacturing recovery in the west midlands somehow just happened under this Government. I sometimes wonder about this Government, when they say that all the bad things happened under Labour and the good things happened under them. It sounds like Pol Pot, 35 years ago in Cambodia. He claimed that all the bad things happened before his time, and all the good things happened when he came to power. We all know what Pol Pot was like, and where he ended up.
When we talk about the economic recovery and about Coventry, we must remember that the buy-out involving Tata and Jaguar Land Rover took place before this Government came to power. Let us be quite clear about that when we remember the jobs that were created as a result. Similarly, Advantage West Midlands created the infrastructure for Ansty Park, but Ministers are now rushing up to Ansty Park because a lot of industries are relocating there. The latest to do so is the London Taxi Company.
Local government has also been involved in the experimental stages. Let us remember that a previous Conservative Government abolished the rating system and introduced the poll tax. They also introduced metropolitan authorities, but the next Conservative Government came into power and abolished them. Local authority leaders, certainly in the west midlands, have been involved in negotiations with the Chancellor to create a greater authority in the west midlands with an elected mayor. Most people in the west midlands would object to having an elected mayor. I am not involved in the negotiations with the Chancellor, but he seems to be claiming that he got a mandate in the general election to make those changes. I for one will be watching the situation very carefully.
It is very important that Coventry does not lose its identity, although we would obviously co-operate in an economic sense if that were beneficial to the city. I suspect, however, that this is a smokescreen for further local government cuts and that when things do not work out, local government will be blamed again. The Government are not taking democracy back to local government; they are taking it away, just as they did in the past when they created metropolitan councils. I know that a lot of people want to speak in the debate; they have been here all day and I am nearly at the end of my allotted time.
Nigel Huddleston (Mid Worcestershire) (Con)
Madam Deputy Speaker—congratulations, and thank you for allowing me to make my maiden speech during this important debate on the economy. It is a privilege to follow the hon. Member for Coventry South (Mr Cunningham), and I also congratulate all the previous speakers who have made their maiden speeches today. They have set the bar very high for the rest of us who are following them. Thank you for that!
I should like to begin by paying tribute to my predecessor in Mid Worcestershire, Sir Peter Luff. Peter was first elected to this place in 1992 as the MP for Worcester, following in the footsteps of another highly respected Member, Peter Walker. Peter Luff was a Whip and a former Chair of the Business, Innovation and Skills Select Committee and the Agriculture Select Committee. He was also, of course, a Defence Minister in the last Government. Peter leaves a great legacy in Worcestershire. He fought for significant improvements to local infrastructure, including the new Worcestershire Parkway station which will open in 2017. He also worked hard to preserve and restore local heritage assets such as Hartlebury Castle, the Droitwich canals and the Regal Cinema. I will try to serve the kind and generous constituents of Mid Worcestershire as well as Peter did.
I am fortunate to represent one of the most idyllic constituencies in the country. A drive through Mid Worcestershire is a wonderful experience, starting from Broadway—the gateway to the Cotswolds—in the south, and heading through the gently undulating landscape of the Vale of Evesham, past fields of asparagus, plum and apple orchards, and greenhouses full of fragrant and beautiful flowers. One continues north, passing the Worcester Warriors rugby stadium, towards the historic town of Droitwich Spa and on to Ombersley and Hartlebury in the north. On the journey one will pass through many quintessentially English villages with splendid names, such as Upton Snodsbury, Flyford Flavell and my children’s favourite—Wyre Piddle. I am proud of the links between my constituency and this place via Simon de Montfort of de Montfort Parliament fame. In August this year we will commemorate the 750th anniversary of the battle of Evesham, where Simon de Montfort was killed.
The experiences of the past few weeks have taught us all in this place that there is no such thing as a safe seat in modern British politics, but Mid Worcestershire is about as true blue Tory as one can get, having returned a Conservative Member at every election since 1837, apart from once, in 1880, when a Liberal was returned as the MP for Evesham by two votes. As this result was transparently an error, a petition was lodged, the result was voided and a Conservative was returned instead. I like the precedent.
As I have spent the past several years working for one of the leading technology companies in the world, it will be no surprise that in this place I wish to be an advocate for technology and the digital sector, despite the fact that I am reading from a piece of paper. Ignore that for the moment. The UK’s digital economy is vital. It employs more than 1.5 million people and is growing at double the rate of GDP. We can be proud that the UK is one of the most advanced digital economies in the world, and I know that this Government are committed to making sure it continues to be so.
The other sector I wish to champion in this place is travel and tourism—again, one of the fastest growing sectors of the British economy. Since 2010 one in three of all new jobs has been in the travel and hospitality space, and tourism overall contributes more than £127 billion—a staggering sum—to the UK economy and employs more than 3 million UK people, including many in my constituency.
Finally, we all know that we can have good public services only if we have a strong economy that generates the taxes to pay for them. That is why it is vital that we continue to support business and job creation, thereby supporting workers and their families. That is what I am here to do. That is what this Queen’s Speech and this Government will deliver.
Roger Mullin (Kirkcaldy and Cowdenbeath) (SNP)
Many congratulations, Madam Deputy Speaker, from the Scottish Benches on your election.
In February 1974, I first stood for this Parliament. It has been a rather long campaign but here I am, representing that wonderful constituency, Kirkcaldy and Cowdenbeath. In the 2010 election former Prime Minster Gordon Brown had a majority of 23,000. I stand here today with a majority of some 10,000, an indication surely of a desire for change not just in my constituency, but mirrored the length and breadth of Scotland.
It is fitting on these occasions to recognise the work of the previous Member of Parliament. Gordon Brown was a giant in Labour party politics and in British politics. He went on to become Chancellor of the Exchequer and then Prime Minister—a very distinguished career to which I pay tribute. There were many issues where we disagreed, but I am sure the whole House will follow me in wishing him the very best for his future. I particularly look forward to the work he intends doing internationally among the poorest countries in the world to bring education to the most disadvantaged.
Kirkcaldy and Cowdenbeath is a constituency of many parts. Some of our communities, including Cowdenbeath, Lochgelly, Kelty, Lochore, Ballingry, Crosshill and the delightful Lumphinnans were hewn out of the very mines of the Scottish coalfields. That mining industry may have gone, but the strength of the community built by those miners is still there, although for the past 30 years or more they have been suffering from political and economic neglect such that I will have to do my best to address it.
In other parts of the constituency, people can meander down the coast from Dysart, through Kirkcaldy, Kinghorn and Aberdour, to the more modern Dalgety Bay, and gaze across the River Forth to Edinburgh. That coastal stretch was a favourite of Adam Smith, that much misquoted father of economics. He would often walk that way and contemplate the great philosophical questions of the day. As he did so, he would look at the impressive European trading ships that sailed up and down the Forth, providing that strong economic and social link to the many great nations of the continent. Standing on the shores of Scotland he saw the importance of international trade and of a European outlook. His perspective then, in the 18th century, challenges us all today to be just as outward looking and imaginative as he was in his time.
Adam Smith knew, too, that there is no centre of internationalism. It is something to be sought in the minds and deeds of people; whether you live in a great city of a great land or in a small seaside town on the northern shores of Scotland, you can be international. He knew, too, of problems, and as I look across at the Government Benches, I see many problems. If I were to point out just one thing where I share the view of Adam Smith, it would be that he could see readily that when looking at people with power and riches, you see that they are no protections against small-mindedness.
Turning to other matters, I was very impressed by the recent OECD report outlining the fact that excessive inequality is bad for growth. To talk of inequality is not to engage in the politics of envy. Rather, it is to engage in a debate about economic failure and missed opportunities. Let me finish with a quote from Adam Smith:
“No society can surely be flourishing and happy, of which the far greater part of the members are poor and miserable.”
Kevin Hollinrake (Thirsk and Malton) (Con)
Congratulations on your election, Madam Deputy Speaker. In speaking to the hon. Member for Kirkcaldy and Cowdenbeath (Roger Mullin) as one of the “problems” from the other side of the House, I congratulate him on a fine opening speech.
I stand before you today not as someone who has long pursued a career in politics, but as someone who was inspired many years ago to make the most of their life. My parents were decent, hard-working people who worked every hour God sent to build something for themselves and, more importantly, for their children. They talked to me not only about making your own way, but about helping people along the way.
The keener observers among you will notice that I am a little older than some of my young, vibrant colleagues, but 23 years building a business is responsible for that. I am older but certainly no wiser; my colleagues are of a very high calibre. They have also come from a very diverse range of backgrounds, careers and experiences, and that strikes at the very heart of the myth that the Conservative party is a party of privilege.
I wish to pay tribute to my predecessor, Anne McIntosh, who worked so hard and was a great champion of the farming industry. She did an excellent job as the Chair of the Select Committee on Environment, Food and Rural Affairs. She was a strong voice, and a willing and active participant in this Chamber.
It is, of course, a huge honour to represent Thirsk and Malton, a place where I have lived all my life. It is a place of distinct and stunning scenery, from Filey, with its immaculate gardens and broad, smooth beaches to picture-postcard villages and market towns such as Malton, racing’s northern home and Yorkshire’s food capital. It has Thirsk, the real-life home of James Herriot and the birthplace of Thomas Lord, who set up Lord’s cricket club and the MCC; Pickering, the gateway to the heather-scented North York Moors; and Easingwold, my home town, the place I was brought up. In short, it is God’s own county, and the true and original country of the white rose.
We are all here to represent our constituencies and to get the best deal, but in my experience we cannot win if the other side loses: it only breeds resentment, division and future conflict. I come to this House wanting a fair deal for our farmers, our businesses, our councils, our schools and our hospitals. I also want to help to build a fairer society and a fairer deal for the north and, in particular, for North Yorkshire. The vibrancy of our economy is critical. Never forget that everything here is provided by business people who go out and take risks, work twice the hours for half the money and put their life savings on the line. More often than not, they will never see them again.
Ronald Reagan once said that virtually all our economic growth is achieved by entrepreneurs and their small businesses. I have heard a lot of talk about productivity in this Chamber over the past couple of weeks and the way to increase productivity is to increase competition. We must make it easier and more rewarding to start a business and invest, and we do not help the poor by destroying the rich.
As our economy grows, the benefits should be felt by everyone. Over time, I believe that we should work with business and work towards introducing a living wage so that everybody gets a decent standard of living. I welcome the Government’s drive to cut red tape. Governments should do less, not more, but must keep stable conditions in our economy. I also welcome the Government’s programme of investment in our railways and in our roads. I would certainly welcome investment in the A64 in our neck of the woods. It is a huge bottleneck and an accident blackspot.
If the price of devolution to North Yorkshire is a metro mayor, I will pay that price. One of the most important things we need is rural broadband and better mobile phone coverage. We heard talk about 4G and 5G, but where I live 1G is the result and that leaves many businesses at a disadvantage. Local businesses compete locally but also nationally and internationally and we need to give them a level playing field.
It is in honour to be in this place. I will work tirelessly and to the best of my ability and always on behalf of the people who put me in this place.
Louise Haigh (Sheffield, Heeley) (Lab)
Thank you, Madam Deputy Speaker, for allowing me the opportunity to make my maiden speech. I, too, congratulate you on your re-election.
It is a great pleasure to speak after so many distinguished colleagues who have done their constituents proud in this debate. I am incredibly proud to be the youngest Labour MP serving in the House of Commons. It is often claimed that young people are apathetic or disengaged, but the young people I campaigned with and for in this election were far from apathetic. They were angry and felt let down because they thought that they did not have a voice. Young people have been under-represented in this Chamber for too long, but it is clear that that is changing on both sides of the House. It is a great honour to be part of the most diverse Parliament ever.
As the fourth Labour Member to represent Sheffield Heeley, it is also a great privilege to succeed Meg Munn, who served in this House for 14 years. She was renowned for her assiduous promotion of women’s issues, particularly in the science, technology, engineering and maths industries, and for building on her extensive experience as a social worker before entering this House to highlight child protection issues and improved rights for young carers. These are her very proud legacy.
Like Meg, I was born and raised in Sheffield, the very heart of God’s own county, a city renowned for its industrial heritage and now the greenest city in the UK, with more trees per person than any other city in Europe.
My constituency boasts a number of beautiful parklands, from Graves Park past Heeley City Farm and Heeley development trust to Richmond and Norfolk parks, all of which not only provide precious and much-loved green space but are important community hubs, providing childcare and family activities as well as adult education and training opportunities.
Colleagues may know that, like Rome, Sheffield is built on seven hills, which means that areas of my constituency command spectacular views of the rest of Sheffield and the surrounding Peak district. However, it also means that the inequality that scars our great city can be viewed in sharp relief. Young people who live at the top of hills in Gleadless Valley and Arbourthorne can look down on the two world-leading universities that we host—universities that they have been priced out of. They can look down on the dwindling industrial bases that their parents and grandparents would have been proud to work in, but which no longer create the jobs they desperately need. And they can look across to the west of Sheffield, where a baby girl can expect to live almost 10 years longer than another born and living her life about four miles away, by virtue of nothing more than her socioeconomic circumstances and the area she was born into. Our duty to our constituents is one that we share in all parts of the House, and the inequality that scars Sheffield, like so much of our nation, is something that I know we will all aspire to eradicate.
Before I entered this place, I worked in the City of London, and that experience motivated me to run for Parliament. I know from my time there that it makes a valuable contribution to our economy, but I also know that the culture and attitudes inherent there have been unaffected by the events of the last eight years. The culture of excessive pay, short-termism and cavalier risk-taking was demonstrated only last week with yet another case of LIBOR fixing. While our constituents remain worse off as a continued result of the financial crisis, again I know that this is something we will all aspire to solve.
It was disappointing, therefore, to hear very little in the Gracious Address on how we can reform the financial system. Given that the consequences of the weak recovery will be familiar to all of us—low wages, poor productivity and insecure work—it is incumbent on us all to address the reasons why our financial system is not providing the long-term investment that we need in cities like Sheffield. Being literally the greenest city in the UK is not enough; this must be at the heart of our industrial strategy and economic policy. If we are to secure a sustainable economy that delivers benefits for all, we must transform the way our economy works, incentivising investment in green, productive industries and penalising those short-term industries and practices that have done our economy and society such harm.
But, Madam Deputy Speaker, we in Sheffield Heeley have waited too long for change. My predecessor’s predecessor, Bill Michie, in his maiden speech in 1983—four years before I was born—spoke about the plight of the long-term unemployed, the young people out of work, the educational inequalities and the lack of investment in my constituency. Those problems pervade to this day. Change for the very vulnerable, the low paid and all working people is long overdue and we face a very clear choice in this Parliament—to continue down the same economic path that has entrenched inequality and embedded vested interests or to stand for a system that will protect the vulnerable, reward working people and create a fairer society so that my successor does not have to repeat the same tired list of issues in another generation’s time.
Simon Hoare (North Dorset) (Con)
It is a pleasure to be called to speak in this final day of the debate on the Gracious Speech, but that pleasure is increased by the fact that I represent the constituency of North Dorset, which is probably—I will not give way to anyone on this point—the most beautiful constituency, certainly in England. At its heart is Blackmore Vale, made famous in the writings of Thomas Hardy. The village of Marnhull, where my children attend school, is very much the centre of the story of “Tess of the d’Urbervilles”. Who will ever forget the great scene in which Tess sees Angel Clare country dancing on the village green? I note that there is no all-party parliamentary group for country dancing. The House will be pleased to know that I am not proposing that we set one up.
The constituency of North Dorset has been represented by some colourful characters over the years, including a polar explorer, a former chairman of Crufts—the dog show, I presume—and a Loch Ness researcher. I do not know whether he ever found the Loch Ness monster, but I say to Scottish National party Members that that is not an invitation to field a candidate at the next general election.
This is an important debate, and one in which my predecessor, Robert Walter, took great interest. Robert served North Dorset for 18 years, filling a number of roles in this House. Probably more importantly, his commitment to democracy and his desire to see the eastern bloc and Europe flourish took him into the realms of the Inter-Parliamentary Union, where he did a huge amount of very good work over the years. We wish him well in his next turn of career.
That said, Robert never neglected his constituency. I lost track of the number of people who told me on the doorstep while I was canvassing for the election that they would always vote Conservative because of what Mr Walter did 10 or 15 years ago. Those are big shoes to fill, and it is a legacy I hope to continue. We wish him and his wife Feride well. While on the subject of Feride, I note that Robert, a man who liked to do things for the first time, was the first Member of this House to have a Muslim wedding service here in the Palace of Westminster.
The economy of North Dorset is growing and our employment rates are going up, but there is still fragility there. A number of hon. Friends have already referred to some of the challenges that hold back what in my constituency are not small to medium-sized businesses, but micro to small businesses. We do not have particularly good coverage for mobile phone signals, or indeed for broadband, as referenced by my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake). Those are things that I campaigned on during the general election, and on which I will be pressing Ministers in the Department for Culture, Media and Sport and other Departments in order to deliver those opportunities for local businesses to grow.
The constituency wants to do well and to see investment, and I am going to be a champion for that. Like many other quarters of the country, we need investment in our road infrastructure. I refer, in particular, to the A350 and the C13. When I was selected as the Conservative candidate, a lady asked me whether I would be joining the 1933 group. I replied, “I think we all join the 1922 committee,” assuming that she was just a little confused about the antiquities of the Conservative parliamentary party. She was, in fact, referring to the local action group set up in 1933 to campaign for the Melbury Abbas bypass. It may well be that in my time in this House we are able to deliver it.
The Gracious Speech put at the heart of the Government’s programme a commitment to growth and to entrepreneurialism, and that is something I want to champion during the years I am here. The people of Dorset are welcoming and they want the constituency to do well. I invite Members of the House to visit Hardy country. Tourism and agriculture in the area are growing. Indeed, the agricultural economy is probably the largest in the constituency. I will be looking to Front-Bench colleagues in the Department for Environment, Food and Rural Affairs to ensure that we are doing all we can to combat such challenges as bovine TB and ensure stability in the dairy sector. There is a lot to do, and I have the honour to play a part in helping North Dorset thrive. I look forward to it.
Ms Margaret Ritchie (South Down) (SDLP)
I congratulate you on your re-election, Madam Deputy Speaker, and your colleagues. I also congratulate all those Members on both sides of the House who made their maiden speeches today. I welcome the opportunity to speak in this debate on the Queen’s Speech, which focuses on the future and, in particular, the economy.
Given the grand claims we have heard from the Government, both before the general election and since, about a long-term economic plan that is working, one would be forgiven for thinking that the UK was in the midst of some kind of economic miracle. The truth, however, is that we are not experiencing any kind of economic miracle and that the recovery, such as it is, remains fragile. We still have record debt, notwithstanding the fact that the Chancellor announced today that Departments will be expected to make further savings through asset sales and that the Government are to sell off their stake in Royal Mail, which I regret and which will have an impact on the delivery of postal services to people across the UK.
We still have that record debt, which despite years of austerity is still rising, and there has not been sufficient growth to improve the fundamental economic ratios. The Government point to their record on job creation, which looks superficially impressive. Record numbers of people are at work, but in fact many of the new jobs are insecure and low paid and many people are doing more work, simply running to stand still. Those people are not feeling better off because they are not becoming better off. The new jobs are not driving economic growth or strengthening the economy because they are low value added and low productivity. Mark Carney, the Governor of the Bank of England, has recently highlighted the fundamental importance of raising productivity and diplomatically reminded us of the real Government failure in this area of economic policy.
The productivity failure is symptomatic of the wider failure to use more imaginatively the economic levers available to Governments. Instead of focusing on austerity and cuts, the Government could do more to stimulate economic activity in sectors that can yield an immediate contribution to growth and prosperity. The necessary stimulus can come from greater fiscal creativity and the smarter application of taxation. One such area is the labour-intensive industry of tourism. I firmly believe that the Chancellor and his Front-Bench Treasury team should give longer and deeper consideration to lowering VAT on tourism for all the UK.
Tourism is the principal economic driver in my constituency. Only last week, we hosted the Irish Open, which attracted 20,000 visitors each day. They came not only to witness our great golfers from the island of Ireland, Britain and elsewhere, including the guy from Denmark who won, but to get outside and sample our local hospitality—our restaurants, eateries and the rest of our tourism offering. But if tourism is to be more successful, the Government need to lower VAT. Northern Ireland—my constituency in particular—has a land border with the south of Ireland, whose VAT rate has been 9% for years, notwithstanding its austerity measures. Our VAT is 20%. It has become increasingly difficult to be competitive in such a world. I ask the Government and hon. Members to give the issue due consideration because fiscal flexibility will help achieve better economic prosperity for difficult regions.
Edward Argar (Charnwood) (Con)
It is a pleasure to deliver my maiden speech following such distinguished contributions, including from the hon. Member for South Down (Ms Ritchie), and to have such an illustrious predecessor in representing my seat, which is such a beautiful part of the country. First elected to represent Loughborough in 1979 and becoming the right hon. Member for Charnwood in 1997, following the seat’s creation, Stephen Dorrell served for an astonishing 36 years in this House. Upon his election, he was the baby of the House, often described as “permanently boyish”—a trait that, as hon. Members will see, eluded my grasp, I fear, many years ago. Stephen served in a string of offices, from the Whips Office to the Cabinet. His commitment to serving his constituents was formidable and the respect in which he is held locally never ceased to be apparent to me as I campaigned.
But the man is so much more than a list of the offices that he held. He was once described in The Guardian as
“exuding sweet reasonableness and being recognisably a member of the human race.”
He combined this with intellectual rigour, diligence and genuine decency. While I may not be able to emulate his length of service or swift progression through ministerial ranks, I will continually strive to emulate his values, humanity and hard work.
Although a relatively new seat, Charnwood is in the ancient heart of our great country, sandwiched between Leicester and Loughborough. It also, in its short history, has a strong tradition of re-electing its Member—something I hope will continue. It is a mixed, beautiful but oddly shaped constituency, curving around Leicester from Glenfield and Leicester Forest East in the west in a large arc to the rural villages of Barkby, Beeby and South Croxton in the east, taking in historic Kirby Muxloe with its castle, through Groby and Anstey—reputedly the furthest point south reached by Bonnie Prince Charlie’s Scottish army before its swift retreat back north—and picture-book rural villages like Woodhouse Eaves, then passing Bradgate park, containing the ruins of Lady Jane Grey’s family estate and the ancient Charnwood forest.
Heading east, we pass through Cropston, Swithland, Rothley and Mountsorrel, with Thurmaston and Birstall to the south, before reaching Syston, the home of Pukka Pies. I fear that my post-election figure suggests that I have taken my support of local industry a little bit too far. Finally we reach Queniborough, East Goscote and the rural idyll typified by villages such as Cossington, Seagrave, Thrussington, Rearsby and Barkby, where, with the summer approaching and the nights getting shorter—not, I hasten to add, a reference to my constituency neighbour, my right hon. Friend the Member for Rutland and Melton (Sir Alan Duncan)—many a sunny evening can be spent at the excellent Barkby United village cricket ground.
In the past five years the Chancellor has already laid the strong economic foundations for creating the one nation we all aspire to. Now, with the proposals in the Gracious Speech, we will make that a reality for everyone in this country. I look forward to being in my place to support him in doing this.
Charnwood is a success story and it has achieved much since 2010. It is a constituency blessed with extremely high ownership rates, low unemployment and successful businesses, although there is always more to do. That success does not just happen—that it happens is down to the hard work of the people of Charnwood, the sort of people who are the backbone of this country, working hard, doing the right thing, and building a better future for themselves and their family. They are exactly the people this Government are pledged to continue to support with our focus on opportunity and aspiration.
I will always fight for my constituents and constituency—for example, in continuing to campaign for fairer funding for my county of Leicestershire and for its schools—but there are a number of broader causes that I will particularly seek to champion in this House. While we have made significant progress in recent years, we still need to go further in vigorously and energetically focusing on improving dementia care and mental health provision; both are causes on which I will be vocal. I will not, I fear, be able to emulate the moving eloquence of my hon. and gallant Friend the Member for Plymouth, Moor View (Johnny Mercer) on this subject, but he will always find me shoulder to shoulder with him in his commitment to improving this country’s mental health care for children and adults and giving a voice to those whose cause is too often not heard.
I am here to represent the whole community in my constituency but particularly those on the fringes of our society who may not have the voice or ability to speak up for themselves. Every day I will strive to help build the one nation the Prime Minister has spoken about and in which I passionately believe, and every day I will humbly endeavour to repay the honour and trust that the people of Charnwood have placed in me.
Madam Deputy Speaker (Mrs Eleanor Laing)
I am sorry that it has not been possible to find time today for every new colleague who sought to make their maiden speech. I hope you will all be reassured by the thought that if you have sat here all day partaking in this excellent and important debate, should you seek to catch Mr Speaker’s eye again in the near future you will be looked on favourably.
Stephen Timms (East Ham) (Lab)
Thank you and congratulations, Madam Deputy Speaker. As you have said, we have had a good debate, which has demonstrated the seriousness and commitment with which we are ready to take up our duties as Opposition Members.
It has been widely acknowledged in this debate that my right hon. Friend the Member for Doncaster North (Edward Miliband), the former leader of our party, made a fine and powerful contribution. It was especially welcome for being so soon after our bruising election defeat. He addressed the topic of one nation, which was the theme of his leadership as well, drawing attention to the problem of rising inequality across western democracies. He spoke of the rungs of the ladder getting further apart and reminded the Prime Minister of his 2006 commitment to address relative poverty. I think the whole House will look forward to my right hon. Friend developing those ideas in the months ahead.
We have had valuable contributions from both sides of the House. I particularly congratulate everyone who has made their maiden speech today, including the hon. Member for Bexhill and Battle (Huw Merriman), the hon. and learned Member for South East Cambridgeshire (Lucy Frazer), the hon. Members for Glasgow South West (Chris Stephens), for Horsham (Jeremy Quin) and for Cannock Chase (Amanda Milling), my hon. Friends the Members for Greenwich and Woolwich (Matthew Pennycook) and for Cardiff Central (Jo Stevens), the hon. Members for Mid Worcestershire (Nigel Huddleston), for Kirkcaldy and Cowdenbeath (Roger Mullin) and for Thirsk and Malton (Kevin Hollinrake), my hon. Friend the Member for Sheffield, Heeley (Louise Haigh) and the hon. Members for North Dorset (Simon Hoare) and for Charnwood (Edward Argar). I congratulate each of them and wish them well for their membership of this House. The whole House will look forward to hearing more from each of them in the years ahead.
At the heart of this debate is the security of working families. Many families feel deeply insecure at the moment, in ways spelled out in a fine maiden speech by my hon. Friend the Member for Greenwich and Woolwich. How is the programme that has been announced going to affect them? We have yet to hear clear answers from the Government on how they plan to strengthen the foundations of our economy so that we can deal with the deficit, control social security costs and secure better living standards and a better future for the working people of Britain.
My hon. Friend the Member for Nottingham East (Chris Leslie) began by highlighting the fragility of our economic recovery. Productivity continues to stagnate, leaving output per worker far behind that of comparable advanced economies—a point that was highlighted by the hon. Member for Dundee East (Stewart Hosie).
The right hon. and learned Member for Rushcliffe (Mr Clarke) was right to point out that employers are struggling to find people with the right skills for their jobs. Many employees have roles that do not make full use of their talents and potential, and we have heard a great deal in the debate about the grave challenges relating to infrastructure and the need for more progress. Those underlying weaknesses will make it harder to get the public finances in order and to get social security spending under control.
Fragility in the economy translates into insecurity for working families, who have seen their living standards go backwards over recent years and still worry about whether they will be able to keep on top of their bills. Working families are struggling to balance the demands of work with the rising cost of childcare. They wonder whether the NHS will still be there for them when they need it in future and want their children to have a decent career and a realistic prospect of getting on the housing ladder. Too many at the moment are stuck in low-paid, insecure work and a growing number are depending on housing benefit to make ends meet. Those families all want to know what difference the measures in this Queen’s Speech will make to them.
There are welcome commitments in some areas, but questions remain about how some of them will be paid for. It is, however, what has been left out that gives the greatest cause for concern—actions not taken, details not provided—and makes many families less secure and fear for the future.
We all support any cut in taxes for low-paid workers, but we also need a serious plan to tackle low pay and boost wages for the majority by raising investment, as my hon. Friend the Member for Cardiff Central pointed out in her excellent speech. The hon. Member for Thirsk and Malton also rightly called for the adoption of a living wage in the UK. We need to raise the levels of skills and productivity across the economy, securing sustainable tax revenues and reducing the reliance on in-work benefits.
It was disappointing to have sprung on the House this afternoon, without any proper detail or explanation, a series of spending cuts in the Chancellor’s speech. There is a press release that outlines what they are, but there is no proper information. We should have had a statement so that the House could scrutinise the cuts. They include a significant cut to the skills budget.
We will welcome any help for working parents with childcare, but families can be forgiven for believing it when they see it, after five years in which it has become harder, not easier, to afford the childcare they need. There is a worry that the proposals in the Queen’s Speech are likely to result in fewer affordable homes and bigger housing benefit bills for taxpayers.
Britain succeeds only when working people succeed. Hard work should be rewarded, prosperity should be shared and we should protect the most vulnerable. Those elements, which are vital for our society, need to be underpinned by a strong social security net. The Opposition support the work that local authorities are doing under the Government’s troubled families programme, but we are aware that a majority of the families involved still have nobody in work and that the Work programme is not doing enough to help them. We will be glad to see additional money for apprenticeships.
We have made clear our support for the principle of a benefit cap to ensure that people are better off in work and for reforms to ensure that young people are earning or learning, and do not become caught in a benefits system that at the moment does too little to improve their skills and prospects. We will scrutinise—[Interruption.]
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I hesitate to interrupt the right hon. Gentleman. There is no heckling or bad behaviour going on, but there are an awful lot of private conversations. He has a difficult job to do and he should be given peace in which to do it.
Stephen Timms
We will scrutinise those proposals with great care. The well-meaning rhetoric on apprenticeships needs to be matched by action on the quality, as well as the quantity, of the apprenticeships that are being created. When the rules are changed on benefits for 18 to 21-year-olds, we will look carefully at the safeguards for the vulnerable young people who will be included. We need to ensure that reducing the benefit cap does not end up costing more than it saves.
Those measures amount to only a fraction of the £12 billion reduction in social security spending that the Government promised. We want to see savings where they can sensibly be made. We have argued consistently for keeping the system affordable. We have said that that requires a readiness to take tough decisions on low-priority spending, alongside action to tackle the underlying drivers of rising benefit bills, such as low pay and high housing costs. The unwillingness or inability of Ministers to explain to this House or the public how they intend to make the reductions that they have set out is adding to the insecurity that is felt by many working families today.
There will be widespread relief that the Prime Minister has, reportedly, overruled the Secretary of State on child benefit. However, working families need to know whether the tax credits and other in-work benefits that they depend on will be taken away. The Prime Minister yesterday declined my invitation to reaffirm his election campaign commitment that benefits for disabled people are safe. The Institute for Fiscal Studies says that it will be virtually impossible to achieve a £12 billion saving without hitting low-income working families hard.
When he gets to his feet, the Secretary of State needs to assure those who are clearly not well enough to work that support for disabled people and their carers will be protected. Government failures in that area—the failure of the rushed and ill-prepared incapacity benefit reassessment exercise and the failures of the Work programme for people in receipt of employment and support allowance—mean that the Government are spending nearly £5 billion more this year on employment and support allowance than they forecast five years ago. That is a serious failure.
We heard a Queen’s Speech five years ago that promised
“to simplify the benefits system in order to improve work incentives”.
That was a worthy aim, but there has been very little progress since then. My hon. Friend the Member for Bishop Auckland (Helen Goodman) touched on the problems with the IT for universal credit. In 2011, the Secretary of State told us that universal credit would be complete in six years; now he is telling us that it will be complete in another six years. In four years, completion has slipped by four years.
The Opposition will continue to stand up and speak for the working people of this country, who have endured years of falling living standards and economic uncertainty. They now need assurances and action from the Government to promote their security and to secure their finances and the public services that they rely on, and on which all our futures will depend.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
May I start by congratulating you on returning to your position, Madam Deputy Speaker?
It is a pleasure to conclude this debate on the Gracious Speech. I am conscious of the fact that we do not have a huge amount of time, but I want to congratulate right hon. and hon. Members on both sides of the House on their contributions, particularly those who have made maiden speeches. I will come back in a little more detail to those speeches and to a few comments that the right hon. Member for Doncaster North (Edward Miliband) made. I think I have a few tips for him.
We are elected and in power now, although I remind my colleagues that a month ago pollsters said otherwise. As my right hon. Friend the First Secretary of State and Chancellor of the Exchequer said in his excellent speech, we defied expectation and were elected to govern with a majority Government, and we intend to govern accordingly. We were elected to continue with our long-term economic plan and our welfare reforms, which have seen employment rates at record highs, the number in the main out-of-work benefits down by 1 million since 2010 and workless household rates at record lows. We will also carry on our work on repairing the economy, reducing the deficit and creating jobs. That is our purpose, and we will stick to it.
I will pick up on some of the speeches that have been made, as is normal for a Member winding up a debate. I start with the right hon. Member for Doncaster North. I feel like I am the only one in the House who understands where he is. As he knows, and as I mentioned earlier, I won some money on him when he became the leader of the Labour party—I put a bet on him two years out. I never felt that I was wrong. Whatever else the British public and others may have decided, I have always felt, and I have told him this, that he is a decent man who is highly intelligent and motivated to serve the British people and his constituents. His speech today showed the best of him. In the leadership election campaign, there will be collective amnesia among some of his closest colleagues about who was in the room when policy decisions were made. He may feel now like he was the only man in the room, but that short-term memory loss will not last. His colleagues’ short-term memory does not mean that he should have anything less than a long-term political career. I sense that the best is yet to be.
There were a number of really good maiden speeches from Government Members. I will try to go through as many as I possibly can. I commend the speech of my hon. Friend the Member for Bexhill and Battle (Huw Merriman), who took well to his task of recommending his constituency. He made an incredibly fluent speech, and even though he strayed back to 1066 to draw upon his predecessors, he made powerful comments about getting the economy right, and always doing it with social justice. I recommend that he stays with that idea.
My hon. and learned Friend the Member for South East Cambridgeshire (Lucy Frazer) made a really interesting speech. I think she upset some Scottish National party Members when she referred to her predecessor but many, one Oliver Cromwell, who, she said, had found a solution to the West Lothian question that we might not necessarily wish to pursue today. [Interruption.] And the Irish problem, although some may say that he made it worse.
My hon. Friend the Member for Horsham (Jeremy Quin) spoke movingly about his predecessor. Our friend, Francis Maude, served diligently. He was always reminded that he was the one who signed the Maastricht treaty—everybody else apparently had a medical appointment on that particular day. My hon. Friend will go far.
My hon. Friend the Member for Cannock Chase (Amanda Milling) showed her business prowess. She brings that very welcome experience to this House. As she represents Cannock Chase, I will offer her one little bit of advice: she should make sure she does not wear any fancy dress, as this does not help one’s prospects.
My hon. Friend the Member for Yeovil (Marcus Fysh) made an excellent speech in which he talked about transport infrastructure and quoted T.S. Eliot on humility. It was a very powerful speech. I recommend it, for those who want to read it.
My hon. Friend the Member for Mid Worcestershire (Nigel Huddleston) paid a powerful tribute to our old friend Peter Luff. He talked about the virtues of service, which he intends to follow.
My hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) paid a strong tribute to Anne McIntosh, who served both in the European Parliament and here in the House of Commons with great distinction. Many of us who are her friends feel that she has yet still more to do. His business experience is most needed in this House. No matter what his age is—I have to say he looks pretty young to me—he will go far with that experience and he should use it.
My hon. Friend the Member for North Dorset (Simon Hoare) spoke movingly about his constituency and recommended that everyone tour there. His speech got a bit complicated when he started asking about wanting to set up all-party groups on country dancing à la Thomas Hardy. I will leave that to him if he does not mind, but he spoke very well indeed.
My hon. Friend the Member for Charnwood (Edward Argar) finished off by paying tribute to his predecessor, Stephen Dorrell, who served with huge distinction in this House through some very difficult periods, particularly when he was Health Secretary. He spoke well and fluently. I recommend him to the House.
Many other hon. Members spoke well, but I cannot go through them all. I hope they will forgive me if I do not mention them. I will make one exception and mention the hon. Member for Kirkcaldy and Cowdenbeath (Roger Mullin). I thought he spoke brilliantly. He is the successor to Gordon Brown and he spoke just as powerfully and as loudly as him—and almost with the same politics. I wondered whether there had been any change at all, although he is not quite the same age. I recommend him to his colleagues and to the House. He made a really, really good speech.
The Queen’s Speech builds on the best of what we can do here in Parliament and sets out our plans for the next. My right hon. Friend the Chancellor made it very clear that we will introduce a full employment Bill. It will contain a range of measures to reform welfare and to grow the economy. We will give more people the security of a pay packet by achieving full employment and we will report on progress annually. We have the highest employment rates in the G7. Too many Opposition Members kept on repeating the same mantra they had before, laying out the course for more spending, more borrowing and more taxation. The electorate rejected that at the election and we must never cease to remind them.
There are four areas in the welfare Bill. I want to speak about three areas in particular. In the previous Parliament, we delivered 2.2 million apprenticeships. It is really important to train and provide the skills our young and older people need to get on and to develop their productivity. We intend to deliver a further 3 million. We intend to report on this. We take it so seriously that the Chancellor has made it clear that he will not put up with any divergence: we will get those apprenticeships and they will work.
In conclusion, we will pursue what we set out to do: unemployment going down, workless households down, the deficit down. The Queen’s Speech builds on our success and I commend it to the House.
Question put, That the amendment be made.
Rohingya Community (Burma)
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Jonathan Ashworth (Leicester South) (Lab)
It is a pleasure to see you re-elected and in the Chair, Madam Deputy Speaker. Please accept my congratulations on your re-election.
I want to bring to the House an opportunity to talk about the human rights situation in Burma/Myanmar and the migrant boat crisis that we have seen reported on in recent weeks in the media. We have seen heartbreaking coverage as thousands of Rohingya refugees and Bangladeshi migrants have remained stranded in squalor in smugglers’ boats at sea while initially Thailand, Indonesia and Malaysia refused to allow them to land.
Some estimates suggest that 88,000 Rohingya and Bangladeshi migrants have taken to the seas over the past 15 months. Indeed, between January and March this year 25,000 boarded smugglers’ boats, which is double the number for the same period in 2014. It was only after media reports and international pressure that the Thai, Malaysian and Indonesian authorities allowed migrants to arrive on their shores and, in recent weeks, between 3,500 and 4,000 have been allowed into Thailand, Malaysia and Indonesia or have returned to Burma/Myanmar.
Fiona Bruce (Congleton) (Con)
I commend the hon. Gentleman for bringing this extremely important issue to the House’s attention. Does he agree that the circumstances in which so many of those people are living in Burma need to be looked at, and that urgent representations need to be made to the Government of Burma—or Myanmar—on granting humanitarian access to those areas so that they can be improved radically, which is greatly needed?
Jonathan Ashworth
I thank the hon. Lady, who hits the nail on the head with that intervention. I will come later in my remarks to the persecution of the Rohingya in Burma, which is what is driving the migrant crisis. I saw her statement a few weeks ago on behalf of the Conservative party human rights commission, which I entirely endorse. I am pleased that she has been able to put her point on the record this evening.
Throughout early May it seemed that every day brought another report of abandoned migrants found at sea: 10 May, 575 migrants were recued near Indonesia; 11 May, 1,018 migrants were found on the Malaysian coast; 11 May again, a vessel carrying 400 migrants was intercepted by the Indonesian navy; 13 May, a boat carrying 300 migrants was turned away from Langkawi island near Malaysia; 13 May again, another boat carrying 500 migrants was turned away from Penang island near Malaysia; 14 May, a boat carrying 300 migrants left the Thai shore, having been given food and water but refused refuge; 15 May, 700 migrants were rescued by a fishing boat after their vessel sank near Indonesia; and last week more than 700 refugees were brought ashore in Burma/Myanmar, having been found drifting in the Andaman sea in an overloaded fishing boat that was taking in water.
The coverage we have seen—I pay tribute to the BBC and al-Jazeera, in particular, for their reporting—has shown desperate scenes of dehydrated refugees and emaciated, starving children. On the boats women endure rape and other sexual violence, and many are forced into marriage with the men who pay for their journey.
Nia Griffith (Llanelli) (Lab)
Does my hon. Friend share my concern that no preconditions were set before the British Army started training the Burmese military, despite allegations of continued sexual violence? Given that Burma has now been included in the initiative on preventing sexual violence, will he join me in asking the Minister to look into what is being done about that?
Jonathan Ashworth
My hon. Friend makes an extremely valid point. I hope that the Minister will reflect upon that and perhaps say something when he responds to the debate.
The people traffickers had abandoned those boats, leaving those on board with no food or water. The migrants were then refused sanctuary by the countries to which they were trying to escape. The Rohingya people are often described as the most persecuted in the world. Those men, women and children were fleeing Burma/Myanmar to escape what have been described as apartheid-like conditions, hoping to reach predominantly Muslim counties such as Malaysia via the jungles of southern Thailand. Yet many meet certain death; if they are not swallowed up by the south-east Asian seas, they are slung into mass graves when they eventually reach the Thai-Malaysian borders.
One migrant, Ziaur Rahamn, spoke to the Financial Times. He escaped from Burma/Myanmar to Bangladesh, but he was then kidnapped and trafficked to Thailand before being sold on and making it to Malaysia. He said:
“I have an ambition to help my mother and help my nation…Everywhere is dying for the Rohingya. Everywhere is killing and beating and trafficking, everywhere.”
Today it is not clear how many migrants remain at sea in boats abandoned by the people traffickers; search and rescue vessels from Malaysia and Indonesia have not yet located any more migrant ships. So many of the boats have been abandoned as a tragic consequence of Thailand’s seeking—for entirely the right reasons, I emphasise—to stamp out its appalling record on people trafficking in the region. As a result, many of the smugglers, no longer able to bring people ashore, have resorted to abandoning boats or dumping their human cargo on islands near the coastline—essentially, they have killed some of their human cargo. The circumstances are tragic. The Thai authorities have found graves with 150 bodies along the Thai-Malaysian border, many thought to belong to Rohingya migrants.
The US and EU have criticised the authorities for failing to deal adequately with people trafficking. In recent months, the Thai authorities have arrested several Government officials, from army colonels to town mayors, thought to have been involved in people trafficking. Indeed, in the past 24 hours there have been reports of a senior major-general’s involvement in trafficking the Rohingya.
The problem is that no single Government in the region is prepared to show any leadership or take any real responsibility; it is no wonder that the UN has described the situation as a “massive humanitarian crisis”. Yes, there was a conference in Bangkok on 29 May to respond to the crisis. Yes, it is welcome that the countries attending agreed to intensify search and rescue operations and that the Indonesians and Malaysians agreed to offer shelter to migrants—albeit temporarily and in the expectation that the international community will resettle them within a year. Yes, there was a welcome agreement to tackle the causes of migration through job creation and the promotion of
“full respect for human rights and adequate access of people to basic rights and services, such as housing, education and health care”.
Those commitments are all welcome; I will be interested in the Minister’s assessment of them. However, was it not hugely disappointing that the conference refused even to utter the word “Rohingya” publicly? It refused to recognise that driving this issue is the persecution of the Rohingya people in Burma/Myanmar and the fact that to this day Burma/Myanmar refuses to recognise the citizenship of the Rohingya.
Like many Members here tonight, I have spoken before in the House about the citizenship issue and I will reiterate some of the points in a moment. Before that, let me say a brief word about the Association of Southeast Asian Nations. I hope the Minister will agree that the crisis has become a major test of the association. If those nations want to launch a single economic market by the end of the year, as is their plan, does that not imply rules on movement of labour—and not trafficked labour with smugglers’ networks in which it seems Government officials are complicit? The single economic market that ASEAN wants to create by the end of the year needs to face up to the human rights abuses of the Rohingya in Burma.
Valerie Vaz (Walsall South) (Lab)
I congratulate my hon. Friend on securing this important debate. I want to follow on from the point made by the hon. Member for Congleton (Fiona Bruce), who went to Burma with Mr Speaker and me two years ago. Does my hon. Friend agree that this is a classic case for the involvement of the United Nations? Should not the Secretary-General take personal control of this enormous and overwhelming humanitarian crisis?
Jonathan Ashworth
My hon. Friend is absolutely right, and I pay tribute to the work she did in the last Parliament, and I know she will continue to do in this Parliament, on raising the issue of Burma. She has been a strong and persuasive voice. I am pleased that she has got her point, which I agree with and will come to, on the record.
The Minister has my appreciation for having been the first western Minister to visit Rakhine state. Some 1.1 million Rohingya in western Burma, particularly in Rakhine state, are denied citizenship and access to jobs and basic services. Indeed, he knows, after the brutal sectarian violence in 2012, many of the Rohingya were forced out into some of the worst camps ever seen, according to the UN.
In the past year, conditions have worsened for the Rohingya. They have been denied voting rights unless they are prepared to register themselves as Bengali, and they do not recognise themselves as Bengali, as the Minister is well aware. He will also be aware that the violence in Rakhine a few years ago when Rohingya were driven from their homes often occurred with the complicity of local officials, if not national Burmese officials. Certainly, local officials appeared to turn their back on some of the communal violence. Is it not an absolute disgrace that when the UN adopts resolutions, as it did in December 2014, urging the Myanmar Government to grant the Rohingya full citizenship and calling for the office of the UN High Commissioner for Human Rights to be opened in Myanmar without delay, the response of the Myanmar-Burmese regime is still to refuse even to acknowledge the Rohingya as an ethnic group, and then to say that reports of Muslim persecution are a “fabrication”? I agree with the President of the United States when he says, rightly, that Burma/Myanmar should end this discrimination against the Rohingya.
There are going to be elections later this year. Given the migrant boat crisis over the past few weeks, should not the British Government take the view that it is time for all Burmese political leaders now to speak up and do what they can for the Rohingya and say that Rohingya citizenship should be recognised? The Minister will be aware that there is one particular prominent leader who many of us are keen to see speak up and say that Rohingya citizenship should be recognised. According to reports, US Assistant Secretary of State Anne Richard said recently in Jakarta that while the US was not considering imposing more sanctions, they remain “in the diplomatic toolbox”. What is the Minister’s view of sanctions given the migrant crisis we have seen over the past few weeks?
I recall that in our previous parliamentary debate in Westminster Hall in January the Minister rightly told us of the Government’s commitment of £12 million in aid for Rakhine state. Of course, I support that. However, given that we are set for a rollercoaster ride in the future projections of public expenditure, can he indicate the Government’s future thinking on aid and humanitarian assistance for Rakhine and in the region more generally? Picking up on the comments of my hon. Friend the Member for Walsall South (Valerie Vaz), does he agree that now is the time for the UN Secretary-General to be given personal responsibility for negotiating unrestricted international humanitarian access to Rakhine state? What representations has he made at the UN level on that matter?
On the boat crisis, will the Minister update the House on the discussions that he and the FCO have had with the ASEAN nations in recent days? Is there any more support that we can offer to Thailand, for example, in dealing with people-trafficking in the region? Will he agree to lobby the ASEAN nations to ensure that genuinely life-saving measures are set up to offer support on search and rescue operations so that when migrants disembark from ships they are given appropriate access to humanitarian assistance? Will he raise particularly the issue of children? Many of the children coming off these boats are unaccompanied. Will he undertake to lobby for the provision of child-friendly spaces and learning spaces in the shelters and camps in Malaysia, Indonesia and elsewhere so that they are protected and have access to education?
I am very grateful for this opportunity to put some of these points on the record so early in the Parliament. I look forward to a full response from the Minister, because whether it is the migrant crisis in the south Asia seas or the migrant crisis in the Mediterranean, we simply cannot walk by on the other side.
The Minister of State, Foreign and Commonwealth Office (Mr Hugo Swire)
I congratulate the hon. Member for Leicester South (Jonathan Ashworth) on his re-election and on securing this debate—his second on this important subject within six months. I also thank other hon. Members for their contributions.
The fact that this debate comes so soon after the House’s return demonstrates the importance that Parliament rightly places on the situation of the Rohingya and on the recent humanitarian crisis in the Bay of Bengal and the Andaman sea. The crisis has been made even more alarming by the discovery of mass graves in Thailand and Malaysia, and by boats either avoiding landing or being prevented from doing so.
With conditions at sea becoming increasingly desperate, we welcome the 20 May decision by the Foreign Ministers of Malaysia, Thailand and Indonesia to provide vital humanitarian assistance. Clearly, tackling this issue requires a strong and co-ordinated regional response. I am glad that Thailand called last Friday’s regional co-ordination meeting in Bangkok, at which our ambassador represented the United Kingdom. I welcome the agreement of the countries involved to meet again soon.
Those discussions were a positive step, but much more remains to be done. South-east Asian countries must continue to work together to tackle the appalling trade in human lives and its root causes, and, in particular, to press Burma to address the situation of the Rohingya in Rakhine state. With that, I can associate myself with the hon. Gentleman’s comments about ASEAN and its future.
According to the office of the UN High Commissioner for Refugees, over 130,000 Rohingya left by sea between 2012 and 2014. However, the numbers this year are something new, with a further 25,000 leaving in the first three months of 2015—nearly double the numbers during the same period last year. I share the hon. Gentleman’s deep concern about the many issues they face. The fact that so many are willing to risk this highly dangerous journey speaks of increasing desperation within the community. It is a community where, three years since the ethnic violence of 2012, over 140,000 remain displaced in “temporary” camps, where humanitarian conditions—as I saw at first hand during my visit in 2012—are, quite frankly, dreadful. The February decision to cancel the temporary identity cards held by many Rohingya looks set to disfranchise the community and leave them open to further restrictions, intimidation and abuse.
As the crisis emerged last month, I took action in calling the Burmese ambassador to the Foreign Office in order to express our concern and press Burma to take urgent steps to deal with the humanitarian implications of the crisis, as well as the underlying causes in Rakhine.
I met the Bangladeshi Foreign Secretary in London on 20 May and urged Bangladesh to work within the region to address people trafficking and irregular migration in the Bay of Bengal.
Paul Scully (Sutton and Cheam) (Con)
My father was born in Burma, so I take a great interest in these issues. What is going on there is horrific, so I congratulate the hon. Member for Leicester South (Jonathan Ashworth) on securing this debate. As he and the hon. Member for Walsall South (Valerie Vaz) have said, Ban Ki-moon should take a personal interest in the matter. Burma Campaign UK, Christian Solidarity Worldwide and a number of other organisations have also called for such action. I would be grateful if the Minister informed us what the UK Government are doing in that regard.
Mr Swire
I welcome my hon. Friend to the House and the fact that we now have somebody interested in these matters who perhaps has closer Burmese connections than any of the rest of us. UN Secretary-General Ban Ki-moon called Burmese President Thein Sein on 20 May to discuss Rakhine and Burma’s response to the migration crisis. With our support, the issue of Rakhine was also discussed at a briefing of the UN Security Council on 28 May. My hon. Friend may be unaware of this, but in the past few years we have had a Friends of Myanmar—Friends of Burma—meeting at the General Assembly in New York, and we will be pressing for just such a meeting again this autumn.
In Rangoon, our ambassador joined EU and US colleagues in delivering a joint démarche to Burmese Ministers. Through our network of missions, we lobbied extensively throughout the region and co-ordinated regular discussion with like-minded states, non-governmental organisations and international organisations, including the International Organisation for Migration and the UNHCR.
My hon. Friend the Member for Congleton (Fiona Bruce), who has taken a very close interest in this issue, raised the wider issue of Rakhine itself. We will continue to raise the problems in Rakhine at every opportunity. In particular, we continue to press the Burmese authorities for progress in a number of vital areas: improved humanitarian access, greater security and accountability, the protection of civil and political rights for everyone in Burma, and a sustainable solution on citizenship.
The hon. Member for Leicester South spoke about the vast amount of money the British taxpayer gives to Burma. I confirm that as part of our continuing commitment to support progress in Burma, we will continue with our funding, which increased to £82 million this financial year.
Mr Swire
I will make progress, if I may.
In Rakhine state, we are one of the largest bilateral humanitarian donors. We have given it over £18 million in humanitarian support since 2012. I am pleased to say that an additional £6.2 million was recently announced for 2015-16.
The hon. Member for Llanelli (Nia Griffith) raised our training of the Tatmadaw, the Burmese military. It remains a key force in Burma and we believe that it is right to continue to engage with it. It is not true to say that we have not consulted; we have consulted extensively with members of ethnic groups, civil society and the political Opposition led by Aung San Suu Kyi, who is supportive of this approach. We cannot ignore the fact that it still has a bloc in Parliament, and it needs to be taught to behave like a responsible military in a democratic country in the 21st century. It is key to repeat that we provide only non-combat education and training, and we will continue to do so.
In addition to our other bilateral work, we continue to operate through the UN and the EU. The Secretary-General has called Burmese President Thein Sein, as I said, and the UN Security Council discussed Rakhine on 28 May. The UK has been instrumental in securing strong UN resolutions on Burma, including the Human Rights Council resolution in March, which extended the mandate of the special rapporteur for human rights in Burma, Professor Yanghee Lee, who has done so much to shine a spotlight on the plight of the Rohingya.
We have made our concerns extremely clear to the Burmese Government, and we will continue to do so. We will continue to work with the Burmese and our international partners for progress. The hon. Member for Leicester South asked about the other people—he said I would know who he was speaking about, and indeed I do. Daw Aung San Suu Kyi has a remarkable record of defending human rights and democracy, and we encourage all parties in Burma to work together to improve the humanitarian conditions and ensure that there is respect for the human rights of all communities in Rakhine. Ultimately, of course, it is the Burmese Government that have the executive power.
Patrick Grady
Does the Minister have any indication of the number or proportion of refugees who might be making their way to these islands? What support are the British Government prepared to offer any of them who do end up here?
Mr Swire
As far as we can ascertain, this is a regional issue that needs to be addressed by the countries that I have mentioned. It is an ASEAN problem. Where the majority of these people are coming from is quite uncertain. It is our assessment that it is a combination of people coming from Rakhine itself, possibly some people getting on boats and coming across the Bay of Bengal, and others coming down. It is pretty mixed. The key thing is the immediate humanitarian alleviation, such as getting them off the boats and getting them watered and fed. At the same time, on a parallel track, we need to get Burma and Bangladesh to play their part. As far as we know, there are no people heading here. That is not to say that we are not interested or that we do not care. We care passionately about the situation, but at the moment it is for the countries in the neighbourhood to deal with it.
Mr David Burrowes (Enfield, Southgate) (Con)
The Minister says that this is a regional issue, but is it not an international issue? There are grave international precedents of community groups and ethnic groups effectively being pushed out and cleansed, and being left to find their own way on boats. Surely we must recognise that this is an international issue that demands an international and United Nations response.
Mr Swire
I hoped to demonstrate our interest and that of the international community—I have obviously failed—by mentioning the fact that we have been pressing for the meeting that took place. I have discussed the matter with the Burmese ambassador and the Foreign Secretary of Bangladesh, and we have been pushing in the UN and will do so again in the autumn. The international aspect of the matter is about Burma’s future transition to a democratic country with democratic values and tolerance of people’s ethnicity, religion, sex and so on, which we take for granted. It is also about the humanitarian aspect of the crisis. However, the immediate issue is local. It is happening on the borders of the countries to which I have alluded, and it is for them to deal with it at first hand. That does not mean that the international community is turning its back on the situation—quite the reverse.
We have repeatedly made our concerns extremely clear to the Burmese Government, and we will continue to work with the Burmese and our international partners to make progress. Some have criticised our continuing engagement with the Burmese Government, whether with the military or through our aid programme. However, we believe, in consultation with our international partners, that the best way to help Burma achieve real progress is to engage with all parties, including the Rakhine community itself, about their concerns.
It is important that the international community demonstrates that it is listening to all sides, so that the arguments do not become more polarised than they already are, particularly in the run-up to the forthcoming election. That is the way to help embed reform and encourage the transition towards peaceful and democratic government for the benefit of all Burma’s people. With elections set for November, and in the light of the situation that we have seen in the Bay of Bengal, that need is more starkly apparent than ever.
I thank the hon. Member for Leicester South for this opportunity to set out the Government’s position once again. I very much welcome the involvement in the debate of Members in all parts of the House, and I am particularly pleased that the shadow Foreign Secretary is on the Front Bench to listen to it. I particularly welcome my new colleague, my hon. Friend the Member for Sutton and Cheam (Paul Scully), who has close genealogical connections with a country that we all care passionately about. We want to see it transition from an extraordinarily difficult, dark period. We can expect to see more challenges, and we will maintain our levels of interest and support, but not at the cost of turning our back on an appalling humanitarian situation.
Question put and agreed to.
Written Statements
(8 years, 11 months ago)
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Chemical Weapons Convention
(8 years, 11 months ago)
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The Parliamentary Under-Secretary of State for Defence (Mr Julian Brazier)
The UK’s chemical protection programme is designed to protect against the use of chemical weapons. Such a programme is permitted by the chemical weapons convention, with which the United Kingdom is fully compliant. Under the terms of the convention, we are required to provide information annually to the organisation for the prohibition of chemical weapons. In accordance with the Government’s commitment to openness, I am placing in the Library of the House a copy of the summary that has been provided to the organisation outlining the UK’s chemical protection programme in 2014.
[HCWS15]
National Employer Advisory Board
(8 years, 11 months ago)
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The Parliamentary Under-Secretary of State for Defence (Mr Julian Brazier)
Following open competition, I am pleased to advise the House of the appointment of seven new members to the National Employer Advisory Board (NEAB). They are:
Mr Bagnall
Mr Bird
Mr Carter
Mr McTague
Mr Randeniya
Mr Sproule
Mr Walkinshaw
They join the other seven members of the board, which is chaired by Mr Richard Boggis-Rolfe. The NEAB provides informed independent strategic advice to the Ministry of Defence and the reserves community about how they can most effectively develop their relationship with employers across the UK and particularly employers of members of the armed forces and veterans. I take this opportunity to thank the NEAB for its work which is greatly valued by the Ministry of Defence.
[HCWS16]
Energy Council
(8 years, 11 months ago)
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The Secretary of State for Energy and Climate Change (Amber Rudd)
In advance of the forthcoming Energy Council in Luxembourg on 8 June, I am writing to outline the agenda items to be discussed.
Under the first item on the agenda, the Council will hold a policy debate on implementation of the EU energy security strategy, focusing on achievement in strengthening energy security in Europe since adoption of the strategy in 2014, priorities for next steps to be taken and how to ensure synergies between the various tools that can contribute to energy security in the EU. The UK considers that there have been a number of developments in the EU that will have a positive impact on energy security, including the agreement of the 2030 climate and energy framework and the development of the energy union. Looking ahead, the UK considers that delivering a fully functional single energy market, building resilience into the system and diversifying energy supplies should all continue to be priorities.
The Council will then be asked to adopt conclusions on the implementation of the framework strategy for the energy union focusing on empowering consumers and incentivising investments in the energy sector. The UK agrees that more needs to be done to enhance competitiveness in the internal energy market to deliver benefits for consumers and that particular priority needs to be given to the facilitation of new interconnection and investment projects.
The Commission will then report on developments in external energy relations, including recent trilateral talks on energy issues between the EU, Russia and Ukraine, and developments in the energy community.
The Czech delegation will update Council on discussions held at the plenary meeting of the European Nuclear Energy Forum (ENEF) which took place in Prague in May.
Finally, the Luxembourg delegation will inform the Council of the priorities for their presidency in the first half of 2016.
[HCWS13]
Service Personnel Deaths (Inquests)
(8 years, 11 months ago)
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The Parliamentary Under-Secretary of State for Women and Equalities and Family Justice (Caroline Dinenage)
Together with my hon. Friend the Minister for Defence Personnel, Welfare and Veterans, I present our latest joint statement on the progress of coroner investigations into the deaths of UK service personnel on active service overseas. Our armed forces demonstrate great courage, commitment and self-sacrifice in their service to our country, and it is right that they receive our heartfelt gratitude. Most of all we remember and honour those who have laid down their lives in the service of their country, and the families they leave behind.
This statement sets out the progress of investigations being held by the senior coroners for Oxfordshire, for Wiltshire and Swindon and for other coroner areas in England and Wales as at 22 May 2015.
Tables to supplement this report have been placed in the Libraries of both Houses. These give details of all cases, including whether there has been or will be a service inquiry—known as a board of inquiry in the earlier years covered.
The defence inquests unit of the Ministry of Defence continues to work closely with coroners—including the dedicated cadre of coroners with special training in service personnel inquests—to make sure that everything possible is done to progress and complete investigations quickly and thoroughly. There is now provision under section 12 of the Coroners and Justice Act 2009 for investigations to be held in Scotland, where appropriate, rather than in England and Wales.
We are thankful to all who are involved in the course of these investigations: to those who provide support and assistance to bereaved families; to the coroners and their staff who seek to conduct thorough investigations which put the bereaved families at their heart; and for the Chief Coroner for his leadership and oversight of the coroner service.
Repatriations of service personnel who have died overseas have mainly taken place at RAF Brize Norton and RAF Lyneham. To enable the senior coroners for Oxfordshire and for Wiltshire and Swindon to conduct inquests into these deaths alongside their local case load, additional funding has been provided to both areas since 2007 by the Ministry of Defence and the Ministry of Justice.
Current status of inquests
Since our last statement on 29 January 2015 there have been six inquests into the deaths of service personnel on operations in Iraq or Afghanistan. This brings the total of inquests into the deaths of service personnel who have died on active service in Iraq or Afghanistan or who have died in the UK of injuries sustained on active service to 624. Three deaths of injured service personnel have not led to a formal inquest. Two of these were taken into consideration at inquests into other deaths which occurred in the same incidents. The third case concerned a serviceman in Scotland who made a partial recovery but later died from his injuries, and it was decided not to hold a fatal accident inquiry.
Coroners’ investigations which have been opened
As at 22 May, seven coroner investigations are open into the deaths of service personnel in Afghanistan.
The senior coroner for Oxfordshire has retained five of these. The other two investigations are being conducted by the senior coroners for Gateshead and south Tyneside and for West Sussex, whose courts are closer to the next of kin. A pre-inquest hearing date of 2 November 2015 has been set for one of these inquests. Hearing dates have not yet been listed for the remaining six inquests.
We will continue to inform the House of progress.
Attachments can be viewed online at:
http://www.parliament.uk/business/publications/written-questions-answers-statements/written-statement/Commons/2015-06-04/HCWS14/
[HCWS14]
House of Lords
Oaths and Affirmations
BBC Royal Charter
(8 years, 11 months ago)
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Lord Fowler
To ask Her Majesty’s Government what plans they have to consult the public on the renewal of the BBC royal charter.
The Parliamentary Under-Secretary of State, Departments for Business, Innovation and Skills and for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, the Secretary of State for Culture, Media and Sport is currently considering a range of options for how the charter review might be conducted. An announcement will be made in due course. There is no set process, but of course we are determined to conduct a robust and thorough process with significant opportunities for the public to contribute.
Lord Fowler (Con)
I am grateful to the Minister, but did she see the reports of 12 May, which appeared in every newspaper and clearly resulted from an official briefing, that the Government intended, in the words of the Daily Telegraph, to declare “war” on the BBC? Does the Minister recognise that many people in this country profoundly disagree with such a policy, value the high standards of the BBC and its international reputation and will strongly oppose any attempt to undermine these?
Baroness Neville-Rolfe
My Lords, war has not been declared on the BBC. The BBC makes an enormous and valuable contribution to many people’s lives as the nation’s broadcaster and in its overseas services, with 308 million people around the world and 96% of the UK population watching it each week. It is also a very well-understood and supported cultural institution, which I know is important to this House. The arrangements will be looked at fully and from every perspective in the charter review. I think the process starts today with the kind of comments that I know will be made in this House.
Lord Lea of Crondall (Lab)
My Lords, is the Minister aware that it is a bit rich for many members of the Conservative Party to complain when the BBC does not reflect everything said by the Daily Mail, when, as far as I can see, it is compelled each morning to regurgitate everything said by the Daily Mail, the Daily Telegraph, the Daily Express, the Sun et cetera on “What the Papers Say”?
Baroness Neville-Rolfe
My Lords, the underlying point is about impartiality. The BBC is required by the royal charter and agreement to deliver impartial news. Under the terms of the agreement, the BBC must do all it can to ensure that controversial subjects are treated with due accuracy and due impartiality. This is, of course, one of the issues for the charter review. I think there has been some long-standing suspicion that the views are sometimes skewed, and not in a way favourable to our party.
Lord Low of Dalston (CB)
My Lords, I saw a report in the Spectator which suggested that music and entertainment services provided by the BBC could be put out to subscription and that the only thing the licence fee should continue to support was the BBC’s news and current affairs output. Does that reflect the Government’s thinking?
Baroness Neville-Rolfe
My Lords, funding, governance and all other aspects, especially ensuring that we continue to have some of the best public broadcasting in the world, are all matters for the charter review, which will be getting under way very soon.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, the House seems to be calling for the noble Lord, Lord Pearson, but we have plenty of time and we have not heard from the Liberal Democrat Benches either. I suggest that we hear first from the noble Lord, Lord Pearson, and then move to the Liberal Democrats.
Lord Pearson of Rannoch
My Lords, I am most grateful. Have the Government examined the News-watch.co.uk website, which shows how the BBC has so far failed to allow fair debate between the two sides in the forthcoming EU referendum and thus to respect its present charter? Might it be good to involve the public in the next charter by allowing the licence fee-payers to elect the BBC’s trustees and, through them, the chairman and the director-general?
Baroness Neville-Rolfe
My Lords, I have not seen the News-watch website that was referred to, but I will obviously take the opportunity to look at it as part of my induction into this vital area. All aspects of the kind that the noble Lord describes will be looked at in the review. As I said, I think that the comments from this House will be very helpful to us in coming to the right conclusions.
Baroness Bonham-Carter of Yarnbury
My Lords, does the Minister not agree that a BBC funded by the licence fee is essential in a changing world as a safeguard for British creativity? The creative industries are the fastest growing sector of the UK economy and a crucial part of our continued prosperity and the economic recovery.
Baroness Neville-Rolfe
My Lords, I very much agree with the noble Baroness’s point about the power and importance of the creative industries, and of course the BBC plays a huge part in that, not least around the world because of the respect that it is accorded.
Lord Morris of Aberavon
My Lords, are there plans to consult on the BBC’s partial funding of the Welsh television channel S4C?
Baroness Neville-Rolfe
My Lords, the Government are committed to strong Welsh language broadcasting, although the funding arrangements for the future are clearly for the charter review. I am sure they will be looked at in that context. It is really important to safeguard Welsh language broadcasting. When I was on maternity leave, I was a big fan of “Pobol y Cwm”, which you can get in the south-west, where I was spending some time.
Lord Dobbs (Con)
My Lords, if the noble Baroness were to go round any of the market squares of eastern Europe and talk to anybody over the age of 45, she would discover how vital the BBC has been in emphasising British and western cultural values. The same could now be said of all the villages and madrassahs in places such as Afghanistan, where they gather round a television still in their coffee shops. For those of us who believe that the BBC, in some of its areas, needs a good and perhaps vigorous nudging, will she ensure that that crucial element of soft power which the BBC represents is not undermined but indeed enhanced?
Baroness Neville-Rolfe
My Lords, I agree with my noble friend. I have spent a lot of time in the towns of central Europe and I know just how important the BBC is to them. Indeed, I was very pleased to hear that while there were a lot of concerns about the World Service, the funding has actually gone up since the new arrangements were brought in.
Baroness King of Bow (Lab)
I draw attention to my entry in the register of Members’ interests, as I work for Channel 4. Turning to the BBC, it is, as my noble friend Lord Bragg put it yesterday,
“not so much the family silver as the family itself”?—[Official Report, 3/6/15; col. 432.]
As the Minister herself mentioned, a staggering 96% of the British population uses a BBC service every week. Given that, when going into negotiations on the licence fee, will the Government take into account the range and breadth of the BBC’s offer, so appreciated by the British public, because any wholesale reduction in funding will inevitably damage content and tarnish the family silver, if not the family? Lastly, did the Minister’s response to the noble Lord, Lord Low, not indicate a lack of clarity in the Government’s thinking?
Baroness Neville-Rolfe
My Lords, good points have been made, but we are embarking on a charter review and we need to consult the public, business and distinguished people such as your Lordships. Nothing is ruled in and nothing is ruled out, but the underlying variety which the BBC produces, here and around the world, is obviously incredibly important and helps our place in the world.
General Election: Postal Voting Fraud
Lord Lexden
To ask Her Majesty’s Government what assessment they have made of the extent of postal voting fraud at the recent general election.
Baroness Chisholm of Owlpen (Con)
My Lords, the Government are not aware of any issues in relation to postal voting at the recent general election, although no formal assessment has been made. The Electoral Commission will produce a report on the general election in the coming months, which will include any concerns around the use of postal votes at the general election. A range of measures is in place to combat electoral fraud in the UK.
Lord Lexden (Con)
Do the Government agree with Mr Nazir Afzal, the former chief crown prosecutor for north-west England, who said last month:
“One of the big problems is that victims who have their votes”,
stolen or,
“taken from them won’t come forward … We need the police to be much more proactive”?
He added that consideration should be given to establishing,
“a national, high-profile police hotline”.
Will the Government also ensure that the large number of complaints by registered overseas electors who failed to receive the postal votes for which they applied are fully investigated and the results made public?
Baroness Chisholm of Owlpen
My Lords, we are in the early stages of a discussion with the Electoral Commission about how to take forward the manifesto commitment to ensure that it puts greater priority on tackling fraud. Obviously, all these issues will be considered in that discussion. On my noble friend’s second point concerning overseas voters, for the 2015 general election—as with future general elections—postal votes were able to be sent out as soon as practicable, 19 working days before the day of poll. These changes were made specifically to meet the needs of overseas voters.
Lord Morgan (Lab)
My Lords, does the noble Baroness acknowledge that the greatest electoral fraud of all was committed by the Ministers of the last Government, Liberal Democrat and Conservative, in wilfully adopting policies that kept millions of people off the electoral register?
Baroness Chisholm of Owlpen
My Lords, I do not accept that. The latest figures published by the National Police Chiefs’ Council and the Electoral Commission, on 19 March 2015, show that police forces had only 272 cases of alleged electoral fraud in the UK in 2014, out of a total of 29 million votes cast.
Lord Pearson of Rannoch (UKIP)
My Lords, is not the first past the post system pretty much an undemocratic fraud, when the Government are elected by only 24% of the electorate and UKIP gets only one MP with 4 million votes? I might add that, although of course your Lordships’ House is appointed under patronage, with no pretence of democracy, we have only three Peers here whereas the Liberal Democrats now have 100, even though they got only a measly 2.4 million votes.
Baroness Chisholm of Owlpen
My Lords, I am not quite sure how that is about electoral fraud, which is what we are discussing today.
Lord Rennard (LD)
My Lords, given the widespread abuse of the postal voting system and the ease with which it was possible to cheat in the most recent Tower Hamlets mayoral election, will the Government accept the need to review our election laws to provide more safeguards for democratic principles? If so, what is the justification for the abolition of the Political and Constitutional Reform Select Committee, which examines such matters?
Baroness Chisholm of Owlpen
My Lords, the Tower Hamlets situation was dealt with in the courts, so I do not want to comment on that. I am sorry, but can the noble Lord just repeat the other part of the question?
Lord Rennard
I understand. If election law were to be revised, in the previous Parliament the Political and Constitutional Reform Select Committee in the other place would have looked at that revised law. However, the Government are now abolishing that Select Committee, which I believe cannot be justified. What is the justification for the abolition of that Select Committee?
Baroness Chisholm of Owlpen
My Lords, as is known, the Government do not get involved in Select Committees, so that is not a point for me to answer here.
Baroness Warsi (Con)
My Lords, I would not want to refer my noble friend to the case of the Tower Hamlets mayoral election, but could she write to me, if she cannot answer me today, about whether the Government’s understanding of the law in relation to undue spiritual influence is clear? Can the Government be sure that the law in relation to undue spiritual influence at the time of elections is being consistently applied across different religious communities?
Baroness Chisholm of Owlpen
My Lords, I will certainly get back to my noble friend on that question. The Government consider tackling electoral fraud to be a very high priority and they believe that more needs to be done to safeguard the integrity of elections. Indeed, this will certainly be looked into in the future with the Electoral Commission.
Lord Beecham (Lab)
Given the large number of people not currently registered and the likelihood that that number will grow with the introduction of individual registration, how much are the Government prepared to invest in supporting local authorities in ensuring that people do register?
Baroness Chisholm of Owlpen
My Lords, in 17 local authorities where there is a feeling that there is a problem at the moment, £500,000 has been made available to increase the completeness and accuracy of the electoral register. This should improve research and intelligence gathering, and help with the production of videos to educate the public.
Armed Forces: Airborne Maritime Patrol
(8 years, 11 months ago)
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Lord Empey
To ask Her Majesty’s Government what plans they have to improve the United Kingdom’s airborne maritime patrol capability.
The Minister of State, Ministry of Defence (Earl Howe) (Con)
My Lords, we have been clear for some time that the right point to look again at the requirement for a maritime patrol aircraft is in the forthcoming strategic defence and security review, the SDSR. That decision will be informed by the latest threat assessments and the conclusions come to in recent years. We continue to embed around 30 former Nimrod air crew in the maritime patrol communities of allied air forces in order to reduce the time and risks associated with regenerating a capability.
Lord Empey (UUP)
Steady on. Does the Minister not agree with me that one does not need a review to know that, as an island nation with a sea-borne nuclear deterrent capability, we are not even in a position to secure our own deterrent, because we do not have the capability to do so? I understand that all things have to be reviewed, but this is such a no-brainer. It is obviously of great concern if we cannot protect our own sea lanes against an increasingly aggressive Russian naval force. Will the Minister go back to his right honourable friend in the other place and say that we should be proceeding now to prepare the necessary facilities to ensure that we have adequate protection for our nuclear deterrent as well as for our shores?
Earl Howe
My Lords, I absolutely do not accept that we cannot protect our own sea lanes. We have acknowledged that we have a capability gap, following the decision not to bring the Nimrod MRA4 into service, but at the same time we made it clear that we chose to accept that gap because we knew that we could mitigate it through employment of other assets, as well as through co-operation with allies. Even taking operational activity into account, we remain of the view that the SDSR is the right context in which to take a decision of this significance.
Lord Reid of Cardowan
My Lords, does the noble Earl accept that there is an ingenuity in the MoD in producing euphemisms? I was once told that something was being put not into mothballs, but into a “state of extended readiness”. When he mentions the capability gap, will he accept that the maritime patrol aircraft and its facilities is not an optional add-on for a nuclear deterrent but an essential component providing surveillance, security and secrecy of location? What is the point of having a continuous at-sea submarine-based nuclear deterrent if it does not have those features? This has all the hallmarks not of a minor housekeeping problem for the MoD but of a major strategic blunder.
Earl Howe
My Lords, I emphasise again that this matter will be looked at very closely in the context of the SDSR—indeed, some preparatory work has already been done. I do not accept the noble Lord’s contention that we are without protection in this important area. We have the use of other military assets, as I said, including Type 23 frigates, submarines and Merlin anti-submarine warfare helicopters, and we rely on the assistance that we get from our allies and partners.
Lord Craig of Radley (CB)
My Lords, the Minister mentioned that some preparatory steps are being taken in the MoD. What date is the MoD planning for the introduction, assuming an agreement through the review that he mentioned?
Earl Howe
My Lords, I think that the noble and gallant Lord will accept that we must not leap ahead of ourselves too much. However, I can tell him that the capabilities required from a future maritime patrol aircraft have been studied by the MoD over the past two and a half years. The study has received representations from a number of defence industrial organisations, which have allowed us to understand better the nature of the platforms in existence, as well as the timeframe in which novel technologies are likely to mature.
Baroness Jolly (LD)
My Lords, given the Minister’s response just now, can he reassure the House in the mean time how we will be able to meet our international obligations on search and rescue—for example, were an aircraft to crash in the furthermost corner of our sector of the Atlantic?
Earl Howe
My Lords, a range of other military aircraft provide search and rescue radar capability to the Armed Forces. We have the E-3D Sentry system, which admittedly is optimised for the air-to-air role, but its radar has a maritime search mode. C-130 Hercules aircraft are fitted with radar systems that, combined with visual search, provide basic maritime search capabilities. RAF Sea King helicopters, and Royal Navy Merlin and Lynx helicopters all possess short-range surface search radar for use in maritime search operations.
Lord Rosser (Lab)
I welcome the Minister to his first Defence Question since his appointment. He has moved from the health of the nation to the health of our Armed Forces. He referred to the strategic defence and security review and our maritime patrol capability. Can he confirm that, in pursuit of a bipartisan approach to defence policy, Her Majesty’s loyal Opposition will also be involved in the consultations on the SDSR, which the Government told us last Thursday in this House are now taking place?
Earl Howe
My Lords, I hope I can reassure the noble Lord. We will be looking for opportunities to consult a wide range of stakeholders, including industry, naturally, academics and parliamentarians. The Opposition will be welcome to feed in their ideas in the course of that process.
Lord West of Spithead (Lab)
My Lords, the surveillance of our offshore economic zone and our waters is much broader than just the submarine issue. There is a real resource and money issue. We have already sent two Border Force cutters to the Mediterranean, one of our offshore patrol vessels for fishery protection has gone to the West Indies, and there is insufficient money in the defence budget. If we are going to provide this capability, what capabilities are going to be removed because there is just not enough money to do the things we need to do without going up to at least the 2% of GDP and, ideally, more?
Earl Howe
My Lords, it is important to emphasise that the SDSR will be underpinned by a very robust assessment of the threats that face us and the needs that we have to meet those threats. On the noble Lord’s wider point, the Ministry of Defence is just one organisation with a role in the security of the UK’s territorial waters. Under the UK national strategy for maritime security we have a ministerial working group chaired by the FCO. That has been established to focus on maritime security in its entirety.
FIFA
(8 years, 11 months ago)
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The Minister of State, Ministry of Justice (Lord Faulks) (Con)
My Lords, the Crown Prosecution Service does not conduct criminal investigations. The Serious Fraud Office has not opened a criminal investigation into allegations relating to FIFA. While the SFO has not opened such an investigation, it is actively reviewing material in its possession. It also stands ready to assist the US and Swiss authorities in their investigations, although, by international convention, the SFO would not comment on such matters.
Lord Bach (Lab)
My Lords, I thank the Minister for his Answer. Of course, by its nature this scandal is international and has been brewing for many years. We have excellent investigative and prosecuting authorities in this country. Does the Minister agree that this is the appropriate time for a thorough investigation of any possible British connection, whether through the banking system, British nationals or in any other way? Will Her Majesty’s Government ensure that sufficient resources are made available for any such investigation?
Lord Faulks
My Lords, this is a fast-unfolding story. I am sure we can be generous enough to acknowledge the major contribution the United States Department of Justice has made to this matter. In the mean time, we stand ready to assist. It is a fast-developing situation. The SFO has been aware of allegations relating to FIFA for some years. It is keeping the situation under review and is ready to assist in any way it can. We do not think there is a lack of resources. Although the SFO is involved in a number of high-profile and difficult cases, including the LIBOR manipulation, resources are not an issue in this case.
Lord Thomas of Gresford (LD)
My Lords, soliciting a bribe is a crime. Will the SFO make inquiries of the members of the England bid team for the 2018 World Cup, which achieved only two votes out of 22 from the committee, about whether they were approached by anybody for a sweetener in relation to their bid?
Lord Faulks
The Swiss authority’s investigation is particularly focused on the 2018 World Cup bid on the basis that the jurisdiction is based on FIFA being a Swiss private company. If there is any information that we have in this country, we stand ready to assist on that, too.
Lord Faulkner of Worcester (Lab)
Will the Minister heed those who are calling for the bidding process for the 2018 and 2022 World Cups to be reopened? Will the Government make it clear that they wish to see that happen?
Lord Faulks
It depends on what is found in relation to those bids for 2018 and 2022. The Government are most concerned, as is the FA, to find out whether there was any transgression in that case. Of course we cannot rule out the possibility of those bids being reopened.
Lord Soley (Lab)
My Lords, given the growth of corruption in world bodies generally, and given that this is the year of Magna Carta, should we all not just be celebrating what the United States and Swiss authorities have done—for the reason, I understand, that the offence was alleged to have started there—but looking for a way in which international justice can make its mark in the world? Frankly, it is needed now more than it has ever been.
Lord Faulks
I agree with the noble Lord. We provide mutual legal assistance to a number of countries in accordance with treaty obligations. There are always difficulties with criminal jurisdictions extending beyond one country to another, but I entirely accept that co-operation should be the order of the day where these matters are concerned.
Lord Geddes (Con)
My Lords, would the Minister join me in congratulating my noble friend Lord Courtown on persuading Mr Blatter to resign when he did?
Lord Faulks
I suppose there might be some slight dispute over cause and effect, but nevertheless I join my noble friend.
Lord Wallace of Saltaire (LD)
My Lords, does Her Majesty’s oversight of criminal law extend to offshore financial centres under United Kingdom sovereignty? From what has already come out, it is clear that a number of these illegal payments flowed through offshore financial centres that are British Overseas Territories. Do the Government intend to investigate that, or do they regard it as outside their jurisdiction?
Lord Faulks
It will be a question of fact in relation to each allegation as to whether it comes within the jurisdiction. As the noble Lord may well be aware, the Bribery Act 2010 came into force in July 2011, which has to some extent extended criminal jurisdiction. The timing of any alleged offence will be crucial, but if there are any offences we are not going to be restrained if there is a prima facie case of infringement of criminal law within this jurisdiction.
Baroness Deech (CB)
My Lords, will the Minister take this opportunity to acknowledge the fearless part played in this by British investigative journalism, and the importance of a fearless and not overregulated British press?
Lord Faulks
I have absolutely no difficulty in acknowledging that, particularly the contributions by the Sunday Times and “Panorama”.
Lord Reid of Cardowan (Lab)
My Lords, should we not also place on record our appreciation for the initiative and courage of a Member of this House, my noble friend Lord Triesman, in raising this issue a long time ago and being thoroughly abused for it in many quarters at the time?
Lord Faulks
Equally, I am more than happy to raise that. We should also note that such is the momentum behind this investigation that we have some of the main culprits starting to turn against each other, so we can say that this investigation really has traction.
Assisted Dying Bill [HL]
Conscientious Objection (Medical Activities) Bill [HL]
European Union Citizens (Electoral Rights) Bill [HL]
Divorce (Financial Provision) Bill [HL]
Cohabitation Rights Bill [HL]
Queen’s Speech
(8 years, 11 months ago)
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Lord Gardiner of Kimble (Con)
My Lords, this is the final day of the debate on the humble Address, and the advisory speaking time is seven minutes. That will allow the House to rise at a respectable time, and I hope that noble Lords making their contributions will be mindful of that.
The Commercial Secretary to the Treasury (Lord O'Neill of Gatley) (Con) (Maiden Speech)
My Lords, I begin by thanking your Lordships for the warm and generous welcome I have received from everyone in this House. It is a privilege to serve as a member of Her Majesty’s Government, and it is a particular honour to make my maiden speech opening this debate following Her Majesty’s gracious Speech. I have been told that the conventions of a maiden speech require the speaker to be both brief and uncontroversial. Let me warn noble Lords—though some already know me—that only about 50% of that comes naturally to me.
My only regret today is that my parents are no longer around to see me here. They were true working-class Tories, which may surprise some people. They would have been not only proud but, frankly, slightly astonished that their continuous attempts to get me to focus on the Daily Telegraph at the breakfast table during my younger years, and not on the latest Manchester United programme, eventually bore some fruit. Indeed, one of my cousins told me just yesterday that even many years later my dad was still, in my absence, apparently pondering whether I would ever get a proper job. That showed me that they appeared to know that an individual and society’s collective productivity is what drives wealth and sustains success. This Government have put productivity as a priority for the next five years.
I was brought up in south Manchester, where I attended the local primary and junior school. When I reflect back—which, of course, I have especially done in the past few days—it is still clear to me that many of those school friends were at least as naturally gifted as I may have been, but for a variety of reasons, so many of them did not achieve their potential. I was lucky enough to go on to university and then achieve a career in the City, ending up as chief economist of Goldman Sachs. My time there overlapped with the rapid growth in the so-called large emerging economies, especially Brazil, Russia, India and China, which nearly 14 years ago now I was lucky enough to describe as “the BRICs”.
During those 18 years I started to understand the factors that drive economic growth. Economic theory tells us there are two things that make a country’s GDP grow—the size of its labour force, and its productivity—and I believe that this basic theory is right. The labour force is primarily driven by a country’s population, which is of course limited by physical factors. Importantly in that regard, the UK seems reasonably well blessed for the next couple of decades compared with many of our developed country—and in particular G7—friends. Productivity is trickier, but we can try to influence that with good policy, and I believe that if we are bolder and truly ambitious, we can do something about it.
I am therefore very excited to have joined the Government at this time to help drive the changes that this country needs to try to increase our productivity, whether that is having the right infrastructure, giving our children the best education, giving our workforce the skills they need for the 21st century, getting more women into the workforce, having a more effective policy on housing supply, providing better long-term incentives to invest, or providing even more effective and—importantly, perhaps—less strangling regulation.
During my time in the City, I also saw that successful interconnected urban areas—often, areas beyond the capital city—are vital to economic growth. The UK was, and frankly still is, underperforming in this regard. So, when I left Goldman, among the things that came on to my plate, I was very attracted to an offer to chair an independent commission on the growth of our cities outside of London. I pay tribute in this regard to my noble friend Lord Heseltine, whose work in this area has of course been groundbreaking. His was one of the very first voices to say that government policy on the industrial cities of the north should not be one of managed decline. He was a true pioneer in trying to help them to enable themselves to redevelop.
That can-do, positive, growth-oriented approach has been at the heart of what I ended up somewhat inelegantly calling “ManSheffLeedsPool”, which, of course, has now become better known as the northern powerhouse, not least because it includes other important northern cities such as Hull and the cities of the north-east—strong, interconnected cities across the north of England. I have been lucky enough to be asked to help deliver this, and to use my experience in the emerging world—especially, although not only, China—to help improve the UK’s economic performance.
Importantly, I will also continue to lead the review into antimicrobial resistance that I have been leading for the past nine months, for which we will make our final recommendations in about 12 months’ time. I hope that noble Lords will continue to feed into the extremely productive work that the review is carrying out, which in itself will help to improve the productivity of not only the UK but the whole world.
I believe that this country could be on the edge of something exciting and special. It is an honour and privilege to be asked to serve in Her Majesty’s Government, and I look forward to contributing to the work of this House.
Turning to the legislative agenda, last week in this Chamber we heard Her Majesty’s gracious Speech, setting out this Government’s legislative programme, which will build on the foundations laid in the previous Parliament to get Britain back towards prosperity. Our legislation is designed for everybody in the country, meeting their needs and helping them to fulfil their ambitions at each stage of their lives. Important things were achieved in the previous Parliament. The deficit has come down, and the economy has improved. The record on jobs, in particular, has been strong. There are 2 million new jobs and, importantly, in the past 12 months we have had the strongest employment increase among the G7 countries. Today, we have the highest employment record in the UK’s modern history.
However, the work is far from finished. The fiscal deficit is still too high, and the same is true of our external current account deficit. Our trade remains overly reliant on slow-growing emerging European markets. We need to do more with my friends in the emerging world. There are big infrastructure decisions that we have yet to make. Our businesses are still hampered by excessive regulation, and of course, there is so much to do to improve the competitiveness of our cities outside of London. The cities commission that I chaired showed that if the largest metro areas outside of London—not just northern powerhouse, but others too—could grow at the same strong rate as London, the UK’s national growth trend could be boosted by 0.2%. This may seem immediately significant only to the economics geeks among your Lordships but, to put it in perspective, it will translate into an extra £79 billion to the British economy by 2030.
Our productivity challenge is well known. I do not need to labour too long on the statistics, but our output per hour is 17% below the G7 average; 27% below that of France; similarly, 28% below that of Germany; and, even higher, 31% below that of the US. In my judgment, there are some valid questions about the accuracy of our productivity statistics but that should not be an excuse. We can and should do a lot better. If we could get our productivity rates up, we could enter a virtuous circle to the benefit of all.
Against that background, today I shall briefly address the measures in the Government’s legislative programme dealing with business, economic affairs and transport.
When businesses do well, so does the country, so we want to help businesses every step of the way. Our enterprise Bill will remove another £10 billion of red tape from businesses. Our target for cutting red tape will cover the activities of more regulators so that they contribute to our deregulation target too. We will make it easier for small businesses to solve late-payment disputes with other businesses. We will also create a faster, simpler, more efficient business rates appeals system, to be in place for the next business rates revaluation in 2017.
Moving on to the tax lock, we also want to let people keep more of the money they earn to spend or invest as they see fit. We will keep the manifesto commitment not to increase the rates of national insurance contributions, income tax or VAT. The commitments for income tax and VAT will be delivered through a finance Bill and, for NICs, we will introduce a national insurance contributions Bill, preventing any increase in the class 1 rate above the current rates.
We believe it is important to keep improving the transparency, accountability and governance of the Bank of England. To keep us ahead of the game, a Bank of England Bill will address the recommendations of the Warsh review, complete the transition to eight meetings of the Monetary Policy Committee a year and formalise changes to the Bank’s top team. Further changes are under discussion between the Treasury and the Bank, and we will announce them shortly.
This Government believe that strikes, many of which disrupt essential public services, should be the result only of a clear mandate. The trade unions Bill will therefore introduce a 50% threshold of those eligible to vote for ballot turnout. In the health, education, fire and transport sectors, it will also introduce a voting threshold of 40% in support of strike action in order for that vote to be legitimate. Other measures will tackle the intimidation of non-striking workers, reform the rules on ballot mandates and make changes to the role of the certification officer.
Noble Lords will recall that in 2013 the Prime Minister delivered a deal in Brussels which saw the EU budget cut in real terms for the first time while protecting our rebate. The mechanism by which individual member states finance this budget is known as the Own Resources Decision. The new ORD was agreed unanimously by member states in 2014. This fully reflects the financing aspects of the Prime Minister’s historic deal, including protecting our rebate. In common with previous practice, legislation is required for the UK to approve this, and we will introduce this in the form of the European Union (Finance) Bill.
I turn now to an important topic for the country and a Bill which, if executed correctly, could be highly advantageous; namely, the HS2 Bill. As is known from a number of my past public comments, I believe that other significant transport projects are vital for the success of the northern powerhouse. However, let me point out that, just in the past few days, a significant number of the leading local policymakers of all the northern cities that will be linked by HS2 have repeated their highly favourable stance to this project.
HS2 will connect eight of Britain’s top 10 cities. It will more than double capacity on some of our busiest routes and support up to 100,000 new jobs, 25,000 of which will be in construction alone. The cross-party support shown to HS2, both here and in the other place, is notable. I would like to pay tribute to the work of the noble Lord, Lord Adonis, and others in this regard. This Bill will provide the Government with the legal powers to acquire the land needed for phase 1 of HS2, to build it and to operate it. As a hybrid Bill, it will also enable both Houses to hear petitions based on specific issues relating to HS2, although not about the general principle. I look forward to working with my noble friend Lord Ahmad of Wimbledon on this important issue.
The Department for Transport is also taking forward the buses Bill to enable combined authorities with directly elected mayors to franchise their own buses. It is right that local areas that have ambitious plans to grow and develop should be given franchising powers as they consider necessary to deliver an integrated transport system.
In conclusion, this Government’s legislative programme has three primary objectives: first, to help working people at every stage of their lives; secondly, to put the public finances on a stable, sustainable footing by running a surplus; and thirdly, to deliver a step-change in the nation’s productivity. A dynamic, growing economy, underpinned by sound finances and solid investment, is by far the best way to give the people of this country a better standard of living. The measures set out by Her Majesty last week will help us achieve exactly that.
Lord Mendelsohn (Lab)
My Lords, it is a great honour and pleasure to follow such an impressive maiden speech. The Minister is known to me and I was very pleased to hear of his appointment and delighted that he has now taken up ministerial office. The Minister earned an undergraduate degree at the University of Sheffield and a PhD from the University of Surrey. He enjoyed a meteoric rise through the investment banking industry, ending at Goldman Sachs. He should also be known for his services to education, for philanthropy and for his very important work on cities.
Many have previously sought to woo the Minister into political service. I had always hoped that the colour of the shirt of the football team he adores so much was always likely to be a sure indication of his devotions. A recent FT article on his appointment described his political views as “opaque”. Well, from where I sit, he has turned into a Blue—not the most comfortable of places for a Manchester United devotee.
The Minister is an engaging speaker, as we witnessed. An online commercial listing to book the Minister to speak—an old listing, I hasten to say—provides his CV and, to help with your search, has a tab you can press if you are interested to find “similar speakers”. I pressed it. He will be pleased to know that among the eight speakers listed were Franz Beckenbauer and Myleene Klass. He may be comforted to know that the list also included Steve Forbes.
The Minister is a great addition to this house and to the Government. His fantastic work on cities and growth is truly to be admired. I wish him well and wish him every success in his post.
It is always a pleasure to see the noble Baroness, Lady Neville-Rolfe, in her place. I look forward to hearing what she will say later. I congratulate her on her extended role in the Government and hope that the courteous and generous way in which we were able to debate fully on areas of disagreement and collaboratively on areas of agreement will continue in this Parliament.
As someone who still pursues an active life in business, I refer noble Lords to my entries in the register of interests. I am looking forward to this debate and to the maiden speech of the noble Lord, Lord King of Lothbury.
On behalf of these Benches, I want to provide some context to how we will look at the measures proposed in Queen’s Speech and refer to some matters which we hope the Government will consider in their plans. We are yet to be convinced that the gracious Speech provides a strategy to build the productive and sustainable economy that the country needs. There is, for example, a considerable problem with foreign direct investment and its impact on productivity. Our performance is good and has been for many decades, but in the past five years we have clearly seen foreign direct investment’s contribution to UK performance, measured by GDP per head, become a drag on productivity. The coalition Government ended with a wide deficit still in place in public sector finances and external imbalances. Alone among the major economies, this twin-deficit problem is in double-digit territory. A current account deficit represents a country selling its assets and/or incurring debt to finance spending. This is a reasonable strategy if such investments are likely to create a return and to pay off in the long term, but the UK’s problem is that we have been seen to be on a consumption binge. Household savings are weak; household debt is rising steeply and projected to deteriorate further. We may continue to grow but there will be costs and many potential risks and shocks to the system ahead.
The plain truth is that the UK economy has not recovered because of the successful fiscal austerity programme of the Government—quite the contrary: the UK economy recovered because the last Government abandoned the fiscal consolidation programme three years ago and left it for the next Government to deal with. The way in which they dealt with austerity was not balanced. The Minister is in charge of infrastructure, so we hope that he will succeed in delivering effective and long-term investment and making a significant difference.
The likely occurrence of bumps ahead is indicated not just by frequent reports of uneven confidence in different sectors of the economy but by the proposed national insurance contributions Bill and finance Bill. We will not oppose measures that lock the main rates of tax until 2020, as we oppose additional taxes on working people. We want to see the tax burden shared fairly and soberly, with any scope for tax cuts focused only on middle and lower earners. We will not oppose the measures on the national minimum wage even though it is worth pointing out that they provide no additional benefit, as life, frankly, is just too short.
We support efforts to get people back to work, to achieve full employment and to get the social security bill under control. We will look carefully at the full employment and welfare benefits Bill, especially in light of what may be said in the emergency Budget.
We will not oppose the European Union (Finance) Bill, whose purposes we support, and we will clearly support measures in the Bank of England Bill that help ensure that the Bank is able to fulfil its role of overseeing monetary policy and financial stability. We will await the publication of further details.
It is important that the business and economic dimensions are considered in relation to other Bills in the legislative plan, including especially the Cities and Local Government Devolution Bill. We will probe this Bill to make sure that the important economic opportunities are fulfilled and made available to all.
I am concerned that the trade unions Bill masks a much darker purpose that the 20-year trends do not support. No one can accuse me of being in the pocket of the unions and I believe that they require more than just reform, but there lurks something nasty and unpleasant in the construction of this Bill and in its lack of natural justice. The Government should expect some energetic engagement on it.
The centrepiece Bill, which is the expression of the Government’s growth agenda, is the enterprise Bill. I am bound to say that it is a little limited in its scope, but there may be a case for doing a few things well. However, we will naturally support measures that take us beyond where we currently are. We will naturally support, too, measures to make life easier for small businesses, including tackling late payments, as indeed we will support measures to improve the business rates system and address issues around pay-offs for public sector workers. I especially look forward to a detailed analysis and scrutiny of the suggested £10 billion of savings which we have heard about. I am pleased that further measures are planned for small businesses and am grateful for being given a second bite at the cherry on late payments, which is a terrible scandal, with £40 billion to £50 billion of cash failing to circulate properly in the economy and drive economic performance. Having personally examined the Australian arrangements in relation to our debates on the previous Bill, which became the Small Business, Enterprise and Employment Act, I look forward to understanding the Government’s argument for the new proposals.
The Queen’s Speech is quite bold in its language but modest in its scope. The country needs to strive constantly for a low-cost and more business-friendly environment; a more skilled labour force; better economic infrastructure; an industrial policy that fosters competitiveness, innovation and entrepreneurship; balanced and long-term investments; to make the case for the positive role of business in creating prosperity, employment and fulfilment; and, most crucially, to address the productivity failure of the past five years, which will undoubtedly be the greatest challenge for the next 10.
We will rigorously scrutinise every Bill that is before this House. We will be constructive and collaborative where we can be but our economy and businesses need more than what is on offer and we will not shirk from suggesting what can be done within the bounds of the conventions. We will not hesitate to challenge the Government when the occasion demands.
Baroness Kramer (LD)
My Lords, it is a pleasure to join in the welcome to the noble Lord, Lord O’Neill. There could not have been a more difficult set of circumstances under which to make a maiden speech, and he did so quite brilliantly. He has achieved a great deal in a very distinguished career and he brings great experience and financial expertise to this House.
As he will gather from my remarks, I hope that he will act as a reality check on a Government who show every sign of veering away from the balanced and fair coalition strategy on the economy and finance that has brought us through one of the worst financial crises in our history and advanced the rebuilding of our economy.
When the IMF and the OECD praised the success of the coalition in bringing down the deficit and restoring financial stability, they praised an approach in which everyone contributed—the rich as well as the middle and, indeed, the poor; and with tax increases as well as cuts in public spending. The broadest shoulders took on a significant burden and we were all in it together. That approach not only promoted fairness but bolstered economic recovery and dynamism across the country.
However, with the Liberal Democrats gone, the Tory Government are now clear that fairness and balance have been abandoned. Ideologically driven welfare cuts are at the heart of the Tory strategy and the Government have trumpeted their determination to cut £12 billion from the welfare budget—not to eliminate the deficit but over and above eliminating the deficit. They have not even had the grace so far to name those cuts—only about £1 billion are identified in the gracious Speech. So what are the rest? Perhaps the Government will admit that this is not considered economic policy but is essentially a sop to a Tory right wing that bitterly resented the elements of fairness and balance that brought that success in the coalition years.
The noble Lord, Lord O’Neill, also told us with enthusiasm—which I understand—of the new NIC and finance Bills to enact into law measures to prevent his own Government raising income tax, VAT and national insurance for the next five years. Frankly, the premise that any Government has to pass a law to regulate their own tax behaviour is quite extraordinary. However, the issues go deeper. I suggest to the noble Lord, Lord O’Neill, that, back in the days when he was involved in asset management, if a chief executive had locked his company into paying a dividend no matter what the state of the company, the industry and the country, he would have dumped the stock and called for the resignation of the CEO—and yet he has just announced the government and Treasury equivalent. Do he and the Government really believe that volatility, instability and crises are ended?
Gordon Brown believed that he had ended boom and bust for ever, and consequently the Labour Government made disastrous decisions on public spending that drove a financial crisis into a deep recession. Now we are faced with a string of issues and instability—a Greek exit from the euro; a possible EU exit by Britain, which would surely be a self-inflicted injury on an extraordinary scale; Russia’s ambitions; ISIL; a weakening Chinese economy; and never mind the unknowns—that same arrogance has now returned to the Treasury, and this time it has a Tory face. That is a fundamental threat and I hope that the noble Lord, Lord O’Neill, will use his expertise and experience to temper some of this arrogance before, once again, we are on a trajectory of failed decisions that restrict our ability to respond to and remedy the crises that inevitably will come.
There is some limited reform of the financial system in the Government’s proposals, notably in the Bank of England Bill. Let me suggest that the Government could do worse than enact more completely the recommendations of the Parliamentary Commission on Banking Standards, of which I was privileged to be a member. But yet more needs to be done. We have the return to the private sector of RBS. This is surely an opportunity to look at doing that in a way which will increase the diversity—preferably the regional diversity—of banking in the UK. We need better arrangements to deal with systemic risk, particularly that posed by central counterparties for clearing derivatives—an area in which the noble Lord will have real expertise. We lack a sufficient regulatory framework to deal with abuses in personal financial services, the latest being the behaviour of so-called debt management companies. We will press the Government to address these and a wide range of similar issues.
The noble Lord, Lord O’Neill, referred to the importance of the full employment Bill. I am most interested to know how he reconciles that with the Government’s targets to reduce net immigration to the tens of thousands when, as he knows, it is the import of relevant skills that is absolutely critical as an element of growth.
As a Liberal Democrat, I am obviously pleased that our policy of lifting the starting rate of income tax continues, although I note that when we were part of the Government we did not need a law to make it happen. I am amazed that the Tories trust themselves so little that they need a law to make them do it.
My noble friend Lord Teverson will talk much more extensively on transport issues but obviously I am delighted, after my time as a Transport Minister, that HS2 progresses, as does the devolution of transport powers to cities. The policy owes a great deal to the noble Lord, Lord Heseltine, but perhaps I may also mention that it owes a great deal to Nick Clegg personally—as does the whole process of devolution.
We on these Benches will be constructive, as is our duty and our wont, but our role is to scrutinise and revise. What a tragedy for the country if the hard-earned successes of the coalition years are now squandered to pacify a right-wing ideology.
Lord Birt (CB)
My Lords, a new Government have a unique opportunity to set a clear strategic direction for the longer term and thus to achieve real, fundamental and enduring change, as Clement Attlee and Margaret Thatcher once did. 1 hope that this new Government will begin first by articulating a long-term plan for reducing our nation’s indebtedness. Earlier this year, the noble Lord, Lord Deighton, set out in a Written Answer the aggregate debt of the G7 countries in 2012, which was the last year for which comparable figures were at that point available. Aggregate debt is not just government debt but all debt; it includes private households as well as the finance and general business sectors.
The picture unveiled by the noble Lord, Lord Deighton, was truly gory, and the OECD’s updated figures for 2013 appear to show the same grim picture. Two countries stand out from the crowd: Japan and the UK. Japan is higher up the naughty step than we are, but the UK, by a wide margin, is far more indebted than other G7 countries, with total aggregated debt of seven times GDP—a truly shocking figure.
We appear suddenly to have a welcome, if belated, consensus that when the sun shone the last Government but one should have saved, not spent. This Government accept, I think, that when the global tsunami struck, private-sector debt was also too high and that as a country we were massively overexposed to debt in the financial sector, as the bank rescues all too dramatically illuminated.
In his Answer, the noble Lord, Lord Deighton, suggested that overall levels of private and commercial-sector debt should not threaten our financial stability, but he declined to set any explicit targets for the future. Would the Minister set out in her concluding remarks how we will know when we have reached the point of comfort as a nation for both sector and aggregate debt? We have in total 45% more debt than Germany. Would we, for instance, like to reduce down to current German levels, or even beyond? How long should we take to do that? What principles should guide us? Perhaps the Minister will say.
Our approach to bringing down the deficit, as we must, should also be strategic and not technical. On many occasions in my life, working in both the public and private sectors, I have had to drive or preside over spending reductions. In reducing public spending the focus should be not on capacity reductions but on maintaining desirable public outcomes more cost efficiently and by myriad means: promoting competition, ending duplication, improving processes, sharing services, harnessing technology and much more.
We should also be suspicious of the shallow, much repeated assertion that spending cuts must equal capacity cuts. In most areas of the economy, more can and is being done for less. I continue to see substantial evidence that that can be true in the public sector, too. But there is a problem to overcome if we are to achieve that goal. In my time in government, I saw how weak Whitehall was at analysing cost structures—I say this surrounded by a phalanx of former Permanent Secretaries to the Treasury. It was a world away from best private-sector practice, and I see no reason to believe that it is much better now. Not only the departments but the Treasury itself needs a more muscular value-for-money capability, and now is the time that it needs it most. If we focus just on cuts we will make a grievous error, for in healthy organisations you invest even as you cut. You prioritise, keeping within your means in the here and now, but at one and the same time you plan for the longer term.
As a nation we must be clear-sighted about our long-term priorities. With black clouds on every horizon, with the world a troubled and volatile place, the first responsibility of government is to design, to build and to maintain a security and defence capability that will meet our future needs. Next, we must improve the health of our economy, as well as safeguard our defence. We must identify why our national productivity has been lower than that of comparable countries for so long. For certain, as the noble Lord, Lord O’Neill, suggested in his punchy maiden speech, we must invest in the future skills our economy will need. We must accelerate spend on our road and rail infrastructure, on which we are by far the worst compared with our competitors, and we must end the shameful delay in creating appropriate national strategic airport capacity. Let us be alert to the pace at which much of Asia moves, and let us not be left badly behind.
Finally, a new Government must ask themselves what capabilities and accountabilities they need at the centre, not only to drive and to monitor a massive and unavoidable programme of change right across Whitehall but to improve our national planning. Who in government foresaw that our population would grow by 7.5% in 10 years, and in the middle of highly adverse economic circumstances? Who forecasted and planned for this? I suggest that no one did. We need at the centre of government a proper focus on long-term and integrated planning.
Now is the moment to begin to drive the UK, over the next five to 10 years, to a more harmonious and stable place—a UK with a more balanced, productive, less indebted economy, and with a more alert, agile and efficient state. This can be achieved, but only if we seize the moment and start now.
Lord Higgins (Con)
My Lords, it is a great pleasure to welcome the noble Lord, Lord O’Neill of Gatley, to the House and congratulate him on his maiden speech. It is not an easy thing to make a maiden speech from the Front Bench and to combine those things adequately. I had the same experience when I entered the House but I had the disadvantage of doing so in opposition. I am delighted that the noble Lord has the chance to do so in government.
One looks forward with great pleasure to the maiden speech of the noble Lord, Lord King of Lothbury, who will certainly make a major contribution to our debates, not least, of course, as far as banking is concerned. I also look forward to hearing the maiden speech of the noble Baroness, Lady Altmann, in due course, although she is not down to speak today. When I served for a decade or so on the Front Bench as the main spokesman on pensions, I benefited enormously from her comments outside the House. It is very good indeed that we shall have the opportunity to hear her views first-hand rather than from the sidelines.
We are lucky to have those who are now joining us at a time which I think is more difficult than any I can remember in the last 50 years or so as regards both the mass of difficult problems at home and impending dangers—the well-known expression—abroad. I benefited greatly from a very good article by Professor Vernon Bogdanor, The Crisis of the Constitution, in which he analyses the way in which we have a whole series of interlocking crises. We have a Scottish problem following in the aftermath of the referendum, a European problem with the anticipated referendum, a human rights problem, an English problem in terms of English votes and so on and a crisis of representation in a multi-party system. This is all extremely difficult and the problem arises from the way in which each of these crises interlock. As I say, this is well analysed in the article to which I referred.
In the short time I have I want to concentrate on two things: the deficit on the one hand and the European referendum and our lead in Europe on the other. I am afraid that there is still enormous confusion in the press between the deficit and debt. The two are not the same. The extraordinary thing about the deficit is that it has been overwhelmingly at the centre of our economic problems for the last five years, and will continue to be so for the next five years, but there is no mention of it in the gracious Speech. That is curious. What the Government are planning to do will be immensely difficult to achieve over the next five years, not least because so many areas have been ruled out as far as making economies is concerned. I do not know whether legislating at this stage in the proceedings to make that a solid situation we cannot go back on is very helpful.
Having said that, we need to stress that the deficit is a UK problem. Remarks by leaders in the Scottish nationalist field both during the campaign and since seem to indicate that Scotland will be exempt from the cuts that will be necessary if we are to cure this United Kingdom problem. Indeed, one gets the impression that it will be a case of having austerity in England but not in Scotland. We must face up to the fact that Scotland is already in a privileged position. The Smith commission report would seek to maintain the present balance. We have to look again at the Barnett formula and we should not rule that out. Indeed, the great Lord Barnett himself—greatly missed—felt that it needed to be changed. Therefore, I hope that we can take some action as far as that is concerned.
Finally, I turn to the question of the European referendum and the remarks made in the Queen’s Speech, which says that the Government will,
“pursue reform of the European Union for the benefit of all member states”.
There is a whole series of issues, not least freedom of movement, on which clearly the Prime Minister will need to negotiate. The crucial thing is that we must take a lead, as the Queen’s Speech says, in the interests of Europe. We must face the fact that the present structure of Europe, dependent as it is on the eurozone, is fundamentally flawed.
We should be taking a lead in planning for a situation where if a country has to leave the eurozone, it can still remain in Europe—that is very important—but also that there is a planned process of exit. I believe fundamentally that there is no prospect of the Greek economy becoming competitive at the present exchange rate. Indeed, this view is shared by a number of others, including Alan Greenspan in the United States. We ought to press the European Union to make sure that there is an escape mechanism for countries that are not going to be competitive. We cannot have a situation where they go on being bailed out for ever and the European economy as a whole, and particularly our own, is adversely affected as a result.
Lord Reid of Cardowan (Lab)
My Lords, I am genuinely delighted to welcome the Minister to the Dispatch Box, for three reasons. First, he deserves it. Indeed, he deserves to be in the premier league on this side but at least he is on the red Benches, which should be some consolation to him. Secondly, it enables us to continue our occasional discussions on the great affairs of state, which of course involve the future of Manchester United Football Club. Thirdly, he majored on the truth that up to this stage dare not speak its name—productivity.
We are seven years on from the biggest recession in modern times—seven years during which we have had the slowest recovery—and five years of that, courtesy of the blessed Fixed-term Parliaments Act, have effectively been a general election campaign. I listened to the speeches, I read the articles and I looked at the manifestos and there was a great deal of advice on how to spend money, how to allocate resources and how to distribute wealth but nothing—nothing—on how to create wealth, from any of the parties, incidentally. So I am glad that the Minister is now majoring—now that the Government are safely berthed, as they see it, for another five years—on how to face the storms ahead, not least of which is productivity.
I want to make three points specifically on productivity and I do so from a background that has nowhere near the expertise that the Minister brings to the subject. First, there seems to be a danger of exploitation squeezing out exploration when it comes to productivity. Productivity has to do much more than just find more efficient ways of doing the same things. It needs exploration as much as—perhaps more than, in the present circumstances—exploitation. Sacrificing one for the other is not only unproductive but strategically very dangerous.
In that context, how productivity is measured therefore matters a lot. The Minister mentioned his scepticism about some statistics. I also have a great deal of scepticism about the means by which we measure productivity: the rate of output per worker per unit time, or labour productivity; and the residual of output not explained by the amount of inputs used in production—that is, the total factor production. These of course feature large in debate among the experts but they tend to assume that radical changes in modes of production do not need to be matched by radically improved means of measurement. I doubt that is the case.
The practical results of inadequate measures are real enough, though. Ordinary people feel the spectre of labour being substituted for technology and vice versa as exploitation far more widely than high-priced experts who are often indulging in groupthink—the very phenomena which enabled us to stumble into the recession last time around. As a result, people’s job anxieties are needlessly provoked and capital is poorly invested. Exploitation squeezes out exploration at all levels. It is remarkable that rather than investing capital surpluses in necessary innovation, last year share buybacks —buying back our own shares—amounted to $903 billion for the S&P 500. The failure to reinvest capital manifests itself in all sorts of small but significant ways: for instance, in unproductive labour being employed in the revival of hand car washes because of the failure to invest in highly successful technology, which is also, by the way, environmentally very sound.
These examples evidence two major failings sapping productivity. First, there is the failure to invest in research-intensive innovation that is vital to our competitive future—for instance, in UK biotech. Secondly, there is the failure to liberate labour for more productive endeavour by withholding capital investment, even in exploiting well-established technologies. Both are of course linked. Productivity measures are—to coin a phrase—not entirely fit for purpose, given the strategic challenge ahead of us. They are skewed to exploitation squeezing out exploration. The Chancellor, or the Minister, may well be spurred into action at long last on productivity but would be well advised to assure himself that he is using instruments calibrated for the real economy, not financial groupthink.
Secondly, unless we learn to innovate at the pace, intensity and scale fit for the strategic challenges ahead, our problems will grow, not our productivity. For centuries, British ingenuity and innovation have enabled us to sit astride the spokes at any given contemporary period of the globalised world. The shipping lanes we opened were complemented by financial services that underpinned confidence in growing trade. We constantly evolved, building coaling stations and laying submarine cables, which in turn allowed us to dominate the world’s communications, and developing engines to propel ships, trains, planes et cetera. At the heart of that is a language and ethos for pragmatism, which we share for the better conduct of business and science the world over. However, something has stalled. A deep, wide and persistent productivity disease has taken hold and we cannot afford that.
The third and final point is the advent of cyberspace. Success in the cyber environment, an environment characterised by constant entrepreneurial innovation, makes this issue more essential than ever. Yet according to the European Union Innovation Union Scoreboard 2014, despite the fanfares for Shoreditch and the Silicon Roundabout, the UK is an EU follower in cyberspace, not a leader. The evidence suggests that however world-class our research and education are, they simply fail to translate into innovation that sells. In particular, I say to the Minister that this includes an overweening financial services sector, which the Bank for International Settlements and the IMF warn can undermine productivity severely because its interests are served by generating short-term transactions, not investment in research and development or capital-intensive industries in the real economy.
If we are honest, we may be able to face these things. If we are dishonest and ignore these productivity inhibitors, as all parties did in the election, things will only get worse. Our fitness for the cyber environment is a benchmark that we must set for ourselves at “excellent” and “world-leading”. Reaching such benchmarks needs some very practical and sustained effort, and that effort needs to start now.
Lord Newby (LD)
My Lords, it is a great pleasure to be able to speak in today’s debate before I re-enter the Stygian world of the Whips’ office. I welcome the noble Lord, Lord O’Neill, and congratulate him on his maiden speech. I wish him well. I also look forward to the maiden speech of the noble Lord, Lord King of Lothbury. I will say something about the economy and then something, given that it has attracted considerable interest, about the attitude on these Benches towards the passage of business in your Lordships’ House.
Although the economic position inherited by this Government is incomparably stronger than that inherited by the coalition in 2010, a combination of deep-seated problems and external risks means that we are definitely not out of the woods. As far as the macroeconomic position is concerned, great progress has been made in reducing the deficit, and clearly more needs to be done, but I urge the Government not to bring about an accelerated elimination of the deficit on the back of very significant welfare cuts for the working poor and modest earners. That is neither economically necessary nor socially justifiable.
It is said that the only reason the Conservatives included the provision of £12 billion of welfare cuts in their programme was that they knew that, in any second coalition, the Liberal Democrats would not let them get away with it. They are now embarrassed and confused because they have not the faintest idea how they will make the cuts. I will make the Minister an offer. If the Government would still like the Liberal Democrats to scupper these proposals, I am sure that, with colleagues from across the House, we are still prepared to oblige. Perhaps the Minister will tip me the wink when the welfare reform legislation comes forward, and I will see what I can do.
In terms of the deep-seated economic problems facing the country, the last Government began to tackle some of them with some success, but much needs to be done. I will briefly mention three issues, all of them falling within the Minister’s priority of productivity. The first relates to innovation. Although the UK is a world-leading innovator in the service sector, we consistently spend less than our major competitors in this area in manufacturing. We are in fact 19th in the OECD for total expenditure and 24th for government R&D spending. We should be looking to increase the Government’s own investment in R&D to bring us much further up the OECD table. In particular, it is extremely important that we invest further in the extremely successful Technology Strategy Board, the Catapults and the sector research bodies, and that we commit to doing so over the long term.
Secondly, the housing shortage is now becoming a crisis. On current policies, the problem will get worse during the course of this Parliament rather than better. It is a particularly acute problem in London and in the social housing sector. I was therefore depressed to see that the Conservative manifesto devoted just three sentences, one of them descriptive, to affordable housing. Many changes will be needed in this area if we are going to really deal with this problem. I mention only one, which lies at the door of the Treasury and is an institutional mindset which is deeply damaging. The Treasury currently does not regard housing as part of our national infrastructure—as I discovered when I asked for a brief on infrastructure from Treasury officials last year. This must change, and the Minister is ideally placed to change it. I hope he will.
Thirdly, there is the northern powerhouse. The Chancellor, in his guise as the thieving magpie of Liberal Democrat policies, has very sensibly identified the need to give greater government impetus to the development of the north by latching on to Nick Clegg’s advocacy of greater powers for the northern cities. This is greatly to be welcomed. However, not only must the northern cities and indeed other cities be given greater powers, as is planned, but if the infrastructure of the north, particularly the transport infrastructure, is to match that of London, greater powers on their own are not enough. More resources are going to be needed if we are going to transform trans-Pennine rail links, for example, than simply giving northern cities greater powers.
Much has been said already in these debates about the Salisbury/Addison convention and how the opposition parties should behave in this Parliament. Let me make it clear that, for my part, I would not support any suggestion from any of my colleagues that we should seek to frustrate the Government by filibustering or by mounting a full-frontal attack on every aspect of the Government’s legislation. But what we shall do is to challenge aspects of legislation with which we disagree. In doing so, we will be guided by the traditions of the House. As a young and impressionable Treasury spokesman in your Lordships’ House, I learnt about these traditions during the period of the last Labour Government.
Several episodes stand out in my mind. I remember with affection the vote called on the then Financial Services and Markets Bill by the noble Lord, Lord Saatchi, at 10.45 pm on 9 May 2000. I also remember the noble Baroness, Lady Noakes, catching me almost literally napping when she called a vote at 11.35 pm in Committee on the then Banking Bill on 26 January 2009. I also remember the memorable day when the noble Lord, Lord Davies of Oldham, rang me in my office having suffered a big defeat on the first day in Committee the previous day, on an amendment to the statistics Bill, to sue for peace. In that case, the Government had brought forward a Bill which seemed calculated to give Ministers more control over official statistics when they were pledged to reduce it. A cross-party group led by the noble Lord, Lord Moser, sought fundamentally to redraft the Bill. As a result of this early defeat in Committee, the Bill was largely redrafted. I think that everybody, perhaps even the noble Lord, Lord Davies, agreed that this was the Lords doing its work.
My experience in government was that, when the Government lost the argument, they tended to lose the vote. There have been a number of the Government’s flagship proposals which we have already debated in these Queen’s Speech debates where the Government have already lost the arguments. They can expect a busy time in the Division Lobbies in the months ahead.
Baroness Wall of New Barnet (Lab)
My Lords, I, too, would like to congratulate the noble Lord on his entrance into this House, and know that he will play a major role. As somebody who comes from the other side of the north-west divide, I was delighted to hear his rich south Manchester accent is still prevailing. It is really important that we keep the flag flying for the north-west.
I want to focus my contribution in this interesting and wide-ranging debate on important policies on an issue that some businesses are succeeding in and some are trying hard to do so, while many still struggle to understand the value that it would have for their business and, importantly, to many of their staff of both genders. I refer to getting the balance right—women in business. It is a fact that women play a vital role in business across all sectors, not least in the advanced manufacturing and engineering sector, and in all the STEM roles. Manufacturing is an important component for a balanced economy, and women are a vital component for a balanced workforce. We need 1 million more women in STEM roles by 2020 to meet the skills shortage and to achieve 30% critical mass of women carrying out those STEM roles. WISE has been very helpful in providing me with information to put this speech together; that organisation is very anxious about the state of science and engineering, particularly from its own aspect.
In 2014, there were 14.2 million women in the workforce overall, representing 46.5%. However, in STEM occupations there are only 689,000, representing only 12.8% of the STEM workforce. Currently, fewer than one in five, or 13%, of those working in STEM occupations in the United Kingdom are female, with fewer than one in 10 STEM managers who are women. In some areas, such as ICT and science and engineering, the percentage of women is actually falling.
I am keen to discuss what works. By taking positive action to support their female workforce, companies can target improvements in their recruitment of women, in reducing their resignations and holding on to them as important members of society, and increasing the number of women in senior executive roles. Many leading companies in the advanced manufacturing and engineering sector are implementing diversity strategies to ensure that they can recruit, retain and, very importantly, progress their female talent to deliver business growth.
A number of companies use Skills 4, which I support. Its career development programme to support female talent to progress their careers is usually successful. It is now offered as an open programme in partnership with WISE to allow smaller companies and individual women to access the rights and opportunities to grow. A number of companies are focused on improving their gender balance across a range of activities. For example, Atkins supports a women’s professional network and a women’s leadership council which guide women and act as role models and mentors. The Skills 4 career development programme and returners programme support women returning to the workforce following maternity leave or carer leave. They also offer a wide range of part-time and flexible working schemes. If businesses are serious about aspiring to have 30% of women on boards, they must take serious action to support and progress women to the top of their careers to ensure that they will be there when the places need to be taken up.
My noble friend Lord Davies of Abersoch, working collaboratively with business, agreed and got co-operation from business to set a target of 25% of women on the boards of businesses. There has been good progress in the FTSE 100, and it is believed this target will soon be achieved. However, this will be difficult to achieve in the STEM sector due to the small percentage of women in that sector, which means that the pipeline is not there and we need to create successful role models. There have been a number of key successful government initiatives to support women in STEM, but we do not have a real strategy across the key government departments—the Department for Education and the Department for Business, Innovation and Skills—to ensure long-term success.
The right honourable Nicky Morgan, the returning Minister for Women and Equalities and Secretary of State for Education, is in a good place to influence this. She stated that, looking forward, the Government have ambitions and plans which include continuing to close the gender pay gap, increasing the number of women on boards and in public life and increasing free childcare to 30 hours for working parents of three to four year-olds. This is all key, nobody would disagree with it and all of us would support it, but it has to happen rather than be talked about. There is a need for a joined-up government strategy across education, skills and businesses that we all want to succeed to make gender balance an integral part of mainstream policy rather than what often seems an add-on programme, particularly in apprenticeships where there is a chronic gender divide.
Who benefits? The compelling business case is clear and well researched. Diverse teams help drive customer insight, a further reach into new markets, team working, safety and risk management. It is well known that teams involving people from different backgrounds make better decisions than homogenous groups. Companies with three or more women in senior management perform better on nine criteria of organisational excellence, including leadership, accountability and innovation.
We urgently need young women to consider a career in STEM. This is the only way we will have that future and that pipeline will be filled. I congratulate the Minister on her dual role, which is obviously onerous but I am sure she will do extremely well. I urge her to work very hard with the new Minister to make sure that we have joined-up government. We need to stop saying the right things and start taking the right decisions.
Lord King of Lothbury (CB) (Maiden Speech)
My Lords, I am extremely grateful for your Lordships’ patience in allowing me to wait until after the general election before burdening the House with my views, and for the warm welcome that I have received. Parliament is a forbidding place for a central banker—our experience is usually confined to appearances in the other place before the Treasury Committee. I can report that, contrary to that body, the Economic Affairs Committee of this House offered not only greater decorum but also a superior quality of discussion.
With the general election behind us, I shall say a word about the economic challenges facing the country. Before that, I add my welcome to the noble Lord, Lord O’Neill, who will be responsible for many of the policies aimed at improving the performance of our economy. He will add expertise to the experience of the House at a time when economic issues loom large in our politics, especially in relation to Europe.
Over the past five years, the UK economy has expanded by almost 10%, faster than official statisticians initially estimated but still slower than expected at the beginning of the previous Parliament. The task now, as then, is to rebalance the UK economy away from private and public consumption and toward investments and exports. Monetary policy is in good hands, fiscal policy is tackling the structural deficit and banking is being reformed.
We have made progress, but we face two challenges. The first is to raise productivity throughout the economy—easy to say, hard to do. Several noble Lords today have made convincing contributions to explain what we need to do. Despite recent official data, we should be optimistic about the long-run growth rate of the British economy. Innovation is our strength. If we support research and encourage its application to commercial ventures, I believe that we will make up the output lost in the financial crisis. We have not yet fully resolved the problem of “Invented in Britain; developed abroad”, and I hope that the Government will look closely at any inhibitions to the development of British discoveries at home.
The second challenge is the continuing slow recovery of the world economy. No major economy has found it easy to generate a sustainable recovery. Indeed, most countries today could argue that if only the rest of the world was growing at its normal rate then they would be fine but, since it is not, they are not. With interest rates close to zero and fiscal policy constrained by high debt levels, many countries have resorted to pushing down their exchange rate. One does not have to employ the emotive language of “currency wars” to see that this is a zero-sum game. And one of the costs is that the appreciation in sterling’s effective rate of over 10% over the past 18 months is holding back the rebalancing of our economy.
Most problematic is the position of monetary union in Europe. The first crisis weekend to deal with Greece was almost exactly five years ago. Since then, the crisis has spread to other countries. It ebbs and flows with little sign of any permanent solution and, as all the options for the euro area are unpalatable, the inevitable result is drift. This feeds directly into the problems facing the Government in renegotiating our relationship with the European Union.
I hope that the Government will approach those negotiations not with a British shopping list but with a simple principle for the future of the European Union: the nature and speed of political integration required for monetary union to survive is wholly different from that appropriate for countries outside the euro area. The reality is that for the foreseeable future there will be two types of member of the EU: those in the monetary union and those outside it. This is not a temporary state but one that will continue for a considerable time. Failure to recognise that reality will threaten not only monetary union but the wider Union, too.
I echo the views of the noble Lord, Lord Higgins. I think that a deal could be based on a binding declaration that countries outside the euro area would not prevent further political integration among the “ins” in return for a guarantee that those steps would not apply to the “outs”. That is not a British demand, but an attempt to save Europe from itself. This is as much a challenge for Chancellor Merkel as it is for our Prime Minister. It will be her taxpayers who foot the bill for greater integration of the euro area.
There are two challenges: raising productivity at home and, in Europe, a more realistic approach to the development of the Union. In both cases the process would be helped by what John Maynard Keynes once described as “ruthless truth-telling”. We in this House can show that it is not only the child but also men and women of a certain age who can say that the emperor has no clothes. Interest groups at home and a few of our partners in Europe may not always like what we say, but they will listen. And who knows, with good arguments, we might even change some minds.
Lord Turnbull (CB)
My Lords, I am delighted to welcome the noble Lord, Lord King of Lothbury, to the House and to congratulate him on his excellent maiden speech. It was well worth waiting for. The noble Lord’s career divides neatly into two parts of roughly 20 years as a distinguished academic economist and 20 years at the heart of the Bank of England. As its governor for 10 years, he became a key figure not just in the UK but globally as part of a small group of world policymakers who, by developing innovative monetary policy techniques, prevented a recession from spiralling into a depression, for which we must be grateful. Since he left the Bank two years ago and was made a life Peer, he has wisely followed one of the teachings of the Lords spiritual: when a bishop retires, he leaves the diocese, at least for a time. He has wisely judged that now is the right time to re-engage in the public debate, and we welcome that.
Some people may have found writing a maiden speech daunting, but in the case of the noble Lord, Lord King, it must have come as a relief as two of the passions of his life, English cricket and Aston Villa, bombed out so badly over the weekend, but at least he can remember the name of the football club he supports. With the simultaneous arrival of the noble Lord, Lord O’Neill, the collective experience of the House in finance, economics and taxation has been enormously enhanced, and I look forward to their respective, possibly contrasting, contributions.
The electorate clearly thought that the Conservatives’ record in office was more credible than Labour’s. The latter party was punished heavily, I believe, for its refusal to acknowledge the flaws in its economic management in the middle of the last decade. The electorate clearly also thought that the Conservatives’ policy programme was the more attractive. Nevertheless, the Conservatives do not, in my view, have a monopoly of superior wisdom. There are elements of their programme that are objectionable, and there are elements of Labour’s programme that are more attractive.
Let us start with fiscal policy. A position in which the stock of debt was increasing far faster than money GDP was clearly unsustainable, and the priority was, rightly in my view, to get to a point where the debt/GDP ratio was no longer rising, and as now is beginning to fall. I do not agree, however, that it is an urgent priority to eliminate the overall deficit, both current and capital, in four years and then to go on running a surplus. The Labour proposal that only the current deficit should be eliminated is more logical.
Why do I take this more dovish attitude to public-sector debt? First, one cannot make a sensible judgment without looking at the asset side of the Government’s balance sheet as well as the liabilities. The UK Government debt ratio is around the median of the G7, but the UK also has serious gaps in its infrastructure, including in power generation, roads, and above all in social housing. There is a serious illogicality in the Government’s position. It is promoting HS2 and the northern powerhouse on the grounds that these are investments that will make the economy more productive. If that is so, they will create the means to service the debt to pay for them.
Secondly, I dislike intensely the language of reducing the debt so that we do not impoverish later generations. In an economy where 70% of government debt is owned by UK citizens, we are witnessing a transfer process. Tax is being collected from and interest is being paid to many of the same people or their pension funds. It is true that if that is carried to an extreme, the weight of this extra tax burden can reduce the effectiveness of the economy, but that is far short of the alarmist impoverishment claim. I believe that the narrative of debt reduction is being used to provide a smoke-screen for another objective: to reduce the size of the public sector. There is a case for that, but it should be made explicitly and not be hidden behind a bogus argument.
My second area of concern is housing, where I believe that neither party has it right. Fortunately, I do not need to deal with the objections to the Government’s right-to-buy scheme, as they were dealt with very effectively by the noble Lord, Lord Kerslake, and other noble Lords earlier this week. The proposals coming from Labour on rent control and letting control were a ghastly throwback to the failed policies of the last century. Nevertheless, there was one area in which Labour rather than the Conservatives correctly diagnosed the problem: the relative weight of taxation on higher-value housing. It cannot be fair that a £3 million house, which is 100 times more valuable than a £30,000 house, pays only three times the tax. Council tax is based on relative values as they were a quarter of a century ago.
In that time, relative house prices across the country have shifted substantially. This not just a Kensington issue but a national one; it is as just as much about the relative contributions of Beckenham and Birkenhead. However, having identified a valid issue, Labour produced a deeply objectionable response. Its mansion tax was based on class rather than economics, grafting a tax on absolute values on to a system of relative values. The correct answer, which neither party has shown the courage to adopt, is to start by undertaking a national revaluation and then to redesign the bands, adding two or three more at the top end.
The other flaw is the position of housing in the overall system of taxation. Housing is a capital asset that pays no capital gains tax on people’s first residence, nor any tax on imputed income. The same money invested in businesses or financial assets pays both. It is not surprising that people have been incentivised to pile into residential property. We get this wrong, because we fail to understand the difference between the cost of a house as bought on the market and the cost of building a house. Many people can afford to pay the cost of building a house, but the problem is with land, and until we tackle that all those schemes and subsidies, tax reliefs and rights to buy will simply make things worse.
As a former Permanent Secretary to the Treasury, I cannot be expected to applaud the legislation to freeze our main tax rates. Why do legislators need legislation to force them to implement what they have legislated? This is now the fourth of these legal duties, after the reduction in child poverty, the decarbonisation target and the commitment on international aid. What has happened to good old-fashioned accountability? Far from increasing trust in politicians, these arrangements merely serve to advertise their untrustworthiness. The tax proposal has many dangers in it. If it is to be strictly enforced, it will create extortion opportunities for predatory parties such as the SNP and DUP and could bring to the UK the farcical shut-downs of the US Congress. If there are sensible safety valves and waivers, what is the point?
Finally, one parting shot: we should scrap the Smith commission and start again. Grafting tax powers on top of an already overgenerous grants system will make the outcome even more unfair. The sine qua non of any new system if it is to generate fiscal responsibility is that £1 of extra spending in Scotland must be funded at the margin by £1 of extra tax in Scotland.
Lord Haskel (Lab)
My Lords, as a fellow Mancunian, I welcome the Minister to the House and congratulate him on his maiden speech.
Yes, the election and its surprises are behind us, but our economic problems remain. My noble friend Lord Mendelsohn reminded us of them. We all know the answer, which many noble Lords have given: productivity. Yes, raising productivity is the main determinant of our standard of living, so why has it not happened? Could it be that productivity contains so many different ingredients, spread across so many government departments, that it is just too difficult to bring it all together? However, that is what leaders do. Yes, progress is often incremental, but sometimes it happens when leaders bring different elements together so that the whole is greater than the sum of the parts. That is true of productivity. The irony is that many of the elements required to raise productivity are already here, waiting to be harnessed by leadership.
What are those ingredients? The Minister listed some. We have an excellent science base in our universities and research organisations. Nurtured and supported in an age of productivity, it will become even better. We know that government spending on science pays, and it is a good example of investment crowding in. The noble Lord, Lord King, spoke of that. We have in place Innovate UK—the old Technology Strategy Board—which the noble Lord, Lord Newby, mentioned. I declare an interest as a past honorary president of its Materials Knowledge Transfer Network, and so I know the excellent work it does. In an age of productivity, there would be more nurture and more support for those organisations.
Another ingredient is skills. The gracious Speech promised us 3 million more apprenticeships. However, in an age of productivity the number would be less important than the standard; vocational education would be given the same priority as other sectors, instead of being the poor relation. The numbers are important as regards raising the number of firms offering good apprenticeships. The age of productivity in the digital 21st century requires digital skills and education. What has to be done is laid out in your Lordships’ own ad hoc committee report on digital skills.
Steps towards the age of productivity have already been taken in finance. We have an embryo industrial bank and the Business Growth Fund, and once our priorities change to productivity instead of austerity, new areas of finance will present themselves. Although sometimes misdirected, the City’s contribution, too, is important in an age of productivity. The UK would have much to lose by its decline—and much to gain from directing its ingenuity towards productivity. The noble Lord, Lord Reid, queried the data, and I agree. Much production is hidden in intangible production, but we raised that with the Minister’s predecessor on many occasions.
In an age of productivity, a national infrastructure commission would address our chronic underinvestment, as mentioned by the noble Lord, Lord Birt, and tax incentives would encourage productive investment over rent-seeking investment, as the noble Baroness, Lady Kramer, mentioned. The Minister spoke of cutting red tape. By the three internationally accepted measures we are among the most lightly regulated OECD countries. In an age of productivity, sensible regulation is important. Other attitudes, too, have to change: we need longer-term business leadership where productivity growth replaces financial engineering, as the noble Lord, Lord Reid, said. I put it to the Minister that the means of achieving this ambition of raising productivity is all around us. It needs to be harnessed.
The Minister is new, but your Lordships have heard this from me many times. However on this occasion I have an important ally: the Governor of the Bank of England. In the quarterly Inflation Report published this May, the Bank draws our attention to the fact that productivity has hardly moved in the last seven years; the Minister gave us the numbers. It speaks of the disproportionate number of low-skilled and low-paid jobs that require little investment. The point is that we cannot achieve sustainable increases in our standard of living by employing more and more people for longer hours on low pay. The message is that, when interest rates go up and the supply of cheap labour runs down, do not expect the Bank of England to keep things going by printing money and easing monetary policy.
The governor expects us to become more productive, and he is right. If productivity goes up by 0.5% a year, after five years we would still have £104 billion to find in cuts. A rise of 4% a year—ambitious but not impossible from a low start—would leave the Chancellor with £18 billion to give away. It can be done. We already have some wonderfully productive companies showing us the way. Unipart even has its own university of productivity, and McKinsey tells us that three-quarters of potential productivity growth comes from adopting these better management practices. So why are the Government not encouraging this?
The Minister reminded us that in the gracious Speech there are Bills to get Britain working. I am so ancient that I can remember something similar from Barbara Castle’s day, when she was the Minister for productivity. When Gordon Brown was Chancellor, he had a team in the Treasury doing this. The coalition claimed to have an industrial strategy. The Government’s proposals are therefore nothing new.
So what is missing? What is missing is an understanding that productivity is not just economics. Both Ministers have been in business—they know that productivity has to be a way of life and a culture, because it affects every aspect of a company’s business. And so it must be for Britain. It has to become our way of life, instead of austerity.
I put it to the Minister that this age of productivity is the real one-nation politics. It raises the standard of living of us all. It is business friendly. It would have the support of the Bank of England. The time has come for our culture to move from the age of austerity to the age of productivity.
Baroness Noakes (Con)
I extend the warmest of welcomes to my noble friend Lord O’Neill of Gatley, and to his role at the Treasury, and I congratulate him on his maiden speech. We are very lucky to have his expertise on our Benches. I also welcome back to her enlarged ministerial role my noble friend Lady Neville-Rolfe.
It was good to hear the maiden speech of the noble Lord, Lord King of Lothbury, which brought back happy memories of my years on the Court of the Bank of England. His huge expertise will be of great value to your Lordships’ House.
The last five years have been marked by the outstanding economic leadership of my right honourable friend the Chancellor. I particularly welcome the commitment in the gracious Speech to continue with the long-term economic plan, and to bring the finances under control and reduce the deficit. We have made a lot of progress in the last five years but there is much still to do, and I am glad that we now have the opportunity to complete that task.
There is a temptation for any new Government to launch large legislative programmes, and I would like to offer the Government a few words of advice. Please do not feel it is necessary to legislate. The electorate did not vote for lots of legislation. Businesses are certainly not gagging for more legislation. Businesses in particular want to be left alone to get on with their role of job creation and wealth creation. The Government should be especially wary of gesture legislation. Here I agree with the remarks of the noble Baroness, Lady Kramer, and the noble Lord, Lord Turnbull, in respect of legislating not to put taxes up—legislating not to do something you are not going to do anyway. That is actually an abuse of legislative time.
Noble Lords who have heard me speak before will not be surprised to learn that there is one Bill about which I am hugely enthusiastic, and that, of course, is the European Union Referendum Bill. Today, I will say only that it is important that we have an informed debate about the economic benefits or otherwise of our membership of the European Union and the opportunities and risks involved in withdrawal. It is far from a self-evident truth that there is a net economic benefit to our remaining in membership; indeed, many studies show quite the reverse. I sincerely look forward to that debate.
I know that the Government’s deregulatory heart is in the right place—we have had two rather large Bills already this year that had deregulation at their heart, and we are now promised even more in the enterprise Bill. If it really is necessary to legislate again, so be it; but the more important thing is to achieve real reductions in regulation. In that light, I certainly welcome the Government’s announcement that they will cut another £10 billion of red tape over the Parliament. Will my noble friend the Minister say how much of that £10 billion is expected to deliver for small and medium-sized enterprises? Not all regulatory savings are equal; those which benefit SMEs can be more equal than others.
In the limited time available today, I will refer to two bits of legislation in the gracious Speech that trouble me, and one thing the absence of which I regret. I will start with my regret. Yet again, the Government have missed an opportunity to signal the merger of income tax and national insurance—an idea that has much support, not least from the Office of Tax Simplification. Taxpayers find the different rates and thresholds baffling, and businesses bear the brunt of complex and burdensome administration. A brave Government would set a course towards a merger.
The gracious Speech has confirmed that the Government remain set upon legislation for High Speed 2. Earlier this year, a report from your Lordships’ Economic Affairs Committee concluded that the Government have yet to make a case for continuing with this project. For a cost of a minimum of £50 billion, we might shave 20 minutes off the travelling time between London and Birmingham. HS2 does not even connect to the northern powerhouse. The Government would be very wise to look again at this project with a cold and analytical eye.
That is the first thing I find difficult in our legislative programme. The second—and, the Whips will be pleased to know, only other—thing I have difficulty with is the commitment to increase the amount of free childcare to 30 hours a week for working parents of three and four year-olds. I am quite sure this policy is popular with those who are eligible: any policy that has other taxpayers picking up the tab for something you would otherwise pay for is bound to be popular. But this is evidence-free policy-making, and the Minister who defended the policy on Radio 4 earlier this week merely asserted that it was the “right thing to do”, and offered no rationale.
I could support the policy if it increased maternal employment, but the evidence base shows at best a weak employment effect. I could support the policy if it was about improving the life chances of children, but that would require eligibility to be based on the disadvantaged status of children, not the working status of their parents. This policy will work only if the Government accept that the private sector providers who are crucial to delivering it are currently inadequately funded. Put simply, free childcare will require a lot more money. The report of your Lordships’ Select Committee on Affordable Childcare, on which I served, sets all this out. I am genuinely surprised that the Treasury has endorsed a statist policy that has so many obvious question marks over the value for money it could deliver.
I conclude by welcoming the policies that are directed at restoring prosperity to our country. We have been saved from mansion taxes, from the 50p rate of tax, from the persecution of non-doms and from policies that viewed businesses as predators, rather than creators of wealth. Now, let us get on and prosper—and with as little interference as possible.
Baroness Liddell of Coatdyke (Lab)
My Lords, sometimes when I wander the corridors of this building, I feel a bit like my namesake, Alice Liddell, and I have a sense that I have wandered through the looking glass. I feel that when I see names such as those of my noble friend Lord Desai and the noble Lord, Lord Skidelsky, on the speakers list, when I pass my noble friend Lord Peston in the corridor and when I come in and hear the maiden speeches of the noble Lords, Lord O’Neill and Lord King. I am enough of a geek that the only autograph I ever asked for in my life was that of John Kenneth Galbraith, but I have managed to get out a bit more since then.
Many of the areas that I wish to cover have already been touched on, but I want to talk about growth, innovation and productivity.
The existing growth industry that I want to talk about is tourism. I suspect that some colleagues are saying, “She got the day wrong. Tourism was yesterday; we did culture yesterday”. The noble Lord, Lord Lee of Trafford, in his excellent speech yesterday referred to tourism as the Cinderella industry. I think that it is time to bring Cinderella to the ball, which means bringing it to the Treasury and to BIS. For too long it has languished in the Department for Culture, Media and Sport, yet it is one of our most successful growth industries. Inbound tourism is worth £24 billion a year to the UK economy and, indeed, it is continuing to break records at a time when domestic demand is softening. It is growing faster than many sectors of the economy, including manufacturing, construction and retail, yet we consign it to a department where it does not appear in the title and it does not even have a Minister. The Minister for Sport is presumably to do tourism at half-time. That is not good enough.
In terms of employment generation, a third of all UK jobs generated between 2010 and 2012 were in tourism. For politicians—I say this with a bit of guilt myself—the generation of jobs is the easiest part of growing the economy. Things such as zero-hours contracts help to grow jobs, but the hard bit is growing productivity, and some of that in the service sector has been drifting. It is interesting to look at how competitive the marketplace is for tourism. Australia spends £90 million a year on tourism, and £20 million alone on tourism from China. VisitBritain’s grant in aid for everything that it does is less than that.
I have a proposal to put to the Ministers on the Treasury Bench. It does not involve legislation—one thing on which I agree with the noble Baroness, Lady Noakes, is that we do not need more legislation. I believe that we need a machinery-of-government change. Tourism should be recognised as the third-largest service sector and it should be moved to BIS, where it would work together with our major inward investors in UKTI. That would get proper recognition for the one industry that can generate jobs not just in the northern powerhouse but in Cornwall, Galloway, Orkney and Shetland. It has the Heineken effect and it is time that we allowed it to grow up.
The other area that I want to talk about—innovation —was touched on by a number of noble Lords, not the least of whom was the noble Lord, Lord Newby. I declare an interest as a non-executive director of the Offshore Renewable Energy Catapult. The catapults were brought into being largely because of an idea from my noble friend Lord Mandelson, who asked Hermann Hauser to look at how we harnessed research and innovation and to make it into something commercial. There are now a number of catapults and in many instances they are proving extremely successful. The High Value Manufacturing Catapult has galvanised that sector and is doing extremely well. However, if you wish to innovate, you have to be prepared to have long lead times.
The area that, unashamedly, I am particularly interested in is offshore renewable energy and particularly offshore renewable wind. I am a Scot. We have two former Secretaries of State for Scotland sitting on the Front Bench, and I bet that the Barons whose statues are up there are glad that we are not here to talk about Scotland. The decline in the North Sea means that a skill shift needs be addressed rapidly to prevent employment dipping and those skills being lost to other markets. Offshore renewable energy is a classic area where that can be done. I want to say something to the noble Lord, Lord O’Neill, that I think will shock him: he will be used to the short term of industry but the short term of government is even more pernicious. If we are to change this industry, we have to invest now and invest for the long term.
Finally, I turn to productivity in general, about which there have been quite a few remarks in our discussion this morning. There is a very interesting pattern in the productivity dip in the United Kingdom. Is it not bizarre that here, with particularly liberalised labour markets, our productivity has not risen as fast as that of France, where it has gone up 2% and where the labour markets are particularly illiberal? One part of productivity is investment. Indeed, if we look at vehicle manufacturing, we see a significant increase in productivity because there is investment in technology, techniques, training and skills. The Minister talked about the significance of education in that regard. The other side of the coin is that in chemicals and pharmaceuticals, many of which are in that northern powerhouse, there is a dip in productivity. We have also had a dip in productivity in the financial services sector. The Minister is very good on acronyms—he gave us BRIC and MINT—and I would like to ask him to give us an acronym for productivity. We need something that we can coalesce around.
Solving this productivity problem is not a short-term but a long-term game, and I think that we need to take party politics out of it. We need to work together for the good of this country on issues such as productivity. The Finns do it wonderfully. They have a “Committee for the Good of Finland”. I think that we need a “Committee for the Good of Britain”. I cannot think of anyone better to convene it than the noble Lord and the noble Baroness on the Treasury Bench, but I challenge the Minister to come up with an acronym for it.
Lord Teverson (LD)
My Lords, I, too, congratulate the noble Lords, Lord O’Neill and Lord King, on their speeches. I am going to talk primarily about transport but I want to take up one point from the excellent speech of the noble Lord, Lord King. He talked about the “euro ins” and the “euro outs”. That is sometimes a bit of a dangerous argument. One forgets that a lot of those euro outs are trying to get in: they are the future ins of the euro. As he mentioned, the Greek crisis has gone on for some five years now. We all thought that the euro was going to melt down, and it may be a surprise to people out there on the streets of the United Kingdom to hear that the number of members of the euro has gone up over that period rather than going down, with the addition of two member states. So we have to look at the analysis in terms of the aspiration of the outs, rather than just seeing them as permanent outs, as perhaps we ourselves will be.
Transport is the plumbing of the nation. There is no doubt about that, and I congratulate my noble friend Lady Kramer on the work that she did on transport in government. A lot of good things came out of that. Broadband and transport are absolutely key to productivity and to the way that the economy works.
I was pleased to see two Bills mentioned in the Queen’s Speech and in the Government’s programme. The Liberal Democrats, along with many other Members of this House, have strongly supported HS2. I understand that it is contentious but it is clear to me that in terms of capacity and investment in infrastructure that will last for more than 100 years, this is something that has to happen in some way. Getting that increased capacity through changes in the existing west coast, east coast or even central railway would be utterly disruptive to the nation in terms of the economy, commuters, long-distance travellers, business, leisure and freight. It would be a disaster to enter into that investment other than by trying to find a new way of adding capacity—and why add capacity that is old-fashioned rather than new technology?
There is one thing that we often forget. We think of HS1 primarily as an intercontinental railway into Europe. One of its great successes recently has been fast transport into areas that have been hard-pressed economically, in particular east Kent. Those services have been hugely popular, with local authorities demanding that they be increased rather than trying to push them away. That is an example of how that can work. On the other hand, when it comes to connecting up the northern powerhouse, the nomenclature of HS3 is perhaps rather dangerous given the brand image of HS2 in so many areas. We should be quite clear how important it is and that it will be about making a much more conventional railway work properly and to the advantage of those communities.
The other programme is the buses Bill. I suspect that we will not have a full Chamber for that and that it will not be discussed in Committee on the Floor of the House. However, I very much welcome the Bill, in that it transfers to other combined authorities some of the advantages that Transport for London has over controlling buses. My question to the Minister is whether there would be an option—as in the devolution Bill that is coming to the House for Second Reading on Monday—for unitary counties to bring in that power as well.
Transport is very important in terms of sustainability and is responsible for about a quarter of our national CO2 emissions. Therefore, we need to look to sustainable transport systems. I congratulate the Conservatives on having in their manifesto a target of 2050—that may be slightly late—for zero-carbon vehicles. I also congratulate them for effectively saying that they will continue their £38 billion programme for other improvements through railway capital expenditure over the next five years. Sometimes we forget that a huge investment programme is taking place outside HS2. We should shout about that much more loudly. It is policy that is, I think, agreed widely round the House, but we sometimes forget that.
In the Infrastructure Act, which we passed towards the end of the last Parliament, a commitment was brought in—it was rather resisted by the coalition Government to begin with, although I am sure many of us put pressure on to get the change—for a cycle and walking strategy. I would be very interested to hear from the Minister when an investment strategy for those areas of sustainable transport, which is so increasingly important, will be published so that we can start to look at and implement that important programme.
As someone who lives in the far south-west of Cornwall, when I talk about sustainable transport I am also going to talk about the resilience of rail links into our regions, not least Devon and Cornwall and the still outstanding matter of a decision on how to secure the resilience of the line into the far south-west, while still protecting and providing transport for cities such as Torbay. I look forward to understanding how that might move forward.
On airports, we look forward to Sir Howard Davies’s report and to finding out how sustainable that proposal might or might not be.
In the last minute that I have, I want to talk about access to transport. One of the great contrasts that I see, as a rural dweller, is that “poor” regions such as London have £3 billion of subsidy for Transport for London for people who travel in this area. The buses for the poor people of London have some £450 million-worth of subsidy. The rich “rollercoasters” of Cornwall, however, have a subsidy of £5 million, and in Devon, £7 million. It is a complete contrast in terms of public investment and subsidy of services. I would not argue against the subsidy in London; it is clearly important due to all the externalities there would be if we did not have those systems. However, there is an imbalance there that, along with reduced local government expenditure, has caused those services to decrease over the years. It is vital to the economy that people are able to get to work, go to college and go to training courses on public transport. This is one area that we have to tackle to make sure that there is greater equality of opportunity economically in the regions.
I am going to leave it at that and make one small point outside transport. One business model that we so often look at and praise in this Chamber, and in Parliament generally, is that of small businesses. Clearly, they are exceptionally important—I have been involved in a number over time. I believe very strongly that we so often forget about middle-sized businesses and their importance. In the United Kingdom economy we have a shortage of those important middle-sized businesses. They are able to invest, offer careers to their employees, export, and offer wealth and income that is spread across all regions rather than being concentrated in a few areas. An important part of the German economy and of the very alive economy of northern Italy is based around that type of business model. I hope that the Government will find a way to make sure not just that small businesses thrive but that the middle sector of business becomes an important and hugely contributing part of our British economy.
Lord Leigh of Hurley (Con)
My Lords, I am delighted to be speaking today on the Queen’s Speech debate on business and the economy, and declare all my business interests as in the register. The noble Lord, Lord Teverson, will be pleased to note that most of my remarks focus on middle-sized businesses.
I am delighted to be speaking, not least because it could have all been so very different. Instead of a Government who recognise the role that business plays in our economy and our communities, we could have had one who saw business as inherently bad; one seeking to split businesses up into producers and predators and pit large businesses against small; a Government whose principal role was perceived as regulating rather than enabling businesses to excel. I am thankful that those of us in business do not have to contend with the radical proposals made by the party opposite, such as the extraordinary suggestion to force business owners to give employees first dibs on buying a business put up for sale by its owners, or the proposal mooted by the leader at the time for compulsory work councils for businesses employing over 49 people. I am thankful that we do not have to contend with a Government intervening on pricing or with other anti-business measures, particularly the idea of greater taxation on medium and larger businesses, which would be to the detriment of small businesses. Those of us on this side of the House who understand aspiration know that that aspiration applies equally in business. However, I will leave it to the party opposite to explain those proposals and confirm that it no longer supports them.
As the Minister knows, this does not mean that there are not challenges ahead and important issues that need to be addressed by this Government. I would like to run through just a few of these that I hope might be picked up in the legislation introduced by the gracious Speech.
First, we need to keep our foot to the floor in encouraging entrepreneurship and making sure that the UK is seen as the place to start a business and grow it; otherwise, the momentum gained in the last Parliament could stall. One way to do this is to liberalise the entrepreneurs’ relief, which, to their credit, was brought in by the last Labour Government. Currently, a 5% minimum shareholding is required to be eligible for that relief. This discriminates against smaller shareholders and distorts economic activity. Indeed, I have seen one company recently refuse to take in fresh equity because it would dilute certain shareholders below 5%. The employment test for that relief should be scrapped. Business mentors, angel investors and academics who invest not just capital but time and advice should not be prejudiced against being eligible for that relief.
Specifically, the absurd lifetime cap of £10 million should be abolished. We are talking about creating a market for the world’s most ambitious entrepreneurs, who want to start not just one business but many, some of which will be global titans. Scrapping the limit will encourage them to do this in the UK.
To further support entrepreneurship and the growth of companies, I am delighted to see the inclusion in the Queen’s Speech of the enterprise Bill, promising as it does to cut down on red tape and, as we have heard, saving businesses £10 billion in this Parliament. I was a member of the DTI—as it was it then—deregulation task force in 1996 and the area that I focused on, as it happens, was business rates. I am therefore delighted to hear that this matter is finally going to be addressed and use this opportunity to welcome to the House the noble Lord, Lord O’Neill of Gatley, whose appointment is welcomed not just here but by the business community and the financial community worldwide as recognition of the importance attributed to this area by this Government. I am also delighted that my noble friend Lord Maude of Horsham, who created the DTI deregulation task force, will be at the forefront of BIS and will, with the Minister, continue our efforts to spread the wings of UK business still further.
In addition to cutting red tape, the Bill should enforce greater transparency with respect to regulators to make sure that they comply with their statutory obligations. I want to emphasise that the reach of the Bill must extend to the financial services, as I am sure that the noble Lord, Lord O’Neill, will recognise, and in particular to the FCA. After a financial crisis such as we have had, it is vital that the regulator acts to restore trust in what is still a very important industry in the UK, yet I am increasingly concerned that the FCA is pursuing an agenda that, at least in respect of smaller firms, is lacking in transparency and accountability. Decisions made by an ombudsman or individual within the FCA can have extremely wide implications and affect the availability of financial products to the detriment of both consumer and provider. I ask the Minister to ensure that the enterprise Bill looks at this area, which is threatening growth in the UK’s financial services industry.
I have expressed concern in this House in the past that insolvency practitioners become administrators. I hope that this will be addressed. I would also like to lend my support to the trade unions Bill. To improve business confidence further, our labour laws must work in the interests of employers and employees alike, not the trade union bosses. Introducing a 50% minimum voter turnout threshold for strike action is therefore fair and proportionate. I accept the assertion made by the noble Lord, Lord Mendelsohn, that he is not personally financed by unions, but others are.
Having just come through a credit crunch, we need to look again at the supply of business finance in our economy, so hats off to the Government for creating the British Business Bank and the business growth fund, mainly on the equity side, but we should be concerned about the return of “covenant-light” lending from the banks and, specifically, from debt funds. Some of these covenant-light loans are originated on the assumption that if they turn bad they can later be offloaded to vulture funds without any cost to the debt providers. This is bad news for the borrower. It is far better to make sure that the terms of the loans do not allow their sale and are more responsible in the first place. This is crucial for financial stability. We need to learn from 2007-08 that covenant-light loans will inevitably lead to reckless borrowing. I am sorry to advise your Lordships’ House that such loans are back in the market. I therefore urge the Treasury and the Bank of England to revisit controls over covenant-light lending with some urgency. I at this point express my great delight that the noble Lord, Lord King of Lothbury, a world expert on this matter and to whom this country owes so much, has made his maiden speech today.
Likewise, it is time to take a serious look at tightening the rules on tax deductibility of debt interest, because what we have now is simply an incentive to load debt on to the balance sheet of companies. This is not in the interests of the long-term viability of the businesses concerned or of the country as a whole. With the OECD looking at this issue, in a piece of work championed by the Prime Minister no less, it is time for the UK to come in from the cold and bring its approach more into line with the emerging global consensus on debt relief, where at least deductions are limited.
Therefore, there is much still to be done. One thing we can be sure of is that the election result and the Queen’s Speech that has followed are undeniably good news for business and the UK economy. I believe that the growth that we have enjoyed recently will continue unabated and we should be proud that Britain has shown the way in how to run a competitive economy that benefits all its people, businesses and workers alike. Long may this continue.
Baroness Drake (Lab)
My Lords, the Governor of the Bank of England recently stressed that productivity performance is the single most important driver of prosperity and growth in wages, but productivity in the UK has not improved in eight years, breaking a trend of around 2% annual growth. The FT reports the Conference Board as showing that, on the measure of total-factor productivity, the UK has suffered three consecutive annual falls. The drop in productivity growth is a global problem, but, as the IMF observed, it is deeper in Britain than in any other member of the G7. The ONS reports that UK productivity slow-down is three times as great as in the rest of the G7.
The Government have announced through Her Majesty’s gracious Speech a series of supply-side reforms. The MPC offers three possible explanations for the problem: low interest rates and lenders’ reluctance to crystallise losses, allowing inefficient businesses to survive; weak business investment; and the growing proportion of lower-skilled employees, which has been bad for output per hour. I comment on this latter explanation.
The UK has a flexible labour market, and the Chancellor’s further drive to deregulate it has not made productivity rise. Indeed, it fell in the last quarter of 2014. Wages may have begun to increase, but productivity has to improve if growth in real earnings is to be sustained. The Government should consider raising the national minimum wage to much nearer the living wage as part of their portfolio of measures to drive inefficient firms to be more productive, to reduce welfare expenditure and to raise the living standards of lower earners.
According to the Centre for Policy Studies, the evidence suggests that increases in labour costs in low-paying firms have been met by increases in labour productivity, not from reductions in employment but from increases in total-factor productivity, and that raising wages at the lower end of the labour market can improve productivity. One hundred and forty research projects from the Low Pay Commission show that the minimum wage had little negative effect on employment even when the rate increased faster than average wages. Yet some sectors and businesses remain stuck in a low-pay, low-productivity cycle that is self-perpetuating. The way in which some companies operate means that increasing numbers of workers are reliant on in-work benefits. In 2014, around 1.2 million over-21s earned the minimum wage, a proportion doubled since 1999, and a further 1.1 million earned within 50p of that minimum. This year, nearly £30 billion will be spent on tax credits to top up the low wages of those in work. Taxpayers are subsidising company pay bills. Seventy per cent of tax credits are paid to in-work families and by far the biggest increase in the tax credit bill has gone to such families, not to out-of work families.
The CPS, whose head of economic research argues the case for raising the national minimum wage as part of a portfolio of measures, demonstrates using data from the Labour Force Survey and the IFS that for every £1 increase in low wages the Government get a 50p fiscal boost due to lower welfare payments and higher tax revenue from higher incomes. Only a quarter of FTSE 100 companies have signed up to the living wage.
Too many British businesses operate on low wages and low productivity. The overall rate of return for British companies in 2014 hit its highest level in nearly 20 years. Profits drive growth and employment. Successful businesses are the bedrock of a growing economy. However, recent growth has within it declining labour productivity and a polarisation of jobs. The employer benefits from flexibility, but risks are transferred from the employer, through the employee, to the taxpayer. When an employer has a limited obligation in the wages they pay, the universal credit system takes the downside risk. This is a disincentive on employers to increase their productivity. Simply cutting tax credits without increasing the minimum wage will simply make working families poorer and reduce productivity even further.
Yes, low-paid workers should be able to keep more of what they earn and be better off in work. The Government are focused on increasing the personal tax allowance to address low pay. However, they are also reducing the work allowance—it is frozen for three years—which is the amount a family can earn before benefits are reduced and is crucial to making work pay. It is an inefficient way of improving incomes for many working families, because increases in net income as a result of reduced income tax payments increase household income brought to account for some benefit purposes and universal credit, thereby reducing the value of benefits received and offsetting the reduced income tax gains.
If low earners were taxed less and paid a higher national minimum wage, public expenditure on in-work benefits would be less, incentives to work would almost certainly be stronger, and companies would be incentivised to increase productivity. It would also benefit the many part-time employees on very low earnings who pay little or no income tax and so benefit little from increases in the personal tax allowance.
I conclude by congratulating the noble Lord, Lord O’Neill of Gatley, on his maiden speech. I hope his desire to increase productivity and drive growth throughout the north and other areas of the country remains a passion, because it certainly should be a passion.
Lord German (LD)
My Lords, before I address the remarks made by the noble Lord, Lord O’Neill, in his excellent opening speech, I should like to add a supporting measure to the comments on tourism made by the noble Baroness, Lady Liddell. As a Minister for economic affairs in Wales with responsibility for tourism, I resisted every attempt to push that portfolio into the culture and sport portfolio. The main reason for that was that tourism is an economic driver and contributes 7% of GDP in Wales. A huge amount of its growth is possible through tourism and it was important to maintain it as an economic driver.
I wish to address my remarks to the comments made by the noble Lord, Lord O’Neill, and many other noble Lords about the productivity issue, particularly the need to see it as one of the principal inhibitors of growth in our economy. I shall focus on one factor on the issue of increasing productivity, and that is in-work progression—helping people to progress within work both financially and in self-esteem. I wish to link these remarks to the full employment and welfare benefits Bill and to address some of the wider implications of that Bill. As the Bill has both the words “employment” and “welfare benefits” in its title, and as it spans the responsibilities of BIS and the DWP, I apologise if I stray across the subject areas scheduled for debate both yesterday and today.
The elephant in the room facing Treasury Ministers is the proposed £12 billion cuts in the welfare bill. I shall not venture into the landscape of where the Government are going to make those savings—after all, all efforts to find the answer to that question failed during the general election, as they did in this House yesterday—but the Prime Minister’s announcement a few days ago that child benefit and child tax credits will not be touched leaves the only credible answer to the question of where the cuts are to come as housing benefit and disability benefit. In themselves, these cuts will work to the detriment, with job-related impacts, in particular relating to in-work progression.
These issues are closely linked to the real progress that we can make on ensuring employment opportunities for our country. The challenge for the Government will be not only to get people into jobs but to ensure that they can have in-work progression in the number of hours of work they are offered and in their rate of pay. The full employment and welfare benefits Bill presumes that the savings in the welfare benefits element will go in part or in full to pay for the promises in the full employment element. The Treasury question to be asked at the outset is whether the envisaged cuts in welfare are savings to contribute to deficit reduction or savings to be reallocated to other areas of government.
The information we have so far on the Bill is that the savings from the welfare element are specifically to fund new apprenticeships and to increase support for the troubled families initiative. The IFS’s analysis of the matter is that that would account for £130 million a year to put to those issues. Is the £12 billion still a separate amount? I would value an answer to that question from a Treasury Minister.
The Government’s Bill is about a series of sticks and carrots, incentives and sanctions, to meet their policy objectives but there appear to be more sticks than carrots. The policy of providing more opportunities for jobs is laudable, but it requires an appropriate mix of incentives and sanctions. There is no doubt that the previous Government achieved a great deal in sourcing jobs and getting people into work, but the challenge now is not only getting people through the doorway into work but ensuring that they have an income which permits them not to fall back on to state benefits.
The current statistics are stark. The noble Baroness, Lady Drake, mentioned £30 billion of tax credits and, according to the House of Commons Library, over £5 billion last year was paid out in housing benefit alone to people in work. The figures and the numbers are growing and this is a recurring feature of universal credit as it is rolled out. I agree that work remains the best route out of poverty and that is why universal credit is so important. Its successful implementation will mean a route into meaningful employment.
However, there are potential incentives the Government can provide to assist working households to increase their earnings. That might mean through a continuation of the Access to Work programme of support to get people into work and to help them to get the skills and self-esteem that they need to progress within work.
As to the sector facing the most difficulties in accessing a job—those with disabilities—yesterday in your Lordships’ House the noble Baroness, Lady Campbell, told us that 52% of working-age people with a disability are out of work and that many wish to work. There are some incredible examples of where people with a disability have found work and are contributing fully to the economic life of our country. However, for many there is a need for support. The Access to Work programme paints disability with a single brush and the Government intend to make this worse by trying to get more users out of the same amount of money.
Each person with a disability has different needs. For a deaf person it could be the provision of sign language; for a wheelchair user it could mean physical adaptations, including widening doors and putting in ramps. The Government’s ambition is to halve the disability employment gap. Does that mean that the Government’s target is that 25% or less of people with disabilities will be unemployed? More importantly, what is their target? Is it to increase the rate of employment among people with disabilities from 48% to 75%? That is a big challenge.
The big challenge of improving productivity is closely linked to these elements of work progression. The dramatic cuts which are threatened to in-work benefits will have a major impact not only on helping people into work but on enabling them to progress in employment and creating that sustainable productive economy which is the wish of all Members of this House.
Lord Aberdare (CB)
My Lords, I shall speak about two topics that were less prominent in the gracious Speech than I hope they will be in the Government’s overall programme for business and the economy: namely, apprenticeships and digital skills. Both are vital to tackling the challenge of improving UK competitiveness and productivity, which was so rightly emphasised by the noble Lord, Lord O’Neill, in his fine speech and by several other noble Lords.
I welcome the Government’s target of 3 million new apprenticeships and the commitment, via the full employment and welfare benefits Bill, to report annually on progress towards its achievement. However, I have some questions about how it can be achieved and how the Government will ensure that quantity is matched by increased quality. Reaching the 3 million target will require significant growth in the number of apprenticeships on offer, particularly from small and medium-sized enterprises. Many SMEs, and, indeed, larger employers, have been distinctly wary about offering apprenticeships. They worry about the costs involved, the bureaucratic and management burdens, and their ability to provide continuing work for an apprentice over the length of time involved.
A real effort is needed to persuade more firms, especially SMEs, to offer apprenticeships. Possible initiatives might include a sustained, high-profile marketing campaign to sell the benefits of apprenticeships, including powerful case studies; an enhanced system of incentives, including for approved independent bodies helping to broker apprenticeships, such as chambers of commerce or local enterprise partnerships; and specific support and encouragement for mechanisms designed to make apprenticeships easier for small employers, such as employer-led apprenticeship training agencies which undertake the tasks of recruiting and managing apprentices on behalf of a consortium of small employers, either on a geographic or a sectoral basis.
Apprenticeships need also to be of high quality. We need more higher-level, longer-term apprenticeships, as the Government have recognised, and, above all, apprenticeships need to lead on to actual, sustainable jobs. Like the noble Lord, Lord German, I find it startling that there seem to be no clearly defined ladders of progression through the various levels of training: for example, from traineeships on to apprenticeships and then into full-time jobs. Surely there should be some sort of account management for young people entering work experience, so that on completion of each stage they receive guidance on possible progression routes that they might follow at the next stage. This links to the need for a much better system of careers advice and guidance than currently exists. I hope that the plan included in the same Bill to provide Jobcentre Plus adviser support in schools across England will help address this.
Another concern is the challenge of proliferating apprenticeship standards. According to the Federation for Industry Sector Skills & Standards, which is the single certifying authority for all apprenticeships in England, there are currently 200 standards under development by 96 so-called trailblazer groups. It is estimated that ultimately some 1,500 standards may be needed, with at least 150 development groups. We need clearly defined processes for managing this complexity and avoiding unnecessary duplication, and for maintaining all the standards after their development groups have disbanded. I therefore hope that the Minister will be able to tell us something about how the Government plan to persuade more employers, especially SMEs, to offer apprenticeships and to ensure that the overall quality and sustainability of apprenticeships is raised.
Digital skills are equally important to productivity and competitiveness. I had the privilege last year of serving on your Lordships’ Select Committee on Digital Skills, along with the noble Lord, Lord Haskel, who has already spoken, and the noble Lord, Lord Macdonald of Tradeston, who is about to speak. The committee published its report in February with recommendations specifically aimed at this new Government. The copious evidence we received made it absolutely plain that the need for digital skills is not confined to what might be called technical sectors, let alone the information technology sector itself, nor only to people wishing to become technologists.
Digital skills are universally required by every sector—from robotics to fashion design—by every worker and increasingly by every citizen. The Tech Partnership, recognised by government as the industrial partnership for the digital industries—and so a key player in meeting the digital skills challenge—now comprises more than 500 employers from every industry sector across the UK economy. There are huge and growing opportunities in the digital economy, and the UK is in many respects well-positioned to grasp them, but at the same time the risks to our competitiveness of not stepping up to the challenges in this area are drastic. The Tech Partnership estimates that 134,000 new tech specialist workers are needed in the UK workforce every year, but employers are finding it hard to recruit for these jobs. A further alarming constraint is that only 17% of entrants into the sector are women.
The committee’s report identified the need for an overarching and ambitious digital agenda for the UK, co-ordinated by government acting as “conductor of the orchestra” of all the different interests involved, particularly in business and education, and with a Cabinet-level Minister having overall responsibility. Key elements of such an agenda would include recognition of high-speed broadband access as a utility service, so that everyone, whether in a remote rural area or one of the so-called urban “not-spots” where broadband coverage is currently poor, should be able to use the internet freely and effectively. Digital literacy should be seen as a third critical skills dimension, along with literacy and numeracy. Digital skills should be embedded within every level of education and training in schools, colleges and universities, as well as in all apprenticeships.
Now is not the time to rehearse all the recommendations of the committee’s report. The only other one I will mention is the recommendation that:
“Regional and sub-regional strengths are recognised and encouraged”.
In that context I welcome the Government’s commitment to the concept of the northern powerhouse. There are already good examples of effective regional technology clusters in the north, such as Sunderland Software City, a private sector, publicly backed organisation whose aim is,
“to generate a sustainable software industry in the region and drive the development of world class software businesses”.
The title of the committee’s report is Make or Break: The UK’s Digital Future and I believe that that phrase in no way exaggerates the importance of this issue. I hope that the Minister will be able to say how the Government plan to address it, across all departments, with urgency, vigour and commitment, and in partnership with other key players in business, education and the regions, as a central part of their efforts to enhance UK productivity.
Lord Macdonald of Tradeston (Lab)
My Lords, I follow the noble Lord, Lord Aberdare, in concentrating on the full employment and welfare benefits Bill, which hopes to achieve full employment by helping to create 2 million new jobs. The gracious Speech gave Ministers new duties to report annually on job creation and apprenticeships and to report progress towards, among other things, the Government’s target of 3 million new apprenticeships by the end of this Parliament in 2020. The duty to report annually to Parliament is particularly welcome in relation to apprenticeships. As the noble Lord, Lord Aberdare, explained, concerns persist about their availability and standards, and about whether apprenticeships are now defined too widely, to the detriment of school leavers.
By outlining some of these concerns, my hope is that, through the discipline of annual reporting, such concerns will be addressed and progress better measured. If so, we can reinforce the achievements of previous Governments, which were significant. Like many noble Lords, I was saddened by the long decline of traditional craft apprenticeships. In 1997, the new Labour Government found apprenticeship starts had fallen to just 65,000 a year. However, by the end of the third Labour Government in 2010, new starts had risen to 280,000 a year. Even so, the demand by young people for places still far outstripped supply.
The growing cross-party consensus and the need to improve and expand vocational training was further strengthened by the coalition Government, which pledged to increase the number of apprenticeships to 2 million across the last Parliament. But it was the way in which the coalition achieved its target which raised questions that the new Government should now address directly through their annual reports to Parliament. For instance, research funded by the Local Government Association, which is to be published by the Institute for Public Policy Research this month, claims that, since 2010, 42% of apprenticeship starts have been by people over the age of 25, rather than by young people starting work. The IPPR also reports that two-thirds of those starting intermediate and advanced-level apprenticeships were already employed by their companies. The concern is that public money is being used by companies to train their existing staff, which is not an apprenticeship as commonly understood. The LGA says that,
“too many new apprenticeships are low skilled and taken by older people already in work with their employer. Too few new apprentices are school-leavers trying to get their first job”.
Can the Minister say whether the Government share this concern? At present, only about 10% of companies offer apprenticeships and about half of large UK companies employ no apprentices. Given the money and responsibility devolved by the coalition Government to companies, which I support, can we expect the first annual report on apprenticeships to show increased corporate involvement?
That greater employer involvement is especially important in key sectors of the economy such as construction and engineering, where the skills gaps are alarming. The construction industry is expected to create 180,000 extra jobs in the next few years, which is good news. The problem is that the number of building workers retiring will be more than 400,000 by the end of this decade. Perhaps even a skills gap of that size can be closed by importing still more building workers from abroad, but little wonder the Local Government Association says that too few school leavers,
“are getting the construction skills to build the homes and roads our local communities need”.
When it says “too few”, that perhaps refers to just 7,300 apprenticeships across the whole construction industry in 2013, despite those potential vacancies numbered in the hundreds of thousands. There is a similar yawning skills gap in engineering. By 2022, to satisfy the estimated need for 1.8 million people with engineering skills, the number of apprentices and graduates entering the industry will have to double. Can the Minister offer evidence of significant progress in boosting apprenticeships in construction and engineering?
As we have heard, another related concern of great importance is the urgent need to develop digital skills. My noble friend Lord Reid cited the UK’s underperformance in cyberspace. My noble friend Lord Haskel and the noble Lord, Lord Aberdare, in discussing productivity, told the House that earlier this year your Lordships’ Select Committee on Digital Skills, of which I was also a member, published its report, entitled Make or Break: The UK’s Digital Future. We heard evidence that the impact of digital technology on the labour market might put 35% of UK jobs at risk of being automated over the next two decades. The committee recommended that the new Government of May 2015 should develop an ambitious digital agenda to enable the UK to compete with the leading digital economies by the end of this Parliament. We also concluded that a better co-ordinated response across government was a high priority for action in schools, colleges, universities—indeed, in almost every sector of our economy—to ensure that the UK adapts rapidly to this unstoppable digital revolution. Specifically on apprenticeships, we suggested that a government objective should be the inclusion of a digital skills element in all apprenticeships.
I look forward to the Government’s response to our report on digital skills and the subsequent debate in your Lordships House on its recommendations. The UK’s pervasive skills shortages and the profound impact of the digital revolution require a strong, co-ordinated response across government. I hope that our make-or-break agenda for action is seen as a constructive contribution to future strategy. If in doubt, the Minister might ask her colleague, the noble Earl, Lord Courtown, who was a member of our committee and who knows a great deal about the subject.
Baroness Wheatcroft (Con)
My Lords, I add my voice to those who have congratulated my noble friend Lord O’Neill of Gatley and the noble Lord, Lord King of Lothbury, on their maiden speeches. In my former life I used to listen to them both intently and I shall continue to do so. My noble friend Lord O’Neill is, of course, known for his acronyms and the noble Baroness, Lady Liddell, suggested that he should come up with some more. I am confident that he will bring us all the PIES: productivity increases, infrastructure investment and economic sustainability. I will say a few words on each.
A lot has already been said about productivity. Recently, the Bank of England’s experts produced an article trying to analyse what the causes were. Of course, they talked about low skill sets and pointed out that, after Spain, we have the lowest proportion of unskilled labour of any country in the OECD, but they confessed that they were unable to explain the full extent of the productivity shortfall. I will throw in one suggestion: too often, our management is not up to scratch. There is real reluctance in this country to part with people who clearly are not the right people in the right jobs. There is a big contrast with the United States in that. When Jack Welch ran General Electric, he was renowned for saying to one-10th of his managers every year that both they and the company would be better off if they changed direction. While not advocating a 10th every year, too often we do not have the right management taking our companies in the right direction.
We have too much regulation and the gracious Speech promised us a Bill to cut red tape. In our new Business Secretary, Sajid Javid, we have somebody who actually knows about business. As he said, he grew up living over the shop. I have every confidence that he will slice through the red tape. I hope, too, that our new Government will be able to bring us the Transatlantic Trade and Investment Partnership. It has stalled so often, but if we can get it through it will bring huge benefits to this country.
I should like to think that the local enterprise partnerships, which are already proving so successful in parts of this country, will now be built on by the Government. They vary incredibly in what they can do and in the calibre of people working there. They could do a great deal more for small businesses. As others have said, much of our future lies in growing the small businesses that we have. At their best, local enterprise partnerships can really help there; they need government help and to benefit from talking to each other. The Federation of Small Businesses has produced an in-depth report looking at how these organisations function and suggesting ways that they might do better. Too often, they are governed by big business and do not cater for the needs of small business.
What else could we do that would benefit productivity? How about remuneration? A new report has come out this week from the Chartered Management Institute, which refers to an,
“unacceptable discrepancy between pay and performance”,
in Britain. It looked at 72,000 employees and found that 30% of those rated as “not meeting expectations” were paid a bonus. That is quite hard to understand. When it looked at higher-paid people and directors, it found that it was not 30% of people who had not met expectations who received bonuses, but more than 40%. Clearly, we need to look at remuneration again.
The noble Baroness, Lady Drake, spoke at length about low pay and the link between low pay and productivity. While it is not an issue for government to legislate on, as others have remarked—we do not want too much legislation—it is up to shareholders to begin to put more pressure on companies to distribute the rewards of growth a little more fairly. It cannot be right that the gap between the top and the bottom is now so great that the people at the bottom are being subsidised by taxpayers while the people at the top get huge bonuses. I would like to see shareholders really wake up to this and do a bit more.
Going back to those PIES, on infrastructure we have heard about HS2. My noble friend Lord O’Neill pointed out that he has not always been the strongest advocate of HS2 beyond all else—perhaps the east-west connection is at least equally important—but there are much smaller things that impede this country’s efficiency. Since it was in the Conservative manifesto, I see no harm in reminding people that we are apparently pledged to fill 18 million potholes before 2021. I do not know who counted them but it is there in black and white.
We have done a good job so far on economic sustainability but there is a long way to go. I point to one issue where I have concerns. We have got through one financial crash but where will the next one come from? A former chairman of the Federal Reserve in the States, Paul Volcker, said that he could think of only one financial innovation that had been of any benefit to the public in the past 20 years, and that was the ATM. I am inclined to agree.
I am fearful about algorithmic trading. I do not know whether noble Lords have read Flash Boys by Michael Lewis. It is quite a scary tome and points to something that is the very antithesis of investment—and investment is what we need. Therefore, I ask the Minister to investigate whether the regulators are looking at this carefully enough.
Lord Clement-Jones (LD)
My Lords, it is a pleasure to follow the noble Baroness, Lady Wheatcroft. I agree with much of what she said.
These debates are often much more about what is not in the gracious Speech than what is in it, especially in the context of business and the economy. The UK’s creative industries have been one of the great success stories of the past five years. Significant policies benefiting these industries were developed during the coalition Government. I pay tribute to Vince Cable for all his work as the Business Secretary.
I want to see creative businesses continue to thrive across the whole country so that our economy can continue to reap the benefits. It is vital that we do not lose the momentum. Will this Government build on the achievements of the last? That is the question. I welcome the fact that both the Minister and Ed Vaizey are Ministers shared jointly now by DCMS and BIS to ensure that creative industry policy is fully joined up. To maintain that momentum we need to encourage clustering of creative businesses developed through alliances between central government, local authorities, universities and the private sector in our major cities. Our cities and many counties need greater powers, especially over finance. I therefore welcome in principle the proposed cities and local government Bill as part of the Government’s northern powerhouse strategy. I add my welcome to that of others to the noble Lord, Lord O’Neill, whose presence in government is so welcome and whose passion for delivery of the northern powerhouse strategy is so apparent.
The noble Baroness and Ed Vaizey represent valuable continuity for the sector. I welcome John Whittingdale to his new role, with his enthusiasm for intellectual property and live music in particular, and his background of 10 years as Culture, Media and Sport Committee chairman. I am sure that a brief spell for Sajid Javid at the DCMS has given him a useful insight into the fundamental relationship between the arts and our creative industries.
Many noble Lords have talked about development of digital skills being vital. Expansion of digital platforms has highlighted the growing convergence of creative content and the tech sector. Skills in the arts and sciences are increasingly drawn together. Will the Government promote the value of creative subjects in schools and ensure that they are rewarded for offering a broad and balanced curriculum? The number of apprenticeships created and taken up in the creative industries has expanded hugely in the past few years. I hope that they will enhance the co-ordination of action on skills by merging the two skills councils, Creative and Cultural Skills and Creative Skillset, into a single powerful and effective body. Will the Home Office break the habit of a lifetime and ensure with BIS that the tech and creative industries are able to fill the gaps in high-end skills, from abroad if necessary?
As we have heard today, our broadcasters are the linchpin of the creative industries and there are some key questions in that regard. Will the Government maintain Channel 4 in public ownership? Will they follow up the consultations started in March on Section 73 of the Copyright, Designs and Patents Act, which requires public service broadcasters to give away their most valuable product—their channels—to the pay-TV cable platform in the UK, and repeal it? We had a mini debate on the BBC today and contributions on the BBC were made yesterday. Under John Whittingdale’s chairmanship, the Culture, Media and Sport Committee produced a valuable report on the future of the BBC with many useful observations and recommendations, including on governance and extension of the licence fee to iPlayer-only users, which can, and no doubt will, be taken forward into the charter discussions—and so too, I hope, will the committee’s views on the need for open and transparent discussions on the charter. Will there be a full and open debate on any decriminalisation proposals and will the potential financial cost of such a policy to the BBC be fully recognised? We need strenuously to protect the independence of the BBC. Currently, the licence fee is the best way of doing that. However, that does not mean that it needs to rise faster than inflation.
Investment in the UK’s creative industries can only really make a difference if their intellectual property rights, particularly those relating to the protection of their online materials, are properly understood and enforced. It was good to see the acknowledgement in the Conservative manifesto of the importance of intellectual property and of proper behaviour by search engines. However, I was rather baffled by some of the statements in the manifesto. It says:
“We will protect intellectual property by continuing to require internet service providers to block sites that carry large amounts of illegal content”.
I do not recall that we were able to persuade the last Government to bring in any legislation to do that. The legislation remained unenforced on the books, so I think there are questions to be asked about that. Is it not crucial that we should educate consumers on the importance of intellectual property and support initiatives designed to get voluntary agreement from the advertisers and credit card companies not to advertise on infringing sites? Will the Government continue to support the long-term funding of the Police Intellectual Property Crime Unit, or PIPCU, which carries out such vital work? Will they increase sanctions relating to online offences in line with the recent government review of penalties for online copyright infringement, Penalty Fair?
I regret that we shall spend the next two years arguing about membership of the EU. I hope that, at the same time, the Minister will find time to work with our EU partners to ensure that proposals for copyright reform as part of the single digital market proposals do not damage our creative industries by limiting territorial licensing.
I very much hope that the Government will continue discussions with artists and creators on extending the law governing unfair contracts to include intellectual property contracts. I very much hope that, when possible under EU law, the application of public lending rights to remote e-lending will be extended.
I have little time left but I very much hope that the Government will continue to promote the value of live music despite the powers created in the Anti-social Behaviour, Crime and Policing Act, which are already being used disproportionately. I agree 100% with the noble Baroness, Lady Liddell, and with the comments made by my noble friend Lord Lee yesterday, on the importance of our tourism industry, which so far, even after five years of the last Government, has been treated as a Cinderella and holds such promise for job creation in the years up to 2020. Time will tell. I look forward to future debates and discussion on all these policy areas.
Lord Desai (Lab)
My Lords, I congratulate my noble friend Lord King of Lothbury on his joining the House and on his brilliant maiden speech. I think that we have known each other for more than 40 years, although I do not know the exact figure, so it is good to see him in this place.
I also welcome the Minister, the noble Lord, Lord O’Neill, who made a brilliant maiden speech, as we expected. When I saw him in the Royal Gallery I told him that we intend to give him a very hard time—and I think now is the time to start. Let me say to him first of all that he promised to cut red tape and save £10 billion. I have been here 24 years and I have heard that about 10 times. The gains are illusory and the red tape is seldom cut because the committee appointed to cut red tape does not care to meet as often as the Government would like. Therefore, red tape shall continue to be slashed and cut and we shall go on having fun along the way.
I have been a friend of austerity, much to many other friends’ dismay. I advocated it before the election of 2010 and I stick by that. The debate is no longer about whether or not we should have austerity but about the pace and the size. As the noble Lord, Lord Turnbull, said, he prefers my party’s time shape of austerity and deficit reduction to the Government’s, but we are no longer questioning that the deficit has to be reduced. That is at least one plus. I know that the OECD is saying that the deficit should not be reduced so rapidly, and so is the IMF. When those two agree, I really think something should be done. We have to doubt their advice. It is frequently wrong.
One thing that will determine the time shape of the deficit is not the economics but the politics. Since the Government are going to embark on this EU referendum saga, whatever the result will be—and I believe it will be a decision to stay—the Government’s trouble will start the day they win the referendum because their Back Benches will give them hell. I was here during the Major Government and I remember how much a Conservative Back-Bench rebellion can affect government performance. So I say to Ministers: do what you can do in the first two years and later your lives are not going to be comfortable.
That having been said, I add my words to the warnings other people have given. It is possible to believe six impossible things before breakfast and say many inconsistent things before the election, but once the election is won we ought to pause and say that this mad promise not to raise taxes—income tax, VAT and NIC—is not only irrational and fiscally irresponsible but unnecessary to implement. If the Government are going to implement this mad proposal, they will make their lives much more difficult than before. Again following the speech of the noble Lord, Lord Turnbull, and I think some other noble Lords said this as well, if we revalue properties across the UK—the challenge that the Thatcher Government flunked 30 years ago and we had the saga of the poll tax—the Government could promise to cut the rate of council tax and increase their revenue. That is a combination I do not normally offer to people. It is a real tax-cutting thing but just revalue properties and you will be able to harness the capital gains people have made over the number of years. You can even say, “Thanks to a Tory Government, people have got richer so we are going to tax them”. That may actually reduce your burden.
I have a wheeze, a little scheme—it may or may not work—which is now that interest rates are so low, it will be possible for the Government to issue 100-year bonds like the Spanish Government have done at a 0.5% rate of interest or whatever and repay the existing debt, which has a much higher service charge. I do not know whether it is possible. Some experts may doubt it, but whatever the service charge of that debt is, and I think it is about 4% or 4.5%, you could reduce it much more and release some money for spending on good things such as HS2 or something like that. Maybe the Minister will put me down properly and tell me that my numbers are completely wrong.
I will say something about productivity. This is a snare and a delusion. When we had an economy largely producing solid things—in agriculture, manufacturing or even transport—it was possible to define productivity somewhat precisely. Then we had the sort of growth model where we all got hung up on productivity and total factory productivity and all that. That is no longer the economy we have—not only us, even the US economy is finding productivity growth low. The noble Lord, Lord O’Neill, said that there are statistical problems. They are not statistical, they are conceptual. If a large part of your economy is in services, there is no way of defining productivity. I do not know what the productivity is of a childcare worker or somebody who takes care of the elderly or a physical fitness instructor or your shopping manager or whatever it is. We really have to say that there are jobs which, even if we use the old classical terminology, are surplus-producing sectors and there are jobs that are welfare-enhancing. Only the surplus-producing sector can help productivity as normally defined, and the larger your welfare-enhancing labour force, the lower your productivity level and growth. That is a short lecture. I cannot take another 35 minutes with this.
Lastly, as my noble friend Lord Reid said, we may be on the verge of another big asset bubble and another crash. The merger and acquisition numbers are frightening. Again as my noble friend Lord Reid said, people are buying and selling existing equities and bonds but they are not investing in any new productive activity. This is a classic effect of a sort of Wicksellian cycle in which we have a very low interest rate and any profit rate would make it feasible to borrow. People are borrowing and buying equities back and forth. This will crash, no doubt, and I hope that when it does, the noble Lord, with his expertise in the financial markets, will be able to get us out of it.
Lord Skidelsky (CB)
My Lords, it is always a great pleasure to follow the noble Lord, Lord Desai. We seem to be yoked together like a pair of terrible twins, perhaps on the theory that at least we understand what each other is saying even if no one else does. It is a great pleasure to welcome the noble Lord, Lord King, to this House, and the very powerful speech of the noble Lord, Lord O’Neill, promises strenuous mental exercise over the coming months and years.
Praise where praise is due: there are several good things in the gracious Speech. It is strong on aspiration and there are some sound implementing measures promised. It is a good idea to take people working 30 hours a week on minimum wages out of income tax. Can the Minister explain how many are expected to benefit from that measure?
I particularly welcome the goal of building a northern powerhouse, and look forward to the Cities and Local Government Devolution Bill, which will provide for an elected mayor of Greater Manchester and possibly elected officials in other conurbations. Elected mayors are vital to the strength of local government. Some of us on the House’s Economic Affairs Committee hearing evidence about HS2 were struck by the weakness of the northern voice. It would have been better, I think, to have started the scheme by reducing transport costs in the north of England rather than spending a huge amount of money in the next five years reducing train times from London to Birmingham by 15 minutes. Elected mayors in the big cities will help to redress the London bias which has too long dominated our economic life.
I welcome the aspiration in the gracious Speech to “full employment” and job security. I emphasise aspiration because there is no indication of how either goal is to be achieved. In particular, how does the aim of job security square with the large increase in insecure jobs over the last five years through temporary work, exploitative self-employment, zero-hour contracts, agency work and so on? Evidence suggests that about 5 million working-age adults are in such precarious jobs, and they account for much of the increased employment of which the Government boast.
This growing population of the working poor contributes to the amply documented rise in inequality, which has been growing since the 1980s and has accelerated since the onset of the crisis. Austerity has contributed significantly to this by reducing the share of income going to wage earners. The gap between rich and poor is now almost as great as it was before the First World War. This is morally unacceptable, socially divisive and economically destructive. In particular, it is a major cause of the collapse in productivity, to which noble Lords have alluded. I quote the Government’s briefing:
“Fixing the UK’s long-running productivity weakness is one of the government’s biggest challenges over the next five years”.
The noble Lord, Lord O’Neill, powerfully reinforced that, as did other noble Lords. Treating productivity as a long-run problem, however, disguises the fact that the most urgent problem is the collapse in short-run productivity. Between 2000 and 2008, productivity increased by about 2% a year, but since 2010 it has not grown at all. That is what is wrong with the argument of the noble Lord, Lord Desai, as it is not just a long-term problem based on the increase in unmeasurable service costs; it is what has happened in the last five years. That is what we ought to address, because most of the new jobs created since 2010 have been low-productivity jobs. How many people understand that the welcome fall in unemployment is the mirror image of the redeployment of many of the unemployed to low-productivity jobs? Real wages, as we know, have fallen since the coalition took office and apropos the noble Baroness, Lady Wheatcroft, most minimum wage jobs are not in companies that have shareholders. That is not the main problem here.
I do not want to rake over the coals of my long dispute with the coalition on economic policy. I do not doubt the Government’s commitment to sustainable growth but they see growth purely in terms of supply-side policy. It was assumed from the start that public austerity, by promoting the switching of production from the less efficient public sector to the more efficient private sector, would increase the efficiency of the economy. However, what that ignores is the effects of the policies on demand. At best, the Government have seen the problem of demand as a very short-run problem, not taking into account that a prolonged demand shortfall has lingering effects on supply. Economists have a rather horrible word for this: hysteresis, a word from engineering denoting the reduced capacity of a machine when it is disused or underused for any length of time. This has been happening to our productive system. Many, if admittedly not all, of our supply problems stem from the way that the labour market has adjusted to the austerity policies of the last five years.
The Government still hanker for supply-side solutions. Of course supply is very important but it is not the only thing. They promise to introduce a bill to freeze benefit rates and reduce benefit caps for two years, in order, they say:
“To ensure that it pays to work rather than to rely on benefits”.
Of course you can always force people to work by reducing benefits but you will then get wages chasing benefits downwards in a vicious circle. What good does that do for productivity? The Government promise 3 million extra apprenticeships, which is very good, but those apprentices will need jobs to go to. Rather than the mean-spirited assault on benefits, the Government should bring forward investments in infrastructure that provide decent jobs. The Government promise a British investment bank, something that I have been advocating since 2010—better late than never—but are silent about its scope and financing. I suggest that investment projects should be targeted at the areas of higher than average unemployment, as part of the rebalancing and northern powerhouse strategy. To boost demand, the Government should take steps to raise middle and lower incomes, which will provide confidence for firms to invest. Raising the minimum wage would be a step in that direction.
It seems to me that the Government’s post-crash growth strategy relies dangerously on recreating the pre-crash levels of private debt. This is a perilous course, which risks another collapse at no distant future. In short, is that what we want? Is this the best that we can do? I think not. Let us try to do better. Let this House give voice to that better future which the leaders of the defeated parties failed to offer at the last election.
Lord Farmer (Con)
My Lords, I join others in congratulating my noble friend Lord O’Neill of Gatley and the noble Lord, Lord King of Lothbury, on their excellent maiden speeches. I welcome particularly the strengthened contribution which my noble friend brings to the Front-Bench Treasury team and which both noble Lords will bring to future economic debates in this House.
My noble friend Lord O’Neill underlined in his speech the need for improved productivity, as we have heard much of today, if our economy is to prosper. In this respect, I would like to contribute to this debate from the somewhat unusual angle of government family policy. I was delighted by the emphasis in Her Majesty’s gracious Speech on giving every child the best start in life. The Prime Minister made this a cornerstone of our election campaign, reiterating what he has always maintained: that the best start begins with a strong family. It is completely appropriate that a debate on the economy includes an emphasis on strong families, because they are the absolute bedrock of a successful nation. Sound management of the economy requires investment to ensure that families are productive and able to add value, instead of costing money. Helping families to get relationships right creates wealth, while failed relationships dissipate it.
With this in mind, I want to talk about the need to counter the biggest and most downplayed assault on our social fabric: family breakdown. As my honourable friend Fiona Bruce said this week in the other place:
“States have a vested interest in making families stronger. They make a contribution to society by producing a competitive labour force, caring for family members … playing an instrumental role in healthy child and youth development and putting a heart into local communities”.—[Official Report, Commons, 2/6/15; col. 531.]
Yet one-third of all children have experienced the breakdown of their parents’ relationships. That is nearly 5 million children and in percentage terms twice the OECD average and over six times as high as it is in Finland. Costing nearly £50 billion a year, it really is the elephant in the room when discussing the wider economy.
Much is made of the costs of families with complex needs, estimated to be £9 billion per year, to justify the troubled families programme. Help to turn their lives around is essential, but the tax credits and benefits bill associated with family splits across the country is almost £14 billion, with housing costs of £5 billion and health and social care costs of £16 billion. Much of this net loss to the Exchequer could be turned into tax receipts if families could be stabilised and helped to become net contributors to the economy. So as we embark on the first 100 days of a majority Conservative Government who are relentlessly focused on getting our economy on a sound footing, we must develop family policy that goes way beyond childcare and parental leave.
Making progress on this agenda will require a Cabinet-level family champion. Just as with the equalities brief, we cannot leave this to impact assessments, welcome though the new family test for all policy is. We need a Secretary of State with clear accountability, and resource at a departmental level, to prioritise the stability as well as quality of relationships and to promote fatherhood. Every government department has a role to play. For example, the Ministry of Justice should prioritise parenting and relationship support in prisons to reduce reoffending. The National Audit Office estimates that this costs between £9.5 billion and £13 billion every year—the same amount as the London Olympics. Yet reoffending rates are significantly reduced when a prisoner returns to a stable family environment.
The Department for Work and Pensions must address family breakdown as a driver of welfare dependency through its ownership of the wider social justice agenda. Communities and Local Government must ensure that couple work is included in the troubled families programme, and local authorities should address family breakdown as a root cause of poverty in local child poverty strategies.
The Department for Environment, Food and Rural Affairs should also acknowledge the strain on farming families and couples from the challenges of the rural economy, where depression and suicide are higher. Business, Innovation and Skills Ministers should work with employers to provide relationship support to reduce absenteeism. Lloyds Bank and others already do webinars on couple relationships as well as parenting.
Finally, the Department for Education and the Department of Health should work jointly on children’s and young people’s mental health. Family conflict and breakdown contribute significantly to the onset of mental health problems, so not least because of the huge associated costs this should be a priority area. But it is not. Friedli and Parsonage have calculated the lifetime cost of childhood mental disorder very conservatively at £150,000 per case, so just one year’s cohort of children with conduct disorder is costing us £5.25 billion.
As well as better mental health provision integrated into schools and other settings, we specifically need community-based infrastructure, such as children’s centres, to be far more responsive to the problems besetting many families. I have described in the past how they should become family hubs where anyone can go with a family or relationship issue.
To remove all doubt about this issue, people do seek help for their relationship anxieties. Just this week, Citizens Advice revealed that personal relationship issues in particular are putting enormous strains and pressure on GPs, who spend almost a fifth of their consultation time, and almost £400 million, on non-medical matters. GPs have nowhere to send people, hence broadening children’s centres into family hubs could ease significant pressures on our health service and help to contribute to the £22 billion of savings the NHS has to find.
Family relationships are not the soft centre of social policy but are at the hard edges where costs multiply. Strengthening families puts backbone into our nation and is indispensable to the sound management of our economy.
Baroness Donaghy (Lab)
My Lords, my contribution to this debate will concentrate on employment relations and on why I believe that the Government have missed the point about them. Of course our economic success depends on improving our dire productivity record and rebalancing our economy so that we are not so reliant on the service sector, as well as on staying in a reformed Europe, making the most of our talent through training and improving pay inequalities, particularly for women. Therefore, it is with a feeling of near despair that I see in the Queen’s Speech proposals to take away workers’ rights in some areas and to have another go at trade unions. There are 31 million people at work and only 6 million in trade unions. Why does the Minister think that existing employment law, already the tightest in Europe, is in any way inhibiting job creation? Some of our most successful enterprises are strongly unionised, with a record of consultation, co-operation and flexibility. Why do the Minister’s Government seem to think it is possible to separate workers from trade unions? Whenever the words “worker” or “working people” are mentioned, Ministers go misty-eyed and husky of voice, with moistened lips; mention the phrase “trade unions”, and they take on attack mode.
We live in a country where workers can earn 80 times less than their boss. It is unequal and unfair. The contrast in Germany could not be greater: Angela Merkel speaks at the congress of trade unions and spends at least half a day listening to debates. Mark Carney, the Governor of the Bank of England, came to the TUC last September and thanked workers—trade unionists all—for their sacrifices and answered questions from delegates afterwards. What is wrong with this co-operative model? You would expect a former chair of ACAS to say these things, and I want to ask the Minister what consideration will be given to ACAS funding. A lot of extra work was passed on to ACAS by the previous Government, most of it welcome. ACAS is good value, and has the trust and confidence of participants and the country, but it needs to be funded adequately. I can do no more than quote the noble Lord, Lord Marland, when he was the Parliamentary Under-Secretary of State at BIS:
“We all agree that ACAS is a terrific institution … That is why we intend to put much more in the way of resources into it … We know it acts fairly and properly, it has a good track record, and we are keen to support it”.—[Official Report, 5/12/12; col. GC 197.]
If extra work is to be given to the certification office, which is part of the ACAS family, I hope also that adequate funding will come with it.
Turning to the issue of political funds, I realise that this will press all the buttons about the party of the rich and the party in hock to the trade unions, so reason goes out of the door. Without state funding, which is unlikely to happen, we are faced with the unfortunate situation where the Conservatives receive £19 million from 27 of the 59 wealthiest asset managers included in the Sunday Times rich list and the Labour Party receives a substantial part of its income from trade unionists. Lady Thatcher introduced a requirement that trade unions should ballot their members every 10 years to see if members wished to retain or create a political fund. It takes a huge amount of time and money to set up the ballot, and not one has ever failed, but this is not enough for some Conservatives. They want to keep picking and picking at what they see as a running sore on the body politic, while blithely accepting cash from the least regulated financial area in the country.
For the record, the majority of trade unions with a political fund are not affiliated to the Labour Party. They are required to have a political fund if they wish to campaign on behalf of their members. What are the Government’s intentions regarding the non-affiliated unions? Will they be hit for six, so that it does not look too obvious that this is an attack on the Labour Party, or will they be exempt from the new requirements? The majority of trade unionists do not pay into a Labour Party-affiliated fund. Civil Service unions and teaching unions do not affiliate.
I was active in NALGO for 33 years, when it was not affiliated to the Labour Party. We were required, by a court of law, to set up a political fund because of the new legislation and we did that. I was chair of the general political fund at one time, and when it was agreed to merge with COHSE and NUPE, which were both affiliated to the Labour Party, the new union, UNISON, had to devise a solution to recognise the different cultures of the former partner unions. We came up with an elegant solution, which I have described before. Members could opt for the Labour Party-affiliated fund, the general political fund, both funds or neither fund—four choices. When the legislation is before us, I shall be very interested to see how non-affiliated unions will be treated and whether an opting-in process will make the 10-year ballot requirement redundant. This subject area may seem esoteric and faintly embarrassing to some noble Lords, but any proposed changes could have an important impact on trade union resources and income for the Labour Party.
The issue of strikes and public services was raised recently in a Question from the noble Lord, Lord Carrington of Fulham. The new Secretary of State for BIS was elected on less than 50% of his potential vote, and police commissioners and Members of the European Parliament as well as local councillors will never reach the required threshold of 50%—so why apply it to trade union ballots? It is clear that the Conservative Government intend to ban strikes in public services without appearing to breach any international codes on the right to strike. I caution the Government on this; it will not stop strikes, but it will prevent trade unions keeping some control over events. If you give people no achievable outlet, they will find other ways in which to protest.
Finally, the Queen’s Speech talks about the security of a job but not about job security. It talks about reforming trade unions, but not about improving management skills. There is no hint of trying to improve employment relations—not even a crumb of comfort for the HR community. As a fellow of the Chartered Institute of Personnel and Development, I would say that it presents a rather barren picture of the world of work.
Lord Shutt of Greetland (LD)
My Lords, today is allocated to discussing matters relating to business, economic affairs and transport. They are of course related. I want to speak about transport, and one specific area in relation to transport—railways. Even more specifically, I want to talk about the case for further electrification of our existing railways. Yes—infrastructure. By and large, it is not about legislation. I shall leave for a moment on one side the case for building HS2 and HS3.
Before I rise to the theme, I want to thank and congratulate the maiden speakers, the noble Lords, Lord King and Lord O’Neill of Gatley, and welcome the noble Lord, Lord O’Neill, to his ministerial task. I note that he referred to the northern powerhouse, and I have learnt from him today that it is more than just TransPennine. Geographically, at least, it includes the north-east. But what is the definition of northern powerhouse? It sounds like something that I would be rather in favour of, but what is it? What is the substance, or is it something akin to the American dream?
The UK has lagged behind the rest of Europe on electrification. The clear case is for clean-up, for a speedier and cheaper service once the capital costs have been dealt with, and because there will be scope for more trains. It is all well understood. Following the electrification of the east coast main line, completed as far back as 1991, there has been little further progress, or certainly not much progress in completed work. If we look at the period of the Government before last, from 1997 to 2010, electric wires were put up over only 8 miles from Crewe to Kidsgrove. In the last five years, it has not been hugely better, but 45 miles have been electrified, from Liverpool to Manchester and Liverpool to Wigan. However, there are plans and work is taking place.
The last Labour Government did announce plans in 2009, with the Great Western main line, hinting at the Midland main line and further electrification in the north-west of England. In 2010, perhaps understandably, several schemes that had not been started were stalled, only to be given the go-ahead later. I had the privilege of announcing in this House the Great Western electrification to Cardiff, back in 2011. It was a day when the noble Earl, Lord Attlee, was indisposed, and I had the task of announcing it there. In 2012, further electrification was announced, from Cardiff to Swansea, the Welsh valleys and the northern hub, which must be a friend of the northern powerhouse. Then there was the TransPennine line via Huddersfield to Leeds and York and the Midlands main line, Southampton to Nuneaton. Work is going on, but I learn that there have been delays.
What will the route mileage electrified become, in the period 2015 to 2020? Does the Minister think that there is any impediment to that tremendous list of electrification being achieved—and where next? The electrification plans should not stop at those announced in 2012 to 2014; electrification is a long process, and the electrifiers need keeping in business. Teams should not be disbanded, as happened years ago. There are many places, some gleams in the eye, along with other thoughts by planners, politicians and all-party parliamentary groups, as well as railwaymen. When the present announcements have been achieved, what will happen? Is the programme going to be kept rolling, particularly in terms of in-filling schemes? There are some major schemes, and I would not wish to stand up here without mentioning the Calder Valley line as one of many that come to mind.
Following on from earlier planning, the Government have a real chance of delivering significant electrification of our railways based on the present plans—but they must not stop.
Lord Low of Dalston (CB)
My Lords, I add my word of welcome to the new Minister to his position. I have heard him on the radio frequently; he is a big hitter, and will add much authority—I nearly said “much-needed authority”—to the Government and to our proceedings in this House. To judge from his speech this morning, he will add much dynamism as well. I also congratulate the noble Lord, Lord King of Lothbury, on a maiden speech every bit as distinguished as we would expect.
The Prime Minister and the Conservative Party are to be congratulated on their surprise victory—a surprise, I believe, as much to themselves as to anybody else, although people are now coming out of the woodwork to claim that they saw it coming. I myself believed that it was the one outcome that could not possibly come to pass. Mr Clegg has described it as the triumph of “grievance and fear” over liberal values. I have great respect for our Lib Dem colleagues, but I have to say to them that if that is the case it is something that they have connived at for the last five years.
In truth, the election was won on a fraudulent prospectus of over-promising and under-delivering. The record for competence, especially economic competence, was rubbish, with the loss of our AAA credit rating and flagship deficit reduction and immigration targets missed by miles. Instead of the much-denied top-down reorganisation of the health service, we got a top-down reorganisation of the health service, only a costly one of byzantine confusion—and the jury is still out on universal credit, with major question marks still hanging over its deliverability.
The Prime Minister is now impaled on a number of promises that he probably did not expect to have to keep. On public expenditure, the figures simply do not add up. How are £7 billion worth of tax cuts, raising the threshold for inheritance tax to £1 million, subsidising the sell-off of housing association property and £8 billion more a year on the NHS to be squared with the removal of £30 billion from the budget is anyone’s guess, especially given the absurd lock on raising VAT, income tax and national insurance. Perhaps the Chancellor will tell us on 8 July, but I am not holding my breath. Against this background, seven-day working, along with extra doctors and nurses for the health service, is surely for the birds. If anyone else had exhibited such a cavalier approach to the nation’s finances, they would have been torn to shreds.
It is widely agreed by economists that the Government’s austerity measures at the beginning of the previous Parliament delayed the recovery by two years, entailing a permanent loss of resources to the economy conservatively estimated at 5%. When the recovery failed to materialise, the Chancellor abandoned his austerity policy, and the pace of the recovery quickened up to the present time. The Chancellor and his followers never tire of describing this as his long-term economic plan and claiming credit for holding to it. Indeed, the Chancellor achieved the singular feat of persuading people to accept a policy of austerity on the grounds that, although unpalatable, it is good for us, even when he has abandoned it himself. This is only a long-term economic plan if by “long-term plan”, you mean shrinking the state in the first two years of a Parliament with a view to expanding the economy again in the run-up to a general election.
The noble Lord, Lord Desai, and I had a slight difference of opinion over this when we last debated it shortly after the Budget when the noble Lord gave the Chancellor credit for sticking to his guns. It is true that the slowdown in the pace of deficit reduction in 2012 owed as much to disappointing tax receipts as to the Government reducing their expenditure. However, the Chancellor could have stuck to his original deficit reduction plan by raising taxes to compensate for this, or cutting spending still further, but the important point is that he chose not to do so.
Labour is said to be facing an existential crisis stemming from the unravelling of traditional class identities, its failure to come to terms with Scottish nationalism and its failure to speak to those left behind by the damaging effects of market individualism and global market forces. It certainly faces a herculean challenge which will not be overcome by vague appeals to back aspiration. It is said that Labour’s dilemma is that it needs to appeal to different audiences simultaneously, but I am not so sure. I think the problem was that it simultaneously colluded with the narrative on austerity and Labour’s part in the crisis while cautiously hinting at something a bit more radical, with the result that the trumpet gave forth a very uncertain sound. Whenever the Labour Party was taxed with the deficit, all it could do was go on about the good things it had done with it. It had just about screwed itself up to say that the deficit did not cause the crash but did not seem to be able to take the crucial step of explaining that it was the crash that caused the deficit. If Labour’s analysis is so poverty stricken, how can it expect anyone to get the message? Yet whenever I heard a strong lead being given in opposition to austerity, people resonated strongly with it. This is what happened in Scotland, and people voted for it. Labour needs to learn the lesson from this and stop giving so many mixed messages.
I fear that the Government are about to make the same mistake that they made at the beginning of the previous Parliament and inflict another bout of austerity. A number of speakers have anticipated this concern. This would not only be wrong in itself but risks choking off the recovery, which is not so strong that it can easily withstand another austerity shock. Attention focuses principally on stagnant productivity these days, but this should be viewed against the background of a host of other deep-seated problems with the British economy. It was reassuring to note the Minister’s awareness of them in his speech.
Investment is too low, the economy is unbalanced, our manufacturing base is too small and we rely too heavily on the service sector, particularly financial services. We have chronic balance of payment problems, debt levels remain too high, but growth, rather than further consolidation, is a much better way of addressing this. The recovery is too dependent on consumption artificially boosted to unsustainable levels by rising asset values and asset sales. There is even ominous talk of another crisis, worse than the previous one, looming. I was not sure how far this ominous talk was loose talk. The noble Lords, Lord Desai and Lord Skidelsky, referring to it this afternoon should lead us to take it very seriously.
The IMF has just said that deficit reduction is no longer the priority that it was, so there are many good reasons to be concerned at the prospect of a further round of austerity on economic grounds. It would seem to be counterproductive, even in the Government’s terms of delivering a programme of one-nation compassionate Conservativism. What price seven-day working in the NHS then?
Lord Horam (Con)
My Lords, I add my warm welcome to the two maiden speakers, the noble Lords, Lord O’Neill and Lord King. Both are economists, as am I. I tend to think that economists ought to run the country, but I doubt that I would carry the House with that thought. None the less, the noble Lords are very welcome, particularly since we are having an economic debate. Perhaps we could leave it that economists might be rather better than lawyers at running the country; that might be something that the House would agree to.
A recent issue of the Spectator purported to list the top priorities of what it called “Cameron’s inside gang”. It did not actually spell out what “Cameron’s inside gang” was, which might have been more interesting, but it listed the priorities. They were,
“keeping economic growth going, getting an acceptable deal from Europe, securing the Union at home, showing that their policies benefit the poorest in society and ensuring that more houses are actually built”.
That rather cheered me up: first because there were only five priorities. Usually Governments have a long laundry list of issues that they say they are going to prioritise, but five is quite enough. Secondly, I rather agree with the priorities. You can say, with Groucho Marx, that if you do not like them, I have others—but if I had to settle for five at the point of a gun, those five are not too bad.
My problem is—and this is what I want to say a few words about—the difficulty there will be in achieving priority one, keeping economic growth going, and priority five, getting houses built. On economic growth, the US recovery is proving feeble, the BRIC countries, which were made famous by the noble Lord, Lord O’Neill, are slowing down and our exports are suffering. Jaguar Land Rover sales fell by 20% in the first quarter. Manufacturing is not doing particularly well at the moment. The international situation is not very promising and growth is rather fragile.
I am also concerned about the Government’s stance. Here I get into questions of Keynesian economics and so forth. The Government are saying that they are giving top priority to growth, according to the Spectator, but the economic section in the manifesto is all about deficit reduction, and the Queen’s Speech also centred on this. This reminds me of the beginning of the last Parliament, when priority was given to deficit reduction, and expenditure, particularly capital expenditure, was cut pretty drastically. The result was that the rather feeble growth went into reverse. Macroeconomists at the Lords seminar on austerity under the chairmanship of the noble Lord, Lord Bilimoria, which I attended before Christmas, suggested that this might have cost us 4% in GDP growth over the two years at the beginning of the last Parliament.
Only after the infamous “omnishambles” Budget did the Chancellor realise that the advice he was getting was wrong and quietly change tack, becoming rather more Keynesian. As someone who learned his economics in Cambridge during the post-war Keynesian heyday of the 1950s, I can only commend that, as well as his political flexibility—but I do not want to see the emphasis on deficit reduction repeated in the first Budget of this Parliament. That would be a serious mistake.
I would much prefer the Government to stick to their general proposition that they will give priority to maintaining economic growth and, consistent with that overriding objective, keep firm control of current government expenditure and endeavour to reduce the deficit year on year. I believe that the Chancellor now has real credibility as a result of his success—plus, for the first time in many years, a decent majority in Parliament—and the markets would not mark him down for adopting such a posture. It would be much more sensible that trying to meet the rather implausible figures that were mentioned in the Queen’s Speech.
My second and final point is about housing policy. The fact is that housing policy in the UK has been a disaster for the last 40 to 50 years. In 1968 we built 425,000 houses. Last year it was 140,000, but we need 250,000 a year. As a result, prices have soared and we spend £24 billion a year on housing benefit—a huge sum that, if it were spent on actually building houses, would revolutionise the situation. As John Kay, the FT columnist, put it the other day, the trends over the past 40 to 50 years,
“are … entirely explicable by reference to changes in … policy”.
In other words, it is our fault—or rather the fault of Governments and Parliaments over the past 40 or 50 years.
Now the Government want to go back to selling more social housing—this time, that owned by housing associations. This is a mistake. It does nothing to increase supply: indeed, it will reduce it. I therefore endorse the remarks made on Tuesday by the noble Lords, Lord Kerslake and Lord Best, in this Queen’s Speech debate. Since the Government appear determined to bring forward a Bill to transfer housing in this way, I beg them to subject it to pre-legislative scrutiny so that expert opinion on housing can be fully heard by both Houses of Parliament. Then we will see exactly what people who really know about the housing situation think.
To be fair to the Government, they have relaxed planning controls and encouraged the assembly of large parcels of land. I believe that the cost of land is a fundamental issue that has to be tackled in a radical way if we are to get more housing. I also believe, as the noble Lord, Lord Kerslake, said, that in Greg Clark we have an extremely able Secretary of State to deal with these matters. The fact is, though, that if we are going to get a decent housing situation for our children and particularly our grandchildren, with the sort of benefits that we enjoyed when we were young, we must have a much bigger and bolder effort by government to deal with the housing problem. Harold Macmillan did it in the 1950s when he oversaw the building of 300,000 houses a year, and if the Government are going to be truly a one-nation Conservative Government, they should be emulating him.
Lord Monks (Lab)
My Lords, I add my congratulations to the Minister on his maiden speech. He brings, among many other things, a much-needed lustre to a group much mocked and reviled in recent years in this House and more widely: I refer of course to supporters of Manchester United. Congratulations, too, to the noble Lord, Lord King, on his debut.
I had hoped that the Conservatives had exhausted their supply of bile against British trade unions and that the ludicrous dollop of red tape in the recent lobbying Act was the final scrape of that particular barrel. Clearly, though, there is plenty of bile left, as the original step-by-step approach of the 1980s is reappearing. A new Bill is proposed that aims to hobble trade union action still further. We are threatened with more curbs on balloting, with thresholds that no other organisations have to satisfy, as has been mentioned by my noble friend Lady Donaghy. Labour agencies would be allowed to bust strikes, which is something that those agencies do not even want because they do not want a reputation like that. We are threatened with changes in facility time for representatives along with contracting in to political contributions rather than contracting out, an old threat that has been revived as an attack on unions’ campaigning ability, whether or not they are anything to do with the Labour Party. This agenda is tribal hostility, no more, no less.
Noble Lords will be thinking, as I am a former general secretary of the TUC, “He would say this, wouldn’t he?”. After all, who today is afraid of the union wolf? It may still be bad but it is not very big—not as big as it used to be. However, join me for a moment in reflecting on the following truths. There are 6.4 million people in trade unions. I see that just this week the Royal College of Midwives joined the TUC: that is the kind of people that trade union members are today. Collective bargaining covers 30% of the workforce. Union membership is not just confined to the public sector, as I often hear; it remains the norm in most UK companies with more than 500 employees. Last time I looked, 41 of the FTSE top 50 were unionised companies; I could list them but your Lordships know all the household names that I would refer to. Thousands of agreements are made every year. Strikes are infrequent and relations are generally constructive.
So why are the Government so set on clouting unions again? Why is that a priority at this time? There are many features of the British labour market that work far less well than collective bargaining and the trade union role. The Minister and others in today’s debate have rightly put productivity at the heart of the country’s problems and of the Government’s programme, and I welcome that. We lag alarmingly behind comparable countries and it is not easy to turn things round. One thing that it is unwise to do, though, is pick a fight with one of the component parts of improving productivity, the trade unions. That was a gap in what the Minister said earlier—the need to involve and engage people, not just train them, though that is very important. Bringing people with you, getting their morale up and making them feel respected and worth something is very important if we are to make it to the premier league of productivity. Unions are an important part of that, not just something that is marginal or that can be given a kick now and again with no consequences.
It is not just productivity where the union role is important. Take inequality, which has alarmed even the IMF, the World Economic Forum and the CBI in recent months and years. When union membership was higher and collective bargaining covered 70% of the workforce, directors and other top executives knew that they could not help themselves to an annual, possibly double-digit pay increase, often regardless of performance, without facing the possibility of a wave of militancy of people claiming comparability. In the past 30 years, though, too many have adopted a self-service culture, feeling free to help themselves to a large chunk of the company income. To a large extent, that is now recognised across the political spectrum.
In the 1920s, a period of union weakness, Stanley Baldwin, the Conservative Prime Minister, worried about boardroom greed and rising inequality. His solution was to build up institutions for collective bargaining through the then new Ministry of Labour. Baldwin also acted to bring in contracting in to the political levy, so he stops well short of being one of my political heroes. But what he did on collective bargaining is certainly relevant to today, and I hope that the more fair-minded and long-sighted Members on the Benches opposite and more widely will recognise that that is important.
We need influential and constructive trade unions to sort out decent living wages. It cannot all be done by law and it will not all be done by voluntarism. We need proper information and consultation arrangements. We need decent contracts with people that respect them, rather than just putting them on humiliating zero-hours casual bargain-basement contracts of the kind that are too prevalent today. A genuine one-nation Government would recognise that the need to boost productivity and promote long-termism in business cultures is interfered with by any tribal instincts of some in the Conservative Party to give unions a kicking.
This Bill deserves tough scrutiny in the House. I hope that we see a bit more of the spirit of Baldwin and rather less of the venom of the 1980s. Is that just too much to ask?
Baroness Smith of Newnham (LD)
My Lords, I welcome the Government’s commitment to a long-term economic plan and to reduce the deficit, but I have to agree with the excellent speech of the noble Lord, Lord Low of Dalston, suggesting that there is a long-term economic plan because the short-term economic plan did not get very far in the last Parliament. As a Liberal Democrat, I obviously welcome the fact that the deficit was halved as a percentage of GDP in the last Parliament, along with the commitment to getting rid of the deficit and beginning to reduce public debt. However, the Lib Dems were also committed to doing that fairly, as my noble friend Lady Kramer noted earlier. It is to be hoped that the Conservative Government will indeed reduce the deficit fairly, although, as the noble Lord, Lord Fowler, pointed out yesterday, to announce £12 billion of cuts without saying where they will fall is a perilous venture, so we are in perilous waters.
There is a further pledge to legislate to cap tax rates. As the noble Lord, Lord Desai, said a few moments ago, that is a mad promise. Suddenly, alongside unfunded manifesto commitments, here is something that will put pressure on many government departments, particularly those that are not ring-fenced. The two I want to mention today are the Ministry of Defence and the Foreign Office. As my noble friend Lady Harris noted on Tuesday, cuts have consequences, and so, too, do unfunded spending commitments. As the noble Lord, Lord Fowler, rightly warned in his contribution, protecting the NHS in the manifesto, without clear funding, means that public spending in other areas will be reduced. The Treasury will have to look at reducing spending,
“on the police and on defence”.—[Official Report, 3/6/15; col. 430.]
This is also a problem for the Foreign and Commonwealth Office, despite the Government’s avowed commitment to continue to play a leading role in global affairs. There is a real danger to Britain’s place in the world if the salami-slicing of the FCO’s funding commitments continues.
The commitment, or lack thereof, to defence is, if anything, even more serious. The Prime Minister pressed others to commit 2% of GDP to defence at last year’s NATO Wales summit. That is a minimum and is not intended merely as an aspiration; nor is it a maximum figure. It is the minimum requirement and one that the Prime Minister argued for. At a time of global insecurity, credible defence commitments are crucial now more than ever. Will the Minister take back to the Chancellor the importance of ensuring that the welcome, albeit vague, commitment in the gracious Speech to,
“do whatever is necessary to ensure that our courageous Armed Forces can keep Britain safe”,
is delivered on? It is essential that this commitment is met, ideally with a firm 2% commitment on 8 July in the emergency Budget.
Of course, some may say that the economy is growing and therefore a 2% commitment is not as important as people have said, but I beg to differ. If this country genuinely seeks to be at the forefront of the NATO alliance, it must step up to the plate and deliver on its own commitments. After all, the time of a growing economy is surely the time when we should be delivering on them. As the Chancellor used to say to the Labour Party, you should fix the roof while the sun is shining. Now is the time to make that commitment.
The UK’s place as a key and engaged member of the European Union is also crucial to our place in the world and to our economy. The pledge to hold an in/out referendum and the prior renegotiation pose a threat to the UK economy by raising uncertainty. The noble Lord, Lord King of Lothbury, warned in his excellent maiden speech against having a laundry list of suggestions in the renegotiation. I am sure that that is right. We need a swift renegotiation and a clear commitment to staying in the EU. Brexit would be an even greater problem for the UK economy. Membership of the EU is clearly in the national interest in terms of our economic stability as well as our place in the world more generally.
The free movement of people is also vital to our economy, yet it is a freedom that is often seen as a cost to the British economy rather than as a benefit. In his excellent and powerful maiden speech, the Minister, the noble Lord, Lord O’Neill of Gatley, pointed out that economic growth depends on two things: productivity, which has been much mentioned already in the House, and the size of the labour force. The free movement of people and the fact that we are a magnet for those who want to come and work here is very significant to the British economy. We do not talk sufficiently about the merits of immigration or of free movement, both of which are important to our economic prosperity. These issues should be considered rather more fully than appears to be the case in the gracious Speech or in the nature of the debate today.
I hope that the Minister will accept that our economy is stronger for being an integral part of the European Union, just as the United Kingdom is better together, as almost everyone in this House and many Members of the other place—although not the newly elected 56 members of the SNP—would agree. If Britain is better together, the UK is better as part of the European Union. We are better when we work with our EU partners and allies. This country has prevaricated for too long about making a wholehearted contribution and commitment to the European Union. The time has come for us to do that. We need to be in the EU for our own economic prosperity. We have been talking about a growing economy. If that is to continue, it needs to be as a full part of the European Union. We need to hear “yes” and we need to hear it said loud and clear, and I hope that the Minister and her team recognise that, along with those in the Foreign and Commonwealth Office who accept that Britain is better off in the European Union.
Lord Bilimoria (CB)
My Lords, with just 1% of the world’s population today, the UK is the fifth largest economy in the world. Having endured the worst recession in a century, we have recovered remarkably well. We have low inflation, low interest rates, high employment rates and a growing economy. We are the envy of Europe. But as so many noble Lords, including our maiden speakers the noble Lords, Lord O’Neill of Gatley and Lord King of Lothbury, have said, raising productivity is a serious challenge. As the noble Lord, Lord Leigh of Hurley, said, we are very lucky to have Jim O’Neill in the House of Lords. I have known him for many years. He was very helpful to me when I was the founding chair of the UK India Business Council, and we both served together for many years on the UK-India Round Table, where he was instrumental in getting Teach For India off the ground. It is now hugely popular, as our very own Teach First is here. He has been tasked by the Government to create the northern powerhouse. Well, in the noble Lord, Lord O’Neill, we have a northern powerhouse in our midst, and we welcome him to the House.
Where is Britain going to be in 2020? Our productivity must improve, because we lag way behind others. We may be the fifth largest economy in the world, but in purchasing-power parity terms—in per capita GDP—we are 27th in the world. How do we address this? Wearing my hat as the proud chancellor of the University of Birmingham and my various roles at the University of Cambridge, I was surprised to see no mention of higher education in the gracious Speech. We have the best universities in the world, along with the United States, and we are in danger of taking this for granted, because we way underinvest in higher education compared with the US, OECD and EU averages. The Minister, the noble Baroness, Lady Neville-Rolfe, who I congratulate on her reappointment—and I look forward to working with her—was on the board of the UK India Business Council when I was the chair, and a great board member she was too. Can she please explain the glaring omission of higher education? Can she reassure us that universities are going to be a top priority and that this Government will increase funding for universities to increase our competitiveness and productivity?
The noble Lord, Lord King, is a great West Ham supporter. I am sorry, it is not the Prime Minister speaking; I meant Aston Villa supporter. We are so fortunate to have him in the House because he will add huge value. He talked in his great speech about innovation being one of Britain’s greatest strengths, yet when it comes to innovation and research and development, as other noble Lords have said, we invest way below the US, EU and OECD average as a percentage of GDP, and indeed way below South Korea. The coalition Government’s patent box initiative is tinkering around the edges. We need to encourage far more serious investment through our universities and business to really increase our productivity and competitiveness through innovation and R&D. Does the Minister agree?
We also need to encourage entrepreneurship. In India, Prime Minister Narendra Modi now has a Minister for Entrepreneurship in his Government. That is how important it is. As Secretary of State Sajid Javid has said, SMEs are the engine of our economy, and we need to have that focus on entrepreneurship, creativity and innovation. One of the reasons why the United States constantly bounces back so rapidly from any crisis is its huge strength in productivity, higher education, research and development, and innovation.
The Government are rightly targeting full employment as a goal. One way in which this could be achieved is by having a more balanced economy, where manufacturing is a priority. In my own business, Cobra Beer, I am first and foremost proud to be a British manufacturer. In India, Prime Minister Modi has his Make in India campaign, and has set an aim to increase the manufacturing share of GDP from 16% to 22% by 2022. Does the Minister agree that we also should set a specific target to increase manufacturing as a percentage of GDP?
It is not necessary for the Government to legislate that they are not going to increase certain taxes; the noble Baroness, Lady Kramer, made valid points about that. However, surely the Government should also be articulating that they will reduce certain taxes? The most important one is the 45% top rate of income tax, which should be brought down to 40%, which is where it was under both a Brown and a Blair Labour Government. Does the Minister agree?
One area where I fundamentally disagree with the Government is immigration. The gracious Speech mentions that immigration will be a priority to be controlled, and we all know that illegal immigration needs to be controlled and bogus colleges shut down. On the other hand, the Prime Minister, the Home Secretary and the Government continue to stick to their target of reducing immigration to the tens of thousands. However, by having no control over EU immigration this will not be possible, and continuing to include international students in net immigration figures is absolutely foolish and illogical. Even our new Universities Minister, Jo Johnson, with whom I look forward to working, has acknowledged the drastic drop in the number of students from India.
The negative immigration rhetoric is hampering our universities and our businesses. Sir Venki Ramakrishnan, the president-elect of the Royal Society, the pre-eminent institution for scientists in the world, is a Nobel laureate from Trinity College Cambridge and of Indian origin. The City of London would not be the number one financial centre in the world were it not for immigration. People and capital in business vote with their feet in our global world. Britain would be insignificant without immigration.
In terms of priorities, the Government should commit to spending 2% of our GDP on defence in this dangerous world, and it is negligent even to think of cuts to our defence or our Armed Forces today. Does the Minister agree?
Today, Britain is a remarkable nation, with the best of the best capabilities in every field you can imagine, whether it is advanced manufacturing, aerospace, financial services, beer, our lawyers, our accountants, our creative industries, our Oscar-winning film industry, designers and architects—I could go on. I spoke at the Milan expo recently and saw our brilliant GREAT Britain campaign in action. Our pavilion at the expo, the beehive, is by far the most impressive and creative of all pavilions from all over the world.
To conclude, the Government speak of aspiration. We need to be much bolder. The 200th anniversary of the Battle of Waterloo will be on 18 June. The Duke of Wellington’s motto could not be more appropriate: Virtutis Fortuna Comes—fortune favours the brave. If we as a country aspire by 2020 to be far more productive and competitive than we are today, we need that aspiration, which will lead to achievement, which will lead to inspiration, which in turn will lead to aspiration: a virtuous circle.
The Earl of Arran (Con)
My Lords, I will say just a few words on a part of the United Kingdom so far scarcely mentioned—it is called the West Country—where there is still a sense of deep shock at how at how quickly the events of the general election changed from the predictions of the pollsters to an outcome which, for the first time for a generation, shows the peninsula with a blue political colour-scheme, save only for fortress Exeter. The implications of that will take time to assess, but we do not forget that the coalition has not been unkind to our local economy and that many of the coalition members have worked hard to highlight that the deficiencies of our infrastructure should be remedied.
It is interesting to note that the 5.2 million population of Scotland currently receives £2,000 per head more than the 5.3 million population of the south-west. Perhaps many felt, when faced with their voting choice, that the risk of this becoming an even wider gap was too big to stomach.
What next? Do we risk again becoming the forgotten peninsula—the Cinderella of the west—or will we hold Whitehall to the commitments that were made during the pre-election period? That we most certainly will. In simple terms our message is easy to understand. The south-west cannot function without effective infrastructure. Some 90% of transport needs are on the roads, but we still have only one 21st century route, in the M5. When that is disrupted, paralysis quickly follows and many hours of business are lost before normal service is resumed. The case for a second artery—the A30/A303—has been argued for 30 years. It was nearly approved 15 years ago. It is ready to go. The maths are also simple: £2 billion expenditure equals a payback of £40 billion and 40,000 jobs. The Treasury has confirmed these figures. We cannot wait another five to 10 years before this work starts.
The rail network is in a similar state of under- investment. We have the oldest rolling stock in the United Kingdom—it predates the Ford Fiesta—and journey times that are an embarrassment when we greet national or international investors. We have been promised some new train sets, but this decision is still subject to Treasury approval. These commitments simply must be honoured. When considering rail, it would be wrong to ignore how vital both the national and the local networks are to our economies. In my own area of north Devon, the Tarka line carries nearly 1 million passengers a year, many of whom are students travelling to Exeter and back. The potential for growth in local rail initiatives such as the West Somerset Railway and the Lynton and Barnstaple Railway is quite simply huge. Again, they are vital lifelines for supporting economic growth.
It would be enough for most Members of your Lordships’ House to have to live with infrastructure deficiencies such as the ones I have just mentioned; however, they are not quite the end of our woes. What is now taken for granted across the country—simple access to mobile telephones and decent broadband speeds—is still absent in many of our rural, and surprisingly urban, areas. If the south-west is to improve its productivity outputs, which currently languish 10% behind the UK average, the quickest solution, which would attract the greatest support from businesses big and small, is broadband and mobile infrastructure investment. It would create a bow wave of exciting business activities. In the last five years, the south-west has created nearly 60,000 new jobs in the private sector. A high percentage of these people are self-employed, and many are working already in international markets. Broadband will ignite these businesses, enabling them to be the new generation of entrepreneurs and demonstrate that the south-west can deliver significant value to the UK economy.
In the run-up to the general election, a number of bold statements were made on—here we go again—housing. It was said that 200,000 houses a year will be built, and the right-to-buy provisions extended. Fine words, but how and when? In north Devon, the gap between affordable housing delivery and the housing waiting list becomes bigger and bigger. The current right-to-buy arrangements have not seen a like-for-like replacement of affordable dwellings. Planning delays can hold up vital schemes for three to five years and cost thousands of pounds, which could be invested in more dwellings. The impact on my local economy is most damaging in the recruiting of skilled key workers. In the rural economy these problems are multiplied, fuelling an exodus of the next generation and destroying family succession for many in the farming industry. The housing issue is a time bomb, as so many of your Lordships have said this afternoon. Radical reform is necessary, starting with yet another major reform of our heavily overbureaucratic and protracted planning system.
This is not a list of whinges and whines. It is simply a list of some of the promises made by the Government during the election—promises that, both politically and economically, must be kept, for to renege on them would be both irresponsible and most unwise.
Viscount Hanworth (Lab)
I wish to talk about the dangers of our current economic circumstances, which have been exacerbated over the past five years of a Conservative Administration. I believe that we are heading for a crisis that will impoverish the nation, and from which it will take a long time to recover. I should like to examine this situation in the context of competing economic theories.
In the years following the end of the Second World War, until the 1970s, Keynesian macroeconomic theory held an unassailable position. Keynesian theory placed its emphasis on the supply side of the economy and on the role of central government in regulating economic demand through fiscal controls. It gave little recognition to the monetary and financial aspects of the economy. The theory had shown how an economy could be lifted out of a recession, but the problem in the UK in those post-war years was with an overheating economy.
A monetary aspect of Keynesian theory to which little attention was paid in the early post-war years concerned a theoretical curiosity described as the liquidity trap. The liquidity trap denotes a situation in which injections of cash by the central bank into commercial banks fail to decrease already low interest rates. Therefore, an expansionary monetary policy becomes ineffective. I shall return later to this matter, because it fits our present economic circumstances.
In the 1970s, economists began to espouse monetarist doctrines that were utterly at variance with the Keynesian nostrums. The doctrines were accompanied by a free-market ideology that advocated a widespread deregulation of economic and financial activities. Markets were deemed to be rational and self-regulating. These ideas, which were readily adopted on the right wing of British politics, had an appealing simplicity.
One of the simplifications of the monetarist theory was the assumption that the rate at which the stock of money circulates throughout the economy could be regarded as constant. In that case, since it was geared to the circulation of money, economic activity could be regulated by controlling the available quantity of money. The theory took little account of the towering edifice of credit and of derived money that can be generated by the financial sector on the basis of the so-called high-powered money provided by the Treasury and the central bank. In the latter years of the Thatcher Administration, the nostrums of the monetarists were utterly negated by the growth of this edifice. This was the result of the financial innovations that the Conservatives’ deregulation of the banking system encouraged. It was the unstable nature of this vastly inflated financial structure that caused the crisis that occurred in 2007 and 2008, during the subsequent Labour Administration, the effects of which continue to afflict us.
One of the myths perpetrated by the Conservatives during the recent electoral campaign is that the financial collapse was Labour’s responsibility rather than theirs. The blame that falls on a Labour Administration is a failure to recognise the extent to which the hypertrophy of Britain’s financial sector was endangering the nation. The blame must rest squarely on the Conservatives for having unleashed the malign forces in the first place. Thereafter, over the past five years, they may be blamed for having done next to nothing to diminish the dangers posed by our financial sector.
It is important to understand the manner in which the activities of Britain’s financial sector are serving to perpetuate the pathologies of our economy. These activities have succeeded in averting a balance of payments crisis that would otherwise have overtaken us long ago. In the process, they have created the circumstances that will eventually give rise to much greater difficulties.
The UK’s current account—which captures the value of flows of income and goods between the UK and the rest of the world—has now reached a record deficit of 6% of gross domestic product. The overall balance of payments has been maintained, as it must be inevitably, by adjustments on the capital account. These consist of the sales to foreigners of purely financial assets, of residential properties and of the public utilities and manufacturing enterprises that remain in British hands.
The result of this process has been the maintenance of a high value of the pound versus other currencies. The overvalued pound makes it generally difficult and often impossible for British companies to export their manufactured products. The reductions in the value of the pound that occurred between 2008 and 2010 have not materially altered this circumstance.
The prolonged overvaluation of the pound has left Britain with a severely diminished industrial sector, which satisfies an ever-decreasing proportion of our own domestic demand. A major crisis will arise when the supply of assets for sale overseas has been depleted and when the remnant of our industrial sector will be too small to engage in any effective import substitution. I believe that the crisis will be upon us sooner than most of us are liable to expect.
I now wish to return to the matter of the Keynesian liquidity trap. This was little more than a theoretical curiosity in the early post-war economic environment but it now has a very tangible embodiment. It is represented by our commercial banks, which have benefited from large injections of money from the central bank via operations that are nowadays described as quantitative easing. The banks had been expected to supply some of the money to industrial enterprises for the purpose of investment but they have not done so. Instead, they have retained most of the money, albeit that some of it has already found its way into financial assets.
The existence of the liquidity trap has some disconcerting implications. The abundant surplus of money, if it is not to be deployed in stimulating an investment boom, will surely be available for fuelling a further boom in financial and capital assets. Such a boom will favour those who are in possession of such assets, and they are the richer members of our society. What we will see is a worsening of the already sickening inequalities of our society.
To avert an impending economic crisis, or, at least, to reduce its severity, we need to reduce the value of the pound, and we must cease to sell our assets overseas. We need to ensure that the money that has been pumped into the economy finds its way into industrial investment. In short, we should observe the nostrums of Keynesian economics.
Lord Fox (LD)
My Lords, before I begin, I should draw attention to the Members’ register of interests and the fact that I am a member of the executive team of GKN plc and that I hold shares in Smiths Group plc, a former employer. They are both global engineering companies with a strong manufacturing footprint in the United Kingdom.
I feel very fortunate to participate in today’s debate, it having been graced by two such excellent maiden speakers. The noble Lords, Lord O’Neill and Lord King, should be congratulated, as indeed they have been, on those speeches. I feel less fortunate in coming in as speaker number 35 in this debate, not least because I am following some absolutely excellent speeches from other Members. However, I will try my best not to repeat what has been said and to add a few other points.
A large proportion of the debate has focused on productivity, as, I am afraid, I was intending to do. The diagnosis is agreed and it was set out by the noble Lord, Lord O’Neill, very clearly at the beginning: the UK is very much falling behind the G7 in productivity. So we agree on the diagnosis, although the noble Lord, Lord Desai, begged to differ a little and tried to split up the sector. There are statistics that to some extent support what he said. The manufacturing statistics and data put out by the Engineering Employers’ Federation, for example, show that manufacturing and advanced manufacturing are delivering productivity at a rate different from that of some of the other sectors, particularly the services sector. Therefore, perhaps it is not a one-pace economy and we have to think about these things in a number of different ways.
Then, the economic big guns were rolled out. In a way that is perhaps heartening, almost all of them have had a different suggestion as to the solution to the productivity problem. This kind of confirmed what I found when I started to really look at this. I went to the Bank of England’s writing on it and was even more heartened when I found that it confessed to being puzzled by the situation. It does worry me a little when the Bank of England is puzzled. It cited the position in the cycle, where we are in fact growing capacity ahead of the need for that capacity. It cited the redeployment of people from productive tasks to business development. It talked about lower investment—I will come back to lower investment in more detail in a minute—and the inefficient allocation of capital. For a scientist, not an economist, all these things seem feasible. However, at the end of it all, the Bank of England did say that it was puzzled. This illustrates, as this debate has illustrated, that more work is necessary if we are going to explain the issues around the productivity gap. I ask the Minister to confirm that her team, and perhaps the Treasury and DBIS together, are working on a better understanding of some of the key issues.
For us to work together on this, we have to have confidence in the statistics. A number of doubts have been expressed about those statistics. Sometimes, if the message is not what we want to hear, we throw doubt on statistics. It could not possibly be true, for example, that France is more productive than us—or is it? We need to start to have some focus on the key levers that we ought to be pulling in this area.
As an aside, I want to talk a little about investment. The availability of capital, particularly for SMEs, is a key issue. Finance for working capital, for expansion and for start-up is vital. It does seem that, during the recession, this had dried up. The tendency has been to blame banks and banks alone for this drying up. I suggest that banks are not necessarily the right sort of lender for many of these kinds of activities. Their risk profile, particularly of late, often does not match the sort of financial package that people are looking for. As noted today by several other speakers, we need to be in a position where we are fostering a more diverse source of capital and a broader pool of finance.
The Competition and Markets Authority is, to some extent, looking at SME banking. Its interim report is, I think, due some time in the autumn. I ask those in the ministerial team whether they would be able to bring back some of those interim findings. Perhaps using the expertise of the noble Lord, Lord O’Neill, in this area the team can lend some light to how we can put in place quite quickly some broader mechanisms to deliver finance to SMEs.
My second and much briefer point is around the industrial strategy, because I have not heard anything about it. There was nothing in the Queen’s Speech and nothing today. I am a little disappointed because it is very much an important centrepiece of what Government can do in conjunction with business. Noble Lords will be aware that, during the last Parliament, industrial strategies were established between Government and 11 key business sectors. I declare an interest that my own company was involved in two of those. There was a tremendous level of co-operation, discussion and exchange of shared ideals between the various segments involved. It should be acknowledged that that is really important work. The aim of industrial strategies is to establish the structures and relationships to give business the confidence to invest in the future, invest in the necessary R&D and capital, and to foster the development of the skills that we will need, not just in 10 years’ time but now.
I would like to take this opportunity to ask the Minister to assure us that these long-term initiatives—along with the work around Catapult and innovation centres, which is another important part of innovation fostering—and the focus on STEM skills will continue to be an important part of the work that goes ahead. We need continuity and a sense of certainty to encourage business to participate in investing in the long term in this country. I hope that the Minister can give business that sense of continuity.
Lord Broers (CB)
My Lords, as a microelectronics engineer who spent his first 20 years in industry, it is perhaps appropriate that I follow the noble Lord, Lord Fox, and a lot of what I shall say resonates with what he has just said.
It is a great privilege to speak in this debate. With other noble Lords, I was immensely impressed by the outstanding maiden speeches of the noble Lords, Lord O’Neill and Lord King. It is hugely encouraging that they have come to join us and help us in finding ways to strengthen our economy.
Like many other noble Lords, I wish to concentrate on manufacturing. The best way to reduce our deficit and bring our economy into balance is surely to increase our manufacturing output. To do this, we need to make our products more innovative and attractive to customers, reshore a significant fraction of our manufacturing and, most importantly, improve our productivity. Much has been gained over the past few years and there have been signs of a real renaissance in our manufacturing capability. Disappointingly, however, output has levelled off during the past year and, once again, manufacturing is lagging behind the financial and services sector, leaving our economy unbalanced. It is vital that we maintain our focus on manufacturing.
During the past two weeks, I have chaired for the fourth time the national manufacturing debate at Cranfield University, this year with the theme of reshoring. I also chaired a session of a Westminster Employment Forum focused on higher apprenticeships. Many of the critical factors affecting our manufacturing performance surfaced at these events and I want to talk about three of them.
First is the need to maintain and grow the support to the catapults, just mentioned. We now have seven catapults already producing innovative advances derived from research in industry and academia that will lead to better products and more efficient manufacturing, and two that began operations this April. Dick Elsy, the director of the first catapult, the High Value Manufacturing Catapult, told us at Cranfield about the success of this flagship example. It now operates at seven different sites and works on manufacturing processes that range from the production of Rolls-Royce turbine engines to plastic electronics. It is pleasing that the TSB, now Innovate UK, was able to exceed the original funding limits and allow it to expand. The other catapults are also doing well, although there is a worry that the regulations governing the provision of government funding to these centres places constraints on their operation that may impair entrepreneurship, but hopefully Innovate UK will keep an eye on this and not let it dull their performance.
As many of your Lordships will know, the catapults are a UK version of the German Fraunhofer centres, but we have a very long way to go before we will compete with the power of those German equivalents. Hermann Hauser, who proposed the catapults, points out that there are 77 Fraunhofers versus our seven to nine catapults. Each of the Fraunhofers is about the same size as the catapults, with more than €3 billion of support, and there are 55 potential Fraunhofers in waiting. He thinks that it is important that there should be a steady increase in the number of catapults—about two or three a year. These have the potential for being the life-blood of our manufacturing recovery, but only if they continue to receive adequate support.
The second factor affecting our manufacturing performance that I wish to talk about, as many other noble Lords have done, is skills, and specifically the need for coherence in the two branches of our higher education system: the university branch and the apprentice branch. One of the speakers at the employment forum that I chaired described our higher education system as a series of pieces from a jigsaw puzzle, mostly of high quality but none of them fitting together. In particular, the qualifications for the different levels of apprenticeship are not adequately defined, especially with respect to the theoretical knowledge required to attain a given level.
It is felt by senior industrialists who I have spoken to that the Government need to help in determining these standards. At present they are established in an ad hoc manner by individual companies and the standards of attainment are too variable—they are all over the place and, to be blunt, not fit for purpose. There is also a tendency for the vocational or apprentice branch to be considered only by those who cannot get into a university. The result of this has been a serious shortage of what Europeans call master craftsmen. This was emphasised at Cranfield as a serious issue that may limit our ability to reshore manufacturing. The strong emphasis that the Government place on apprenticeships is admirable, but the qualifications needed to reach the different levels of apprenticeship need to be defined and enforced.
Finally, I wish to stress the need to place more emphasis on the needs of medium-sized businesses. It was pointed out at Cranfield that it was unfortunate in many ways that we almost universally refer to SMEs, small and medium-sized enterprises, as if they were the same and have the same needs. They are not the same. We are better at creating and supporting companies than we are at supporting and growing companies that are already established. I have raised this issue before. Our financial sector needs to learn how to assess the potential of these businesses and fund them, and not leave it to the Americans to have free access to our successful mid-sized companies just as they are ready to take off, thereby depriving us of the boost they could make to our manufacturing output.
Lord Harrison (Lab)
My Lords, like many others on this side of the House, I am less than transported by the Government’s proposed Bills for the forthcoming Session. However, I welcome the noble Lord, Lord O’Neill, not only as a man of the north but for his interests in strengthening transport links to not only the north and beyond but across to the east and the west. There are many successful large cities and big towns in the north. If that is true of the north, I hope he agrees—I believe he does—that it is also true of other areas throughout the United Kingdom and that there has been a failure to develop the east-west links which are so vital. One colleague would talk about the south-west and others would talk about the A14, for instance.
However, the noble Lord omitted to talk about the Airports Commission and the forthcoming decision that will have to be made. I encourage him not to proceed into the pusillanimity that David Cameron has exhibited by kicking this issue into the next Parliament. We need decisions. The airports need to be part of an integrated transport response to the changing and growing needs of our economy. Perhaps in his reply the Minister will mention more about regional airports and what the Government intend to do there.
Like others, I shall talk principally about small businesses and access to finance. Next Thursday, the noble Baroness, Lady Neville-Rolfe, and I will have a debate on the question of late payment of commercial debt. I warn her that it is no longer satisfactory to invoke the Prompt Payment Code as a way of solving that problem, which has been with us for far too long. I remind her that some two years ago, at the behest of the German ambassador in London, I attended a meeting with the German business bank on the eve of our setting up of the British Business Bank. However, I am at a loss to explain what is happening in the UK and what our bank has been doing. The British Business Bank was finally set up, as I understand it, in November 2014. Why so late? There was an explanation about waiting for the European Commission, but I do not understand why that did not apply to the German business bank. Why has there been so little help for manufacturing? The Minister, Matthew Hancock, agreed that only 13% of the moneys so far lent had been to manufacturing. That is another theme highlighted by the noble Lord, Lord Broers.
In addition, the Commons, in its report of 10 February, talked about the British Business Bank and said that,
“support is too complicated for business to understand or too poorly communicated for businesses to be aware of”.
It concluded that businesses seeking support find,
“a complex and unclear offer … from the Government”.
Will we do something about that? In that same report, there are concerns about the Green Investment Bank. It is a bank inhibited by a lack of borrowing powers. What do the Government propose to do about freeing up the Green Investment Bank?
During the spring, I had the pleasure of attending the World Bank and IMF parliamentary conference in Washington and of meeting Christine Lagarde. She and others are proposing a symposium or conference in Paris on climate change. What UK initiatives are we producing at that important meeting? What are we doing to fulfil the aim by our Prime Minister to be the greenest Administration ever?
The leitmotif of the noble Lord, Lord O’Neill, was productivity. He talked about the problems of being the second-poorest in terms of productivity in the G7 and being 17% behind—in deficit—compared to other countries. Even France, which is often invoked in UK political circles as a nutcase when it comes to the economy, clearly is more productive than we are. I ask the Minister to take on board the memorable formulation by my noble friend Lord Haskel that we need to replace the age of austerity with an age of productivity. We must clothe ourselves in the habit of productivity. In order to tackle productivity, the noble Lord, Lord O’Neill, suggests that we must do more in education. I suggest that we have a chaotic education system which leaves out higher education, as the noble Lord, Lord Broers, pointed out.
We need to improve infrastructure. We have become pothole Britain. A Roman legion marching in Britain today would be subject to turned ankles and shattered shins. The noble Lord, Lord Horam, pointed out how the lack of housing is incapacitating our ability to revive the economy. Even the Telegraph yesterday had a report about how the City is snared in London from bringing in new customers and operators because of the lack of housing. The noble Lord, Lord O’Neill, boasts of coining the expression “BRICs”, but we need more bricks and mortar, and a bit more housing, to provide for peoples locally. I ask that local councils stop being attacked. They are often loaded with more and more work to do, and responsibilities, while being deprived of the money that is so important.
I conclude in agreeing with others who have spoken on the European question, to which we will return in time. I hope that we make a proper decision at the end of all this debate and that the noble Lord, Lord O’Neill, will join us in ensuring that we have a European future.
Earl Attlee (Con)
My Lords, I have very much enjoyed listening to the speeches today, in particular the two maiden speeches. I was also struck by your Lordships’ very interesting comments on the problems of productivity.
I take issue with the comments made by the noble Baroness, Lady Kramer, about welfare. We spend about £100 billion on welfare—more than health and several times what we spend on defence. If we do not adjust welfare we will have to cut something else even harder, which could have adverse effects on the economy. The noble Baroness suggested that my party is lurching to the right. The bad news for her is that my right honourable friend the Prime Minister has firmly pitched his tent on the centre ground and he has no intention of moving it.
Towards the end of the last Parliament I initiated a QSD on cyclist fatalities in London caused by HGVs. I was grateful for the participation of the noble Lord, Lord Davies of Oldham, who is in his place. Sadly, since Dissolution there have been a few more of these dreadful accidents. They are simply not tolerable. I can tell the Minister, my noble friend Lord Ahmad, that I will be on the warpath this Parliament. The impression I get is that Ministers would be happy if they could show a measureable reduction in the number of these accidents and fatalities. We do not appear to have a policy or set of policies to get us towards zero—by “zero”, I mean that in some years there are no fatalities. I believe that we can get to nearly zero by using sensor technology. The sooner we get to that point, the more lives we can save in absolute terms. We must not forget the very serious life-changing injuries as well.
I expect that Ministers will still be being briefed that the sensor technology available is simply not good enough to be mandated. That is not surprising, since central government has not promulgated a set of performance or evaluation criteria for manufacturers to work out what they need to do to be mandated. In short, industry does not really know what it has to do, although some manufacturers and suppliers think that they have the solution, which they do not. I do not need an answer this evening, not least because I will be tabling a whole range of helpful Written Questions for my noble friend the Minister to answer.
I was very pleased to hear the comments made by the Minister, my noble friend Lord O’Neill, about HS2. I was rather less enthusiastic about the comments made by my noble friend Lady Noakes in her otherwise excellent speech. She did a rather good job of criticising HS2; I just did not agree with her. The construction industry needs to have a steady and continuous stream of mega-works to be sustainable. That is to the benefit not just of front-line construction workers, but of the enablers: the architects, engineers and all the other specialists who work on these mega-projects. They have already done a considerable amount of work on HS2 phase 1 and they will be on to HS2 phase 2. We also must not forget the plant-hire industry, which hires all the necessary cranes and construction equipment. We have constructed the Olympic park; we are now building Crossrail. After Crossrail we will have HS2 phase 1 and then phase 2 to build. But if we do not build HS2 phase 1, what is the construction industry going to do in terms of mega-projects?
On affordability, we are currently spending around £3 billion on Crossrail per annum. When I was having a pop at the noble Baroness, Lady Kramer, I pointed out that we are spending £100 billion on welfare, so it is not as if we cannot afford HS2—we can.
I appreciate that my noble friend Lady Noakes could not give a full argument against HS2, but she mentioned time savings of 20 minutes to get to Birmingham. She will recognise that those time savings are also applicable to those passengers going north of Birmingham. HS2 is not just about time saving for the few, but about increasing capacity, because otherwise we will run out of capacity on the west coast main line. The noble Lord, Lord Berkeley, is in his place. He will want space for freight trains to run on the west coast main line. We have absolutely got to build HS2. But it is also about connecting all our great cities in this country. As far as I am concerned, there is a very strong case for HS2. The report from your Lordships’ Select Committee on Economic Affairs is a bit unfortunate. No doubt we will debate it fairly thoroughly in due course.
In his interesting speech from the opposition Front Bench, the noble Lord, Lord Mendelsohn, mentioned late payment of commercial debt. This was the subject of my maiden speech many years ago. I can see no good reason why we cannot have a system whereby all normal trading invoices are paid by the end of the month following the month of the invoice. This whole business is simply a waste of effort with the purchase ledger section in one business and the credit control section in another all undertaking perfectly pointless activity. In addition, some commercial organisations, especially in the haulage industry, can run up several months of credit with their customer and the customer goes bust, which can then send the haulage company out of business. Therefore, as I say, there is a very strong case for moving gradually to a system whereby invoices are paid by the end of the month following the month of the invoice.
Finally, I turn to how this House will operate in this Parliament. We are not in a new situation. I am confident that noble Lords on the Benches opposite will recognise the need to act responsibly and that my noble friends on the Front Bench will recognise that for our Parliament to work effectively the Government in this House must be defeated from time to time.
Lord Watson of Invergowrie (Lab)
My Lords, the outcome of the general election came as a massive blow to me, as it did to all noble Lords on the Labour Benches. It was a major defeat for the Labour Party; there is no point trying to dress it up any other way. Even a month on, I admit that it still hurts.
As I began to get involved in competitive sports as a young boy, I remember that my father said to me, “Winning is everything”. But he qualified those remarks by saying, “Winning is everything within the game or within the contest, whatever it is. Once it’s over, your true mark is shown by how you react. Never gloat if you win, never sulk if you lose”. Those words have stayed with me ever since. It is regrettable that my father never had a chance to offer advice to the Prime Minister, because anybody watching Prime Minister’s Questions yesterday will have seen a sneering, patronising display aimed at the interim leader of the Opposition, which I believe did no credit to the Prime Minister or to Parliament.
The inquest within the Labour Party into what happened in the general election is ongoing, but I have no doubt that the main reason for our defeat is the very subject we are discussing today—the economy. Labour never managed to achieve economic credibility in the minds of enough people, and I believe that can be traced back to the period immediately following the 2010 general election. The coalition parties banged on about “the mess we inherited” and it stuck. It stuck despite being completely untrue. That is something about which the Liberal Democrats should be examining their consciences now.
As my noble friend Lord Hanworth said, the economic crisis was not caused by Gordon Brown or the Labour Government. It was a global economic crisis and it was caused by banks, with British banks well to the fore. The only accusation that could be laid at the door of the Labour Government was that regulation of the banks was woefully inadequate. But—and I believe that it is a big “but”—at no time prior to the economic crash did the Conservatives urge the Government to bring the banks under control, so they were equally culpable in that respect. However, Labour never managed to get that crucial point over to the electorate from the beginning. I believe that we had plenty of time to refute the coalition’s mantra and build a convincing economic policy narrative, but for reasons that I cannot quite grasp we never really managed to do so. That failure sowed the seeds of this year’s election defeat and we need to learn that lesson as we begin to rebuild the party as an electoral force.
As I said, I am still hurting—not for myself, but for the millions of people throughout the UK who are going to suffer considerable hardship over the next five years at the hands of a Government who talk about one nation but have neither an understanding of the concept nor any real interest in moving towards it. They talk the talk; I will be interested to see but I do not expect them to walk the walk. Inequality is the biggest and most pressing problem we face in this country today, and we desperately need policies that tackle it and begin to reverse the slide towards an ever more unequal society. I regret that I do not see any evidence that we will get that from this Government.
How can the Prime Minister claim that he wants one nation when his Government are about to embark on £12 billion of cuts in the social security budget? Indeed, along the Corridor his Chancellor has just been outlining the first tranche of some £3.5 billion of cuts, which we are told will amount to a 3% cut in the budgets of unprotected departments. Why were the plans for the full £12 billion not outlined during the election campaign? I suspect that the Chancellor never expected to be allowed to implement such cuts, as the Conservatives had no idea that they would be in a position to govern alone. That explains why there is to be a Budget next month, just four months after the previous one. Unconstrained, the Government are pressing ahead with unalloyed enthusiasm, irrespective of the effect it will have on families, children, the disabled, the unemployed and would-be first-time buyers.
Equally, how can the Prime Minister claim one nation as his aim when during the election campaign he cynically exploited the rise in support for the SNP to help him win power, all the while being fully aware that the outcome made an independent Scotland more likely? How can he claim one nation as his aim when he announces legislation in the trade unions Bill that will make strikes virtually impossible? My noble friends Lady Donaghy and Lord Monks have covered this in some depth and with greater experience than I have, but I believe that some points are worth restating.
More than 6 million people in the country are members of a trade union, yet they are being shackled in a manner not seen since the 1920s. One nation? Then why not apply the 50% threshold to all ballots? But that would mean the election of the Prime Minister’s close friend the Mayor of London would have been invalid. Why should a dispute between employees and their employer be seen as more important than the election of the most senior politician in the capital city? Mind you, the fact that the mayor regards his job as part-time perhaps diminishes my argument there.
The thresholds proposed are arbitrary, unfair and quite unnecessary. Even more so is the 40% threshold in favour that will be required in public sector strike ballots. On that basis, the Prime Minister’s own position is untenable as he and his party managed to gain a mere—I use the term advisedly—37% of the popular vote a month ago, which equates to just 24% of those eligible to vote. One nation? I say, “Hardly”. It is one rule for trade unionists and none for everyone else. How can the Prime Minister claim one nation as his aim when he seeks to require trade unionists to opt into paying the political levy to the Labour Party yet proposes no such requirements on shareholders as regards donations to his own party from business? This is a blatantly party-political move of the sort that discredits politics in its widest sense. This Government are determined to reduce workers’ rights and, indeed, human rights. The latter may not have been in this Queen’s Speech but it will be along soon enough.
Finally, I am disappointed that proposals to deal with tax evasion or avoidance were not included in the gracious Speech. There is a tax lock Bill, but it includes nothing to tackle tax dodging by multinational companies. This week, the International Monetary Fund said that every year $212 billion is lost to corporate tax dodging in developing countries. It believes that the existing global tax rules are,
“obsolete and ineffective in preventing tax abuse by multinational corporations”.
The Minister will recall that I raised these matters earlier this year during the passage of the Deregulation Bill and it is clear that the Government need to do more to tackle corporate tax dodging, because the job is far from done. The Conservative manifesto said that the party would consider the case for making country-by-country reporting public on a multilateral basis. I urge the noble Baroness, Lady Neville-Rolfe, and the noble Lord, Lord O’Neill, to ask the Chancellor to spell out in the Budget how the Government will go about doing this.
Lord Cotter (LD)
My Lords, the Government have a big job on their hands when it comes to business. We have had an excellent debate today and many issues have already been raised. I should like to raise a few more points on some of those issues. How the business community operates is crucial for jobs but also for trade, and thereby for the profitability or otherwise of this country. We need to include in our aims—the Government do, anyway—to ensure that we increase the interest and ability of firms in this country to export. As I say, we need to be a profitable country for many reasons. There are many other strands to address.
To add to the list, we have had problems in the past on inward investment, as the Government will know. This area needs to be looked at again and again. There have been issues with visas and with people from overseas being able to come to this country to set up businesses and trade. A very important aspect of business is to ensure that young people are trained up and ready for the workplace. Many colleagues have spoken about engineering and the different abilities and skills needed. I am sure that many others in the Chamber will be monitoring and following up time and again over the months on these points. At this point I will mention one issue which I think was raised by the noble Baronesses, Lady Liddell and Lady Wheatcroft, and others. That is the need to make tourism a very important strand in the ability of this country to trade.
I hope that when it comes to the enterprise Bill, these and many other issues will be addressed because, as I have said, the Bill will need to cover so many of them. One issue that the Government have announced that they will address is red tape. The often-trumpeted reductions in red tape must happen this time. Many say that this country is adept at rule-setting. Am I going too far in saying that Governments in the past have excelled when it comes to regulating and regulations? I do not think so. With my lifetime of experience in operating a small business, I can and will point out to Ministers how those self-employed people struggle so often against bureaucracy. I have some specific examples in my mind.
There is much to address under the heading of finance. The difficulty for small businesses in getting finance and having money lent to them has been referred to already. We have had a debate on this area this year and I would appreciate a specific report back on late payments, which is a very big issue for industry and construction, for example. Specifically, a figure was quoted a while back of £39 billion being owed to SMEs because of overdue payments. Is this improving? The Government have written to FTSE companies to encourage those not signed up to the Prompt Payment Code to do so. I would be glad to learn whether that has succeeded and will be carried forward as a strong issue. I would be pleased to hear about the record of the Government and other Governments on local and national payment, by government and local councils, as well.
As the Minister will know, we have welcomed the concept of the business bank. As somebody who has been in business for much of my life, the bank’s overall funding and financing will be important. But there is also the importance of having local ability to raise money, and people with the knowledge to understand the business needs of their areas and the people operating locally. That is a very important strand of the business bank. I have spoken before about local enterprise partnerships, which I hope can be engaged to bring localism back into the picture.
There are many issues to be covered. Broadband was referred to again today. The previous Government made announcements about the appointment of various organisations when it comes to broadband, but I am told that in rural and other areas of the country our broadband is still just not necessarily up to the mark.
There is much to do when it comes to business, which is crucial for jobs and our country’s future. I look forward with great pleasure to the Government coming forward with their business Bill and to trying my best, with many colleagues, to influence the many aspects of the business Bill we need for jobs and the future of this country.
Lord Northbrook (Con)
My Lords, the electorate spoke and trusted the Conservatives to carry on the rescue mission for the economy that was started in 2010 by the coalition. Then, we inherited an economy on its knees. We had emerged from the most severe recession in post-war history. We had a big structural deficit. Government debt was 60% of GDP and rising. It has been hard work over the past five years to restore the economy to a state that resembles health. I note today the recent OECD survey, which said that we will have the fastest-growing economy in the G7 this year.
The job is still work in progress, but there is much to cheer about. Recent economic news has included better than expected April budget deficit news, the construction business confidence survey and buoyant UK retail sales. Unemployment has been falling rapidly, and the growth in jobs is notable because they are focused in the private sector. Real disposable incomes are starting to rise again. Manufacturing industry is generally on an upward path. The Chancellor has been correct to reduce the deficit largely through expenditure reductions rather than taxation and has been wise not to adopt wholly Keynesian measures to resolve the dangerous situation we inherited.
So how are the Government planning to reduce the budget deficit in part 2 of the rescue plan? I welcome the full employment and welfare benefits Bill, with its aim to freeze working benefits, tax credits and child benefits from 2016-17 for two years. I also welcome the planned reduction in the benefit cap. I support the scrapping of the automatic entitlement to housing benefit for 18 to 21 year-olds. I await with interest the plans for the remaining welfare cuts, amounting to £12 billion in total.
In the area of business, I applaud the enterprise Bill, with its pledge to free entrepreneurs from burdensome regulation by cutting at least £10 billion-worth of red tape and to create a small business conciliation service, as many other noble Lords have mentioned, to address late payments to suppliers. Government promises to do away with pointless rules and bureaucracy are nothing new, but this latest deregulatory drive is the first that will require wholly independent regulators to contribute. Business groups have been supportive of the commitments. However, as the British Chambers of Commerce has pointed out, since many of the costly regulatory burdens originate in Europe, genuine cuts to red tape may rely as much on reforms to the EU as on anything a domestic Government can do.
I also welcome the trade union Bill, which makes it harder for strikes to be called. It is only fair to make the stipulation that 50% of union members have to turn out in a vote for strike action for the walkout to be legal. I also approve of the proposal that, for essential public services, a strike will also have to have the support of 40% of workers eligible to vote.
I approve of the plans in the enterprise Bill to pledge 3 million new apprenticeships. However, the plan to fund these by a new visa levy for those employing foreign labour has been queried by the EEF manufacturers group. According to the Financial Times, the EEF’s head of employment policy, Tim Thomas, said that the levy proposed seemed high. With regard to the proposed EU referendum, the director-general of the British Chambers of Commerce, John Longworth, said that the vote should take place,
“as soon as is practicable”,
to minimise uncertainty. Overall, I think that we will have a more business-friendly regime at BIS for the next five years.
On the subject of taxation, I note the plan in the national insurance contributions and finance Bill for a tax lock to ban rises in income tax rates, VAT rates or national insurance contributions for individuals, employees and employers, but I am just not sure whether that is a good thing for a Government to legislate on, to stop things happening. I like the proposal to exempt from income tax those working 30 hours or more on the minimum wage, which would incentivise work over welfare. I also welcome the plan to raise the income tax threshold to £12,500 a year. However, more should be done at the higher rate of the tax scale to reduce the rate to 40%, which after all is only what it was under much of the Labour Government, and to raise that threshold to £50,000.
While I am full of praise for how the Government cut corporation tax over the last period, this has not been matched by the cutting of personal taxes. I am a great believer in the Laffer curve theory, which says that within reason lower taxes bring in higher revenues; this was certainly the case a few years ago when I got a study done by the House of Lords Library which stated the beneficial effect when corporation tax was cut from 52% to 30%, as it was at that time.
On the theme of tax, I move on to tax simplification. My noble friend Lady Noakes made an excellent speech highlighting this a year ago, and it is still valid today. Her first point was that the Office of Tax Simplification has done a great job but its recommendations have not all been heeded, and more than 2,000 pages of complex tax legislation had been added by the end of the last Parliament. She stated that the Chancellor had used the principle of dynamic modelling to underpin his reductions in corporation tax the year before last, and this should be extended to income tax. The 2020 Tax Commission, which was sponsored by the TaxPayers’ Alliance and the Institute of Directors, echoed the conclusion of the work done by my noble friend Lord Forsyth of Drumlean’s Tax Reform Commission nine years ago. Its proposal, which is truly radical, was to abolish most taxes and replace them with a single rate of income tax of 30% and a total restraint on taxes as a percentage of national income of around one-third. It said that this would add over 9% to GDP over 15 years and the annual growth rate would be improved by 0.4%.
I make no apologies for bringing this topic up again for our new Minister, the noble Lord, Lord O’Neill of Gatley, whom I would like to warmly welcome and congratulate on his maiden speech. I am sure that he will keep up the high standards attained in recent years by my noble friends Lady Noakes, Lord Sassoon and Lord Deighton. If he is as clever with government legislation as he is with his acronyms, we are all going to be very fortunate. His appointment continues the Goldman Sachs involvement in this House. Could I ask him for his thoughts on these tax simplification views?
Overall, I welcome the humble Address measures with regard to business and economic affairs and wish them a fair passage through this House.
The Earl of Kinnoull (CB)
My Lords, it was indeed heartening to hear, both in the gracious Speech and in the admirable and fluent maiden speech from the noble Lord the Minister, such a clear and prominent statement of intent about the reduction of regulation for small businesses, the “small and the brave”, which are the bedrock of our nation’s prosperity today and a foundation for its future prosperity tomorrow. I am going to concentrate only on this.
The last Administration made a good start in attacking the problem. The Regulatory Policy Committee, revamped in 2012, the Red Tape Challenge and the one-in, two-out rule have each contributed in their own way and continue in force. However, I hope that there will at least be a brief review of those three things to see whether they could be tweaked in any way to become yet more effective. I particularly feel that the one-in, two-out rule could do with some simplification and perhaps even the deletion of some of the exceptions, and I would be very grateful for the comments of the noble Baroness the Minister on this.
In preparing for today, I have been in touch with the British Insurance Brokers’ Association—BIBA—which has 1,500 members with 10 or fewer employees. Here I declare my interests as set out in the register, having worked for 25 years in that industry, but never as a broker. I have also been in touch with the Federation of Small Businesses, with its 200,000 or so members. I have two points that I want to put to the noble Baroness the Minister.
First, I urge greater action on the gold-plating that has arisen out of older EU directives—the emphasis is on the “older”. BIBA members are regulated by the Financial Conduct Authority, the FCA, which—or, more accurately, its predecessor the FSA—has platinum-plated the insurance mediation directive of 2002. According to BIBA’s independently commissioned research, the direct cost of regulation for UK insurance brokers is by far the highest in Europe, being a factor of two higher than second-placed Luxembourg and more than 10 times that in France and Germany. The CEO of BIBA commented to me: “Our peer associations in other European nations like France and Germany are shocked by the cost added by our regulator, and Karel Van Hulle, the recently retired European Commission head of insurance, referred to UK gold-plating by the FCA as ‘sauce anglaise’”. I understand that the FCA wants to stretch its lead at the top of the league table of cost in Europe and appears to be looking for an 8% rise next year in what it charges the insurance brokers it regulates. That must be wrong.
That is just one example of the well-appreciated gold-plating problem. I accept that, certainly since July 2011 and arguably somewhat earlier following the Davidson Review, great care has been taken to try to prevent gold-plating on new, fresh EU directives. Nevertheless, there is a lot of gold-plating around in older regulations made before that date and there is no satisfactory comprehensive mechanism for the automatic review of these older regulations. As part of the efforts to reduce the regulatory burden, will the Government review these older EU-derived regulations to seek out the gold plate, or sauce anglaise, and procure change for the better?
My final point is to do with the attitude of regulators up and down the land. I have had experience of regulators in quite a few countries in my 25 years in the insurance industry. Oddly, it is not a bad generalisation to say that they fall into two distinct camps in attitude, either being remote, severe and unhelpful or being akin to Dixon of Dock Green. Too many UK regulators tend towards the former category, where the regulator is feared rather than seen as a potential source of knowledge and assistance. The chairman of the Federation of Small Businesses summarised the issue to me as follows:
“When setting out to tackle the burden of red tape, it’s important not only to identify obstructive regulations, but also to look at how regulation is enforced. Poor enforcement or excessive monitoring requirements can turn straightforward regulations into costly and disruptive burdens … We would like to see more partnership working between regulators and businesses with regulators focusing on proactively providing guidance to assist and encourage rather than an emphasis on enforcement”.
The “small and the brave” particularly need regulators with a helpful and collaborative approach to prosper. Will the noble Baroness the Minister confirm that the Government will seek to address this issue, which, in all probability, would require no legislation? The “small and the brave” need our help. I urge the Government to be big and bold in providing it.
Viscount Trenchard (Con)
My Lords, I join noble Lords in welcoming to this House and congratulating my noble friend Lord O’Neill of Gatley and the noble Lord, Lord King of Lothbury, on their excellent and interesting maiden speeches.
My noble friend Lord Horam said that the BRICs were made famous by my noble friend Lord O’Neill, although surely it was the other way around and my noble friend became famous for coining the acronym BRICs. The noble Baroness, Lady Liddell, asked him to invent a new acronym for productivity. I am not sure that is a good idea, because there are already too many acronyms, and in fact they are divisive. Acronyms are used more and more in public life and put off the majority of the population, who do not understand what they mean and feel that they appear to be ignorant if they ask. Rather than inventing new acronyms, I hope my noble friend the Minister will concentrate on the commitments that he made to enhancing productivity and to removing a lot of the strangling regulation that we have today.
While it is good for business and the economy that we have the first Conservative Government in 19 years, it is disconcerting for us on these Benches that there are so many fewer noble Lords that we may call our noble friends.
I welcome the introduction of the enterprise Bill, which is intended to cut red tape. This Bill should help to accelerate the encouraging increase in registrations of new companies, from some 480,000 in 2012 to more than 580,000 in 2014, a 20% increase in two years. It is also welcome that the Government have pledged to discourage EU bodies from imposing burdensome rules and have promised that any new regulations that come through from Brussels will be implemented as benignly as possible in the UK.
In order to succeed in a global market, businesses have a strong incentive to meet the standards required in their principal export markets. That in itself will encourage the harmonisation of standards applied across developed-world markets. Beyond that, I hope that the Government will insist in their negotiations with the EU that the principle of subsidiarity be given a great deal more weight than it appears to have been given in recent years.
My right honourable friend the Secretary of State for Business has said that the enterprise Bill will contain deregulatory measures to cut £10 billion of red tape. I ask the Minister, the noble Baroness, Lady Neville-Rolfe, how this figure is calculated. BIS has also announced that the Government’s ambitious target for cutting red tape will look beyond Whitehall and extend to independent regulators for the first time. I wonder whether that includes the European regulators.
I would like to mention the City, including the wider financial services industry, which also has a significant presence in Edinburgh and some other northern cities. I believe that it is time to stop punishing the City. It is arguably the jewel in our crown; it is certainly one of the most sparkling of them. It has come to be by far the most significant and successful financial centre in the European time zone and arguably in the world, not as a result of our membership of the EU, any other group or a politically created market but simply because of the City’s history, stability and highly respected and effective legal and accountancy regimes, the talents of its practitioners and the infrastructure and everything else that our great City of London has to offer.
The City has reacted well to the financial crisis and continues to learn from its mistakes. Several banks have had to pay extremely large fines as a result of LIBOR and foreign exchange-rate fixing. I consider that the balance of punishment has been tilted too much towards the banks and too little towards individuals who may have broken the law. If they have, it is they who should be punished, not the shareholders of the banks. Does the Minister agree?
Given the importance of the City to this nation’s prosperity and productivity, it is important continually to assess what kind of regulation will best protect the consumer against exploitation and at the same time enable our financial services companies to thrive in what is a global rather than a European market. In particular, given that banks now have to comply with greatly increased capital requirements, effective resolution regimes and strengthened deposit insurance arrangements, I would question whether the ring-fencing of retail banking will be necessary or appropriate. The time has come for us to look forward and consider how best we can maximise growth in the economy, in jobs and in tax revenues.
Ring-fenced retail banking would not have saved Northern Rock, and neither would RBS have been protected from the difficulties it encountered if ring-fencing were in force. Neither bank got into trouble because of its investment-banking activities, but the implementation of ring-fencing will be a significant burden for Barclays, HSBC and RBS, and if any one of these banks is considering whether to maintain its global headquarters in the UK, ring-fencing is certainly one of the factors supporting relocation. Other major countries have not introduced ring-fencing and have no intention of so doing.
I would also argue that the City should not be burdened with cumbersome and unnecessary regulation introduced by the European regulators EBA, ESMA and EIOPA, together with the ESRB. On its own, the UK would never have chosen to introduce much of the growing body of EU financial services and insurance regulation to which it is now subject.
As my noble friend the Minister has mentioned, the Government are committed to improving productivity and increasing living standards. That will not be achieved by an artificial rebalancing of the economy in favour of manufacturing. However, the more our financial services sector can thrive and prosper, the better will be the background and conditions necessary for a continued manufacturing revival. There is no statistical evidence that EU regulation has liberalised trade in financial services between the UK and the rest of the EU. Most of the UK’s financial services and insurance exports to the rest of the EU are wholesale in nature and not dependent on the UK’s EU membership. There are no obvious grounds for arguing that EU regulation enables the UK to manage the financial services and insurance sector better than it could do on its own. The European supervisory authorities should be the regulators for the eurozone, and the UK’s PRA and FCA should be restored to their deserved status as global-level regulators equivalent to the SEC of the United States and Japan’s FSA. I ask my noble friend to confirm that powers to regulate the City will be among those which the Government will ensure are returned to our own national regulators.
Like the noble Baroness, Lady Kramer, and other noble Lords, I do not understand the reason for the Government legislating to stop themselves from legislating to increase taxes. We can trust the Government to honour their commitment not to increase taxes, but they do not need to tie their own hands and restrict their ability to react prudently and promptly to any unforeseen economic disaster. I look forward to the remaining contributions, and especially to my noble friend the Minister’s winding-up speech.
Baroness Worthington (Lab)
My Lords, I rise to speak in the debate having listened with interest to the learned and wise contributions of so many distinguished noble Lords, including the most excellent maiden speeches of the noble Lords, Lord O’Neill and Lord King. As ever, the House has today eloquently demonstrated the depth of knowledge and breadth of experience we are so fortunate to embody.
My own contribution to the debate will focus on an important area of the economy which I fear is neither properly understood nor accorded the right level of respect and attention by the Government that it deserves: energy and climate change. Here we sit on our islands, home to a modest population with limited space and no great abundance of natural resources, and yet over the course of history our impact on the globe has been remarkable. As I am an optimist, I see no reason to doubt that we cannot continue to do so in the future, for we live in interesting times. We are buffeted by the winds of globalisation, with increasing interconnectedness and complexity being a part of our daily lives, and we must respond to these challenges.
How might we achieve this? Many noble Lords have spoken of addressing our productivity challenge, stabilising our economy, and equipping our citizens with the skills they need to thrive in this world. The Government’s recipe for success appears to be clear: reductions in business rates, freezing taxes, slashing red tape, slashing welfare in as yet undisclosed ways, and smashing the unions. So far, so much ideology. However, the key question is whether the Government can engender one of the most important elements needed for investment and growth in the economy: confidence. Will people and companies feel confident enough to spend money and to spend it here? So far, the evidence is not reassuring. The Government cling to a simple idea that the market knows best and, rid of interfering Governments, that it will deliver all that we might seek of it. That is of course nonsense—Governments have always and always will have a strong role to play in guiding the hand of the market and, in times of economic insecurity more than ever, they must apply a steady hand on the tiller. That steady hand should be manifest in sensible, well-constructed policy-making and regulation, of which there is too little evidence in the Government’s plan.
The northern powerhouse we have heard so much about remains, sadly, a slogan, without yet any appreciable sign of how it will be delivered—although we might look forward to seeing some detail. The one piece of legislation in the gracious Speech that related to infrastructure was the HS2 Bill, which can hardly be described as new, having been the subject of seemingly interminable debate in this House and the other for many years. The energy Bill contains not much more than a dog-whistle response to a vocal minority who oppose proven, clean, cheap onshore wind, reducing investor confidence when we should be boosting it. That is coupled with another attempt to reassure investors in the North Sea, as if searching to return to the golden era of the 1970s. We cannot evade the truth that in a world of excess capacity, reduced demand and low oil prices, the cash cow that we once relied upon to fill our coffers may be about to be extinguished.
To return to growth we must play to our future strengths, not try to replay our greatest hits, and we must also once again connect the financial world with the real economy, not rely on property price bubbles and financial derivatives that deliver no net gain to the global economy. We were once a nation strong in engineering excellence and infrastructure and we can be again; our infrastructure needs renewing to adapt and respond to the growing risk of climate change in particular.
The UK is fortunate to have a world-leading Climate Change Act, which creates the framework for a new industrial revolution in energy. Rather than pursuing fading hopes in the North Sea, the Government should seek to properly back a wide range of alternative sources of energy: renewables, nuclear, and coal with capture and storage, as well as converting transport to run on electricity and giving industrial sectors much-needed support to develop novel processes, electricity-based solutions and carbon capture and utilisation so that they can thrive in a carbon-constrained world. Solutions developed here in the UK will be in high demand, as every country is now waking up to the threat of climate change and pledging to act. There are few areas of our economy where we enjoy a positive trade balance with China; our environmental services is one. We should pursue it more.
As the Minister knows well, growth in the Chinese economy is delivered through a five-year plan, followed by instructions to state banks, which makes capital available and which results in infrastructure being conceived, financed and delivered with alacrity. This is not how things work here. We seem to have to guide, cajole, regulate and incentivise the private sector to commit investment. Monetary policy in this regard appears to have reached its limits. Government must step in and apply their guiding hand.
The gracious Speech included a Bank of England Bill. That is welcome, but the Government could and should be doing much more to improve the Bank’s capabilities to identify and respond to potential sources of instability. For example, it could require the Bank to extend its risk assessment horizon to include longer-term risks such as climate change. The issue that Mark Carney refers to as the “tragedy of horizons” prevents us properly assessing the risk that this great threat poses to our economy and to our society more generally. The Bill could also give the Bank greater powers to take action to address potential asset price bubbles—including, for example, those potentially overvalued fossil fuel assets that we may not be able to extract and burn in the way that we currently imagine we will. I will seek to promote that as the Bill makes its way through the parliamentary procedure.
I would like to end by briefly commenting on the distinctly odd tax Bill. I, like many noble Lords who have spoken before me, find it slightly strange and potentially a great waste of parliamentary resources. In the Government’s zeal to outlaw various tax increases, does this now mean that, to balance the books, the Treasury will embrace progressive green taxation, increases in which are not limited? Can the Minister confirm that? For example, might we look forward to the introduction of a comprehensive climate change levy—call it climate insurance, if you will—the proceeds of which could be spent on the research and development of clean energy and its deployment?
It has been a privilege to take part in this debate, and I look forward to our continued discussions of these topics in the coming months and years.
Baroness Linklater of Butterstone (LD)
My Lords, my contribution to this debate on the Queen’s Speech comes under the broad heading of “welfare reform”, and would more properly have been given during yesterday’s debate, making as it does the essential interconnection and correlation between social and economic disadvantage on the one hand, and offending behaviour on the other. So I am particularly grateful for this opportunity to speak, albeit somewhat out of context.
Last week, the Prison Reform Trust published the latest edition of its highly successful, informative and much-used Bromley Briefings Prison Factfile. According to the briefing, England and Wales currently have the highest imprisonment rate in western Europe, at 149 per 100,000 of the population. Over the past two decades, the prison population has nearly doubled, at enormous expense to the taxpayer, and it currently stands at more than 84,000. Reconviction rates are sky high: nearly half of all people released from prison are reconvicted within one year of their release.
The current realities of the lives of ex-prisoners include the following. Some 15% of newly convicted prisoners reported being homeless before custody, and 9% were sleeping rough. More than half the people released from prison were claiming out-of-work benefits one month afterwards, and two-fifths were still claiming benefits two years after release. In 2013-14, only a quarter of prisoners entered employment on release from prison, and 26% of women and 16% of men said they had received treatment for a mental health problem in the year before custody.
These figures suggest that social policy is not tangential to success in criminal justice policy, but absolutely central to it. The Justice Committee has highlighted the importance of joining up welfare and criminal justice policy to tackle offending and reoffending. Commenting on the launch of its recent report on prisons, planning and policies, the then chair of the committee, Sir Alan Beith, said:
“The Committee has repeatedly emphasised the dangers of allowing the prison population to escalate and consume huge resources which could be better spent on preventing crime, for example, by dealing with drug and alcohol addiction and further expanding programmes, like the Troubled Families programme. The public look to the criminal justice system to demonstrate that crime is taken seriously, but that means tackling and preventing crime effectively, not merely locking up more and more offenders at massive cost to the taxpayer”.
A number of the previous Government’s policies and initiatives recognised the social and economic dividends that can be gained from a closer co-ordination of welfare, health and criminal justice policies. I am pleased to see that some of these are being taken forward and developed in the proposals contained in the Queen’s Speech.
Alternatives to custody represent the most positive policy in the management of offenders, as well as the one most likely to succeed. Taking offenders out of the community by putting them in prison may work as punishment in the short term, but the evidence is that it is not nearly as likely seriously to reduce offending behaviour.
The troubled families initiative rightly recognises crime and anti-social behaviour as important indicators of disadvantage. The National Audit Office has acknowledged the potential of such programmes both to deliver savings—an outcome always welcomed by Governments—and to represent a more co-ordinated approach to tackling social problems. I welcome the commitment in the Queen’s Speech to,
“expand the Troubled Families Programme”,
and I hope that this will include efforts to ensure closer co-operation between welfare and criminal justice.
There have been welcome changes in the justice system in the treatment of people with mental health needs and learning disabilities. More than half of England and Wales is now covered by liaison and diversion services in police stations and courts, and a full national scheme is planned to be put in place in 2017, subject to the Treasury’s approval.
There are important footholds for greater co-ordination between social and criminal justice agencies in the reduction in recent years in the numbers of children and young adults in custody. Over the past three years, the number of children in prison has reduced by 60%, while levels of youth crime have also fallen. This success is in great measure due to the work of the Youth Justice Board, which I wholeheartedly applaud and which oversees the multidisciplinary youth offending teams based in local authorities. YOTs bring together social workers, police, probation, health and welfare agencies to help keep children out of trouble and to divert them wherever possible out of the justice system into appropriate treatment and support. This intervention alone enormously improves the chances of young people, reducing their offending and keeping them out of prison.
The Transition to Adulthood Alliance has commissioned substantive evidence to show the benefits of extending the multidisciplinary approach to young adults. While people aged 18 to 24 accounted for one in 10 of the UK population in 2010, they account for a third of those sentenced to prison each year, a third of the probation service caseload and a third of the total economic and social costs of crime. Those in this age group are particularly impressionable and subject to influence by peers, but they can also benefit from intensive community and multidisciplinary approaches to divert them out of crime.
A group that is disproportionately represented among children and young people in prison is children who have experienced local authority care. Looked-after children make up 33% of boys and 61% of girls in custody, despite fewer than 1% of all children in England being in care. The noble Lord, Lord Laming, is currently conducting an independent review supported by the Prison Reform Trust into improving outcomes for this particularly vulnerable group in the justice system. It is a real issue: these young people, whose lives have been characterised by disadvantage, badly need more attention paid to their welfare in the widest sense.
I am really grateful for the opportunity to speak on these issues today—out of context—because they crucially concern the management of offenders and the relationship between offenders and communities. There is an assumption that these issues belong exclusively within legal and home affairs, but bringing them to this context, unlikely though that is, may not be an entire waste of time. The silo mentality between government departments must be broken down if we are to have communities which can, instead, enjoy cross-departmental strategies to reduce offending and reoffending.
The Earl of Caithness (Con)
My Lords, I can hear a collective sigh around the Chamber as we come to the last Back-Bench speaker after five days of debating Her Majesty’s gracious Speech.
It is always a pleasure to follow my noble kinswoman and, although nearly 30 years ago prisoners occupied my working day and working night, I will not follow her down her road. It is a pleasure to see in his place my noble friend Lord Finkelstein, who so ably seconded the gracious Speech. I hope that at some stage during the previous five days he has been able to leave it and go and do some other things. However, we very much enjoyed his speech.
I also enjoyed the maiden speech of my noble friend Lord O’Neill of Gatley. I make a plea to him and to the other new Ministers, who are highly talented: please, in the future, will they follow the example set by the noble Lord, Lord West of Spithead, who was also parachuted into this Chamber as a Front-Bench Minister, and not the example of others, of whom we see so little nowadays?
I agree with so much of what has been said over the past five days. The aspirations for health, defence, education, research and the environment are to be welcomed. However, in reality, those aspirations can only be delivered on the back of a strong economy and living within our means. Some politicians can be very prudent with their own home budgets but very good at spending other people’s money.
We have heard much about the UK’s productivity. We are not alone in the problems that we face. We are part of Europe, and Europe is increasingly the aged aunt of the world—and I fear it is getting more geriatric. Europe’s share of global GDP has fallen from 30% in 2007 to 23% in 2013. Over the same period, member states’ average ranking on the World Economic Forum’s global competitiveness index has fallen from 34 to 38 out of 144. Europe’s competitiveness on financial market development has particularly suffered, with average rankings falling from 36 to 55. International investment has also declined by €9.5 billion over the same period. The EU has much to do. Perhaps the capital markets union is an opportunity to start to turn round the decline. We hope that it will, and we will discuss that, along with the report that Sub-Committee A did on capital markets, in the near future. If, however, the EU starts to follow the track of the financial transaction tax, the downhill slide will only be hastened.
We look forward to hearing much more from the noble Lord, Lord King of Lothbury, after his excellent maiden speech. He reminded us of the problems that the recent depreciation of sterling had already caused us. I am sure he will agree with me that there will be considerably more problems for sterling unless we rebalance our economy and reduce our budget deficit. The coalition halved it as a percentage of GDP, and that needs to be at least halved again. However, I agree with the noble Lord, Lord Turnbull, that there is no need to reach a break-even for the overall deficit in this Parliament.
The noble Lord, Lord King, also reminded us that improving productivity is easier said than done. Since 2009, productivity has been negative in the public sector, agriculture, energy and water, and the financial services, which together account for about one-third of UK output and employment. The output per worker in the UK economy has barely risen since 2006. It is self-evident that we need better education, skills and infrastructure. My noble friend Lord O’Neill and my right honourable friend the Chancellor of the Exchequer will only move from “good” to “great” status if they stop the talking and take action.
I remind my noble friend Lord O’Neill that the great infrastructure projects for upgrading the A1 and the A14, a new TransPennine railway and airport expansion in the south-east, all high on the agenda today, were high on the agenda when I was a Minister, and that is some long time ago. Today we celebrate the completion of 26 miles of tunnelling under London for Crossrail 1. Would my noble friend agree that it would be a very good idea to get Crossrail 2 started before the end of this Parliament?
I want to focus on one area that is vibrant and fast growing yet where productivity has declined, and that is financial services. There has been a non-stop raft of legislation in the EU since the financial crisis. The effect of much of it is contradictory, with detrimental results. The Government want less regulation and bureaucracy and more competition. I agree with them. Let me give an example of somebody I know. He is an investment manager who runs a fund that has 15 different share classes. Now, for each one, he has to produce a separate key investor information document—a KIID. That often has to be done in the local language. Last year, his firm produced just under 3,000 KIIDs—an increase of over 10% on the year before—in 17 different jurisdictions and in several different languages. The legal and compliance team has increased fourfold in the past four years, and the annual spend on insurance and regulation was up 40% on 2013. The noble Earl, Lord Kinnoull, reminded us that the regulators are competing now just to see who can be the nastiest and grab the biggest headlines. That is compounding the problem.
One needs to bear in mind that all those involved in the financial services industry, big or small, are suffering in exactly the same way as the company that I have described. That company could not be created today, and what is the result? The result is that we will have fewer small firms, less choice, more cost and less opportunity for the investor, and it means that the poorest in society will not be able to afford the advice that they are going to need, which is a very worrying trend.
Never before has so much money been spent on compliance and risk management as today, but things still keep going wrong. There are two views as to why this has happened. One is that the firms are so vast and so complex that proper management is impossible, and the other is that the money being spent is wrongly targeted and a rethink is necessary. Before the noble Lord, Lord Pearson, gets too excited and blames Brussels, I should point out that there is every evidence that what has been implemented in Europe would have been implemented in the UK whether we were in Europe or not. A recent survey by the Centre for the Study of Financial Innovation revealed that 65% of its respondents believe that the UK gold-plates regulations. My noble friend might not agree with that, but he has to keep his own new house in order.
Let us consider the irony and stupidity of the fact that, while we keep heaping qualifications, regulations and costs on the financial sector, any one of us can walk out of this Chamber tonight, set up an estate agency and sell off tomorrow what perhaps for most people is their largest and most precious asset, their home. That is a nonsense.
Lord Stoneham of Droxford (LD)
My Lords, I declare my interest as chair of Housing & Care 21, the housing association. I also welcome the noble Lord, Lord O’Neill, and wish him well in building on the crusading work of the noble Lord, Lord Heseltine, in reviving our northern cities. He will have our fullest support from these Benches in this endeavour. I also welcome back the noble Baroness, Lady Neville-Rolfe, and look forward to scrutinising the Government’s business and skills agenda in the coming months.
I also congratulate the noble Lord, Lord King, on his maiden speech. All the published histories of the coalition formation quote him as warning the negotiators at the time that whoever entered government would be out of power subsequently for the next generation. If he did say this, he was evidently only half-right. As for the other half, I take it that our resilience and defiance on these Benches still have five to 10 years to prove him, and the noble Lord, Lord Finkelstein, wrong.
As part of this resilience, I want to thank the nine of my colleagues who spoke in this debate and to welcome my noble friends Lady Kramer and Lord Newby to the Liberal Democrat Front Bench after their outstanding service in the coalition Government. We quietly hope that the Government will miss them and that the country will notice. While I thank my colleagues for their contributions today, I think that it is a requirement also to express thanks and appreciation for the work of Vince Cable, Danny Alexander, Jo Swinson and Ed Davey, who played a big part while they were in government in helping the economic recovery after the recession in 2010.
It has been an excellent debate with some remarkable contributions, so I will not hold the House up by repeating them, but I want to draw three fairly concise conclusions which I think the Government need to focus on. As labour markets tighten, living standards will be improved in a sustainable way only if we can improve productivity, but we must be wary of top-down initiatives to improve overall productivity. Overall productivity improvement depends on tens of thousands of small businesses taking decisions to invest more. They simply require stability, confidence, the wherewithal and the encouragement to invest.
I share the view of the noble Baroness, Lady Wheatcroft, that better management is needed. As our motor industry and our sporting teams show, better foreign managers are transforming these sectors. We need to develop more skills at home. Getting the talent out of the City to run things may help and I hope that the noble Lord, Lord O’Neill, will show the way.
Economic growth is not yet balanced enough to be sustainable and to avoid some of the pitfalls of the past. The coalition made huge steps forward in the jobs market but economic growth still remains too reliant on rising consumer expenditure financed on credit and encouraged by rising house prices. We all know where that leads. Business investment is still too low and the deficit in the current trade account matches the deficit on public expenditure as a major problem. The worry is that stronger growth and the net trade deficit may well worsen unless we make more of what we consume as a country.
During this debate I was pleased to go back 30 years and find myself agreeing with my old friend and colleague the noble Lord, Lord Horam, about making housing the number five priority for the Government and about its importance to the economy. I wish to draw attention to the importance of housing because it impinges on the performance of our economy.
Rising property prices due to shortages still encourage overinvestment in property rather than investment in business, particularly at the top end. The Government’s preoccupation with encouraging owner-occupation is simply stoking demand rather than addressing supply. I disagree with the noble Lord, Lord Skidelsky—we do need to concentrate on supply: “supply, supply, supply” should be the Government’s focus in housing. Like any other sector, it needs a plan, a partnership between all the housing sectors, private, public and voluntary.
It would be a tragedy if this Government got waylaid by a pointless political debate on the right to buy from housing association stock. I hope they have the sense to step back from this issue. I further hope that Greg Clark will recognise the need to act quickly if we are to approach a figure of 1 million new homes in this Parliament. The right to buy from housing associations will undermine efforts on the supply side. It is not the same as selling council houses. Housing associations build for sale and for shared ownership; they build affordable houses. There is a compromise if the Government will stop and think. If we cannot have a coalition deal to get rid of this ridiculous policy I hope that Greg Clark will have the good sense to find a way through.
It was noticeable in the early years of the coalition Government that the Conservatives had a blank spot on social housing. Housing associations make a huge contribution and can do more if we utilise their balance sheets better, improve their efficiency and involve them in major regeneration schemes. I urge the noble Lord, Lord O’Neill, to look carefully at the recent publication by the noble Lord, Lord Adonis, on the concept of city villages and how we can use the old council estates for regeneration by turning them into a partnership where we sell some houses, build some houses for rent and build affordable housing for people in social need. These are the measures that we need to increase housing supply. We can use that land and those estates to generate more housing.
These are the kinds of measures by which we, on these Benches, will judge the Government on their one-nation approach. As it did for Macmillan, housing played a vital role in strengthening the economy in the 1950s as well as having important social effects and benefits. It should do so again.
Lord Davies of Oldham (Lab)
My Lords, this has been an excellent debate. The opening speech from the maiden speaker, the noble Lord, Lord O’Neill, set a standard, which we all greatly appreciated. We are very pleased that he has begun in such a promising way at the Dispatch Box and assure him that we will give support to constructive action in relation to the problems of the British economy. However, because of the nature of this debate he ought not to be neglectful of the fact that there will be one or two challenges about as well, particularly when we get on to legislation that gives effect to the Government’s programme.
Fortunately my noble friend Lord Mendelsohn responded first to the debate by identifying our attitude to some of the Bills. That absolves me from having to be clear about that, except to say that if the Government decide to put themselves in a ludicrous straitjacket by introducing a law that forbids them from increasing various taxes and charges, absolutely confident that there will be no difficulties along the way, that is up to them. The noble Baroness, Lady Wheatcroft, indicated that there might be difficulties and circumstances that none of us can foresee. The Opposition will not ease them out of that at this stage; we will merely concur largely with the legislation.
That will not be so with trade union legislation, however. My noble friends Lord Monks and Lady Donaghy identified our principal objection to this measure and the vindictive quality of it, against a background where it would scarcely be contended that a major issue in the British economy over the last decade has been strike activity. Workers are only too concerned to ensure that there is some progress with regard to the work that they do in circumstances where all is gloom around them. It is quite improper of the Government to engage in what after all is merely an indulgence in ideological spite in their introduction of this trade union legislation. It will not have an easy time in either this place or the other place.
However, we were grateful to the noble Lord for emphasising productivity. I must mention to him that in our last debate on the economy we covered a substantial amount of ground with regard to the deficit, who was bearing the costs of it, how it was best to remedy it and at what pace. But I think that only my noble friend Lord Haskel talked about productivity at that stage. Therefore, it was entirely proper that he should speak early in today’s debate to emphasise that and in doing so support and back up what the Minister said about how important issues of productivity are.
As my noble friends Lady Drake and Lord Macdonald emphasised, we should not underestimate the challenge represented by our low productivity, nor what needs to be done. The OECD report today says that the country’s poor record on productivity is at the heart of the problem with the British economy. It is a poor record that has obtained since the crisis way back in 2007-08. It is quite clear that stronger investment is needed.
My noble friends also identified areas in which it was necessary for public action to be taken. There is absolutely no point in the Government thinking that increased productivity can occur on the basis of a low-wage economy employing low-skilled people. That just leads us into direct competition with other countries that have more than their fair share of low-paid workers. It presents us with a difficulty, because for large numbers of our people their standard of living is so low that we are using public expenditure to subsidise their wages. This cannot make sense in modern Britain.
We want the Government to recognise that they have to do something about this. I know that this will cause a few shudders on the other side of the House, but some of it will involve judicious public expenditure. We cannot enhance the skills of our nation if we do not spend money on education. When I say “education”, I mean state education rather than private, but I am not talking about schools, because the Government recognise that they dare not take a step back on the question of standards in our schools. Nor am I talking about universities, because there are all sorts of ways in which we should recognise the achievements of our universities. What is critical to defective skill levels is further education: the education that is directed at present towards vocational skills—the very area in which the Government are making the most significant cutbacks. They ought to think again about that.
We also think that higher productivity comes from having a better transport system, from when government offices give answers to employers and their staff rather than keeping them waiting endlessly on the end of a phone, and from when efforts are made to sustain and support business and employment. We think that the Government need to look at those issues with real care. Judicious public expenditure on this would reap dividends.
The other maiden speech that was greatly welcomed was from the noble Lord, Lord King. It was long overdue in our terms, and we hope that he will come back with some frequency. We have these economic debates only two or three times a year. He could perhaps make a date to ensure that he can come to one or two in subsequent years, because we very much valued his contribution. We know of his vast experience. My ears pricked up when the noble Lord mentioned the strength of sterling and the problems that created. I do not know whether anyone else in the Chamber noticed that: up to that stage I had not heard anyone else refer to that issue in relation to the British economy. We all know the virtues of the strong state of sterling—it is quite helpful when one goes abroad on holiday—but it is a little different if one is involved in a competitive market and the pound has had the increase in value that it has had in recent years. We are grateful to the noble Lord. We hope that he will come again and that it does not coincide with the disasters that beset his favourite sports teams, such as those over this last weekend. I have the greatest sympathy for him on that score—at least on English cricket, if not on Aston Villa.
In this debate we have helped to establish that productivity is key to improving our performance. The Government ought to address themselves fully to these issues. I am sure that the Minister will ensure that they do. One theme that we would like to see explored is why we have to wait for the OECD or someone else to produce a report on productivity. Why can we not ask the OBR to report on how the options for the spending review might impact on productivity and living standards, and to set out the sensitivity of their forecasts for the different choices that the Chancellor could make? He would have our support if he suggested that the OBR could take on this work. If we are all united on the significance of this concept for the development of the British economy, let us use every tool at our disposal.
I am all too conscious of the fact that many noble Lords have contributed to this debate. I particularly appreciated the comments of noble Lords who sought to broaden its context. The noble Lords, Lord Skidelsky, Lord Low and Lord Bilimoria, on the Cross Benches all tried to put the present issues confronting the British economy into a general context. I was very grateful for those remarks.
I am Her Majesty’s Opposition’s spokesman not just for Treasury matters but for transport. However, transport has received precious little shrift in this debate, although it is carefully listed in its title. I know that the Minister who is replying will be fully briefed on the transport issues, so I will ask my questions in short order. I was grateful to the noble Baroness, Lady Kramer, for mentioning HS2 right at the beginning of the debate. We unite with others in wishing to see it make progress. The Government have a great deal of work to do and we wish them well on this very important project, but for heaven’s sake let us get away from the idea that it is intended only to accelerate the speed at which people travel from London to Birmingham or, as is suspected in the Midlands, from Birmingham to London. It is about capacity and increasing the transport resources that we have available. That is why it is justified. I hope that the noble Baroness winding up the debate will recognise that I have sought to be constructive on this issue.
However, I am less constructive on any delay in providing runway capacity in the south-east. In that I merely follow the noble Lord, Lord Tebbit, in being critical of the Government, as we both were on Monday. I cannot see how the Government can dodge the question of whether they intend to implement the recommendation of the Davies commission. Are they saying that after all this absurd delay while waiting for this report they will still hold his hand and further deliberate on whether he has got it right or wrong? That is surely unthinkable. Once this report is out, we expect action.
I turn to something which I hope is of concern to most noble Lords, and ought to concern us the most: buses. The bus is the most frequently used form of transport. It is the necessary form of transport for a very large number of our people, particularly the low-paid, whom we want to see improve their position and their productivity.
The Government know what a successful bus service looks like: it runs in London in a carefully regulated system. Meanwhile, there is a free-for-all right across our cities and provinces, and our country is ill served. I hope that the Minister in winding up will say something about buses.
The Parliamentary Under-Secretary of State, Departments for Business, Innovation and Skills and for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
I thank noble Lords for their interesting and informed contributions to our discussion today about the key areas of business, economic affairs and, of course, transport.
I was also glad to hear the contribution of the noble Lord, Lord King, in his excellent maiden speech. The noble Lord, Lord King, and I share a deep love of the game of cricket and, as the new man at the crease, I wish him a distinguished future to match his distinguished past.
This is an important day for the noble Lords, Lord King and Lord O’Neill. These contributions are the first, I hope, of many in this House but are preceded by the many and varied contributions they have made outside these four walls. My noble friend Lord O’Neill—the new Dr Johnson—is not only to be congratulated on his compelling speech but on his contribution of the terms BRIC and MINT to the world’s vocabulary and, as we will hear shortly, a new term, “PROD”. Like my noble friend Lord Caithness, I look forward to his continuing contributions because he knows about everything—from the secrets of emerging market success to antimicrobial resistance.
It has been an extraordinarily constructive and erudite debate on a rich and diverse range of issues, well beyond the essay question. In responding, if I fail to answer any noble Lords’ questions, I will write to them. I thank the noble Lord, Lord Davies of Oldham, for his provocative summing-up and I welcome the noble Lord, Lord Stoneham, to the Lib Dem Front Bench. I am very glad to see that he will be helping the House on these issues. I also thank the noble Lord, Lord Mendelsohn, for his kind words and I look forward to debating with him as the House scrutinises the legislation that we will be bringing forward.
Our long-term economic plan is turning around Britain’s economy, as my noble friend Lady Noakes was right to emphasise. In 2008, the UK was hit by the most damaging financial crisis in generations. In 2014, we were the fastest growing of all the major advanced economies. In May 2010, the coalition Government inherited a budget deficit that was more than 10% of GDP. Today, the deficit is half that level and debt as a share of national income is expected to start falling this financial year.
As the noble Lords, Lord Birt and Lord Turnbull, said, debt is too high and we need to reverse the rise as a share of GDP, lowering debt interest and building resilience to tackle future challenges effectively. We are not out of the woods yet, as the noble Lord, Lord Newby, said. There are still concerns on the international horizon, especially in the eurozone, and we have some huge challenges at home. Despite cutting the deficit over the past five years, it remains too high and productivity remains too low, whatever reservations we may have about how the figures are calculated. This Government are tackling this through our productivity plan, which will be published before the Budget, and our plans for a northern powerhouse. As the noble Lord, Lord Bilimoria, said, we are lucky to have my noble friend Lord O’Neill, who is our own northern powerhouse, here to tackle the issue.
Our trade with emerging markets has improved markedly but we are still too reliant on slow-growing markets in Europe. Business investment, which is so critical to improving productivity, has picked up but not by enough. While we have achieved remarkable success in creating jobs and growth, this is still uneven across the country and is reliant on too few sectors. I agree with the noble Lord, Lord Bilimoria, that enterprise, education, R&D and the engine of SMEs are critical to growth, although I do not agree with his view of the patent box, which I think has been a very important innovation.
The biggest theme of our debate has been the challenge and the opportunity of productivity. My noble friend Lady Wheatcroft talked about PIES but PROD is the abbreviation of productivity and should be the message to all parts of government and Whitehall: to be prodded to work with collective focus on productivity; for all parts of business to be more ambitious; and for our citizens and employees to prod themselves to achieve their potential. As my noble friend Lord O’Neill set out, our productivity is 17% below the G7 average. This Government will tackle this through our productivity plan, which will be published before the Budget.
To improve our productivity, we need to improve our infrastructure, as the noble Lord, Lord Teverson, said; we need to rebalance the economy and build the northern powerhouse, as the noble Lords, Lord Clement-Jones and Lord Shutt of Greetland, said; and we need to ensure better housing supply policy, as the noble Lord, Lord Newby, the noble Earl, Lord Arran, and my noble friend Lord Horam said, and good progress is being made, with starts at their highest level since 2007.
We need to expand apprenticeships, as the noble Lord, Lord Aberdare, said, and will be delivering 3 million more over the next five years. We need to reduce the burden of regulation on business, as my noble friend Lady Wheatcroft noted, and we have a new Business Secretary who is very well placed to do just that. We also need to get more women into the workforce, as the noble Baroness, Lady Wall, said, and provide better incentives for long-term investment. I listened to the noble Lords, Lord Reid, Lord Haskel and Lord Desai, on the measurement of productivity. As my noble friend Lord O’Neill said, there are measurement issues that need to be looked at.
The noble Baroness, Lady Kramer, and the noble Lord, Lord Skidelsky, raised concerns about fairness. Inequality, as measured by the Gini coefficient, is lower than in 2010-11 and lower than the pre-recession level of 2007-08.
The noble Baroness, Lady Kramer, also asked about migration and full employment. The Government value the contribution of highly skilled migrants. However, we will also take action to cut down on migrants who undercut local workers, by denying them access to in-work benefits. We will also ensure that our strategy does not close off UK business to the skilled experts that it requires.
I thank the noble Baroness, Lady Liddell, for championing the tourism sector. I agree with her, and with the noble Lords, Lord German and Lord Clement-Jones, that this is a hugely important service industry which brings jobs to the whole of the UK. DCMS has done a good job of ensuring that this importance is recognised across government. We work closely with BIS to promote key sectors including tourism, the digital economy, the creative industries—another global success story, and now 5% of the UK economy—and, of course, sport. We now have joint Ministers across both departments, of which I am honoured to be one.
The Government are committed to seeing more women on the boards of top UK companies. We have made excellent progress but there is more to do. FTSE companies are on track to reach the 25% target set by the noble Lord, Lord Davies of Abersoch, by 2015—but, like the noble Baroness, Lady Wall, I believe passionately that a pipeline of talented women is crucial to success. As the new Minister in BIS for governance, and therefore for women on boards, I will have a chance to help to tackle this. We are also committed to ensuring that there are more women in STEM and I thank the noble Baroness for her contribution. BIS initiated a programme of work to understand these issues and take action. This is being jointly led by the Royal Society and the Royal Academy of Engineering.
I thank my noble friend Lord Leigh for raising points about “covenant-light”, entrepreneurs’ relief and debt subsidy. I have met him separately and will ensure that these points are closely considered within BIS and the Treasury.
Several noble Lords raised points relating to EU renegotiation. There will be a debate in the other place next Tuesday and I am sure that Members will raise similar issues. I will ensure that the points made today are brought to the attention of the Ministers concerned. Of course, the results of renegotiation will be in the public domain and will be discussed and debated very widely.
Turning to the trade union Bill, I fear that there are those here who believe that our desire for such a Bill is born out of some dark intent. The noble Lords, Lord Mendelsohn and Lord Monks, hinted at this. This is quite wrong. Rather, it is our ambition to become the most prosperous economy in the world. That means we must ensure that people are not adversely affected by little-supported strikes which disrupt important public services. I was glad to have my noble friend Lord Leigh’s support on this matter. We will require that in the key health, education, fire and transport sectors, 40% of those entitled to vote must support strike action for it to be legitimate. We will also tackle the intimidation of non-striking workers during a strike, introduce time limits on a mandate for a strike following a ballot, and make changes to the role of the certification officer. Strikes can put lives at risk, prevent people getting to work and earning a living and prevent businesses managing their workforces effectively. As noble Lords will know, I say that as someone who comes from a business which had excellent relations with the trade unions—USDAW in that particular case. I also pay tribute to the work of the noble Baroness, Lady Donaghy, with ACAS and reiterate the important role that ACAS plays.
Another theme has been the importance of skills, digital skills in particular, which was rightly emphasised by the noble Lord, Lord Davies of Oldham. Ensuring that business has access to a highly skilled workforce is also critical for generating growth and enhancing productivity. Over the next five years, we will deliver 3 million new apprenticeships and ensure that they deliver the skills that employers need for growth. We propose to introduce a new duty on government to report annually on progress against the 3 million commitment, which I believe the noble Lord, Lord Macdonald, will support from the Benches opposite. I assure him that the Government are working hard with large and small companies, through our reforms, to grow the all-age apprenticeship programmes.
Our apprenticeship reforms are focused on employer-designed standards and robust assessment processes, and will ensure that apprenticeships become increasingly attractive to all sizes of employer, which is vital. Apprenticeships are no longer confined to the manufacturing sector. You can now become qualified in the accountancy and legal professions through them, and we will promote the development of apprenticeships in all sectors and for all ages. We will also increase apprenticeships across Whitehall and its agencies so that the public sector is leading the way, and we will work with schools to ensure that apprenticeship options are more fully incorporated into careers advice.
Several noble Lords underlined the importance of the Select Committee report, Make or Break: The UK’s Digital Future. I very much look forward to debating that report and taking some of your Lordships’ ideas further, but I can say today that nine standards have been developed for digital since 2014 and that we have digital degree apprenticeships and, of course, the National College for Digital Skills, so progress is being made.
Latest figures for apprenticeships in the construction sector, which was a concern of the noble Lord, Lord Macdonald, have shown an increase of 16% from 2012-13 to 2013-14. There were more than 60,000 apprenticeship starts in engineering, which, again, is encouraging. He will be glad to know that, in 2013-14, 52% of total apprentices were women.
I turn now to enterprise and the enterprise Bill. This Government have an ambition for our small and medium-sized enterprises: to make Britain the best place in the world to start and grow a business. The enterprise Bill seeks to address the critical issues facing business growth. The first is late payment, an issue that affects small and medium-sized businesses in particular, which were owed £32.4 billion in January this year, compared to the £39 billion mentioned by the noble Lord, Lord Cotter—that perhaps reflects some response to the letters that we have sent, although I cannot be sure. On average, small businesses are still owed nearly £32,000.
We have already legislated through the Small Business, Enterprise and Employment Act 2015. Using those powers, we will now introduce a new requirement for the UK’s largest companies to report on their payment practices and policies. The enterprise Bill will establish new measures, including a new small business conciliation service to mediate in disputes between small and large businesses, especially over late payment, thereby avoiding the need for expensive litigation. I was glad to hear of the support that the noble Lord, Lord Mendelsohn, hopes to be able to give on this important matter.
My noble friend Lady Noakes asked why we needed legislation at all. Clearly, the Small Business, Enterprise and Employment Act was a landmark piece of legislation to help small business, but the measures in the new Bill will build on that by making sure that we remove another £10 billion of red tape. I hope that our work on enforcement will also be welcome to the noble Earl, Lord Kinnoull.
On the tax lock, which several noble Lords mentioned, these are important promises to working families, which we believe that it is right to put on the statute book. The noble Lord, Lord Northbrook, rightly highlighted the importance of lower, simpler taxes. To pick up the point made by the noble Lord, Lord Watson, we have a £5 billion target for reducing tax evasion in this Parliament, which I hope will be welcome.
Another area that can stifle small business growth is excessive regulation. We have an ambitious agenda, and the cost of regulation fell by £10 billion over the last Parliament. We intend to deliver a further £10 billion of savings over the coming five years. The job is not done; many businesses believe that how regulation is enforced and the paperwork that goes with it can cause more unnecessary difficulties than the law itself. The Government believe that we should now expand the framework set out in the small business Act to ensure that the actions of regulators are also covered.
With an unprecedented £70 billion of capital investment over the next five years, transport will account for nearly three-quarters of our infrastructure budget, and 22 out of the Government’s top projects. The Queen’s Speech reiterated the Government’s commitment to legislate for and start building high-speed rail links. My noble friend Lord O’Neill referred to our plans to deliver the full network of HS2 and how that will connect eight of Britain’s 10 largest cities. The Chancellor has already committed alongside this to ramp up investments in roads, give Britain the fastest broadband and the most competitive telecoms and take the decision on increasing airport capacity in the south-east once the Airports Commission’s final recommendations are published, which will be shortly. The noble Lord, Lord Harrison, will also be glad to know of the £1 billion airport redevelopment in Manchester.
The noble Lord, Lord Teverson, asked about the cycling and walking strategy. The Infrastructure Act contains a section giving the Secretary of State power to set such a strategy. Once it is commenced, the Secretary of State will be under a duty to set one up as soon as is reasonably practical. My noble friend Lord Attlee rightly raised concerns about cycle safety, and we are trying to address that.
I empathise with the noble Earl, Lord Arran, on the subject of the A303. I have been waiting for improvements to it all my life, and it is great to see them in the plan. We expect to start public consultation on the scheme in 2017.
The Government want to make Britain the technology centre of Europe, establishing more catapult centres, mentioned by several noble Lords. We are providing £800 million in 2015-16 for innovation activities through Innovate UK and other world-renowned institutions. They will keep a beady eye on how that is administered.
To make sure that the UK retains its position as the world’s best IP regime, we will also focus on a number of measures including: improving our rights-granting services; reforming the law to improve protection for businesses; striving to improve international patent systems; and educating businesses and consumers about IP. The consultation on Section 73 is continuing. The noble Lord, Lord Clement-Jones, is right to say that enforcement is incredibly important. It is great that we have managed to extend the life of PIPCU, and we are looking at future options for funding. He will also be very glad to know that we have used Section 97A to block access to websites alleged to host 10 million infringing e-books.
Building on the successes of the last Parliament, the Government have set out key measures, which will ensure that we continue to promote jobs and balanced growth in the UK. We have put the country back on a stronger financial foundation, although we have still more to do. We are putting the interests of business first and dismantling bureaucracy to make this the best place in the world to start up and run a business.
I end by thanking the House for a stimulating debate and for demonstrating economy and business nous by finishing business well ahead of schedule.
Motion agreed nemine dissentiente, and the Lord Chamberlain was ordered to present the Address to Her Majesty.
House adjourned at 6.10 pm.