Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what the criteria are for payments to be made from the Contingency Fund.
Answered by Lord O'Neill of Gatley
The criteria for access to the Contingencies Fund are set out in the Treasury publication “Supply Estimates: a guidance manual” which can be found on the gov.uk website. The Contingencies Fund enables the Treasury to make repayable cash advances to departments for urgent services, in anticipation of provision for those services being provided by Parliament.
The main criteria against which any application is judged is genuine urgency in the public interest and – in cases of new services - near certainty that any related Bill will become law. However, not all advances are dependent upon the passage of enabling legislation: existing legislation may already exist. Advances are generally made in anticipation of the relevant Supply and Appropriation Act.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government whether parliamentary approval would be required for any decision to join the eurozone, and if so, why the Prime Minister has stated that the UK will never join the eurozone, in the light of the fact that one Parliament cannot bind its successor.
Answered by Lord O'Neill of Gatley
As set out in Protocol 15, the United Kingdom is under no legal obligation to adopt the euro as its currency. Under the EU Act 2011, a decision by the UK under Protocol (No 15) leading to a decision by the Council under article 140 (3) of the Treaty on the Functioning of the European Union would require an Act of Parliament and a referendum result in favour before a Minister of the Crown could support it.
The Prime Minister has been clear that Britain will never join the euro.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government, further to the Written Answer by Lord O’Neill of Gatley on 10 February (HL5712), what other mechanisms are available to the EU to intervene on, or influence, taxation in individual member states.
Answered by Lord O'Neill of Gatley
Direct tax is a Member State competence. Under the Treaties, any Directives on tax are agreed by unanimity, the effect of which is to give each Member State a veto power.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what is their assessment of the criticism of the European Commission by Robert Stack, the US Treasury Official in charge of international tax policy, for disproportionately targeting US companies; and under what articles of the EU treaties the EU can tax foreign enterprises.
Answered by Lord O'Neill of Gatley
While corporate taxation is a matter for Member States, under the EU Treaties the European Commission has competence to conduct State aid investigations in order to prevent unlawful distortion of competition and to safeguard the internal market. Investigations into tax rulings issued by EU Member States to multi-national companies were opened by the Commission in 2013. While the Commission has found illegal aid has been provided by some Members States (not including the UK) relating to some US companies, rulings under investigation also relate to a number of non-US undertakings.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what legal powers the EU has to intervene in the taxation arrangements agreed between HM Treasury and foreign-based firms, including Google, and what assessment they have made of whether HMRC could legally co-operate in any such EU action.
Answered by Lord O'Neill of Gatley
While corporate taxation is a matter for Member States, under the EU Treaties the European Commission has competence to conduct State aid investigations in order to prevent unlawful distortion of competition and to safeguard the internal market. Member State authorities are required to cooperate with any such investigations.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what are their plans to deal with the increase in the United Kingdom population to 70 million within 12 years and 74.3 million by 2030, as projected by the Office for National Statistics, and what estimate they have made of the cost of those plans.
Answered by Lord O'Neill of Gatley
The recent 2015 Office for National Statistics projections predict the United Kingdom population to reach 70 million in 2027. This is consistent with their previous 2013 projections which also predicted the UK population would reach 70 million in 2027. The new projections forecast the population to increase to 71 million by 2030, as did the previous projections.
Population growth does not necessarily cause an equivalent increase in demand for all public services, because at different points in their lives people will use different services. For instance, population increases caused by people living longer than previously, might increase demand for health services but probably would not increase demand for classroom places.
However, as these increases are largely consistent with the previous population projections, they are well covered by existing plans and planning processes. Public services are provided local authorities and central departments. Local Government and Departmental budgets are set in advance through multi-year Spending Reviews. This allows the Government to make decisions on all areas of public spending in the context of projected demand and available resources while ensuring the public finances remain sustainable in the long term. Departments are responsible for deciding how this money is then allocated, subject to strict Treasury rules on the proper management of public funds. This allows money to flow to where it is most needed, given demographic pressures and other considerations.
The independent Office for Budget Responsibility produce 50-year forecasts of the sustainability of the public finances in the biannual Fiscal Sustainability Report. For instance, the most recent report highlighted pressures from growth in health spending, state pension costs, and the costs of long-term social care. In response to these pressures, the Government introduced reforms that will save £500 billion over the next 50 years.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government whether the United Kingdom will incur any financial costs relating to the bailout being given to the government of Greece, either through the European Central Bank or the International Monetary Fund, or in any other way.
Answered by Lord O'Neill of Gatley
The Government has secured a deal that protects UK taxpayers from any risk from financing euro area bailouts now and in the future. This deal gives legal force to the commitment secured in 2010 that UK taxpayers would not be drawn into a euro area bailout. Under the European Financial Stability Mechanism (EFSM) short term financing agreement concluded on Friday 17 July, Greece’s IMF arrears have also been cleared.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government what plans they have to renegotiate the funding of the European Union budget so that the United Kingdom’s contribution does not increase as a result of economic success.
Answered by Lord O'Neill of Gatley
The EU budget mechanisms, which determine the UK's net contribution to the EU from 2014-20, were agreed in 2013, when the Prime Minister secured an historic real terms cut to expenditure and protected the rebate. This House approved that deal on 8 July 2015.
Asked by: Lord Stoddart of Swindon (Independent Labour - Life peer)
Question to the HM Treasury:
To ask Her Majesty’s Government whether they will explain why they agreed to a European directive tying the United Kingdom's bank deposit protection scheme to the euro-sterling value which has resulted in a £10,000 reduction in the level of protection for United Kingdom depositors from next year; and what action they intend to take to address this anomaly.
Answered by Lord O'Neill of Gatley
The Deposit Guarantee Scheme Directive (DGSD) updates existing EU legislation designed to harmonise the level of deposit protection provided across the European Economic Area (EEA).
This is necessary to ensure that depositors are entitled to the same level of protection wherever they deposit their money, and that UK firms are not competitively disadvantaged in relation to firms in other EEA jurisdictions.
As a result of the current strength of the pound in relation to the euro, it has been necessary for the Prudential Regulation Authority to review the sterling coverage limit. However, the Government has taken action to ensure that UK depositors are not exposed to a sudden reduction in the level of protection they receive.
HM Treasury has laid a statutory instrument to ensure that depositors who are currently entitled to £85,000 of protection from the Financial Services Compensation Scheme will continue to be until 31 December 2015.
This will ensure that there is sufficient time available for depositors to be made aware of the changes, and to take such steps as they feel necessary to manage their financial affairs appropriately in light of this change.