The Economy

Lord Coaker Excerpts

Thursday 24th October 2019 Commons Chamber

[Vernon Coaker (Gedling) (Lab)]

This debate about the economy gives us an opportunity that the shadow Chancellor tried to take and the Chancellor missed, although the right hon. Member for Sevenoaks (Sir Michael Fallon) started to get to where I think this debate on the economy should be taking us. Let me explain what I mean.

My constituents in all parts of Gedling—in Carlton, Arnold, Netherfield, Colwick and Burton Joyce—say exactly the same as is being said by many people in the country: that the system, as it is currently, does not work for them. They do not believe that the way the system operates is fair and they want something done about it. And what they want from this Parliament is a vision of an economy that is different from the way it functions now.

It is such a big issue that the Financial Times—the doyen of the City of London—recently ran an editorial that itself asks the question,

“How to build a more responsible…capitalism”.

It talks about how that can be done. I hope that the new Chair of the Treasury Committee will consider whether his Committee should look at how we are going to deliver a market system that regulates itself in a way that does not allow the excesses that we have seen. This is a quote from a Guardian report on the Panama papers:

“Twitter and Facebook received hundreds of millions of dollars in investments that can be traced back to Russian state financial institutions…Aggressive tax avoidance by multinational corporations, including Nike and Apple…billions in tax refunds by the Isle of Man and Malta to the owners of private jets and luxury yachts.”

None of us, whether we are Labour, Liberal, Scottish nationalist or Conservative—whoever we are—can believe that is right. Where in the Chancellor’s speech did it say that whoever was in government they would tackle that?

It cannot be right that multinational companies are shifting a growing share of profits offshore—£600 billion in the past year alone. Then we turn to the people who HMRC pursues for a few pounds that they owe, or the Benefits Agency pursues for a few pounds that they owe. That is not the sort of society that people want. That is not the sort of society that people think is fair. The Sunday Telegraph, on page 5, laid into the way in which investment funds work. Nigel Woodford—I have never heard of him—

[Kevin Hollinrake]

Neil Woodford.

[Vernon Coaker]

Well, there you go—Neil Woodford. I have still never heard of him. We read about Terry Smith, Nick Train and Anthony Bolton, and millions of pounds of investors’ money. The money that we—hon. Members on both sides of the House—pay into savings, trust funds and pensions is put together and invested on our behalf by a system that has short-term interests and profit at its heart rather than the long-term benefit of communities. It cannot go on.

It cannot be right that my own brilliant BEIS Committee reported that the average FTSE 100 chief executive is on £4 million a year compared with the average worker on £30,000. It cannot carry on. All I wanted to hear was a Chancellor of the Exchequer who put at the heart of his Queen’s Speech contribution equality, a responsible capitalism, a change to the fast buck and a change to those people who seek to make money rather than putting people first. That is what I wanted to hear and it was seriously lacking.

Finance (No. 3) Bill

Lord Coaker Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 8th January 2019 Commons Chamber

[Kevin Foster]

I could not have put it better myself. If business rates unbalance the economy, that is clearly a real issue. It is no surprise that two years ago, when voters in the north-east of Scotland—which is, as my hon. Friend says, the powerhouse of Scotland’s economy—had to decide which party would be the best to drive forward economic policies and represent their interests, the area, funnily enough, suddenly turned quite a pleasant shade of blue, with only a dot of yellow in the middle. That reflected the confidence of those voters in this Government’s policies.

I am conscious that I have been speaking for a little while, and that others wish to contribute. Let me end by saying that I do not believe the two new clauses add anything to the Bill. They were tabled by Members who regularly like to give us policy-based evidence, and who advocate a form of economic management for the country that has failed many times in other countries. There is no reason why it would not fail again here if they were given the chance to implement it. I hope that the House will not accept the new clauses, but will accept that the Bill will make a difference to working families across the country, will help to drive our economy forward, and will have a positive effect on the country overall.

[Vernon Coaker (Gedling) (Lab)]

I support the two new clauses. Unlike the hon. Member for Torbay (Kevin Foster), I think that they are very measured. They simply ask the Government to review the impact of the Bill on poverty and inequality.

I do not know what other Members think, but let me describe what I think the vast majority of people in all our constituencies believe, and what they believe this Parliament should be saying and doing. They believe that the current levels of inequality in our country are simply and utterly unacceptable. They believe that the levels of child poverty are simply and utterly unacceptable. They are not interested in someone being able to tell them that there are 2 million children living in terrible poverty, or 1,850,000 children living in absolute or, indeed, relative poverty. That is what those people are sick of, and what I am sick of, and what this Parliament should be reflecting.

Across the country, people are asking, “Can you not do any better? Can you not do something about the fact that there are still pensioners in one of the richest countries in the world who cannot heat themselves properly in cold weather, including at Christmas?” They are asking, “What is Parliament doing when we see children living in absolute poverty who cannot afford to go to school, with shoes and clothes and food being given to them as an act of charity by people in those schools?” They are not interested in whether the figures have gone up by 0.5% or down by 1%. They are interested in what this Parliament is doing about it, and what we are saying.

All these new clauses do is say to the Government, “If you believe, for example, that clause 5, through allowing people to keep more of their income when in work, addresses some of those issues, let’s have a review to see whether or not that is the case.” That is what people would expect.

I am sick of this myself. When I drive around, not just my constituency but the country, I see enormous wealth. I am not talking about people who have worked hard and done well, which we all want to see; I am talking about massive accumulated wealth—not just income—with people able to afford to pay astronomical sums on different ways of life, while half a mile down the street there is a kid in a household that cannot afford to put any proper food on the table.

[Catherine West (Hornsey and Wood Green) (Lab)]

Does my hon. Friend agree that it is terrible to think of all the many places in the country where there are so many more food banks, and that the year-on-year increase the Trussell Trust has told us about is deeply worrying?

[Vernon Coaker]

That is right. Every Member of this House would no doubt say, “Isn’t it great that there are food banks and so many volunteers at them?” I agree with that; I agree that it is good to see in communities across this country, in every part of the UK, so many people who volunteer their time with others donating to them. What I object to is that food banks, which are there as a charity, are used as an instrument of public policy—they are used as a way of tackling poverty. What on earth have things come to in 2018 and 2019 when food banks are a public policy mechanism for dealing with poverty? They are supposed to be charitable organisations for people who have somehow slipped through the net, not places where someone at the DWP sends people with tokens. That is an absolute outrage, and this Parliament should be seething about it. In saying that, I do not decry the volunteers; this brings the very best out of people, but—goodness me—is that public policy now?

That is what the Minister should be addressing. The challenge that I think every Member of this House would make to the Government would be to ask what is being done to address these issues. We do not want some academic debate about a bit of research here or there which means that the hon. Member for Torbay can say, “There’s 1,000 fewer here and 2% less there.” The levels of poverty and inequality in our country are a fundamental disgrace; why are the Government not raging about that and doing something about it through their Budget?

[Laura Smith (Crewe and Nantwich) (Lab)]

Does my hon. Friend agree that when he speaks to the food bank volunteers they say to him that they do not want to be doing this work as it should not be necessary because people should be able to pay for the food for their families without having to rely on handouts? They do not want to be volunteering for this because this problem should not exist in 2019.

[Vernon Coaker]

I agree with my hon. Friend.

In my relatively brief contribution I just want to ask the Government why there is disagreement about these perfectly reasonable new clauses that ask the Government to review the impact on poverty and inequality. When the Minister responds, will he say whether he refuses to keep under review any of the budgetary measures to be implemented through this Finance Bill to see whether they impact on poverty and inequality? Is that honestly what he is saying? If he is not saying that, why cannot he accept a new clause that is asking him to review this? Who disagrees with looking at whether our Government’s policies are actually tackling poverty and inequality? I find this absolutely incredible.

The Minister can say that this is all rhetorical nonsense, but let us see what he says about how he intends to review the impact of the Government’s policies. For example, he knows that one of the key challenges for Government policy is that, despite what they have tried to do, the number of working people in poverty is increasing. That is a policy challenge. It is not a Labour-Tory thing; it is a policy challenge. If the Minister simply retrenches on this, he is not acting as a Minister of the Crown or a Government Minister responsible for our country; he is acting as a Tory party politician, and that is not what a Minister of the Crown should be doing.

[Martin Whitfield (East Lothian) (Lab)]

I find it sad to have to ask this, but does my hon. Friend agree that perhaps the reason why the Government will not accept the new clauses is that they would provide the evidence that these policies are wrong and that they are harming our citizens?

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[Vernon Coaker]

I agree. I am not sure if the Minister is listening, but that is the point. Surely the Government would want to know whether their policies were working, so that they could do more of them. And if their policies were not working, all of us would want the Government to change tack.

Poverty and inequality should be at the heart of everything the Government do and of everything this Parliament demands. All that the new clauses and amendments are doing is saying to the Government, “Look at what your policies are doing. Look at the impact out there. What are you doing to tackle the utterly unacceptable inequality, child poverty and increased use of food banks that we see in our country? How are your policies going to address this?” That is the purpose of the new clauses, which I totally support.

[Helen Whately (Faversham and Mid Kent) (Con)]

It is a pleasure to follow the hon. Member for Gedling (Vernon Coaker). In fact, I agree with some of the sentiments that he has expressed. The level of poverty is still unacceptable, and that makes me unhappy. I am also unhappy about the level of inequality across the country and in my own constituency, but I want to support a Government who are doing something about it, not just through words but through actually taking steps to make these things better.

I have enormous respect for the hon. Member for Oldham East and Saddleworth (Debbie Abrahams), who introduced her new clause 1 earlier. It proposes a review of the impact of clause 5 on child poverty and equality—that is, the impact of raising the level of the personal allowance after which people start paying tax. She also spoke to new clause 5, which proposes a review of the public health and poverty impact of the whole Act. It is enormously tempting to say yes, we should do this. All of us in this Chamber care enormously about poverty and inequality levels. I have a background in healthcare, and I feel very strongly about reducing health inequalities. I am also conscious of the different life expectancies within my own constituency, which are substantial, but we must be careful not to be lured into a sense that reviewing a specific part of an Act will give us an accurate picture of all that is being done and of its impact on, for example, reducing health inequalities.

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[Mel Stride]

I think I have been misunderstood, and I apologise to the hon. Lady if I was not clear enough. I am certainly not saying that data does not matter—quite the opposite. What I am saying is that we need to have the right kind of data for the exercise to be meaningful and worth while.

New clause 1 would require the Chancellor to report on the impact of changes to the personal allowance and the higher rate threshold on households of different levels of income, on child poverty, on equality and on those individuals with protected characteristics. New clause 5 would require the Chancellor to report on the Bill’s effect on child poverty, life expectancy and public health.

Let me first address the question of the Treasury’s compliance with its public sector equality duty, as referenced in new clause 1(2)(c). Equality and fairness continue to lie right at the heart of the Government’s agenda, and we take our compliance with this duty deeply seriously while deciding policy. That means that Government decisions are explicitly informed by the evidence available of the implications of those decisions for those sharing protected characteristics. I have no hesitation in saying that the Treasury complies with the public sector equality duty.

Further provisions in new clauses 1 and 5 call for the publication of different forms of analysis for clause 5 and for the whole Bill in turn. The Government have been, and continue to be, transparent—more transparent than any other. Changes to the tax system are always accompanied by a tax information and impact note, and each Budget is accompanied by detailed distributional analysis.

TIINs, in particular, are relevant to the questions discussed today. These notes provide Parliament and taxpayers with information on the expected effects of changes to the tax system, and form a vital part of the Government’s commitment to transparency and accountability around tax decisions. In the context of clause 5, for example, the TIIN already sets out the impact on groups of taxpayers according to their age, gender and income tax band, and this data is readily available to HMRC through tax returns.

[Vernon Coaker]

That is the point: the assumptions on distributional analysis are assumptions. What we want is to see whether those assumptions turn into reality.

[Mel Stride]

I will come to the very issue that the hon. Gentleman rightly raises.

Clause 5 will benefit households across the UK. Due to the information collected by HMRC through tax returns, we have various pieces of information on geographical distribution, as sought under new clause 1(2)(d). That is an important point, because much of the information being requested is actually already available.

In addition, the distributional analysis published by the Treasury already sets out the impact of tax changes on households with different levels of income. To be completely clear, the analysis shows how the living standards of households in each tenth of the income distribution will be affected by the decisions the Chancellor and Prime Minister have taken since they took office in 2016. Not only does the analysis meet the intention of new clause 5(2)(a) regarding the effects of the Government’s tax changes on different households, it actually goes beyond that by including changes to welfare and spending on public services, and by considering changes in addition to those announced at each fiscal event since the autumn statement in 2016.

There is, as I suggested at the outset of my remarks, much that we can agree on across the House. Child poverty, public health, life expectancy and inequality are among the greatest issues of our age. We have got on with the job. Absolute poverty rates are at record lows. One million fewer people are in poverty now than under Labour. I say to the hon. Member for Gedling that 1 million is indeed a number, but for every one of those million, their lives have been enhanced. That includes 300,000 fewer children in poverty than under Labour. As we know, the best route out of poverty is through work. There are 3 million more people in work now than in 2010, with 637,000 fewer children in workless households. That is a record of which we should be proud. I urge the House to reject the new clauses.

Summer Adjournment

Lord Coaker Excerpts

Tuesday 24th July 2018 Commons Chamber

[Vernon Coaker (Gedling) (Lab)]

I say to my hon. Friend the Member for Lewisham East (Janet Daby) what an amazing privilege it is to follow a speech of that quality—not only that, but what shone through was her absolute dignity. She will be an absolutely amazing addition to our Parliament and to the government of this country. Through what she said, it is clear that she will be an advocate for her local people on poverty, inequality and tackling health issues; but above all, she will be a national advocate for the things that we in the Labour party stand for—we stand up against prejudice and discrimination and show what determination can achieve. It is an amazing privilege and honour to follow my hon. Friend, and I wish her all the luck in the future.

I was moved to speak on two issues in respect of the amazing constituency of Gedling in Nottinghamshire that I represent. I am sick and tired of people coming to see me at my surgeries who have mental health problems but are being refused personal independence payments. I say to the Minister, who will answer a plethora of different things that people raise, that the Government need to get a grip. This is not a party political issue. I talk to Government Members, who have the same problems, and even Ministers say, “This is astonishing. We have to get it sorted out.” Well, the Minister should tell the Department for Work and Pensions to sort it out, because numerous people who have serious difficulties cannot access a benefit on which they depend. It is not good enough, and the Government need to take issue with it. I told numerous people that I would raise that, and I have done so.

I want to use this debate to highlight something that was said by a senior Conservative councillor in Nottinghamshire, and I think that it will shock all Members across the House. Councillor Phillip Owen, chair of the children and young people’s committee of Nottinghamshire County Council, said that the police priorities of modern slavery, domestic violence and hate crime were only priorities because they are “politically correct” and “fashionable”. We think battles have been won—on sexism, discrimination, prejudice and intolerance —and then we hear such statements from a senior councillor about things that have a massive impact.

We heard earlier from my hon. Friend the Member for Birmingham, Selly Oak (Steve McCabe). The police recorded 1.1 million crimes in 2016 that related to domestic abuse, and 1.9 million people aged between 19 and 65 were the victims of domestic abuse. If that should not be a police priority, I do not know what should be. The fact is that large numbers of people are still not reporting these crimes. The majority of victims are women, and large numbers of people are still not prosecuted for these crimes, because the victims will not give evidence to ensure that the perpetrator is prosecuted. That should be our priority, not some prejudiced statement about these matters that deserves to come from the ark. Of course it should be a police priority; of course it should be looked into. This country has suffered down the centuries because such crimes have been dismissed and kept behind closed doors.

What of modern slavery? This House, this country and, to be fair, this Prime Minister—I have said it to her—led the way with the Modern Slavery Act 2015. It needs to be better implemented, but we led the way, and the Prime Minister was key to it, yet we are told by this senior Conservative councillor that it should not be a police priority. The Gangmasters Licensing Authority has pointed to a 47% increase between 2016 and 2017 in the number of potential victims of forced labour, while the Global Slavery Index announced just a couple of days ago that 136,000 people in this country were potentially victims of modern slavery on any one day, yet we are told it is not a police priority. I say to Councillor Owen and anybody else who has doubts that tackling modern slavery and forced labour must be a priority for the police of our country, and I am proud that it is. We thought these two issues had ended—we thought we had won these battles—but as my hon. Friend the Member for Lewisham East said in her brilliant maiden speech, prejudice and discrimination are still there to be tackled. Likewise, the police still need to tackle the scourges of modern slavery and domestic violence, and I am proud that they do.

[Mr Speaker]

Maiden speech: Jared O’Mara.

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[Chris Stephens]

I apologise to the hon. Gentleman, but the series ended a year ago.

How will this saga end? Will the male blond hero be the winner, or will the female leader somehow manage to find another way of clinging on to power? But never mind about that: when are going to get another episode of “Game of Thrones”? As the Deputy Leader of the House will know, Scottish National party Members call the Tories the Lannisters, which makes the Scottish Tories House Bolton.

Let me wish every Member a good summer recess. I think it was the hon. Member for Harrow East (Bob Blackman) who said it is not a holiday—he is absolutely right. I am hosting a universal credit drop-in event tomorrow morning in Penilee community centre in my constituency. I echo Members’ comments about the effect that universal credit is having on the community. The Government need to look at this week’s revelations by whistleblowers who used to work on universal credit about the very serious effects of systematic errors on claimants. It is time to pause and fix universal credit.

It is not just our social security system that is broken. As hon. Members have pointed out, the immigration system is broken too, with a “hostile environment” and asylum seekers waiting years for decisions. I discovered another issue this weekend when my constituent Hamid Ahmad, an Afghan interpreter for the British Army, came to see me at my surgery.

Several hundred Afghan interpreters for the British Army are part of a five-year resettlement scheme to the UK, and I find it astonishing that when some families who were brought over on the scheme, who now have children born in the UK, applied for British passports, they were told by the Home Office to apply for Afghani passports instead, because they are not being accepted as British citizens. I hope that the Home Office will deal with that. There are also some men who did not bring their families initially, but who tried to bring over their partners on spousal visas and are having difficulties with that, too. I would have thought that interpreters who have helped the armed forces in this country should be treated a lot better than that.

The hon. Member for North Tyneside (Mary Glindon) mentioned public sector pay and the Public and Commercial Services Union ballot, and I want to associate myself very much with her remarks. We have discovered today that the public sector pay cap is still in place, because the Treasury is still only funding each and every UK Government Department 1%, and each and every other Department has to find the additional money to fund a decent pay rise. I hope that as we go into recess, the Ministry of Defence will pay the living wage to those employees who are not in receipt of it. There are 220 in Scotland, and I am sure that there are others elsewhere.

I want to associate myself, too, with the comments by the hon. Member for Glasgow North East (Mr Sweeney) on the suspension of the Type 31e frigates procurement process. It is absolutely astonishing that we come here but there has been no statement.

[Vernon Coaker]

indicated assent.

[Chris Stephens]

Does the hon. Gentleman want to intervene?

[Vernon Coaker]

No, I was just agreeing.

[Chris Stephens]

It is absolutely astonishing that no statement has been made in the House on the suspension of that programme. What is even worse is that if there was one procurement process suspended in the Ministry of Defence, we would think it would be not for the Type 31e frigate but for the fleet solid support ships—the Royal Fleet Auxiliary ships—which, astonishingly, are being put out to international competition, despite the benefits that a UK-wide bid would have to our economy. It is absolutely astonishing.

As an MP from Glasgow, I was delighted to table early-day motion 1534, commemorating the centenary of the birth of the great Nelson Mandela and to congratulate the Nelson Mandela Scottish Memorial Foundation on its work, which is fundraising and trying to find £250,000, so that there can be a statue of the great Nelson Mandela in the city of Glasgow.

Comments have been made by many hon. Members, including the hon. Member for Gedling (Vernon Coaker), on the work that I am proud to have done in the last year with Show Racism the Red Card. As the vice-chair of the Show Racism the Red Card all-party group, I was delighted to see schools in my constituency—Lourdes Primary School and Hillington Primary School—win awards in the Show Racism the Red Card Scotland’s creative competition.

I am proud to be a part of the Youth Violence Commission, which has just published its interim report. It is important that we try to spend some time in this place discussing how the creative industry can help to address the problem with youth violence, giving young people an opportunity to express themselves through film making and various other creative arts. I was delighted that the South West Arts and Music Project received a grant of £91,000 from the Scottish Government.

As I said earlier, this is not a holiday; it is a recess. I want to thank you, Mr Speaker, and the whole parliamentary staff, who look after us, speak to us and often cheer us up. I wish them all the best for the summer. I also want to pay tribute to the constituency staff right across these islands—I am sure that everyone in the House would agree—who help us as Members of Parliament. I place on record my thanks to Joe Murray, Scott McFarlane, Tony McCue, Mary Jane Douglas, and particularly, Keith Gibb and Roza Salih. Their energy, enthusiasm and hard work are infectious, and I look forward to working with them in the summer and beyond.

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[Mr Speaker]

Before we come to the petitions and any points of order that might precede them, I want to echo what the Lord Commissioner of Her Majesty’s Treasury has said on the Government’s behalf by way of appreciation. Perhaps I can start by thanking all colleagues who have contributed to this debate, but more widely I want to recognise the conscientious application to their task that they have shown ever since we came back after the general election. Whatever may be said about colleagues, and whatever people think of politicians, I know from my vantage point how hard and dedicatedly people on both sides of the political spectrum work in the Chamber, in Committees, in all-party groups and in constituency-related meetings and that should be recognised. People are trying to do the right thing by their constituents and their country. I thank colleagues for their engagement.

I thank the Leader of the House, who applies herself with enormous intensity and commitment to the work that she has to do, and wish her a very agreeable and well-earned summer break. I wish the same to the deputy shadow Leader of the House. Recognising that we can do what we do only because we are magnificently served by a vast number of dedicated, caring, efficient and effective staff at all levels of the House, I thank the staff of the House. Their work does not go unnoticed, and it will always be appreciated. Have a good summer.

[Vernon Coaker]

On a point of order, Mr Speaker. First, I think everyone would associate themselves with those remarks.

May I apologise to the House for not mentioning my entry in the Register of Members’ Financial Interests before my speech? I should have referred to my entry, and I did not. I apologise to the House for not doing so.

[Mr Speaker]

I am extremely grateful to the hon. Gentleman for what he has said, which I think will be readily accepted by everyone in the House.

If I might be forgiven, I want to say thank you once again to our maiden speakers. We heard two outstanding speeches. The hon. Member for Sheffield, Hallam (Jared O’Mara) is not now in his place, but I have offered my respects to him. I reiterate to the hon. Member for Lewisham East (Janet Daby) that hers was a speech of great passion, authority and empathy. My very clear sense is that it commanded enormous support and respect across the House, and I wish her and the hon. Gentleman a very good experience here in the House of Commons.

Oral Answers to Questions

Lord Coaker Excerpts

Tuesday 16th January 2018 Commons Chamber

[Mr Hammond]

Yes.

[Vernon Coaker (Gedling) (Lab)]

Councils such as Gedling Borough Council and Nottinghamshire County Council are setting their budgets now, and they face a funding crisis. What are the Government going to do about it?

[Elizabeth Truss]

We have given councils the power to raise more funds in the draft local government finance settlement, but councils also need to look at how they can become more efficient, share back offices and use modern technology.

Northern Ireland Economy

Lord Coaker Excerpts

Thursday 1st March 2012 Westminster Hall

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

It is a great pleasure to serve under your chairmanship, Mr Scott. I welcome the opportunity to debate the Northern Ireland economy and I am very grateful for the contributions of all those who have participated in this important debate.

As hon. Members are aware, across the UK we face difficult economic conditions and a tough challenge to restore the UK to prosperity. Critical to achieving that ambition is tackling the record deficit that we inherited—not that one would have noticed that point from the speech made by the hon. Member for Pontypridd (Owen Smith)—and rebalancing our economy away from debt-fuelled consumption and public spending towards sustainable private sector growth.

The Northern Ireland economy faces similar challenges, but recent history also means that it faces a different set of circumstances compared with the rest of the UK. That point has been made by a number of speakers, including the Chair of the Northern Ireland Affairs Committee, my hon. Friend the Member for Tewkesbury (Mr Robertson). Although the years of peace following the Good Friday agreement have seen prosperity on the rise in Northern Ireland, it still faces a number of difficulties. The Government are concerned that employment in Northern Ireland is overly reliant on the public sector. Private sector employment in Northern Ireland lags considerably behind the rest of the UK. The latest figures from the Office for National Statistics show that whereas 61% of people aged 16 to 64 are employed in the private sector in England, only 45% are in the private sector in Northern Ireland.

However, I am optimistic about the future of Northern Ireland. As we have heard, Northern Ireland already attracts a large share of UK foreign direct investment, and that is generating new employment. The Government, and in particular the Secretary of State for Northern Ireland, have been tireless in promoting more opportunities for private sector growth and employment as part of our commitment to rebalance the Northern Ireland economy. I doubt if there have been many, if any, Secretaries of State for Northern Ireland who have shown the focus and energy that the current Secretary of State has on that point. Indeed, he made an important speech this week on that very subject.

[Vernon Coaker (Gedling) (Lab)]

Where is he?

[Mr Gauke]

I am sure the Secretary of State will enjoy reading this debate in Hansard. I do not think that a good test of a Secretary of State is whether they read the debate in Hansard or whether they sit mute during the course of a three-hour debate.

The Government have established a joint ministerial working group on rebalancing the Northern Ireland economy, consisting of Ministers of the UK Government and the Northern Ireland Executive, to consider issues raised by the consultation. We are committed to working with the Northern Ireland Executive to promote a more sustainable, private-sector led recovery in Northern Ireland. Of course, the issue of corporation tax is a key consideration when it comes to supporting private sector growth.

Analysis in the “Rebalancing the Northern Ireland Economy” consultation document shows that reducing the corporation tax rate in Northern Ireland has the potential to increase investment there. Furthermore, devolving any tax rate varying power must satisfy the Azores criteria, as a number of hon. Members pointed out. The Azores criteria are in the European Court of Justice judgment on Commission v. Portugal, which set out the conditions that need to be met to be compliant with EU law and, as noted in the Government’s consultation paper, it is expected that Northern Ireland would meet the Azores criteria of institutional, procedural and fiscal autonomy.

However, although strong support has been shown in favour of corporation tax devolution, it has not been unanimous. The process presents its own challenges in the form of administrative burdens on Her Majesty’s Revenue and Customs and businesses to ensure compliance. Designing a devolved regime is likely to be difficult and it will take time and involve extensive consultation with business. Bespoke rules are likely to be needed to cover a range of situations and forms of income, as well as a series of transitional rules. Furthermore, there are significant challenges in estimating the impact of corporation tax devolution on revenue, a point raised by a number of hon. Members, including the Chair of the Select Committee.

One issue with estimating total corporation tax revenue in Northern Ireland is that the only geographical data that companies currently provide is the address of the country where they are registered, which may have no relationship to where their activity is undertaken. My hon. Friend the Member for Tewkesbury raised that point both this afternoon and in the Select Committee’s report, questioning why HMRC and the Treasury do not have the figures. An accurate system would depend on companies operating in Northern Ireland supplying apportioned data on profits, losses, expenses and allowances. For some, that would be simple; for others it could be costly and administratively burdensome. At present, there is no need—indeed, no point—for them to do so. That is why the numbers are estimates, rather than based precisely on what profits can be attributed to Northern Ireland.

Further costs associated with a reduction in corporation tax rates for Northern Ireland include the behavioural effects that could arise from a difference in corporation tax rates between Northern Ireland and the rest of the UK; for instance, through profit shifting, where companies artificially manipulate transactions so that their taxable profits arise in low tax jurisdictions, or tax motivated incorporations, meaning that companies adopt incorporated status to reduce their tax liability. The impact of those behaviours has the potential to be significant. “Rebalancing the Northern Ireland Economy”, states that indirect tax effects could be considered when calculating the adjustment to the block grant, as long as doing so complied with the Azores criteria and the UK fiscal framework; the hon. Member for North Antrim (Ian Paisley) raised that specific point. As the report recognises, designing an appropriate mechanism presents a number of significant challenges, and considerable work is needed to consider the issues involved.

The Government agree that further work is required for forecasting the potential costs of implementing a reduction in the rate of corporation tax in Northern Ireland and the type of systems that could be introduced to allow it to be monitored. Possible mechanisms will be looked at by the working group that was set up by the UK Government and the Northern Ireland Executive. However, no decision has been taken on whether to allow such effects to be taken into account in the event that corporation tax is devolved and the rate reduced. The working group had a meeting in December and there is another meeting next Wednesday, 7 March. I look forward to seeing the Finance Minister once again at that meeting, and I hope we can make progress on working together to assess the costs in this area.

Several responses to the consultation pointed out that devolution of corporation tax responsibilities could pose risks to relatively deprived regions elsewhere in the UK. The Government will need to consider that before taking a decision on whether to devolve corporation tax powers to the Northern Ireland Assembly. For instance, the issue of how a lower Northern Ireland rate might be ring-fenced in a manner that balances protection from avoidance or manipulation against burdens on companies will be considered further as part of the work plan. Here, as in the other devolved Administrations, the Government are seeking to strike a balance. We want to ensure the empowerment of all devolved institutions. At the same time, however, we must maintain the success of the shared economy on which all countries of the UK depend. We need to ensure that any proposals support the competitiveness of the UK by maintaining incentives for businesses to trade, invest and be headquartered in the UK, while not imposing unreasonable burdens on them.

Air passenger duty was raised by a number of hon. Members. Last summer, the Northern Ireland Affairs Committee report into air passenger duty highlighted the unique geographical position of Northern Ireland, which of course shares a land border with the Republic of Ireland. It went on to note the serious effects of competition from substantially lower rates of duty in the Republic of Ireland, which threatened the viability of direct services between Belfast and the United States in particular. As the Committee observed, direct long-haul flights make an important contribution to the Northern Ireland economy, supporting trade and tourism.

The Government agree that direct long-haul services are vital to the future prosperity of Northern Ireland. In September, we took the decision to announce a cut in APD for direct long-haul flights from Northern Ireland. That change took effect from 1 November 2011. We have also reflected on the views expressed during the APD consultation, which ran until December last year. The Government of Northern Ireland are very clear in their desire for aspects of APD to be devolved, to provide a lasting solution to the unique challenges they face. In a direct response to that request, and in the unique circumstances that apply to Northern Ireland, on 21 February 2012, the Government announced that the power to set APD rates for direct long-haul flights departing from Northern Ireland will be devolved to the Northern Ireland Assembly, under the 2012 Finance Bill.

Additional points were made about scrapping APD on domestic flights. We have to bear in mind that we have a very big deficit. We have to be careful about reducing taxes. If we reduced or scrapped APD in such circumstances, it is difficult to see how it could apply for Northern Ireland only, and one has to take into account the overall cost. The Government response on APD is very clear. Devolution will allow the Northern Ireland Assembly to protect the crucial air link to the US, and offer a real chance for new long-haul services, which will support both business and tourism in Northern Ireland.

On other tax measures, in addition to corporation tax and APD, the Government will continue to consider the feasibility, legal constraints, potential timetable and impacts of other tax options. They include capital allowances, R and D tax credits and an employers’ national insurance holiday, all of which received support from some respondents to the consultation. Several suggestions were made about the administration of individual measures, which the Treasury and HMRC will consider alongside other submissions on those policy areas. The joint ministerial working group programme will also consider those alternative tax measures alongside its main focus on corporation tax.

Specific measures were referred to in the debate. On the aggregates levy, there are ongoing discussions with the Commission. We expect a European Court of Justice judgment later this month, but I assure hon. Members that the Government remain committed to finding a solution.

The carbon price floor is a UK issue, but I know that there are particular concerns in Northern Ireland. The Economic Secretary is working on those matters, including in the context of Northern Ireland. We heard a point about VAT—about targeted reductions for tourism, home renovations and so on. Both of those, if applied nationally—or, indeed, a general cut—would be very expensive. As has to be explained from time to time to the official Opposition, it would result in more borrowing, which the Government do not wish to see.

The Government have introduced a number of UK-wide measures that have benefited Northern Ireland. They include cuts in the headline rates of corporation tax, increases in the employers national insurance contribution thresholds, and increased R and D tax credits for small and medium-sized enterprises, as well as reforming the enterprise investment scheme and the venture capital trusts scheme to help provide access to finance. On the point about access to finance, we will say more in the Budget in a few weeks’ time, but I hear the comments made by a number of hon. Members.

I appreciate that we are running out of time. I have not been able to address every point that has been raised during the debate, but I stress that it is vital that the Westminster Government and the Northern Ireland Executive continue to work together to restore the entire UK economy to prosperity.

Oral Answers to Questions

Lord Coaker Excerpts

Tuesday 6th September 2011 Commons Chamber

[Mr Osborne]

My right hon. Friend is, of course, right that the British banking system has had its challenges—not least over the summer, with its share prices. We are in regular discussion with the banks about that, of course, and we will of course have many discussions about the future structure of banking. We need a profitable banking sector that lends to the real economy. We have in place targets to see an increase in lending to small businesses. But my right hon. Friend is absolutely right that a key part of the recovery is a return to health for the financial services industry and the financial system.

[Vernon Coaker (Gedling) (Lab)]

2. What assessment he has made of the effects on the economy of recent trends in domestic energy prices.

[The Economic Secretary to the Treasury (Justine Greening)]

The Office for Budget Responsibility is now responsible for independent economic and fiscal forecasts for the Government, and that includes taking account of trends in energy prices and their impact on the economy, including on inflation. The OBR will publish a fully updated forecast in the autumn.

[Vernon Coaker]

Thousands of people in my constituency of Gedling and millions across the country will be disappointed by that response from the Minister. Consumer Focus has said that, on average, energy bills will go up by £200 a year, which means that this winter many people —pensioners and families—will be worried about switching on gas and electricity. Has the Minister met the energy companies to discuss that, and will she specifically outline some measures that she and her Government intend to take so that people are not afraid to switch on the heating this winter?

[Justine Greening]

The hon. Gentleman is right to raise the issue because it is important. The challenge that we all face is to make sure that energy bills are affordable not just this winter—the point that he makes—but in winters in 10 and 20 years’ time. The problem that we have as a country is our dependency on fossil fuels. In the long term, we need to get ourselves off that dependency so that we are not so blown about by the international winds that see commodity prices go up and down. In the short term, we are taking steps to support the most vulnerable through the Warm Homes discount. Next year, we will introduce the green deal to help energy efficiency. The hon. Gentleman asks whether we have meetings with energy companies, and of course we do every day. I am sure that he will also—

--- Later in debate ---

[Mr Osborne]

Yes, I am happy with the performance of the OBR, because we have created a new institution in Britain that produces independent fiscal and economic forecasts. The absolutely astonishing revelation of the former Chancellor’s memoirs was how—[Interruption.] Let me tell Labour Members this: that book has not even been published yet, but they will be hearing a lot more about it in the months ahead, because it reveals the truth, not just about the last Government but about how the current shadow Chancellor operated in the last Government—the poisoned politics, the paralysed Government and the lack of a credible economic policy.

[Vernon Coaker (Gedling) (Lab)]

T5. Thousands of working-age households in my constituency and millions across the country are set to lose up to 20% of their council tax benefit from April 2013. What assessment has the Chancellor made of the impact of that policy on incentives to work?

[Mr Osborne]

We published our impact assessments at the time of the spending review, and, like other savings in the welfare budget, the policy the hon. Gentleman mentions is designed to deal with a welfare budget that was completely out of control. Just a few weeks ago, the Opposition said they were going to come forward with a credible medium-term deficit reduction plan. Well, where is it? Every single measure we have put forward, they have opposed.

Oral Answers to Questions

Lord Coaker Excerpts

Tuesday 10th May 2011 Commons Chamber

[The Chief Secretary to the Treasury (Danny Alexander)]

I am grateful to my hon. Friend for his question, which raises a very important issue. It is a key part of the Treasury’s engagement with this to make sure that the process for authorising GP consortia ensures that those organisations are fully financially capable, as well as clinically capable, of meeting their objectives before they are authorised on whatever timescale.

[Vernon Coaker (Gedling) (Lab)]

T7. Does the Chancellor recall his statement to the House in October, when he said:“I completely understand the public’s anger that the banks…should now be contemplating paying high bonuses”?—[Official Report, 20 October 2010; Vol. 516, c. 955.]It is all very well being angry about that, but why do the banks continue to pay high bonuses to their high-ranking directors and why does he not do something about it? Why does he not repeat Labour’s bank bonus tax and reinvest the money in jobs, housing and many other things that the people of this country want?

[Mr Osborne]

Bank bonuses were higher when the hon. Gentleman was a Minister. There is complete amnesia among the Opposition about their having presided over the collapse of the British banking system and over bonuses that were billions of pounds higher in total than those being paid today, and they have no ideas about how to reform the banking system. The Chancellor who introduced the bank bonus tax to which the hon. Gentleman refers said that it would not work again. We have introduced a permanent bank levy which, I think, the Labour party continues to oppose.

Oral Answers to Questions

Lord Coaker Excerpts

Tuesday 22nd March 2011 Commons Chamber

[Albert Owen (Ynys Môn) (Lab)]

3. If he will estimate the revenue to the Exchequer attributable to receipts from the increase in the standard rate of value added tax on road fuel.

[Vernon Coaker (Gedling) (Lab)]

5. If he will estimate the revenue to the Exchequer attributable to receipts from the increase in the standard rate of value added tax on road fuel.

--- Later in debate ---

[Justine Greening]

I welcome the hon. Gentleman’s concern for motorists. However, I note that when the VAT rise passed through Parliament on 13 July 2010, he did not vote against it. I assure him that the Government are looking at what we can do to support motorists, hauliers and businesses with the cost of fuel, but I have to say that his party’s proposal on VAT is illegal, unworkable and unfunded.

[Vernon Coaker]

Does the Minister agree with the Transport Secretary—who, on the “Daily Politics” show on 2 March, dismissed the rise in VAT as a spurious argument—or does she agree with my constituents that by adding £1.35 to the cost of filling up a 50-litre tank with fuel, the VAT rise is the wrong tax at the wrong time?

[Justine Greening]

Perhaps the hon. Gentleman should talk to his former Prime Minister, Tony Blair, or the right hon. Member for Edinburgh South West (Mr Darling), the former Chancellor, who both said that our decision to raise VAT was necessary to tackle the huge deficit that was left by his party. Again, if he is so concerned about the VAT rise, how come he did not vote against it last July?

Oral Answers to Questions

Lord Coaker Excerpts

Tuesday 8th February 2011 Commons Chamber

[Mr Gauke]

I will happily meet my hon. Friend to discuss it. The VAT that is paid and the VAT that is recovered is taken into account in the funding of the NHS. There are difficulties in trying to resolve this issue without imposing an impractical and complex solution. That is why the focus tends to be on providing tax relief on charitable giving rather than on expenditure incurred by charities.

[Vernon Coaker (Gedling) (Lab)]

7. What objectives he has set for the outcome of his discussions to limit the bonuses paid to bankers.

[Rosie Cooper (West Lancashire) (Lab)]

13. What objectives he has set for the outcome of his discussions to limit the bonuses paid to bankers.

--- Later in debate ---

[The Financial Secretary to the Treasury (Mr Mark Hoban)]

Our objective in these discussions is to create a banking industry that lends to the British economy, contributes to the Exchequer, and supports economic growth and employment. The Government are in discussions with the banks to see if a new settlement can be reached so that bonuses and remuneration policies are more transparent and levels of bonuses paid are smaller than they would otherwise have been. Alongside this, we are looking at options to ensure that banks make an appropriate contribution to local economies and communities and provide the credit required to support the economic recovery, facilitate growth and create jobs.

[Vernon Coaker]

Can the Minister tell the House why the Chancellor refuses to adopt Labour’s plan to repeat last year’s £3.5 billion bank bonus tax, as well as the bank levy, and use that money to help create the jobs and growth that so many of our communities badly need?

[Mr Hoban]

The hon. Gentleman should remember the words of the former Chancellor of the Exchequer, who said that the bank payroll tax did not work. Labour Members went into the last election ruling out a bank levy; they would not take the action that we have taken to ensure that banks pay a fair contribution to the costs they pose to the economy.

Finance Bill

Lord Coaker Excerpts

Monday 12th July 2010 Commons Chamber

[Chris Leslie]

I am interested in the hon. Lady’s arguments. She is saying that it would be wrong for the banks to receive a corporation tax cut—that is an important concession—but that it is all right because they are paying the banking levy. As I reckon it, that puts them right back to the standstill that they were at in the first place. In other words, they would not be paying any more and there would be no reparations, as I see it, for the public at large. They would simply be standing still. It beggars belief that the Government, having talked tough before the election, are now going to give a free ride to the banks and offset some of the costs of the banking levy.

The hon. Lady mentioned earlier that there is, of course, the Government’s independent commission on banking. I understand that the Secretary of State for Business, Innovation and Skills is a promoter of it and I would be interested to hear his views on whether we should give a corporation tax cut to the banks. He has gone from saint to axeman in a matter of weeks, but it is the impact on public services that we are worried about most of all.

As I was saying, it is the unfairness of this measure that strikes home most of all. People who are in a comfortable position are lecturing the world about the cuts to our public services that are needed. What really sticks in the craw is the statement, “We are all in it together”, which hon. Members will have heard. Well, that is not the case for the banks. They are not in it with the rest of us.

It reminds me a little of the polite and well-spoken cat-burglar who sneaks in to one’s home as a thief in the night and tries to purloin all sorts of goods and chattels but, when caught red-handed, explains, “No, I’m not stealing from you. I’m just rearranging the furniture and decluttering the house.” It is a grab of the worst possible kind—a grab on the public services on which the poorest in our community rely. The revenue from this measure and from reducing the corporation tax on the banks is needed by our vital public services. I hope that the Treasury will take the amendment seriously. The banks have not earned the right to this windfall. They do not deserve it and I commend the amendment to the Committee.

[Vernon Coaker (Gedling) (Lab)]

On a point of order, Mr Amess. Has the Secretary of State for Education given you any indication that he wishes to come to the Chamber to explain some of the errors that have already come to light in his fifth list? Additionally, during questions this afternoon, the Secretary of State claimed that one individual had received more than £1 million in consultancy fees. The Department for Education has now admitted that that was £1.35 million of consultancy fees paid to KPMG as a whole over three years. Do you not think that the Secretary of State should be coming to this Chamber and have you had any word from him that he wishes to do so?

[The Temporary Chair]

I have listened very carefully to what the hon. Gentleman has said, but I am afraid that the point of order is of no relevance to the Committee stage of the Finance Bill.