Amendment of the Law

Debate between Andrew Gwynne and Danny Alexander

Monday 23rd March 2015 Commons Chamber

[Danny Alexander]

It really is not that confusing. Even the shadow Chief Secretary ought to understand that two different parties in a coalition Government will have different views about the future direction of policy in this country. I would say—[Interruption.] If the hecklers would silence themselves, I would say that Labour signed up to £30 billion of deficit reduction in the first three years of the next Parliament when they voted for the charter for budget responsibility. I am sure you remember the occasion, Mr Speaker. It was an important debate in the House, and one to which the country should be paying great attention. It is fair to say that all parties in the House have different views about how to achieve that £30 billion of cuts, and I set out my view to the House on Thursday.

[Andrew Gwynne]

Tell us!

[Danny Alexander]

If the hon. Member for Denton and Reddish (Andrew Gwynne) had not been cavorting so loudly, the shadow Chief Secretary might have been able to listen to my speech on that occasion.

Fiscal Responsibility and Fairness

Debate between Andrew Gwynne and Danny Alexander

Thursday 19th March 2015 Commons Chamber

[Danny Alexander]

Labour Members may not like it, Mr Speaker, but I am setting out the numbers in the Treasury document published today, which is an entirely legitimate thing to do.

This will also allow us to reward the hard-working public servants whose pay restraint has helped so much to balance the books. Public servants have made big sacrifices, and we need to repay that.

No Chief Secretary has ever had to control public spending in the way that I have, and no Chief Secretary should ever have to do so again. But this scenario proves that there is no need to shrink the state in the way that some in this House propose. The recovery secured, the fiscal mandate met, national debt down, public finances that have turned the corner, a stronger economy and a fairer society, and a better future for the United Kingdom: that is what these plans deliver.

However, fairness is not simply embodied by the numbers on a spreadsheet; it is also about the actions that we take. Nothing makes people more angry than the sight of some refusing to pay the tax that they owe. Last month I committed to ensuring that any individual or company that facilitates tax evasion would face stronger criminal penalties and financial sanctions. Today we deliver on that commitment by publishing a substantial package of next steps in the clampdown on these immoral and illegal practices. We inherited—[Interruption.] If the hon. Member for Denton and Reddish (Andrew Gwynne) would simply listen to what is being said instead of ranting like a lunatic, he would hear the measures that the Government are taking to clamp down on tax evasion.

We inherited from the previous Government a tax system that had more holes than a Swiss cheese and was more complex than a Rubik’s cube. The opportunities for those who wish to get away without paying were many and varied.

[Andrew Gwynne (Denton and Reddish) (Lab)]

Which page of the Budget is this on?

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 10th March 2015 Commons Chamber

[Danny Alexander]

I know that discussions have been ongoing, and that the issue has been the subject of a protracted dispute. I have no further updates, but I will ensure that my ministerial colleague who is responsible for the scheme writes to the hon. Lady.

[Andrew Gwynne (Denton and Reddish) (Lab)]

5. What recent representations he has received on fiscal steps to address funding pressures in the NHS.

[Danny Alexander]

The Government have protected the health budget in real terms throughout the current Parliament. Of course a strong national health service needs a strong economy, and the Government plan to deliver that strong economy, along with a fairer society. The NHS budget has already increased by £12.7 billion during this Parliament, and in the autumn statement we announced an additional £2 billion for front-line NHS services. That money is intended to meet demand pressures in the next financial year, and also to help to start the process of transformation that was outlined in the “Five Year Forward View”, which is probably the most important representation that I have received on NHS funding in the last year or so.

[Andrew Gwynne]

Hospitals have struggled to cope with the pressures during the winter. Labour has made a fully funded commitment to provide the extra doctors, nurses, home care workers and midwives who are needed through a “time to care” fund. Analysis of Conservative party spending plans shows that more than 260,000 elderly people risk losing their social care packages during the next Parliament. Is it not time for the Government to commit themselves to taxing hedge funds and tobacco companies in order to raise the extra resources that our NHS so desperately needs?

[Danny Alexander]

Let me gently say to the hon. Gentleman that he ought to be a wee bit cautious about believing too many of his Front Benchers’ spending plans. They say that they want to deal with the deficit but have set out no plans to do so, and they have made multiple spending commitments without any sense of how those commitments will accord with their fiscal strategy.

The hon. Gentleman is, of course, right to suggest that going too far and reducing the deficit reduction by more than is necessary in the next Parliament would have a damaging effect on public services. I would say that his party has got it wrong and the Conservative party has got it wrong, but the Liberal Democrats have got it right.

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 11th March 2014 Commons Chamber

[Danny Alexander]

I totally agree with my hon. Friend. The Labour party does not seem to understand that Governments do not create jobs and growth; it is hard-working businesses and hard-working people in this country who do that. That is why so much of our policy on tax, regulation, infrastructure investment and skills is devoted to ensuring that this country has the best environment for businesses to invest and create jobs. That is the only way our economy will recover sustainably.

[Andrew Gwynne (Denton and Reddish) (Lab)]

The Chief Secretary’s tax threshold boasts would carry more weight if he had not broken his VAT promises at the last general election. Does he agree with the Treasury’s own figures which show that an average family now pay more than £1,350 extra in VAT since he put it up?

[Danny Alexander]

I agree with the figures that show that the mess the hon. Gentleman’s party made of the economy cost every household in this country £3,000. That is something he should be ashamed of and for which he should apologise.

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 10th December 2013 Commons Chamber

[Andrew Gwynne (Denton and Reddish) (Lab)]

The Chief Secretary might like to reflect on the very poor answer he gave my right hon. Friend the Member for Wentworth and Dearne (John Healey) earlier, because I have in front of me Office for National Statistics Table 1A, which clearly shows that infrastructure construction output to September 2013 has fallen by 15%. What went wrong, or is he seriously disagreeing with the Office for National Statistics?

[Danny Alexander]

What this—[Interruption.] The hon. Member for Islwyn (Chris Evans) should pipe down. What this Government recognise is that infrastructure relies on both public and private sector investment. The Labour party seems to have forgotten that the private sector is involved in delivering infrastructure. Total infrastructure investment in this country is higher in this Parliament than it was in the last.

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 14th May 2013 Commons Chamber

[Danny Alexander]

I welcome those figures. They suggest that the policies being pursued by this Government are having the desired effect.

[Andrew Gwynne (Denton and Reddish) (Lab)]

Q2. What assessment he has made of the effect of current fiscal policy on the level of youth unemployment.

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

The UK labour market is showing signs of recovery. More people are in work than under any previous Government.

[Andrew Gwynne]

The Chief Secretary says the economy is healing but he should take more seriously the fact that youth unemployment is growing again, with nearly 1 million young people unemployed for the last year. Will he explain why, in the past year, youth unemployment has grown by a staggering 355% since the Work programme was introduced? Is that not disgraceful? Should not the Government prioritise a compulsory jobs guarantee paid for from a bank bonus tax?

[Danny Alexander]

In this matter, a wee bit of humility from the Labour party would not go amiss, on the basis that youth unemployment has been a persistent problem in this country for many years—youth unemployment has been rising since 2003 or 2004. I note that, in the hon. Gentleman’s constituency between December 2010 and December 2012, youth unemployment fell by 11.8%. Through measures such as the Youth Contract and the Work programme, we are deploying considerable support for the task that he and I agree on, which is getting more young people into work.

The Economy

Debate between Andrew Gwynne and Danny Alexander

Tuesday 11th December 2012 Commons Chamber

[Danny Alexander]

No, I do not agree with the hon. Lady’s analysis.

There are still savings to be made in day-to-day administration costs. I am confident that the civil service can continue to produce more for less and provide excellent value for money to the public.

The welfare system makes up more than £200 billion of public spending and cannot be immune from the effort to deal with the deficit. As a result of the financial pressures that we are facing, we have had to take the difficult decision that we can uprate working-age benefits by only 1% in the coming three years. That figure represents a rise each year, but it will be below the rate of inflation. It is not as high as some may have expected, but it is what the country can afford. That is a tough choice, but an even-handed one, and it avoids some of the more punitive proposals that have been floated in recent months.

Most benefit claimants would love to work and are trying their best to find a job. However, we need to recognise that in-work incomes have risen at half the rate of benefits since the financial crisis. Those who are in work will be better off thanks to our income tax cuts. When we are increasing public sector pay by only 1%, it would simply not be fair to increase the benefits of those who are out of work at a higher rate than those we employ to work for us.

Even while making those cuts, we have taken steps to protect those who are most in need. That is why disability living allowance and other benefits specifically for the most disabled and their carers will continue to increase in line with inflation. It is also why the basic state pension will increase by 2.5% next April, which is higher than either earnings or prices, honouring our commitment to the triple lock. The application of the triple lock means that there will be a better rise in the basic state pension than pensioners have seen before. Pensioners will see a cash increase of £2.70 a week in the basic state pension in 2013-14.

While we are protecting those in need, it is only right that we ask the most from those who earn the most. That is why the higher rate threshold for personal income tax will also be uprated by only 1% in 2014-15 and 2015-16. It is also why the annual allowance for pensions tax relief will be reduced from £50,000 to £40,000, and the lifetime allowance from £1.5 million to £1.25 million. That will raise more than £1 billion a year by the end of the period and is something for which I, for one, have argued for quite some time. The savings from Whitehall, welfare and the wealthy, and the targeted tax rises, are helping to cut the deficit in the medium term and to boost growth now.

Our capital spending plan will see £5 billion switched from current spending to investment in infrastructure, providing a better connected UK on roads, on rails and online. We will provide £350 million for the regional growth fund, enabling it to continue its success in creating jobs throughout the country. We are rolling out rural broadband across the country and have announced £50 million for the second wave of super-connected cities across the UK from Portsmouth to Perth, via Newport and Northern Ireland.

We have announced funding for a number of road building and maintenance projects. We will be dualling the A30 in Cornwall—an improvement that has long been campaigned for, not least by my hon. Friend the Member for North Cornwall (Dan Rogerson), who is in his place. I congratulate him on his efforts. We will also bring the A1 up to motorway standard all the way to Newcastle. I have been made aware of the need to improve that road north of Newcastle, not least by my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith), and have asked my right hon. Friend the Secretary of State for Transport to work up plans for potential improvements north of Newcastle.

The capital projects will not only create jobs in the short term, but crucially will raise the quality of the country’s infrastructure and our growth potential in the medium term. Labour Members may be interested to know that during the previous Government’s time in office, we fell from eighth to 33rd in the global league table for the quality of infrastructure. That is not good enough and is why John Cridland of the CBI said last week that it is

“absolutely right to shift the focus from current to capital spending to boost jobs today and the UK’s competitiveness tomorrow.”

As colleagues will know, our plans will mean that as a share of the economy, the investment that the Government are putting forward in this Parliament is greater than the average over Labour’s period in office. These investments, not just in roads, but in schools, colleges and flood defences, can only serve to help our businesses in the future.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I am pleased by the Chief Secretary’s recent conversion to investing in capital projects, such as building new schools. Now is perhaps an opportune time for him to apologise to the schools in my constituency that had their Building Schools for the Future funding taken away. Can they expect it back?

[Danny Alexander]

I have not had a recent conversion to capital expenditure. The hon. Gentleman will remember that in the spending review in 2010, we committed over £2 billion a year more to capital expenditure than had been set out in the previous Government’s plans. In the autumn statement last year we added £5 billion and in this year’s autumn statement we added another £5 billion for a range of projects. I hope that he will recognise that the Building Schools for the Future programme was expensive and bureaucratic. The proposals that have been brought forward by the Department for Education are a better and more cost-effective way to meet at least some of the needs in the school system in this country.

Public Service Pensions Bill

Debate between Andrew Gwynne and Danny Alexander

Monday 29th October 2012 Commons Chamber

[Danny Alexander]

I agree with that, and I would add that, frankly, these reforms could have been made in the 1980s or 1990s, as well as the 2000s. In fact, we have to go back quite a few decades to find the root of the problems we are having to tackle in this Bill, which I think we are doing very effectively.

The remainder of the £430 billion of savings are generated by the Government’s decisions to change their policy on the indexation of pensions and payments from the retail prices index to the consumer prices index, and, as has been mentioned, to increase the contributions that public servants pay towards their pensions, rebalancing the costs more fairly between them and other taxpayers. The combined effect of those changes will help to restore the health of the British economy, reduce the size of our deficit and correct the unsustainable 40% increase in costs there has been over the last 50 years.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I am grateful to the Chief Secretary for giving way. Does he recognise that the Government have to be careful and approach this issue in a much more balanced manner? There is a danger that if more people opt out of occupational pensions because they find them unaffordable, that could end up costing the Treasury more in the long run through means-tested benefits.

[Danny Alexander]

I would say that we have handled this process in a balanced and sensitive way throughout, in recognition of the fact that the changes affect millions of public service workers. In response to the hon. Gentleman’s concern, which was raised a number of times in the talks, I would say that none of us wants to see increased opt-outs from pensions, for the reasons that have been mentioned on both sides of the House. We have put in place a process for reviewing the next stage of the contribution increase in the light of opt-out data from the first year. I am sure he will be pleased to hear that there is no evidence of increased opting out in response to this year’s increase in contributions. However, we will review the matter again next year before proceeding with the third phase of the increases, so he makes a serious and important point.

The reforms treat not only the symptoms of delayed reform but the underlying problem. Therefore, they are forecast to reduce the cost of providing public service pensions by around 40% over the next 50 years, returning costs to their historic long-term average. Clause 9 deals with the principal risk that needs to be managed if pensions are to be affordable and sustainable: longevity. Longevity has improved significantly over recent decades, which is a very good thing. As a result, the state pension age has increased. The Government are therefore asking public service workers in due course also to retire later. In a society where we are all living longer and where fellow citizens in the private sector are expected to retire later, it is both fair and right that the public sector retirement age should rise with the state pension age. As Lord Hutton says, improvements have continuously been underestimated in the past, which has led to the cost of providing pensions rising significantly over recent decades. As such, clause 9 provides that in future the normal retirement age in the public schemes will be set at the state pension age. As Lord Hutton identified, this change will move the proportion of adult life in retirement for public service pension scheme members back to where it was in the 1980s. More important, by linking the scheme retirement age to the state retirement age, we will ensure that further improvements in longevity are tracked. That is the main way in which the Bill will ensure that the cost of public service pensions cannot again spiral out of control, but will remain affordable and sustainable long into the future.

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 26th June 2012 Commons Chamber

[Andrew Gwynne (Denton and Reddish) (Lab)]

6. What assessment he has made of the performance of the economy in the last 18 months.

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

As the Office for Budget Responsibility made clear last autumn, Britain’s recovery has faced strong headwinds from the euro area, high oil prices and the impact of the financial crisis being deeper than previously thought. Our actions to reduce the deficit and rebuild the economy have secured stability and kept interest rates near record lows, benefiting families, businesses and taxpayers, although, of course, considerable external risks remain.

[Andrew Gwynne]

That just does not wash, because by May 2010 the British economy was growing, whereas since the Government’s emergency Budget of June 2010 the economy has at best flatlined and at worst dropped back into recession. Why does the right hon. Gentleman think that is?

[Danny Alexander]

By May 2010, the hon. Gentleman’s Labour Government had put in place plans to increase fuel duty by above the rate of inflation each and every year of this Parliament. He should be welcoming the fact that we are taking steps to support hard-pressed families and hard-pressed consumers across the country in the very difficult economic circumstances that we face.

Oral Answers to Questions

Debate between Andrew Gwynne and Danny Alexander

Tuesday 1st November 2011 Commons Chamber

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

I do agree with my hon. Friend. We will set out more details of our credit easing plan in the autumn statement later this month, but it is a mark of the Government that we are prepared to think differently and intelligently about how we can use such mechanisms precisely to get small businesses going in this country.

[Andrew Gwynne (Denton and Reddish) (Lab)]

T9. Youth unemployment now stands at a shocking 34% in Tameside and 23% in Stockport. Is not the right thing to do to listen to Labour’s five-point jobs plan, get the bank bonus tax reinstated and invest in 100,000 jobs for young people?