Oral Answers to Questions

Edward Miliband Excerpts

Wednesday 15th January 2014 Commons Chamber

[The Prime Minister]

My hon. Friend is absolutely right: investing in infrastructure is a key part of our long-term economic plan to ensure that Britain’s economy can be a success now and in the future. We have seen major investment in the south-east, with Thameslink, Crossrail and East West Rail all delivering new services for London and the south-east. I can also tell my hon. Friend that, between 2015 and 2020, we are planning to invest more than £56 billion in roads, rail and local transport. It is important to make the point that that is more than three times as much as the planned investment in HS2, so I say to those who fear that HS2 will take all the investment that it will not. Three times as much will be spent elsewhere.

[Edward Miliband (Doncaster North) (Lab)]

RBS is expected to ask the Government to approve bonuses of more than 100% on multi-million pound salaries. Does the Prime Minister think that that is acceptable?

[The Prime Minister]

What I can tell the right hon. Gentleman is that we will continue with our plans for RBS that have seen bonuses come down by 85% and a bonus pool at one third the level it was under Labour. I can confirm today that, just as we have had limits on cash bonuses of £2,000 at RBS this year and last year, we will do the same next year as well.

[Edward Miliband]

We can all agree with the general sentiments that the right hon. Gentleman expresses about bonuses, but today I am asking him a very specific question. RBS is talking to parts of the Government about the proposal to pay over 100% bonuses. He is the Prime Minister, the taxpayer will foot the bill, so will he put a stop to it right now by telling RBS to drop this idea?

[The Prime Minister]

I will tell the right hon. Gentleman exactly what we are saying to RBS: if there are any proposals to increase the overall pay—that is, the pay and bonus bill—at RBS, at the investment bank, we will veto them. What a pity that the previous Government never took an approach like that. [Interruption.]

[Mr Speaker]

Order. However long it takes, the questions will be heard and the answers will be heard.

[Edward Miliband]

I am not asking about increases in pay and bonuses; I am asking a very simple question about the proposal that is expected to come forward from RBS to pay more than 100% bonuses on pay. We know that when RBS is making a loss, when it itself says that it has been failing small businesses and when these kinds of bonuses lead to risky one-way bets, it should not be allowed to happen. When ordinary families are facing a cost of living crisis, surely the right hon. Gentleman can say that for people earning £1 million a bonus of £1 million should be quite enough.

[The Prime Minister]

If the right hon. Gentleman is not asking me about the overall pay and bonuses at RBS, why on earth isn’t he? That is what he should be asking about. I have said very clearly that the remuneration—the total pay bill—at that investment bank must come down. I am getting a lecture from him, yet from his Government we had the biggest bust anywhere in the world with RBS, 125% mortgages at Northern Rock and all the embarrassment about Fred Goodwin. He comes here every week to complain about a problem created by the Labour party—last week it was betting, this week it is banking. He rises up with all the moral authority of Rev. Flowers, but where is the apology for the mess they made of RBS in the first place?

--- Later in debate ---

[The Prime Minister]

My hon. Friend is absolutely right. We are seeing an enterprise revolution in our country again. There are 400,000 more businesses in existence today compared with 2010. The point he makes about small businesses and exports is particularly important. Currently, one in five of them exports. If we could turn that into one in four, we would wipe out our trade deficit. I absolutely support the excellent work that he does to call UKTI to account and to encourage it to do everything it can to back Britain’s entrepreneurs.

[Edward Miliband]

There are sites all over the country with planning permission that have the capacity for a quarter of a million—sorry, 250,000—houses where nothing is happening, some of which are being hoarded by developers. I am in favour of giving powers to say to developers who hold land without building on it, “Use it or lose it.” The Prime Minister said the policy was nuts. Does he still believe that?

[The Prime Minister]

We have just had a demonstration of the grasp of maths that was involved at the Treasury. It is no wonder that we had banks collapsing and all the rest of it.

House building is picking up: we are seeing a big increase in housing starts and housing completions. Why I think the right hon. Gentleman’s policy is, as he kindly puts it, “nuts” is that if we say to developers and companies that we will confiscate land unless they build, they will not go ahead with the building in the first place. His approach is to put a freeze on the whole of development, rather than to get Britain building, which is what we need to happen.

[Edward Miliband]

I have to say that the Prime Minister is incredibly complacent. House completions are at their lowest level since 1924. I am interested in what he says about the policy, because his own Housing Minister has said that the policy might make a contribution, and the Mayor of London says:

“We should be able to have a use it or lose it clause…Developers should be under no illusions that they can just sit on their land and wait for prices to go up.”

So is the policy nuts or is it the right thing to do?

[The Prime Minister]

What we need to keep going with are the policies of this Government, which are seeing house building increase. I know that the right hon. Gentleman does not like the facts, but nearly 400,000 new homes have been delivered since 2010, housing starts in the last quarter were at their highest level for five years—89% higher than the trough in 2009 when he was sitting in the Cabinet—and there has been a 16% increase in housing starts over the past 12 months compared with the year before. His shadow Ministers go around opposing our planning reforms, even though they are important to get Britain building, and time and again they criticise proposals such as Help to Buy that are helping our fellow countrymen and women to realise the dream of home ownership, so here is a question that he needs to answer: if he cares about house building and home ownership, why not make Labour councils get on with selling council houses to hard-working people?

[Edward Miliband]

In Labour councils, they are building far more houses than in Tory councils. Frankly, I am still no clearer at the end of this exchange what the Prime Minister thinks about the “Use it or lose it” policy. His Housing Minister says that he supports it, the Mayor of London says he supports it, but the Prime Minister does not know what he thinks. Here is the reality: he is not doing enough to close the gap between supply and demand. The truth is that the number of social housing starts is down, he has shelved his plans for new towns and rents are rising. Does he accept that Britain is building 100,000 fewer homes than we need to meet demand?

[The Prime Minister]

Of course we need to build new homes. That is why we have reformed the planning system, which the Opposition opposed; it is why we have Help to Buy, which they oppose; and it is why we are helping in all the ways we are to get Britain building. We are seeing the right hon. Gentleman having to jump around all over the place: when it started off, deficit reduction was not going to work, but now he cannot make that argument; then we needed plan B, but now he cannot make that argument; next it was about the cost of living, but yesterday we saw inflation fall to 2%. What we see is a Government who have a long-term economic plan and an Opposition who do not have a clue.