Amendment of the Law

Harriett Baldwin Excerpts

Monday 26th March 2012 Commons Chamber

[Mr Alistair Darling (Edinburgh South West) (Lab)]

I want to return to the “nascent recovery” in just a moment, but first I should say that I was particularly pleased to hear the Minister refer to a number of successful growth industries including publishing, and in that connection I should draw the House’s attention to the Register of Members’ Financial Interests.

Before turning to the question of growth—or, more accurately, my concern about the lack of it—I want to say a word about the 50p rate of tax, since I introduced it. At the time, I said it was a temporary measure. I did not particularly want to introduce it, but I took the view that, at a time when we were asking many people in this country to share the burden of meeting the increased cost of the downturn, it was right that those who had done well over the previous 10 years or so should bear their fair share of it. I do not have a philosophic attachment to that rate at all, therefore, but this is not a Budget in which I would have returned to the topic, simply because the incomes of many other people in this country are currently being squeezed and they are going to lose out this year. I would have tried to do something about their position first.

The documentation that the Treasury has produced on the measure reminds me of the stuff that was produced for the five tests in respect of the euro, in that so much evidence has been adduced in support of the Government position. Why did they not just say that they philosophically did not want the 50p rate so they were going to cut it? As the OBR says that its calculations are highly uncertain and it is very difficult to estimate behavioural effects, especially after only a year, and given that there are so many uncertainties and there will be so much forestalling, it is difficult for the Government to say, “Look, this wasn’t actually raising anything.” At a time like this, I think the fact that the rate brought in £1 billion and that we are talking about smaller sums in relation to some of the welfare reforms means that the Government cannot simply write it off. If they want to bring the rate down to 45p, that is fine, although I am bound to say that I have never understood the argument that someone will still work harder if the rate comes down to 45%, yet they will also work harder if they are told at the same time that they will be paying five times as much tax in the future. That seems a very odd argument to run.

[Harriett Baldwin (West Worcestershire) (Con)]

I thank the right hon. Gentleman for making these interesting points. Was he as shocked as I was to see that, as a result of the measures that he introduced as Chancellor, there was £16 billion to £18 billion-worth of forestalling in 2009-10?

[Mr Darling]

Inevitably, there is some forestalling and there will be an awful lot more of it this year when people realise that they will pay a lesser tax rate next year. The hon. Lady makes a point, but perhaps not the one she intended.

The real problem we face as a country is the lack of future growth. I am concerned about that, because our borrowing levels are still high. The Chancellor is still having to borrow £150 billion more than he set out to borrow in his first Budget, in 2010, and his room for manoeuvre is very slight. He has given away about £2 billion this year. He says that he is going to get that back in two years’ time, but £1.5 billion of it is coming out of the reserve. That is not normally what we would expect a Chancellor to be doing if he is saying that he is conducting his finances in a prudent manner.

Of course, a lot of what the Chancellor is saying is dependent on cuts still to be specified—he used to criticise us when we did not specify these things. An awful lot more cuts are yet to be implemented and yet to be specified. When the Budget figures show that borrowing will be only £1 billion less than the Government thought, it is easy to see that we are right on the margins at the moment and that, unless we get growth going, the chances are that that borrowing will increase, not decrease. The need to get growth going is paramount.

We are already on plan B, in that what the Chancellor announced in his autumn statement last year was rather different from the course he set out on 12 months earlier. We are also relying heavily now on monetary policy—on quantitative easing and the Bank of England continuing low interest rates—to try to bring about a recovery. I welcome some of the things that the Government have done, but it is sobering to read the OBR analysis that the Budget will have a limited effect on growth. The best it can say is that the cutting of corporation tax will get us 0.1% of growth, which shows how much more the Government have to do.

I do welcome some of the measures the Government announced. Of course we are in favour of the patent box, which we introduced. It is very impressive that GlaxoSmithKline was, within hours, suddenly able to decide that it would open new factories and new production. It is just a pity that some of the new investment will take three or four years, if not longer, to be put in place. I also certainly welcome what was done for the creative industries. The deputy leader of the Labour party, who spoke for us earlier, made the point that I introduced a number of these proposals in 2010. They were rubbished by the coalition in 2011, but they are back again in 2012, and I wholeheartedly support them. I am also glad that the Green investment bank is coming to Edinburgh, and I hope that it will be up and running fairly quickly.

Turning to the other end of the country, the Government’s recognition that they have to look again at airport capacity in the south-east of England is welcome. It is a difficult issue, it is 10 years since we looked at it and we need to get a move on with it. However, a lot of the measures that have been announced are small or will not be implemented for a long time. Public investment is set to drop. I hope that the private sector comes in on infrastructure and so on, but unless we do more we are simply not going to get the investment we need.

Lastly, I wish to discuss the cloud hanging over us all—Europe. At the moment, we have something of a lull, as it has gone out of the headlines, but the problems have not gone away. We should all be grateful for what the European Central Bank has done, as it almost certainly prevented at least one, if not two, banks in continental Europe from getting into trouble earlier this year. However, the deep-seated problems that Spain has, that Italy has and that Greece has have not gone away. I hope that we will use whatever influence we have to try to engage with the eurozone, so that, for once, they get ahead of the game, because until that happens, that situation will hold back our prospects of growth even more.

--- Later in debate ---

[Harriett Baldwin (West Worcestershire) (Con)]

This is a Budget that rewards work from a Government who are making work pay, and I want to express on behalf of the small businesses in Malvern and the surrounding cyber valley in my constituency the enthusiasm that exists for taking advantage of the opportunities for growth and the lower taxation rates for small businesses.

Since today’s debate is the technology debate, I point out that in my constituency we have a growing cyber sector. There is an enormous amount of business growth, and it is estimated that 500,000 jobs will be created in the sector over the next decade. Those jobs are great for young people. There is enormous demand among firms in my constituency for teenagers who may have spent a lot of time in their bedrooms on their computers and have become ethical hackers. People in my constituency with those skills are snapped up by local businesses. Perhaps that is why the number of unfilled jobcentre vacancies in West Worcestershire rose by 70% last month, which shows that there are a lot of businesses with the confidence to take on an additional employee.

As a member of the Select Committee on Work and Pensions, I wish to make a point about the Government’s introduction of universal credit. We have talked a lot in these debates about the top rate of tax, but let us think about the rate that those on the lowest incomes had to pay for 13 years under Labour. Page 95 of the Red Book shows that the marginal deduction rate for a lone parent with one child working more than 10 hours was 100%. We are changing such disincentives to work by moving to universal credit, which will be very powerful in helping those on the lowest incomes into work and out of poverty.

I want to make the rather controversial statement that despite the bad press on behalf of pensioners on Thursdays, this Government have done more to help pensioners and future pensioners than any other Government in history that I can remember. First, there is the triple lock on the state pension, which will increase pensions every year by the higher of inflation, 2.5% or earnings. That is worth an enormous amount to today’s pensioners—no more 75p increases.

[Steve Baker (Wycombe) (Con)]

Did my hon. Friend, like me, hear the shadow Chancellor appearing on the Vine show during the week? The first person who came on after he had spoken was a pensioner, who denounced him and his measures.

[Harriett Baldwin]

My hon. Friend will also have heard in the Budget that we are abolishing the means test, which has been such a disincentive to saving for low-income pensioners, and bringing in a powerful simplification of the state pension. That will be worth much to future pensioners.

The Government are also introducing auto-enrolment, which will bring 5 million additional savers into the occupational pensions market. That is a most important step to strengthen the pensions system, and it has cross-party support.

Most important was what the Budget did not do. It did not make further changes to pension taxation and regulation, such as the amount that people can defer from their salaries to take as future retirement income. That is an important point for the overall stability of the system. Did you know, Mr Deputy Speaker, that under the previous Government it was possible to put £250,000 into your pension fund? That was absolutely extraordinary, and I welcome the fact that this Government have lowered that limit substantially so that pensions provide fewer tax reduction opportunities for those on the highest incomes.

Finally, the Government have taken some difficult decisions on overall pensions policy and made some sensible changes that will stabilise the pensions system and make it more sustainable for the future. This is a Budget that rewards work and is good for business, and I urge all hon. Members to walk through the Lobby this evening to support it.

Budget Leak Inquiry

Harriett Baldwin Excerpts

Thursday 22nd March 2012 Commons Chamber

[Mr Gauke]

I understand concerns about there being a debate before the Budget, but now Opposition Members do not seem to want a debate on Government measures after the Budget. I think we should have that debate.

[Harriett Baldwin (West Worcestershire) (Con)]

Given that the centrepiece of the Chancellor’s Budget yesterday was an increase in the personal tax allowance that gives a tax break to 24 million people on low and middle incomes, and given that that was in the coalition agreement, does the Minister agree that a journalist would not need to be Sherlock Holmes to speculate that that increase would be in the Budget?

Amendment of the Law

Harriett Baldwin Excerpts

Thursday 22nd March 2012 Commons Chamber

[Ed Balls]

I am just coming to the issue of the top rate of tax. The Chancellor tries to claim that the top rate of tax does not raise any money, and that he is raising in stamp duty and tax avoidance five times the cost of cutting the top rate of tax. But his own HMRC report makes the true position clear, in table A2 on page 51. It says that next year he will give £3.01 billion in tax cuts to existing and legitimate top rate taxpayers, paid more than £150,000. That is a fact. That is six times more in tax cuts to the richest than he is raising in the stamp duty and tax avoidance measures. He is gambling that this will then bring in £2.9 billion in new tax revenues from people currently not paying tax, without any hard evidence to justify that claim—an estimate that the OBR says in the Budget documentation is “highly uncertain” and could lead to a much higher cost.

The head of the OBR said last night:

“This is a judgement based on not even a full year’s data based in terms of how people have responded to the 50p rate, in particular in terms of those self assessment tax-payers.

The costing of these sorts of changes is by no means unarguable”.

Just a few weeks ago, the Institute for Fiscal Studies said:

“If the future of the 50p rate is to be determined on the basis of evidence...then Budget 2012 will be too soon to form a robust judgement.”

Another expert has said on these matters:

“Some believe that if taxes on the wealthy are cut, new revenue will miraculously appear. I think their reasoning is this—all those British billionaires who demonstrate their patriotism by hiding from the taxman in Monaco or some Caribbean bolt-hole will rush back to pay more tax but at a lower rate. Pull the other one.”

That was the Business Secretary speaking to the Liberal Democrat conference last September. Pull the other one indeed. A £3 billion tax cut giving £10,000 each to 300,000 taxpayers and we are supposed to believe that all these people in tax havens are suddenly going to say, “I want to pay more tax.” Let me say to the Chancellor, “Pull the other one, it’s got bells on.”

[Harriett Baldwin (West Worcestershire) (Con)]

May I therefore assume that a 50p tax rate will be in the shadow Chancellor’s next manifesto?

[Ed Balls]

There will be a vote next week, and we will vote against the 50p change. It is the wrong tax cut at the wrong time. I have always said that no tax rate is set in stone, but how can anyone believe it is right to take tax credits from working families, child benefit from middle-income families and more tax from pensioners, but give £10,000, on average, to every top rate taxpayer in the country? If there were a general election tomorrow, our manifesto would state clearly that we would reverse it. That is the clearest answer I will give.

Oral Answers to Questions

Harriett Baldwin Excerpts

Tuesday 6th March 2012 Commons Chamber

[Miss Smith]

I do agree with my hon. Friend. As I have said already, it is a question of fairness. This measure asks a couple to do what a lone parent has always had to do, and I think that is fair.

[Harriett Baldwin (West Worcestershire) (Con)]

Can the Minister confirm that, under the current system, a single parent who is offered more than 16 hours’ work a week by his or her employer would face a marginal withdrawal rate of up to 97%, and that such anomalies will disappear with the change to the universal credit?

[Miss Smith]

My hon. Friend makes a very fine point, and she is absolutely right that the reform paves the way for the universal credit, through which this Government are proud to be tackling the incentives that make work pay.

Financial Services Bill

Harriett Baldwin Excerpts

Monday 6th February 2012 Commons Chamber

[Ed Balls]

The problem was the US sub-prime mortgage market, and that the failure of regulation there rippled around the world. There were failures also of lending and regulation at Northern Rock here in Britain. I do not in any way deny that there were failures here in Britain and failures of regulation, but I do not accept that it was solely a UK failure, because it happened in America, France, Germany, Japan and all around—

[Harriett Baldwin (West Worcestershire) (Con)]

rose—

[Gordon Birtwistle (Burnley) (LD)]

rose—

[Ed Balls]

I will make some progress and take both interventions in a minute.

I understand why politically the Chancellor is so keen to blame the structure of UK regulation—the tripartite relationship between the Bank, the Treasury and the FSA. He wants to claim that his particular institutional reforms are the solution, but my advice to him is to be very careful indeed, because this was not a peculiarly British crisis; it was a global crisis. It hit countries with tripartite systems of regulation, quartet systems, twin peaks, more powerful central banks, less powerful central banks and statutory and non-statutory regulators alike, and it was not a failure of regulatory structure, but a collective global failure to see the risks inherent in the structure of the global financial services industry.

We heard from central bankers earlier, but Alan Greenspan, the former chair of the US Federal Reserve and architect of the US system, when asked by The New York Times about his and the world’s understanding and management of risk, said:

“The whole intellectual edifice…collapsed”.

He was right. It was not simply a failure of structure, but a flaw in the way regulators understood the financial system, and that is why the British Bankers Association is right in its submission on the Bill to say that

“we consider that successful regulation depends more on regulatory culture, focus and philosophy than structure.”

[Harriett Baldwin]

On that very point, I should like to understand where the right hon. Gentleman is coming from in his objections to the Bill. What was his philosophy in terms of separating the supervision of banks from the Bank of England, which has day-to-day responsibility for monitoring that canary in the goldmine—their day-to-day funding operations?

[Ed Balls]

I am going to come on to explain my analysis. I am not sure I fully understood the question, but I might as time passes.

At its heart, the regulatory failure of the global financial crisis was not a failure of one approach to the institutions of regulation, but a failure of understanding and risk assessment which covered central bankers, regulators and Treasuries throughout the world. That line is not in the Conservative party Whips’ briefing, but it is absolutely true none the less.

Oral Answers to Questions

Harriett Baldwin Excerpts

Tuesday 24th January 2012 Commons Chamber

[Miss Smith]

We expect that that policy will be additional in the sense that it is extending it to disadvantaged two-year-olds. We expect 130,000 disadvantaged two-year-olds to be assisted by the 15 hours of free child care, and we certainly expect local authorities to take sensible decisions with the limited resources that they also have.

[Harriett Baldwin (West Worcestershire) (Con)]

With 2 million children living in workless households, does the Minister agree that the essential steps include not only the additional child care places, but the universal credit and the fact that every hour of work will count towards increased reward for the household? That is an essential part of those fiscal measures.

[Miss Smith]

I certainly do agree with my hon. Friend, and on a couple of counts. First, poverty is not about income: it is about work. I am sure that she will agree that it is a crying shame that under the previous Government the number of children in workless households reached one in every six. I also agree with the chief executive of The Big Issue, who says in The Times today that

“You don’t help the poor by making them dependent on handouts”.

Connecting Europe Facility

Harriett Baldwin Excerpts

Thursday 19th January 2012 Commons Chamber

[Andrea Leadsom (South Northamptonshire) (Con)]

As I understand it, the EU’s ambition is to develop a trans-European network in transport, telecommunications and energy as part of the treaty on the functioning of the EU. It therefore wants the budget for 2014 to 2020 to include sufficient funds to put an extra €50 billion into a connecting Europe facility. However, it also wants to regulate EU-wide programmes. Specifically, on transport, it is proposing that member states commit to a core network by 2030, and to a comprehensive transport network by 2050. The EU estimates that it would cost Britain between £64 billion and £137 billion to meet those targets over that period. Does the Minister believe that if such a regulation were to come into force under qualified majority voting, it could force Britain to spend that amount of its own resources in a way that would be directed by the EU? That would be an astonishing outcome.

On energy, the Commission believes that member states need to spend €200 billion on electricity and gas networks alone, and that €1 trillion is needed for EU energy infrastructure in total. Will the Minister tell me what proportion of that the UK would be required to spend, and whether that requirement would be enforceable at EU level under QMV?

On telecoms, the EU target for rolling out broadband is different from that of the UK. The Commission believes that there are telecoms bottlenecks that hinder the single market. In the light of our own recent commitment to rolling out superfast broadband, I would be interested to know whether the Minister thinks that the British Government need the EU’s advice or the Commission’s targets on how, and to what level, we roll out superfast broadband here. Are those legitimate areas for the EU to be involved in, or are they domestic matters? Does the Minister see a pan-European angle to these questions or not?

What is the Minister’s view of top-down EU expenditure, made entirely at the taxpayer’s expense, as opposed to private sector, or combined public and private sector, investment? Is he aware of any efforts by the Commission to test private sector interest in some of its pet schemes? What proportion of the roughly €7 billion that Britain’s taxpayers would contribute to the connection fund would be spent here, where there is a huge backlog of infrastructure needs, rather than elsewhere in Europe?

I want to make three broad comments on the proposals, in support of the motion. First, I find it astonishing that the European Commission seems to be the only bit of Europe in which the recession, the financial crisis and the issues of sovereign insolvency have passed unnoticed. It is as though it were inhabiting a parallel universe.

[Harriett Baldwin (West Worcestershire) (Con)]

Does my hon. Friend agree that the cost of moving from Brussels to Strasbourg on a regular basis is an ideal budget item to be struck through before forcing member states to spend money on these proposals?

[Andrea Leadsom]

Yes, I completely agree with my hon. Friend’s excellent idea. That would be high on my list of bits of wasteful bureaucracy to get rid of.

What sort of parallel universe is the European Commission inhabiting, if it thinks it reasonable to be expanding the European budget for 2014 to 2020 in the current climate? Why is the EU seeking to take power and control over these particular policy areas, at a time when they are already high on our own Government’s agenda? Requiring Britain to contribute to EU funds is not acceptable, and giving the Commission the authority to require Britain to make expenditure on its own domestic projects is equally unacceptable.

My second point is that the EU has proved itself time and again to be an inefficient allocator of scarce resources. In regard to structural funds, Open Europe estimates that Britain has contributed €33 billion between 2007 and 2013, and that we have received roughly €9 billion. If we took back control over that €33 billion, we might well wish to continue to contribute to the poorer EU member states—that is, those with a national income of 90% of the average or less. However, if we had contributed the same amount to those poorer member states, we could also have spent the same €9 billion that we received from the structural fund, creating a £4 billion saving. If Britain had allocated that same amount, €9 billion, to its own regions, plus the same amount to the poorer EU states, there would have been a £4 billion saving that could have gone towards reducing our deficit or investing further in the poorer regions of the UK. The difference identified by Open Europe’s estimate is a result of the leakage due to the recycling of cash between the richer countries.

It is interesting to note that the Department for International Development spends about 4% of its budget on administration, with a target of 2%. By contrast, the EU Commission spends 5.4% of its contributions to overseas aid on administration. No doubt it is very conscious of that figure, as it has been singled out for comment.

Health

Harriett Baldwin Excerpts

Tuesday 20th December 2011 Commons Chamber

[Harriett Baldwin (West Worcestershire) (Con)]

There are three fine community hospitals in my constituency: Pershore, Tenbury and Malvern. My hon. Friend may wish to invite her constituents to visit the Pershore hospital, which is owned by the district council and operated by the NHS care trust. It is an interesting model.

[Dr Wollaston]

I thank my hon. Friend for that intervention. There is an understandable fear that many premises in the most stunning locations, which have been bequeathed to their communities by local benefactors, could end up being sold off with communities powerless to intervene. I want to touch on some of the alternative models. Communities are reassured that for the time being there is a clear directive providing that in future only NHS organisations may own the estate, but I agree with my hon. Friend that local models can provide alternatives. NHS ownership may, in some circumstances, create difficulties, and inhibit the development of hospitals’ full potential. For example, the Community Hospitals Association is concerned that in some areas management may pass to mental health organisations with little experience of managing community hospitals. There is also a concern that passing management to predominantly secondary-care-focused trusts could cause the hospitals’ interests to be sidelined.

In many parts of the country, social enterprises have been formed to provide community services, but currently they cannot own and invest in premises, and nor can GPs acting as commissioners. May I ask the Minister to look into how ownership arrangements could be made more flexible in order to provide local solutions, while at the same time guaranteeing to local people that the value of their assets will be safeguarded for their communities? I hope that all our leagues of friends will then feel confident enough to continue to invest for the future.

Let me briefly raise the issue of the system of tariff payments. As the Minister will know, currently the tariff is not fairly distributed, which means that community hospitals are often not funded for the provision of step-down care. The acute hospital receives all the funding irrespective of how long the patient remains in its care, although community hospitals are ideally placed to provide safe step-down services. I therefore hope that the Minister will give an update on how and when the tariff will be reformed to assist community hospitals to offer the full range of services they wish to provide.

The main focus should be on avoiding the need for acute hospital admissions in the first place. Community hospitals have a key role to play in providing many services, not just in-patient and palliative care. I join the Community Hospitals Association in calling for more investment in research and evaluation of their role and contribution to high-quality care and the wider social care economy.

Finally, I wish all Members and staff of the House a very happy Christmas.

The Economy

Harriett Baldwin Excerpts

Tuesday 6th December 2011 Commons Chamber

[Harriett Baldwin (West Worcestershire) (Con)]

How can I follow the wonderful, lilting oratory from the hon. Member for Islwyn (Chris Evans)?

It is very difficult to turn round a supertanker. The supertanker that my right hon. Friend the Chancellor inherited was weighed down by the lead weight of having to pay out £120 million a day in interest and artificially inflated by a Government who were spending more than they were taking in, so that, in effect, £1 out of every £4 spent was borrowed. There was a very challenging situation when the Chancellor took the steering wheel of the supertanker, and we need a significant process of change to alter its direction towards one where we have a much healthier public sector financial position and where the private sector is able to continue its process of growth. [Interruption.]

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I am sorry to interrupt the hon. Lady. If Members want to have private conversations, they should leave the Chamber. If they are in the Chamber, they are taking part in the debate and they will listen to the person who is speaking.

[Harriett Baldwin]

Thank you, Madam Deputy Speaker.

I want to feed back to those on the Treasury Bench some of my constituents’ reactions to the decisions that the Chancellor announced last week in his autumn statement as regards the process of steering the supertanker. Those decisions were taken very much with a view to his understanding their impact on household budgets. Businesses and drivers in my constituency have welcomed the fact that the increase in fuel duty promised for January is not going to happen. Following the victory in Libya and acknowledged slower economic growth, they were expecting the price of oil to fall and the price of petrol and diesel at the pump to decline, but it has not. The increase in January would be extremely unwelcome for them.

My constituency has a very high percentage of people over pension age, who, needless to say, welcome the fact that they are to receive the largest cash increase in the state pension in history. They also welcome the Chancellor’s decision to allow councils to freeze the council tax for a further year, because for those who are on fixed incomes or receiving modest pay increases, not having to suffer that increase in their council tax is another significant help to their household budgets.

For the many small businesses in my constituency, the fact that the small business rate relief is to be extended until April 2013 is very welcome. The new initiative whereby larger businesses can defer some of the rate increase by 60% for two years will also greatly help businesses with their cashflows.

On the credit easing measures, I would like to draw the Chamber’s attention to an innovative idea in my constituency called ThinCats.com—presumably the opposite of FatCats.com. People can put their savings to work with ThinCats.com and it will lend the money out for them. It is one of the credit circles that are becoming increasingly popular. Credit easing is another way in which we will be able to get the benefit of lower interest rates into our business sector to allow businesses to receive help with their cashflow.

Finally, let me mention my concerns about the whirlpool that is offshore of the supertanker in the eurozone. The three possible outcomes that could occur are an underwriting of eurobonds, a break-up of the entire currency union, or the current uncertainty as we jolt from summit to summit with great promises and then huge disappointment. Of those, the current situation causes the worst damage to business confidence in my constituency. I therefore urge Ministers, as they go into these negotiations, to try to steer them towards one of those two alternative outcomes, which would provide some of the monetary stimulus that the eurozone needs and thereby a resolution of the current situation, which is the worst of all possible worlds.

Autumn Statement

Harriett Baldwin Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

I completely understand why the hon. Lady is fighting hard for her constituency and her city. In the end, the proposal put forward by Stoke for an enterprise zone was not as compelling as the other enterprise zone proposals that were put forward at the same time. That was independently assessed by the civil servants. I am very happy to sit down with her, and indeed other Members from Staffordshire, to work with them on what we can do to make the proposal a success. I am very much open to considering whether we can get the enterprise zone bid into a state where it is successful and we can go ahead with it.

[Harriett Baldwin (West Worcestershire) (Con)]

There were many measures in the statement that will help businesses with their cash flow, which is truly to be welcomed, for example extending the small business rate relief and credit easing. Will the Chancellor clarify that where business rates go up in line with RPI next year, there will be the ability to defer 60% for two years interest-free?

[Mr Osborne]

We are helping businesses with their cash flow, but it is not a subsidy to those businesses, more a cash-flow measure.