Oral Answers to Questions

John Glen Excerpts

Tuesday 9th May 2023 Commons Chamber

[John Stevenson (Carlisle) (Con)]

25. What assessment he has made of the potential impact of investment zones on the performance of the economy.

[The Chief Secretary to the Treasury (John Glen)]

I would like to inform the House that the Chancellor is not with us today because he is at the G7 in Japan.

The refocused investment zones programme will grow the UK economy and bring investment to areas that have traditionally underperformed economically. The programme will catalyse 12 high-potential, knowledge-intensive growth clusters across the UK, including four across Scotland, Wales and Northern Ireland, in our key future sectors.

[Peter Gibson]

I warmly welcome the Government’s announcement that the Tees valley will be the location of one of their new investment zones, and this £80 million investment will unlock new opportunities for my region. Does my right hon. Friend agree that this is further evidence of levelling up for Darlington and the Tees valley? Can he outline a timescale for when we will see things start to happen?

[John Glen]

The Tees Valley investment zone will boost productivity and drive sectoral growth while providing benefits for the local communities that my hon. Friend represents. The Government want to make rapid progress on delivering investment zones. We are engaging with partners to ensure that we can support those with the ambition to move at speed, and we intend to have all proposals agreed by the end of the financial year, and sooner if at all possible.

[John Stevenson]

Business investment and wealth creation will clearly be central if we are to rebalance the economy and close the gap between less successful and more prosperous areas. Would the Minister therefore agree that prioritising investment zones in areas that need a helping hand is the right course of action? And does he envisage an investment zone in the borderlands area in the near future?

[John Glen]

My hon. Friend is tireless in his advocacy for his constituents. The areas of England that are eligible to host an investment zone were identified through a rigorous analytical assessment that reviewed every place in England and shortlisted based on their strengths in innovation, productivity, potential and levelling up need, as well as the strength of local leadership, knowledge assets and sectoral strengths.

The borderlands area is already benefiting from the £452 million borderlands growth deal, which was signed just two years ago and aims to create 5,500 jobs. My hon. Friend is also familiar with the recent £134 million investment signed off through the housing infrastructure fund, leading to 10,325 homes in St Cuthbert’s garden village.

[Jim Shannon (Strangford) (DUP)]

The Minister mentioned the four investment zones, including one for Northern Ireland, in his opening answer. Of course I make a plea for my constituency, as everyone will. What discussions has he had with the Department of Finance back home about a potential investment zone in Strangford, to ensure that people in my constituency can have the same opportunities as people across the United Kingdom?

[John Glen]

I think the whole House will agree that the hon. Gentleman must be the most effective advocate for his constituents. We will see what happens. There will be a rigorous process, including wide consultation, and we expect to have an outcome that benefits his constituents and people across Northern Ireland.

[Mr Speaker]

I call the SNP spokesperson.

[Stewart Hosie (Dundee East) (SNP)]

The incentives offered by investment zones include 100% business rates relief and enhanced capital allowances. With the exception of reduced national insurance contributions, it is hard to see the difference between an investment zone and an enterprise zone. What additional fiscal support are the Government providing to differentiate these investment zones from enterprise zones?

[John Glen]

The key distinction is that we have identified areas that have clusters, often relating to a university, and that have potential in a key sector. The investment zones will be worth £80 million over five years, and we are obviously working very closely with partners. It is difficult to be precise about the numbers, because there will be bespoke collaborations depending on which sectors are involved.

[Stewart Hosie]

I thank the Minister for his answer but, of course, enterprise zones and, indeed, their near cousin, the freeport, also spoke about clusters in the same kind of language. What steps are the Government taking to ensure that investment zones do not suffer from the same problem as enterprise zones and freeports, which was a woeful failure to deliver the number of permanent, good-quality jobs that was initially promised?

[John Glen]

That is a legitimate concern to raise and it is why we have followed the analytical approach to which I referred. We will be working closely with the Department for Levelling Up, Housing and Communities to look at each proposal by the end of the year. We will be having that certainty on the tax incentives over those five years and making local authorities an accountable body for the delivery of this. The right hon. Gentleman’s whole political doctrine is about the distinctions that exist in different communities around the United Kingdom, and that is why we have a variety of interventions designed to make an effective impact in different places across the UK.

[Munira Wilson (Twickenham) (LD)]

2. What recent discussions he has had with the Secretary of State for Education on the potential impact of inflation on the provision of school meals.

[The Chief Secretary to the Treasury (John Glen)]

The Chancellor has regular discussions with Cabinet colleagues on a range of issues. The autumn statement 2022 provided an additional £2.3 billion in funding for schools this year and next, over and above the totals announced at the spending review in 2021. That means that school funding next year will be £58.8 billion, exceeding 2010 levels of per pupil funding in real terms. That will help schools to manage costs, including those of school meals.

[Munira Wilson]

Since Liberal Democrats in government rolled out universal infant free school meals in 2014, funding for them has increased by just 11p. Given the soaring food costs, that is resulting in a real shortfall in meeting schools’ costs, which is having to be subsidised by cutting teaching budgets. The shortfalls range from 11p per meal in my local authority area of Richmond upon Thames to as much as 39p per meal in Hampshire. Will the Treasury provide the extra cash so that free school meal funding reflects the true costs that schools face or will the Minister continue to leave our schools and children short-changed?

[John Glen]

I do not agree with that analysis. The free school meals funding for 2023-24 was set in line with precedent every year, using inflation forecasts in the autumn prior. About 1.9 million pupils are claiming a free school meal at lunchtime, which equates to 22.5% of pupils in state-funded schools; together with the 1.25 million infants supported through the universal infant free school meal policy, this is having an impact. However, I recognise the pressures across the whole economy, which is why, as I said, the Government gave those additional funds in the autumn statement last year.

[Bob Blackman (Harrow East) (Con)]

3. What steps his Department is taking to improve the regulatory framework of the financial services sector.

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[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

15. What steps he is taking to support financially people on lower incomes.

[The Chief Secretary to the Treasury (John Glen)]

The Government are taking action to protect struggling families by providing support, worth £3,300 per household on average over this year and last, to help with higher bills. That includes targeted support for the most vulnerable in our society through additional cost of living payments and the uprating of benefits by 10.1% this year. The Government have also increased the national living wage by 9.7%, representing an increase of more than £1,600 in the annual earnings of a full-time worker on the national living wage.

[Alexander Stafford]

Does my right hon. Friend agree that the best support in the cost of living crisis, beyond the £94 billion that the Government have already spent, is the cutting of inflation to ease pressures—especially on food, fuel and energy—for families in Rother Valley and up and down the country?

[John Glen]

I absolutely agree. The Government are doing three things to reduce inflation: we are remaining steadfast in supporting the independent Monetary Policy Committee at the Bank of England as it continues to take action to return inflation to target; we are making responsible decisions on tax and spending, so that we are not adding fuel to the fire; and we are tackling high energy prices by holding down energy bills for households and businesses, alongside investing in long-term energy security.

[David Simmonds]

Lowest-income households in my constituency are the biggest beneficiaries of a strong economy. Does my right hon. Friend agree that reducing debt, reducing inflation and balancing the books are the most effective Government interventions to support low-income households?

[John Glen]

Absolutely. It is right that we continue support for the cost of living challenges. I have mentioned the energy price guarantee; we are also sticking to that plan to avoid unnecessary inflationary pressure. [Interruption.] On average this year, as a result of Government decisions made from—[Interruption.]

[Mr Speaker]

Order. Members will have to continue their conversations at another time. Carry on, Minister.

[John Glen]

As a result of Government decisions made from autumn statement 2022 onwards, households in the bottom half of the income distribution will see, in cash terms, twice as much benefit from Government support as households in the top half of the income distribution.

[Sarah Champion (Rotherham) (Lab)]

I listened with interest to the answer that the Minister gave about support for households, but it does not match the reality in Rotherham, where constituents have had increases in rent, mortgages, fuel and food, as well as cuts to public services. What is he going to do to deliver the support that we need to make ends meet, because the offers on the table are not cutting it?

[John Glen]

Everyone can see that the Government have made a range of interventions over the past two years, which means support for all of those on means-tested benefits—8 million people. Eight million pensioner households will benefit from the non-discretionary payments, effectively. The household support fund, which we repeated, provides another £1 billion to give local authorities discretion in individual circumstances to offer supplementary support. Of course, I recognise that this is an incredibly challenging time for the most vulnerable, but we have tried to target those interventions on them, listening to the Low Pay Commission and increasing the national living wage to £10.42. We recognise that these are difficult times, but we will get through them.

[Daniel Zeichner (Cambridge) (Lab)]

8. What recent steps he has taken to ensure fairness in the application of the tax system.

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[The Chief Secretary to the Treasury (John Glen)]

As the Minister for public spending, I oversee the Government’s budgeting system, and a key element of that is incentivising Departments to manage spending effectively so that value for taxpayers’ money is maximised. That is why the Government launched an efficiency and savings review at the autumn statement 2022. Through the review, Departments re-prioritised and identified further efficiencies, building on the 5% efficiency challenge set out in the spending review 2021, to better deliver value for money for the taxpayer.

[Afzal Khan]

The then Chancellor, now Prime Minister, spent £1.3 million of public money on focus groups, which included asking what the public thought of him. Following the public’s resounding rejection of the Tories in last week’s elections, we now know what the public think of him. Will the Government stop wasting taxpayers’ money to boost the Prime Minister’s ego, do the right thing and call a general election?

[John Glen]

No.

[Nick Smith]

Some £7.9 billion was wasted on useless and overpriced personal protective equipment; meanwhile, opportunists who saw the Tories coming are now profiteering on the back of the public purse. Does the Minister regret that this money was not spent wisely? Nearly £8 billion could buy us 20 new hospitals.

[John Glen]

Our priority was clear throughout the covid crisis, and that was to get PPE to the frontline as quickly as possible. Due diligence was carried out on all companies that were referred to the Department. Despite all those steps being taken, some instances of fraud did occur with unscrupulous suppliers taking advantage of the situation. This Government take that fraud seriously, and the Department of Health and Social Care is exploring every available option to bring those who commit fraud to account. We have also made a number of other interventions, including investment in the taxpayer protection taskforce to normalise higher compliance activity in HMRC, alongside other measures to deal with fraud elsewhere in some of the emergency schemes that we set up to help this economy and this country get through covid.

[Mr Speaker]

I call the shadow Minister.

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

Last week, the Public Accounts Committee revealed that our country lost £9 billion-worth of tax revenue during the pandemic because HMRC redeployed 4,000 staff members whose jobs were to chase down tax avoiders. The Prime Minister was Chancellor at the time and presumably signed off that decision. Can the Minister tell me whether the Prime Minister did that as a deliberate act to give the green light to tax avoiders, or is it just another example of Tory incompetence?

[John Glen]

I think that is a ridiculous suggestion, to be honest. HMRC received £863 million to modernise the tax system, and that included £136 million invested over the spending period to deliver improvements in terms of a single customer record and account. On what happened over covid, I have already set out the investment we made, including the £100 million in the taxpayer protection taskforce. We take fraud very seriously. Now it is about HMRC looking at financial records of excessive trading to come to terms with those businesses that used some of those schemes fraudulently. We will continue to work on that.

[Mr Speaker]

I call Carla Lockhart. She is not here.

[Ashley Dalton (West Lancashire) (Lab)]

T2. If he will make a statement on his departmental responsibilities.

[The Chief Secretary to the Treasury (John Glen)]

Three of the Prime Minister’s five priorities are economic priorities: to halve inflation this year, to grow the economy and to reduce debt. We are on track to halve inflation this year to ease the cost of living. We have taken the difficult, but responsible decision needed to get net debt falling and secure the future of public services, and we have a clear plan to grow the economy to create better paid jobs and opportunity right across the country.

[Ashley Dalton]

The consumer voice organisation Which? has recently found that 2 million UK households missed a key payment for their mortgage, rent, loan or credit card. Last month alone, 700,000 of these related to housing, so when will the Tory Government wake up to the fact that the cost of living crisis is far from over and what do they intend to do about it?

[John Glen]

In previous answers, I have set out a number of the interventions the Government have taken to help the most vulnerable. I have mentioned the household support fund, the benefits that accrue to all those who are on means-tested benefits, particularly pensioner households, and those who are eligible for disability benefit. As I have also said, the money that the Government have made available is designed to focus on those who are most in need, and we will continue to look out for the most vulnerable through this difficult time.

[Gareth Bacon (Orpington) (Con)]

T3.   Does my right hon. Friend agree that fiscal responsibility is vital if we are to cut inflation and grow the economy? Does he also agree that the Labour party’s £90 billion of unfunded spending commitments would put all of that at risk, with higher taxes and more borrowing the inevitable result?

[John Glen]

I could not agree more. Responsible public spending is at the core of getting our economy into a state where it can grow, and the £90 billion of unfunded spending pledges made by Opposition Members will be scrutinised very carefully, I am sure, by many in the months ahead.

[Mr Speaker]

I call the shadow Chancellor.

[Rachel Reeves (Leeds West) (Lab)]

The Conservatives have now had 13 years in office—wages lower, the weekly food shop astronomical, energy bills unprecedented, 24 Tory tax rises and the national debt has ballooned —so can I ask: after 13 years of Conservative Government, does the Minister think that people feel better off, or worse off?

[John Glen]

What I can tell the right hon. Lady is that, since 2010, there has been a 25% increase in real take-home pay for workers on the national living wage and, recently, the national living wage increased to £10.42 an hour—a 9.7% increase—for those over the age of 23. In 2009-10, there was a deficit of £158 billion. Before we got into covid, it was down to £38 billion. We have gone through the most tremendous challenges that this country has seen for about 100 years. I think most people in this country understand that this Government have acted on the challenges we have faced in office.

[Rachel Reeves]

The Government have had 13 years, and the answer to the question “Do people feel better off?” is a resounding no. This morning, I met 22 newly elected council leaders from the Labour party, who are creating emergency plans to help to tackle the cost of living crisis in their communities. Why will the Conservative Government not play their part, do the right thing, close the loopholes in their oil and gas tax and help working people in Britain, as a Labour Government would do?

[John Glen]

I congratulate those successful across the country in last week’s elections, but what business leaders want and what the country wants is steady policy making, delivering growth in the economy, dealing with the biggest scourge on the economy, which is inflation—[Interruption.] The right hon. Lady says from a sedentary position that we have had 13 years. We spent £400 billion when we had a global pandemic, where we had to shut down the economy. When we came out of it, we had high inflation consequential on a war that we have not had in Europe for over 70 years. Those are the realities and that is what this Government have responded to.

[Kevin Foster (Torbay) (Con)]

T6. Regenerating our town centres was a key part of the local election campaign in Torbay. Would my right hon. Friend meet me, my hon. Friend the Member for Totnes (Anthony Mangnall) and the new leadership of Torbay Council to discuss what further fiscal steps can be taken to support those aims?

[John Glen]

I am always happy to meet my hon. Friend. I congratulate him on his leadership of his council candidates last week and the excellent result that he secured. Of course, we have invested in many coastal communities across the country, and we are keen to discuss the specifics of how the Government can support him as he drives that local constituency and economy forward.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

T4. Today, manufacturing body Make UK warned the Government that, to tackle regional inequalities and compete on a national stage, we need a national industrial strategy as a matter of urgency. Do Ministers recognise that the reason wages in the north-east are falling under the Tories is their lack of an industrial strategy and their failure to follow Labour’s example and commit to a modern industrial strategy that invests in the industries of the future and delivers good-quality jobs across our country?

[John Glen]

No, I do not recognise that characterisation. What I recognise is that the Government are determined to see the economy grow. I see investment in investment zones focused in the hon. Lady’s region, working with the excellent universities that she is familiar with. I see a Government who are putting £100 million into the foundation model taskforce, £900 million to invest in a supercomputer to fund AI, a quantum strategy that is generally seen as world leading, as well as £160 million of investment in the tech sector. So this is a Government who are committed to the growth industries of the future.

[Jane Hunt (Loughborough) (Con)]

T8. University Hospitals of Leicester NHS Trust was pleased to hear that it is to receive £400 million for a new hospital, but I understand that the money is still with the Treasury. Can my right hon. Friend please confirm when UHL will receive the £400 million, and whether that might be increased to account for construction cost rises?

[John Glen]

Delivery of new hospital infrastructure and prioritisation within health budgets is a matter for the Department of Health and Social Care, but I know from frequent conversations with the Secretary of State that he is working tirelessly to ensure as many new hospitals as possible, and that wider improvements to the health estate can occur. I shall make representations to him after these questions.

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

T7.   It has been reported in the press today that, prior to any investment, BP and Equinor sought written guarantees that assets at the Teesworks site had not been acquired as a result of an “unacceptable act”, and that directors“will not hide or dissimulate the nature, origin, location, disposition or ownership of assets, rights or values.”It is just extraordinary. Given the importance of that freeport to investment and jobs in Teesside, can the Treasury confirm whether it too has made any similar checks?

[John Glen]

I am sorry, I cannot answer that question. But I am happy to meet the hon. Gentleman to look at the serious matter he has raised and get an answer for him.

[Richard Fuller (North East Bedfordshire) (Con)]

The Chief Secretary to the Treasury knows that the long hidden business case for East West Rail represents a bad deal for taxpayers, and that MPs from across Parliament have written about greener, better alternatives for growth in the Ox-Cam arc. He will know that on Thursday the Conservatives won the mayoralty in Bedford for the first time because the Conservative candidate, Tom Wootton, called for a review of Bedford Council’s working and its support for East West Rail. Will my right hon. Friend meet me to discuss that further urgently?

[John Glen]

I would be happy to meet my hon. Friend, and congratulate the Mayor of his home town of Bedford for the success he had last week.

--- Later in debate ---

[Dr Luke Evans (Bosworth) (Con)]

I thank the Chancellor for two weeks ago meeting Leicestershire MPs and the senior leadership of the county council to discuss funding there. Of particular concern is the core funding of special educational needs and disabilities, social care and transport such as buses. What more can the Minister do to address the problems with county council funding that we have in Leicestershire?

[John Glen]

I know my right hon. Friend the Chancellor welcomed that meeting on 25 April. The Government remain committed to improving the local government finance landscape, and in doing so they will work closely with local partners, including Leicestershire, and take stock of the challenges and opportunities across the sector. I thank my hon. Friend for his deep thinking into how improvements can be made.

[Mike Amesbury (Weaver Vale) (Lab)]

Why are the Prime Minister and Government Ministers so keen to protect non-dom status while not investing sufficiently in our NHS, as Labour would do?

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[Jonathan Gullis (Stoke-on-Trent North) (Con)]

Day one on the job and Labour in Stoke-on-Trent talk about cancelling the £56 million of levelling-up funding, which is UK-leading, going to the great city of Stoke-on-Trent. Will the Chief Secretary to the Treasury confirm that the Conservative Government will have the backs of the people of Stoke-on-Trent and deliver this important levelling up?

[John Glen]

We are very committed to the people of Stoke-on-Trent and recognise that enormous investment, thanks to my hon. Friend’s work in campaigning for investment through the levelling-up fund. It is down to the council to deliver on that significant investment and make a difference on the ground.

[Dave Doogan (Angus) (SNP)]

The transition to net zero should be the overarching priority for all of us. With that in mind, when will the Treasury finally get its act together with the Acorn project in the north-east of Scotland and accelerate its funding to ensure that the people of the north-east of Scotland do not just have to listen to warm words about the just transition, but can get a job in the just transition?

[John Glen]

I think that we have made commitments on the first phase. The Chancellor is considering the next steps further and will update the House in due course.

[Dame Diana Johnson (Kingston upon Hull North) (Lab)]

The Financial Times is reporting today that there have been meetings between the Treasury and the Department of Health and Social Care about compensation for victims following the infected blood inquiry. Will the Minister confirm that those meetings have taken place and who was present, and offer reassurance to those who were infected and affected that compensation will be implemented in full, as Sir Brian Langstaff has recommended?

[John Glen]

I believe that the Minister for the Cabinet Office updated the House on this matter a couple of weeks ago, and I am sure that he will be keen to do so again when those conversations have taken place.

[Hannah Bardell (Livingston) (SNP)]

This morning, before I left my constituency, I attended a rally organised by “Hands off Howden Park” and “Save our Pools”, which are two incredible campaigns in my constituency trying to protect our arts venues and pools from closing. Unfortunately, they have been mismanaged by the Labour and Conservative administration, and those results are the reality to be faced after a decade and a half of austerity has decimated public funding. When will the Government stop wasting money on things like Brexit and nuclear weapons and properly fund our pools and arts venues?

[John Glen]

We do not typically make specific decisions on local authorities from Whitehall, but we have committed to significant additional funds for local authorities and funding for the Scottish Government through the Barnett formula. I will leave the hon. Member to continue to lobby and campaign with her constituents to get those decisions made on the ground.

Cost of Living Increases

John Glen Excerpts

Tuesday 25th April 2023 Commons Chamber

[The Chief Secretary to the Treasury (John Glen)]

I beg to move an amendment, to leave out from “House” to the end of the Question and add:

“welcomes the Government’s action to halve inflation, grow the economy and reduce debt; supports the Government’s extensive efforts to support families up and down the country with the cost of living through significant support to help with rising prices, worth an average of £3,300 per household including direct cash payments of at least £900 to the eight million most vulnerable households; notes the use of a windfall tax on energy firm’s profits to pay around half of the typical family’s energy bill through the Energy Price Guarantee, also notes the fact that the Government has frozen fuel duty for 13 consecutive years to support motorists; welcomes the expansion of free childcare to all eligible parents of children aged nine months to four years old; and notes that Labour will fail to grip inflation or boost economic growth, with their plans for the economy simply leading to unfunded spending, higher debt and uncontrolled migration.”

Even in times of economic challenge, this is a Government who prioritise helping families face down the cost of living. I think Members across all sides of the House recognise that having come through the covid crisis, families and businesses across the country have felt additional global headwinds. After two decades of low inflation, the world has been confronted with fast-growing prices. We are not alone. While we tackle this, our friends in Ukraine are at war and we are supporting them diplomatically, militarily and economically. We have faced down those challenges while supporting our economy and, because of the action we took, we avoided a recession. Our sensible, credible economic plan is working. The International Monetary Fund said we are on the right track, unemployment remains very low by historic standards, and measures in the spring Budget deliver the largest permanent increase in potential GDP that the Office for Budget Responsibility has ever scored in a medium-term forecast, as a result of Government policy.

[Emma Hardy (Kingston upon Hull West and Hessle) (Lab)]

I realise that this will bring back painful memories for the right hon. Gentleman, but he may recall that the previous Prime Minister crashed the economy. The UK has been uniquely impacted. The issues with Ukraine and covid are impacting the rest of the world, but they are impacting the UK in a slightly different way because of the previous Prime Minister’s actions. I know that the right hon. Gentleman wishes to erase all memory of that, but he must acknowledge that her actions have had a consequence, and the British taxpayer is still paying the price.

[John Glen]

I value all my colleagues. The previous Prime Minister’s insights into the growth imperative in this economy were right.

[Paul Bristow]

Could my right hon. Friend help me? Some of the faces on the Opposition Benches seem so glum because we have avoided a recession—could he explain why?

[John Glen]

My hon. Friend is right. I approach the job of government with a sense of humility about the challenge we face.

I recognise that we have made significant progress in recent months—that has been generally acknowledged. I will now set out where else we will make progress. Although it is welcome that wholesale energy prices have been falling, many families remain under significant pressure. The Government understand that. Food prices are contributing to headline inflation. Rising food prices, however, are not a unique issue to the UK, as my hon. Friend the Member for Wantage (David Johnston) pointed out. It is a problem that advanced economies are facing. For example, as he correctly pointed out, in Germany, food price inflation is above 22%. We are fully alive to the fact that some people remain in real distress. I want to assure Members and their constituents that we will always stand ready to help where we can.

[Dr Luke Evans]

Is it not about compassion in government? That is why pensioners on a fixed income and people on benefits will receive a 10% increase. Also, the fourth iteration of the household support fund is there directly to help the most vulnerable to get through those tough times.

[John Glen]

My hon. Friend is absolutely right. In a moment I will set out exactly what interventions we have made and how we are continuing to intervene to support the most vulnerable in our communities across the United Kingdom.

The best thing we can do to help people’s money go further is to deliver on our plan to halve inflation and grow the economy. In doing so, we will meet the Prime Minister’s five pledges to the British people. Three of those are economic—two of which I have mentioned—and reflect people’s priorities. Inflation makes us all poorer. It has to be tackled head-on, which is why, working closely with the Bank of England, we are bearing down on it. We are also growing the economy.

[John Redwood (Wokingham) (Con)]

Will the Minister confirm the IMF figures that in 2020 to 2022—that important three-year period after we left the EU—the UK was the fastest growing economy of the G7? The Opposition’s forecast that the UK might be a poorer performer this year is just a forecast, and most forecasts are usually wrong.

[John Glen]

As always, my right hon. Friend is on the money. The point is that forecasts predict many different things. I have been in the Treasury for nearly five years; forecasts for every fiscal event rarely prove to be true at the next fiscal event.

We must continue to focus on taking the right decisions, decision by decision, and prove those forecasters wrong. That means long-term, sustainable and healthy growth that pays for our NHS and schools, finds jobs for young people and provides a safety net for older people, all while making our country one of the most prosperous in the world. It also means reducing debt, which we are on track to do. In fact, because of the decisions we have taken and the improved outlook for the public finances, underlying debt in five years’ time is now forecast to be nearly three percentage points lower than back in the autumn. That means more money for our public services and a lower burden on future generations—deeply held Conservative values, which we put into practice today. It is these steps that will make our country and our people better off. We are also taking action to shelter the most vulnerable while we achieve these longer-term ambitions for the economy.

In the Budget, we announced that the energy price guarantee would remain at £2,500 per year until July 2023. That was funded in part by the energy profits levy that this Government introduced last year, recognising that profit levels in the sector had increased significantly due to very high oil and gas prices caused by global circumstances, including of course Russia’s invasion of Ukraine. The levy is expected to raise just under £26 billion between 2022-23 and 2027-28, on top of around £25 billion in tax receipts from the sector in the same period through the permanent tax regime. The energy price guarantee measure will save the average family a further £160 on top of the energy support measures already announced, bringing total Government support for energy bills to £1,500 for the typical household since October 2022.

It is worth recapping those measures. This Government have helped all domestic electricity customers with £400 off their energy bills through the energy bills support scheme. The energy bills support scheme alternative funding provides £400 to around 900,000 households that are not supplied by domestic electricity contracts and are unable to receive support automatically through the energy bills support scheme.

Our support has not stopped there. Alongside holding down energy bills, freezing fuel duty and increasing universal credit, we are giving up to £900 in cost of living payments to households on means-tested benefits. Starting from today, over 8 million families across the UK will receive the first £301 cost of living payment from the Government. That is the first of up to three payments for those on means-tested benefits, totalling £900 through 2023-24. Those entitled do not need to apply for the payment or do anything to receive it. The payments will be accompanied by a payment of £150 for people on eligible disability benefits this summer and a payment of £300 on top of winter fuel payments for pensioners at the end of 2023.

These are carefully designed interventions, targeted at the most vulnerable across communities in the United Kingdom. The latest payment follows on from the £650 cost of living payment delivered to households on means-tested benefits by the Government in 2022, with an additional £150 for individuals on disability benefits and £300 for pensioner households.

The Government of course need to recognise that some people will fall into difficulties. They have enabled local authorities to provide additional support with the cost of household essentials through a 12-month extension to the household support fund in England worth £1 billion, including Barnett funding. We are also ensuring that more than 10 million working-age families will see an increase in their benefit payments from April 2023, based on the September inflation figure of 10.1%.

While we shelter the most vulnerable, the public also rightly expect us to look further to the future, making sure we are taking steps to grow sustainably and securely in the long term. This Government are unashamedly pro-growth, because expanding the productive capacity of the economy is the only way to solve the productivity puzzle, which has dogged us for decades, and improve living standards for all.

One reason we are held back is because a great number of people have left the labour market altogether. As a Conservative, I believe there is virtue in work and getting people into work is the best way to avoid the ills and perils of poverty. There has been an increase of more than 1.5 million working households since 2010, which shows that we are on the side of working families. That includes our new game-changing childcare offer that will entitle working parents in England to 30 hours of free childcare per week, once their child is nine months old, and close the gap between parental leave ending and the current childcare offer.

In addition to making provision on free childcare, the Budget set out to remove barriers for the long-term sick and disabled, for jobseekers and for older people with our pension tax reforms. Part of the plan is welfare reform to support those who have been disengaged from the labour market. My right hon. Friend the Secretary of State for Work and Pensions has introduced a White Paper setting out reforms that will support more people who are long-term sick or disabled to try work without any fear of losing their benefits. Other policies that we announced at the Budget will then ensure that those individuals are better supported to stay and succeed in work. Overall, the Office for Budget Responsibility expects the spring Budget package to result in 110,000 more individuals in the labour market by the end of the forecast period.

The UK saw the fastest growth in the G7 over 2021 and 2022. Cumulative growth over the 2022 to 2024 period is predicted to be higher than that of Germany or Japan, and at a similar rate to that of France or the US. We have halved unemployment, cut inequality and reduced the number of workless households by 1 million. We have protected pensioners, those on low incomes and those with disabilities. We are continuing to lay the groundwork for a vibrant, innovative and growing economy that benefits communities and families up and down the country.

Having sat and listened to the shadow Minister—I was not smiling, but reflecting on what I heard—I think it is very unfortunate that the Labour party continues to play politics and snipe from the sidelines without a clear and coherent plan.

[Tom Randall (Gedling) (Con)]

I notice that the Opposition motion refers to freezing council tax; the shadow Minister also mentioned freezing council tax under Labour. However, Labour-run Gedling Borough Council is increasing council tax by 2.98% this year, in spite of the fully costed Conservative amendment that would have enabled a council tax freeze. Does my right hon. Friend agree that whereas Labour’s rhetoric is about freezing taxes, the reality is tax, tax and tax again?

[John Glen]

Absolutely, and I think the good people of Gedling will come to the right conclusions next week.

What is really clear is that this Conservative Government will get on with the business of resetting the conditions for growth after this enormously difficult period. We are setting the conditions for protecting the vulnerable and delivering for the British people. As a united Government, we remain focused on what really matters for the British people. I urge the House to reject the Labour motion.

Scottish Government and Welsh Government Funding

John Glen Excerpts

Thursday 30th March 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

In addition to changes in funding at supplementary estimates 2022-23, and in line with the statement of funding policy, the Welsh Government are switching £65.000 million from resource DEL to capital DEL (general).

The Scottish Government have also been provided with an additional £16.300 million resource DEL in relation to the implementation of international financial reporting standard 16 (IFRS16).

Revised 2022-23 funding is as follows:

Public Service Pensions: Superannuation Contributions Discount Rate

John Glen Excerpts

Thursday 30th March 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

SCAPE—superannuation contributions adjusted for past experience—is the process for setting employer contribution rates at valuations of unfunded public service pension schemes. As part of the SCAPE process, the SCAPE discount rate is used alongside many other factors such as earnings changes, changes to life expectancy and demographic assumptions to determine the appropriate employer contribution rate. Valuations as at 31 March 2020 are currently under way and will result in new employer contribution rates which will be implemented from April 2024.

The current methodology for setting the discount rate, based on the OBR’s forecast of long-term GDP growth, was adopted in 2011. At the time, the Government expressed an intention to review the discount rate methodology every 10 years. A 2021 consultation met this intention and sought views on the most appropriate methodology for setting the SCAPE discount rate.

The Government have today published their response to the June 2021 consultation on the methodology used to set the SCAPE discount rate and have concluded that the existing methodology best meets the balance of the Government’s objectives for the SCAPE discount rate, and therefore do not intend to modify the methodology.¹

The SCAPE discount rate to be used as part of the ongoing 2020 valuations will therefore be based on the expected long-term GDP growth figures, published by the OBR in July 2022. Based on these figures, the new SCAPE discount rate is CPI+1.7% p.a.

The Government are aware that the updated SCAPE discount rate will generally lead to higher employer contribution rates for most unfunded public service pension schemes resulting from the 2020 valuations. In recognition of the cost pressure that an increase to the employer contribution rate would bring to existing departmental budgets, the Government have committed to providing funding for increases in employer contribution rates resulting from the 2020 valuations as a consequence of changes to the SCAPE discount rate; this commitment is for employers whose employment costs are centrally funded through departmental expenditure. These funds will be used to pay for employer contributions and therefore will contribute to meeting the costs of public service pensions provision which means this will be cost neutral for the Exchequer.

¹ https://www.gov.uk/government/consultations/public-service-pensions-consultation-on-the-discount-rate-methodology.

[HCWS697]

Economic Crime Levy Allocations Update

John Glen Excerpts

Monday 27th March 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

Today I am confirming the allocation of £300 million between 2023-24 and 2025-26 generated from the economic crime (anti-money laundering) levy. Announced at Budget 2020, the levy was legislated for in the Finance Act 2022. The levy supplements approximately £200 million of additional Government investment to tackle economic crime over the 2021 spending review period.

The levy funding has been allocated to deliver benefits to the entire anti-money laundering system across both the public and private sector and will underpin the priorities set out in the next three-year, public-private Economic Crime Plan.

Over the next three years, the levy has been allocated to:

Invest over £100 million in state of the art technology which will analyse and share data on threats in real time, to give law enforcement the tools it needs to stay ahead of criminals.

Provide funding for more skilled financial crime investigators. This includes funding to hire 475 new investigators and economic crime training for more than 6,500 existing investigators in the National Crime Agency and across national and regional intelligence, investigation and prosecution agencies. New and better trained officers will lead to more cases investigated, more criminals prosecuted, and more assets recovered.

A further £60 million will fund new specialist intelligence teams in the National Crime Agency and expand the combating kleptocracy cell in order to tackle the most complex global money laundering networks.

Funding for c.75 officers to sustain the increased staffing of the UK financial intelligence unit and provide funding for 22 new financial investigators to analyse suspicious activity reports embedded in regional organised crime units. The suspicious activity reporting regime is a key pillar of the UK’s anti-money laundering (AML) system and is a critical tool for law enforcement to identify and disrupt money launderers.

Invest £20 million in Companies House and the Insolvency Service to fund the creation of two new intelligence teams. These new teams will improve our understanding of how UK companies are misused to launder the proceeds of crime and help put a stop to it. A further £600,000 of funding has been allocated for the deployment of UK experts overseas to raise the global standards on beneficial ownership, multiplying the impact of our domestic reforms to Companies House.

£1.2 million for a dedicated surge team to accelerate the fundamental reform of the AML supervisory regime, leading to more effective risk-based supervision, more dissuasive enforcement, and greater sharing of high-value information and intelligence.

Recognising the importance of accountability and in line with the principle of transparency, this announcement made on 27 March will be followed in 2024 by the publication of an annual report on the operation of the levy. A more wide-ranging review of the levy will be undertaken by the end of 2027. These reports will be laid before Parliament.

[HCWS675]

Oral Answers to Questions

John Glen Excerpts

Tuesday 21st March 2023 Commons Chamber

[David Simmonds (Ruislip, Northwood and Pinner) (Con)]

2. Whether his Department has made an assessment of the economic impact of ultra low emission zones.

[The Chief Secretary to the Treasury (John Glen)]

Responsibility for transport and air quality within Greater London is devolved to the Mayor of London and Transport for London via the Greater London Authority Act 1999. It is for the Mayor to assess the economic impact of the proposed expansion of the ULEZ, and to consult properly to ensure that it is not just a tax on the poorest motorists.

[David Simmonds]

Small business owners and elderly and disabled residents affected by the ULEZ in my constituency are concerned about the fact that the Mayor’s process has not been as independent or robust as it should be. Will my right hon. Friend consider commissioning the Treasury’s own independent assessment of the impact of the ULEZ, so that my constituents and local business owners can really understand how it will affect them?

[John Glen]

As the Prime Minister said just last week,

“the Mayor of London should listen to the voices of commuters, families”—

including many of my hon. Friend’s constituents—

“and small businesses as he inflicts his…tax on them.”—[Official Report, 15 March 2023; Vol. 729, c. 832.]

As the House has just heard, our Budget last week supported hard-pressed motorists by cancelling the planned increase of about 11p in fuel duty, saving drivers about £5 billion this year.

[Robbie Moore (Keighley) (Con)]

3. What fiscal steps he is taking to support businesses with the cost of energy.

--- Later in debate ---

[Martin Vickers (Cleethorpes) (Con)]

5. What assessment he has made of the economic outlook for (a) Greater Lincolnshire and (b) Cleethorpes constituency.

[The Chief Secretary to the Treasury (John Glen)]

The Government are committed to creating an environment in which economic growth benefits all. The latest data indicates that productivity in Greater Lincolnshire grew by 8.4% from 2010 to 2020, compared with UK productivity growth of 7.9% over the same period. Coastal communities such as Cleethorpes play a vital role in the economy. I am pleased that, following the announcements on the second levelling-up fund, more than £18 million has been granted for the Cleethorpes masterplan.

[Martin Vickers]

The county of Lincolnshire has great opportunities for economic development in both rural and urban areas. In particular, the Cleethorpes constituency is a major centre for the renewable energy sector and contains a major port at Immingham. Freeport status has been granted for the Humber freeport, but I understand that we are awaiting final Treasury sign-off. Can the Minister give us an indication of when that will happen?

[John Glen]

I am pleased to confirm that the full business case for the Humber freeport has now been conditionally approved by the Treasury, with full approval subject to the customs site being designated and the freeport signing a memorandum of understanding with the Department for Levelling Up, Housing and Communities. The Humber freeport is already open for business, supporting the regeneration of the region by creating jobs and attracting new business investment. I am sorry that Treasury processes can sometimes appear tortuous.

[Carla Lockhart (Upper Bann) (DUP)]

7. If he will make an assessment with Cabinet colleagues of the potential impact of increasing the tax-free childcare allowance on the ability of parents to work.

[The Chief Secretary to the Treasury (John Glen)]

Tax-free childcare provides financial support for working parents with their childcare costs. In addition to tax-free childcare, the Chancellor announced at the spring Budget that all eligible working parents in England will be able to access 30 hours of free childcare a week for 38 weeks of the year, from when their child is nine months old until they start school.

[Carla Lockhart]

I thank the Minister for his response. When will the Government start to reward the working families of this United Kingdom? We have a Chancellor who is giving tax breaks to the wealthy to top up their pension pots, yet he cannot support working families by increasing the personal allowance or by offering tax-free childcare that supports all families with childcare needs, particularly families with older children. The high-income child benefit charge remains untouched, leaving households that earn much less than others unaffected. Can the Chancellor update us on his plans to reform this deeply unfair practice?

[John Glen]

I do not accept the overall characterisation that the hon. Lady has given. Just in November last year, 428,000 families and 511,000 children benefited from tax-free childcare. The announcements last week will make a significant contribution, and of course that work will start immediately, with the Department for Education consultation. We have a commitment of £204 million for the coming financial year, and £288 million for the following year, to increase supply so that we can deliver this as quickly as possible.

[Dame Andrea Leadsom (South Northamptonshire) (Con)]

I congratulate the Treasury team on the excellent new policy of providing much more childcare support to families. Will my right hon. Friend persuade the Chancellor to meet me and a small group of colleagues to talk about the policy in the round and about how we can give more support to all families, providing more flexibility where informal childcare is provided—for example, by grandparents—and ensuring that families who want to look after their children at home are not, in effect, left out and left in poverty as a result of the decisions they make for their family?

[John Glen]

I thank my right hon. Friend for her question, and I welcomed the chance to discuss this matter at length with her recently. The Chancellor has indicated that he would be happy to meet her, and I would also be happy to meet her again.

[Kate Osborne (Jarrow) (Lab)]

8. If he will make an assessment with Cabinet colleagues of the potential impact of the spring Budget on gender equality.

[The Chief Secretary to the Treasury (John Glen)]

The Government remain committed to full genuine gender equality and to supporting women. In particular, we are supporting women into work through our new childcare package, which I just mentioned, allowing people to return to work sooner; encouraging business investment through schemes such as the community investment tax relief; and creating new job opportunities with our labour market package. In developing proposals for the spring Budget, the Treasury takes care to consider the equality impacts on those sharing protected characteristics, including gender, in line with our legal obligations and the Government’s strong commitment to promoting fairness.

[Kate Osborne]

I thank the Minister for his response. Let me help him out. If he had made an adequate assessment, he would have found that the spring Budget failed women. It failed young women, women in work and pensioners. Women are more likely to rely on and work in public services, and this Budget made their lives worse, not better. Most of the UK’s poorest pensioners are single women, and the gender pensions gap needs to be addressed. Will he agree to urgently put forward a compensation package to deal with the injustice faced by 1950s women—the WASPI women?

[John Glen]

I do not accept that. I think the WASPI issue has been covered many times, by Ministers from the Department for Work and Pensions and elsewhere. We are putting in £4.1 billion by 2027-28 to expand free childcare. This Government have a record to be proud of: we have increased the number of women in full-time work; we introduced shared parental leave; we introduced the Domestic Abuse Act 2021; and we made a range of interventions last week that many women up and down the country will be very pleased with.

[Mike Amesbury (Weaver Vale) (Lab)]

10. Whether he is taking steps with Cabinet colleagues to support homeowners with increases in mortgage rates.

--- Later in debate ---

[The Chief Secretary to the Treasury (John Glen)]

The Government strongly encourage the effective utilisation of brownfield land, whether it was industrial, commercial or residential in its former use. We invest heavily in brownfield remediation programmes, including £1.8 billion at spending review 2021, as well as the levelling-up fund. National planning policy also sets out what planning policies and decisions should give substantial weight to the value of using suitable brownfield land.

[Yasmin Qureshi]

Bolton town centre is in a parlous state. We lost out in the latest round of levelling-up funding, and the Tory council failed even to send the earlier application for funding. As an ex-industrial town, we have large brownfield mill sites standing derelict and unused, and they are eyesores. We could retrofit them to create affordable social housing to alleviate our housing crisis, develop retail units for new businesses, and support local charities and community groups with such units. With that in mind, what discussion has the Treasury had with Bolton Council and the Department for Levelling Up, Housing and Communities about the merits of such a scheme for the borough?

[John Glen]

I agree with the hon. Lady that Bolton has great opportunities. Its brownfield register shows that it has more than 100 brownfield sites. Of course, the Government have given the Greater Manchester Combined Authority £150 million—£27 million just last year—to deliver local brownfield remediation. The breadth of the existing funds means that specific land remediation funding is not required, but there is provision in the Greater Manchester area, and I think that she should speak to the metro Mayor about it.

[Wendy Morton (Aldridge-Brownhills) (Con)]

The west midlands trailblazer devolution deal, launched yesterday, brings further support for regeneration and infrastructure along with £100 million of brownfield funding, which is good news for areas such as mine. Does my right hon. Friend agree that this issue is key to delivering homes and jobs while protecting our precious greenbelt and will he consider that in any impact assessment study that he undertakes?

[John Glen]

My right hon. Friend makes a very sensible point. This is about finding appropriate development in different communities, and a range of factors will obviously be involved. We have worked closely with local authorities to ensure that we get the right package of measures and legislative changes to enable the development she and her constituents aspire to.

[Tommy Sheppard (Edinburgh East) (SNP)]

13. What recent assessment his Department has made of the impact of withdrawal from the EU on the economy.

--- Later in debate ---

[Rachael Maskell (York Central) (Lab/Co-op)]

14. If he will take fiscal steps to increase funding for social and affordable housing.

[The Chief Secretary to the Treasury (John Glen)]

The Government are committed to delivering social and affordable housing and are investing £115 billion in the affordable homes programme from 2021 to 2026. That is the largest investment in affordable housing in a decade and includes investment in supported housing, social and affordable rent and shared ownership.

[Rachael Maskell]

The affordable homes programme will deliver just 32,000 homes over five years while 1.2 million households are waiting for social houses, yet there was no mention of new money in the Budget last week, which was a massive disappointment in the light of the scale of the housing crisis. In York, we are seeing a net loss of social housing. Will the Chief Secretary ensure that social housing is prioritised, that money comes forward and that we see a real boost to the affordable homes programme so that York, and places like it, can have the housing they need?

[John Glen]

That is a top priority of this Government and I continue to work with colleagues across the Department for Levelling Up, Housing and Communities and other Departments to deliver it.

[Chloe Smith (Norwich North) (Con)]

15. What fiscal steps he is taking to help reduce economic inactivity.

--- Later in debate ---

[Gareth Johnson (Dartford) (Con)]

T5. Delaying the lower Thames crossing will have a detrimental impact on Dartford’s economy and on its traffic problems, so does the Chancellor of the Exchequer agree that the completion of the lower Thames crossing is vital if we are to promote economic growth, not just in Dartford but throughout the south-east of the country?

[The Chief Secretary to the Treasury (John Glen)]

I am grateful to my hon. Friend, who has met me on a number of occasions to make the case for the Dartford crossing. Obviously, in the current difficult circumstances with inflationary pressures, we have had to make some tough choices, but I want to be very clear with my hon. Friend: we remain committed to delivering it. This is a two-year delay on construction, not a cancellation, and I will continue to update him in due course.

[Mr Speaker]

I call the shadow Chancellor.

--- Later in debate ---

[Alexander Stafford (Rother Valley) (Con)]

T10. On behalf of all the residents of Rother Valley and especially Dinnington, I thank the Chancellor for the £12 million that we got in the Budget out of the new fund for capital regeneration projects to revitalise our high street, taking out the burnt-out building and rejuvenating the whole high street. Of course, there are other high streets across Rother Valley, such as in Maltby, Thurcroft and Swallownest, that also need help. Can the Chancellor therefore look favourably on future applications for those high streets so that they, too, can get the money that Dinnington has so necessarily got?

[John Glen]

I hesitate, because my hon. Friend is so effective in campaigning for his constituency. I am glad that we were able to confirm that extra £20 million in the Budget. We will continue to look with a constructive mindset at all the many bids that he brings forward to the Treasury.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

T4.   At the same time as the Chancellor has been dishing out tax cuts for the pensions of the richest earners, the Tories are considering making millions of people work even longer than they had planned before they can get their state pension. Will the Chancellor today rule out changing the state pension timetable?

[James Wild (North West Norfolk) (Con)]

Given that the Chancellor has protected the new hospitals budget, may I express the huge frustration of my constituents at delays in the announcement that the RAAC-ravaged—reinforced autoclaved aerated concrete-ravaged—Queen Elizabeth Hospital in King’s Lynn will be part of the programme and urge that decisions are announced as soon as possible?

[John Glen]

Given that I answered this question five weeks ago, I admire my hon. Friend’s consistency. I very much regret that we have not been able to make that decision yet. As I think I said last time, it is a matter for the Secretary of State for Health and Social Care, and conversations have developed. We have made a commitment on the quantum of money, and I will leave it for my colleague to make that announcement imminently.

[Jeff Smith (Manchester, Withington) (Lab)]

T6. The head of the Institute for Fiscal Studies has said of the Chancellor:“Continuing to muddle through, massage the figures, and implement poorly designed policies will only make the problems worse.”That is a pretty damning verdict on his Budget, is it not?

--- Later in debate ---

[Tulip Siddiq (Hampstead and Kilburn) (Lab)]

On a point of order, Mr Speaker. The Minister said to me in her response that the Chief Secretary had just confirmed with her that we had signed the memorandum of understanding on regulatory co-operation with the EU. Could you please advise me whether she meant that both sides had signed and the agreement has been secured with the EU? I cannot find the details anywhere. Can you advise me where MPs are able to see the agreement?

[The Chief Secretary to the Treasury (John Glen)]

Further to that point of order, Mr Speaker. I can confirm that we have always been ready to sign the MOU, from two years ago—[Interruption.] Well, we have made it very clear to the EU that we are ready to sign. It is a matter for it to come to the table, and we very much hope it will be able to do that. What happened was that as the Financial Secretary came to the Dispatch Box she did not quite hear exactly what I said, and for that I apologise on behalf of the Government. It was my fault.

[Mr Speaker]

I think that clears it up. The answer was no.

Annual European Union Finances Statement

John Glen Excerpts

Friday 3rd March 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

I am today laying before Parliament, “The European Union Finances Statement 2022 on the implementation of the Withdrawal and Trade and Cooperation Agreements’” (CP 759). This is an annual publication and the 42nd in the series.

This year’s edition is the second in the publication series to cover the UK outside the EU. It continues to include an updated government estimate of the financial settlement on withdrawal from the EU, which can be found in annex A, contributing figures in Chapters 2 and 4, and annex C outlines the cumulative payments with their constituent parts, along with HM Treasury’s forecast.

This year’s edition follows the model of the previous edition, based on the European Scrutiny Committee’s recommendations on how to present the information. The cut-off date for reporting for this publication is 31 December 2022, as these statements will continue to be published every calendar year. The focus of this statement remains the implementation of the withdrawal agreement and the trade and co-operation agreement.

Similar to last year, the statement separates backward-looking reporting on the payment of net liabilities made by the UK from HM Treasury’s forecast of outstanding liabilities. Chapter 2 gives a breakdown of the April and September 2022 invoices received from the EU, and their payment during that calendar year, of £5,030,023,023.

Chapter 3 of the statement provides detail on the verification arrangements that HM Treasury has undertaken. HM Treasury works with the European Commission and its implementing partners to ensure their systems and controls over financial reporting are suitable for the specific requirements of the withdrawal agreement. Chapter 4 breaks down forecast outstanding UK net liabilities to the EU from January 2023, providing a point estimate of £13.2 billion (€14.9 billion) of the total outstanding net liability to the EU.

HM Treasury estimates that the current net value of the financial settlement is £37.9 billion. This estimate is within the original estimated range of £35 billion to £39 billion and shows a material reduction against last year’s estimate of £42.5 billion. This is primarily due to the decrease in the estimation of the UK’s share of liability for EU pensions. Taking into account the financial settlement with the EU, the Government have determined how £14.6 billion of spending by 2024-25 can be allocated to their domestic priorities, rather than be sent in contributions to the EU.

HM Treasury has presented a reconciliation to the methodology adopted in previous years to enable comparison on a consistent basis. This is provided in annex A, along with an explanation of some the principal assumptions underpinning forecast methodologies prepared for different purposes.

This statement reports on the status of EU programme association in Chapter 5.

[HCWS599]

Public Service Pension Scheme Indexation and Revaluation 2023

John Glen Excerpts

Monday 20th February 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

Public service pensions continue to be among the very best available.

Legislation governing public service pensions in payment requires them to be increased annually by the same percentage as additional pensions, state earnings related pension and state second pension. Public service pensions will therefore be increased from 10 April 2023 by 10.1%, in line with the annual increase in the consumer prices index up to September 2022, except for those public service pensions which have been in payment for less than a year, which will receive a pro-rata increase.

Separately, in the career average revalued earnings public service pension schemes introduced in 2014 and 2015, pensions in accrual are revalued annually in relation to either prices or earnings depending on the terms specified in their scheme regulations. The Public Service Pensions Act 2013 requires HMT to specify a measure of prices and of earnings to be used for revaluation by these schemes.

The prices measure is the consumer prices index up to September 2022. Public service schemes which rely on a measure of prices, therefore, will use the figure of 10.1% for the prices element of revaluation.

The earnings measure is the whole economy year on year change in average weekly earnings, non-seasonally adjusted and including bonuses and arrears, up to September 2022. Public service schemes which rely on a measure of earnings, therefore, will use the figure of 7% for the earnings element of revaluation.

As announced by the then Secretary of State for Health and Social Care as part of the Government plan for patients on 22 September 2022, the effective date of revaluation will be 6 April 2023 for the NHS Pension Scheme England & Wales, subject to a consultation by the Department for Health and Social Care. The NHS Pension Scheme (Scotland), the Local Government Pension Scheme England & Wales and the Local Government Pension Scheme (Scotland) will also use 6 April 2023 as the effective date, subject to consultation and other processes by the Scottish Government and the Department for Levelling Up, Housing and Communities. For all other schemes in scope of this order, the effective date of revaluation remains 1 April 2023.

Revaluation is one part of the amount of pension that members earn in a year and needs to be considered in conjunction with the amount of in-year accrual. Typically, schemes with lower revaluation will have faster accrual and therefore members will earn more pension per year. The following list shows how the main public service schemes will be affected by revaluation:

Customs Fraud and the European Union

John Glen Excerpts

Thursday 9th February 2023 Written Statements

[The Chief Secretary to the Treasury (John Glen)]

In March 2018, the European Commission took the first steps towards infracting the UK, alleging that between November 2011 and October 2017, the UK had failed to prevent undervaluation fraud involving importations of Chinese textiles and footwear. On 8 March 2022, the Court of Justice of the European Union (CJEU) published its judgment, finding against the UK on most liability points.

The UK has argued throughout the case that it took appropriate steps to counter the fraud in question. However, since these infringement proceedings were raised, the UK has taken proportionate and increased steps to combat this fraud without impacting legitimate trade, including by liquidating suspect traders through enforcement action. The UK takes a comprehensive and dynamic approach to tackling customs fraud risk and evolves its responses as any new potential threats emerge.

Whilst the UK has now left the European Union and this is a legacy matter from before our departure, the Government are keen to resolve this long-running case once and for all and are committed to fulfilling their international obligations.

Throughout this process, the Government have also been conscious of the risk of further protracted legal proceedings, which could open UK taxpayers to not only a larger principal bill, but also continued substantial interest accrual. Considering this, in June 2022 the UK took the proactive step of making a payment of €678,372,885.63, which the then Chief Secretary to the Treasury set out in a statement to the House on 30 June (HCWS167). This represented the minimum, indisputable amount the UK considered due at that time in light of the CJEU judgment and, vitally, stopped interest accruing on this portion of the bill.

Following further discussions with the European Commission, on 13 January 2023, the UK made a final principal payment to the EU of €700,351,738.31. This constitutes the entire remaining principal due and the figure paid reflects the 12.43% share back that the UK is entitled to from its time as a member state.

On 6 February 2023, the UK made a final payment to the EU of €1,227,884,519.53, representing the interest due on the principal amounts paid. These are substantial sums but represent the final payments and draw a line under this long running case, with the UK fulfilling its international obligations.

Now that the UK is no longer part of the EU customs union, we do not have to remit any duties to the European Union, a tax that in 2021-22 represented a £4.9 billion contribution to the Exchequer. Outside the EU, we can set our own law, including tax and trade policies, that work for the UK. Furthermore, taking into account the financial settlement with the EU, the Government have determined how an additional £14.6 billion of spending by 2024-25 can be allocated to its domestic priorities, rather than be sent in contributions to the EU. This additional spending was already included in the overall spending plans that the Government set out at previous spending reviews.

[HCWS561]

Oral Answers to Questions

John Glen Excerpts

Tuesday 7th February 2023 Commons Chamber

[Chloe Smith (Norwich North) (Con)]

15. If he will make an assessment of the potential contribution of payroll employees to supporting economic growth.

[The Chief Secretary to the Treasury (John Glen)]

Unemployment is at a record low of 3.7%, although we recognise that there are labour shortages due, in part, to a rise in working-age inactivity. Tackling that inactivity and supporting growth remains a priority for the Government, and the Secretary of State for Work and Pensions is working on a thorough review, which will conclude very shortly.

[Chloe Smith]

I am glad my right hon. Friends have taken up the urgent issue of economic inactivity. Does the Minister agree that support for disability and poor health must be improved to help people to start, to stay and to succeed at work? Will he ensure that spending on Access to Work keeps pace, and will he look at a disability employment endowment fund?

[John Glen]

Absolutely, I will look at that. The Government have already committed £1.3 billion of funding to help those with health conditions or disabilities to get into work and to thrive. This is a complex area with a number of interlocking factors, at which we are looking very carefully at this moment.

[Sarah Green (Chesham and Amersham) (LD)]

16. What steps he is taking to help ensure access to in-person banking services.

--- Later in debate ---

[Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)]

18. What recent discussions he has had with the Secretary of State for Levelling Up, Housing and Communities on the impact of inflation on projects to be delivered under the levelling-up fund.

[The Chief Secretary to the Treasury (John Glen)]

The Government recognise that inflation has created a challenging delivery landscape for capital infrastructure projects, including the levelling-up fund. That is why we have made £65 million in delivery support available to successful applicants to ensure that local residents see the benefits of the Government’s investment.

[Jonathan Edwards]

Thank you for getting me in, Mr Speaker. As the Minister said, there have been significant inflationary costs since many of these projects were announced. The feedback I am getting about many of the capital projects in the Swansea bay area is that the same can be said for the city deals. What discussions are taking place with delivery partners to ensure that sufficient central support is available for projects that are in the pipeline to be completed?

[John Glen]

There is a constant dialogue at a central and local level to evaluate projects and look at what can be done to maximise delivery in the anticipated timeframe. Obviously, inflation affects the whole economy and every Secretary of State who comes to see me raises the same issue. That is why the Government are so determined to halve inflation and set the conditions for growth.

[Mr Speaker]

I call the shadow Minister.

[Mr Pat McFadden (Wolverhampton South East) (Lab)]

Following the recent levelling-up round 2 announcements, in which all five bids from Birmingham were refused, as were both bids from the great city of Wolverhampton, but, miraculously, the one from the Prime Minister’s constituency was approved, the Conservative Mayor of the West Midlands Combined Authority, Andy Street, said:

“Fundamentally this episode is just another example as to why Whitehall’s bidding and begging bowl culture is broken”.

What is the Chief Secretary’s response to the Conservative Mayor’s comments?

[John Glen]

My response is to explain that there is a rigorous process of scoring and evaluating all bids very carefully, as there has been over both rounds. In rounds 1 and 2, 45% was given to constituencies held by Opposition parties and 66% was targeted at category 1 constituencies. I recognise the disappointment some colleagues will feel and, therefore, there is another round. Details of that will be made available in due course.

[Mr McFadden]

Right now in the United States, job opportunities and investments throughout the country are being driven by the Inflation Reduction Act. The European Union is responding with an incentive package of its own. But the new Energy Secretary describes both those policies as “dangerous”. Does the Chief Secretary agree that the Inflation Reduction Act is dangerous? Or does he think that the UK needs a response that makes sure that we do not lose out on the green transition and that we, too, need a Government who want to see investment and jobs from the green transition in every part of the UK?

[John Glen]

The Government are totally committed to meeting our net zero obligations. In the comings weeks, as we prepare for the Budget, the Chancellor will be considering these matters in the decisions he brings to the House. Every economy will have a different set of pressures, but we will do everything we can to address the need to find the conditions for growth, deal with inflation and ensure that we set the economy fair for the future.

[Kate Hollern (Blackburn) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

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[Kevin Foster (Torbay) (Con)]

T7. I only have to look at the Bench behind my right hon. Friend to know that the needs of Torbay will be at the centre of the Treasury’s thinking. What fiscal steps will he take in response to the “Communities on the Edge” report produced by the Coastal Communities Alliance?

[The Chief Secretary to the Treasury (John Glen)]

I take that report and my hon. Friend’s advocacy for the needs of coastal communities seriously, and I look forward to meeting him shortly. Alongside the rural England prosperity fund, the £2.6 billion UK shared prosperity fund gives local leaders in coastal areas the freedom to target local issues, but I look forward to further conversations with him.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

T5.   Last year’s register of overseas entities was meant to crack down on corrupt elites using the UK to launder illegal wealth, but today’s BBC and Transparency International report shows that it is clearly not working, with less than half the required firms making declarations and others fudging it. That brings into question the Government’s commitment to tackling illegal wealth and wealth inequalities. What will the Government do about this?

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[James Wild (North West Norfolk) (Con)]

Given the serious condition of the Queen Elizabeth Hospital in King’s Lynn, does the Chancellor agree that it would be better value for money to build a new hospital rather than to patch this one up? Will the Treasury back the plan by the Department of Health and Social Care to do just that and include it in the new hospitals programme?

[John Glen]

As we discussed when we met two weeks ago, it is a top priority for us to resolve the profile of spending for hospitals like that one, in which reinforced autoclaved aerated concrete was used and which need that urgent work. We are working on it quickly, but I do not want to steal the thunder of the Secretary of State for Health and Social Care, who will ultimately make those decisions.

[Liz Saville Roberts (Dwyfor Meirionnydd) (PC)]

The Public Accounts Committee has expressed concerns about the difficulties taxpayers face in getting timely responses and action from His Majesty’s Revenue and Customs. My constituent Kirsty Lloyd and her former employer Llion James have missed out on thousands of pounds-worth of statutory maternity pay support, which they feel is because of delays and poor communication with HMRC. Their case has now timed out. Would the Treasury consider extending the time during which a claim can remain active in cases where there is a dispute with HMRC?

[Robin Millar (Aberconwy) (Con)]

My hon. Friend the Member for Ynys Môn (Virginia Crosbie) has run a tenacious campaign for a freeport. Can my right hon. Friend confirm that the benefits of such a freeport would be felt across north Wales and comment on the benefits that students in my own constituency might feel when considering a future career in north Wales?

[John Glen]

My hon. Friend is absolutely right that freeports offer tax relief, simplified customs processes and business rates retention. The evaluation process for the three bids that came in at the end of November is well under way and I hope that conclusions will be made in the very near future.

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

As the hon. Member for South West Bedfordshire (Andrew Selous) said, some businesses have bought in energy at a very high rate because of when they sealed their contract. Many of my local pubs and hospitality businesses will go bust in the beginning of the next financial year because their bills are so out of kilter; they say they would have to charge £15 a pint to survive. Even in London—even in Shoreditch—that is just not feasible. What extra support is the Treasury even considering as we approach the financial statement next month?

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[Richard Burgon (Leeds East) (Lab)]

It would cost around £1 billion to give nurses an inflation-matching pay rise. Scrapping the non-dom tax avoidance scheme used by the super-rich would raise more than £3 billion. Why, then, is the Chancellor putting non-doms before nurses?

[John Glen]

The Chancellor is not doing that. There is a clear process in place, and we continue constructive dialogue with all professions in dispute with the Government and with their employers. This is obviously a challenging circumstance and we recognise how difficult it is.

[Kit Malthouse (North West Hampshire) (Con)]

When the Chancellor acceded to the Treasury throne, he appointed a panel of four advisers drawn from the City. Has the panel met, has he added anybody from small business or industry, and where can we find the minutes, please?