Finance (No. 2) Bill

Martin Caton Excerpts

Wednesday 9th April 2014 Commons Chamber

[Sheila Gilmore]

We hear so much in this House about how little money there is and how hard it is, yet certain members of the Government support this measure. It appears that not all do—the Lib Dem part of the coalition may or may not support it; it said it did not previously. We are talking about only a small amount of money, but let us see what it is equivalent to. Many people in this country have been outraged by the Government’s bedroom tax. Even if that makes the savings the Government claim it will, which I doubt, it will save less than the amount this measure will pay out. That is the problem: the Government say that the issue that has to be addressed all the time is saving money, but clearly when it comes to some things saving money is not quite so important. There are priorities, and the Government have chosen to make this policy one of them.

I believe we should be giving particular help to families with children, and not just to couples because they happen to be married. Apart from in respect of the very poorest, I have not noticed any great appetite to do away with the couple penalty that probably does apply in terms of people in the benefits system. But if two people choose to marry, we have an independent taxation system here and they can choose to work or not work, so I do not see where any great penalty is being applied to marriage. For those who have children the situation may be different.

If the Government wanted specifically to help parents who are staying at home with children, perhaps that is what they should have done. This measure does not do that; it helps couples where one person is not working, but it has no relationship with the needs of any children they may be raising. If our main aim is to help people with children and make sure that children are brought up in stable relationships, I cannot see what this measure has to do with that. The reason many relationships break down, whether or not they are marriages, has to do with financial insecurity and the difficulties that causes. Those struggling through a cost of living crisis and those who have lost out because of many of this Government’s policies particularly include the low paid. We can all pick and mix our experts—some hon. Members have cited views of the Institute for Fiscal Studies—but if we really want to help low-paid people, we must examine things such as the proposed tapering for universal credit. We need to examine the structure in place for working people who will be in receipt of universal credit—the replacement for tax credits. Under the current structure there is a serious lack of support for second earners in the family who want to start building up their earnings. We could be looking at such things, including child care help for low-paid families.

Very briefly, let me tackle something that was mentioned by the hon. Member for Peterborough (Mr Jackson). He did not take my intervention, so I will deal with it now, and, as he raised the matter, it must be relevant to this debate. One statement that Government Members are always keen to make is that every Labour Government leave office with unemployment higher than when they arrived, but it is not true. In 1946 unemployment was 2%, and in 1951 it was 1.3%. In 1951, at the beginning of the Tory Government, unemployment was 1.3%, and in 1964 it was 1.7%, so it went up under a Tory Government. Between 1979 and 1997, which was again a Conservative Government, unemployment went up from 5.2% at the beginning to 7.4% at the end, but for 13 of those 18 years, unemployment was above 10%. Therefore, the statement is not true, and it also completely distorts the appalling unemployment record of the Government between 1979 and 1997. I will now sit down and allow others to speak.

[The Temporary Chair (Martin Caton)]

Order. I wish to call the Minister by 3.45 pm at the latest, so I ask the hon. Member for Gainsborough (Sir Edward Leigh) to ensure that he has sat down by then.

[Sir Edward Leigh]

I am grateful, Mr Caton. I apologise for not being here at the beginning of the debate, but I was at the Council of Europe. I wanted to come back here to speak on this measure especially, because I have campaigned for it for many years. This is a very proud moment for our party. We are fulfilling an election manifesto, and I am delighted that at last it will happen. I have no doubt that the party will unite today at 4 o’clock to vote through the measure.

There is no doubt that marriage is the fundamental institution of society. It is the one that contributes the most to the cohesiveness and sustainability of society, and I do not think that anyone disagrees with that. But for too many families, the tax system simply punishes marriage. Why do we have a tax system that does that? It should facilitate marriage. The system has led to numerous social problems that, aside from the obvious human cost, create an undue financial burden on the state. Ultimately, if we promote marriage and support it in the financial system, the state saves money, and we create a happier society. Creating a transferable allowance will strengthen the institution of marriage—that may be only a message, but it is a strong one. It will provide benefits for adults, children and society as a whole.

I am afraid that marriage rates are at an all-time low. The scale of family breakdown as a social problem is increasing all the time. It is estimated that it has cost us between £24 billion and £41 billion to deal with it every single year.

The absence of a transferable allowance obviously makes marriage less attractive to prospective husbands and wives and more costly than it should be for some people. However, that is not the main point. The main point is that we are creating a powerful message that marriage works and it is good for children. As I said in an earlier intervention, a married couple where one partner stays at home is uniquely disadvantaged by the tax system. That cannot be fair.

I agree that policy must be based on evidence, and the evidence is absolutely clear. Regardless of socio-economic status and education, co-habiting couples are between two and two and half times more likely to break up than equivalent married couples. The poorest 20% of married couples are more stable than all but the richest 20% of cohabiting couples. The 2004 Blanchflower and Oswald study in the US and UK shows that the effect of marriage on mental well-being is estimated to be equal to that of an extra $100,000.

A 10-year study of British households found that the health gain from marriage may be as much as the benefit from giving up smoking. The Centre for Social Justice found that those not growing up in a two-parent family were 75% more likely to fail at school, 70% more likely to become addicted to drugs and 50% more likely to have an alcohol problem. We should pay tribute to the Prime Minister, the leader of the Conservative party, for constantly expressing his support for the institution of marriage.

Marriage is even a predictor of survival rates in patients with lung cancer, according to The Independent newspaper. The transferable tax allowance will be in line with international best practice. This is not some way-out wacky idea from the Christian right, but what most countries do. Of the biggest countries in the OECD, it is only the UK, Mexico and Turkey that do not have a transferable allowance. It is only 24% of the population of all the OECD countries that are not benefiting from this transferable allowance for married couples. It is a common idea that is widely accepted all over the world. It works; it is normal; it is good.

The UK is one of the only countries in the OECD not to recognise marriage in the tax system. The comparison between the United Kingdom and the OECD average is telling. The tax burden on the single earner married couple with two children on the average wage in the United Kingdom has increased from being 33% greater than the OECD average to now being 42% greater. Clearly, the problem is growing. Introducing a transferable allowance for married couples will disproportionately benefit poorer families and those in the lower half of income distribution. I am proud of what we are doing and I am proud that at last, this afternoon, we are recognising marriage in the tax system.

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[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

I beg to move, That the clause be read a Second time.

[The Temporary Chair (Martin Caton)]

With this it will be convenient to discuss the following:

Amendment 1, in clause 112, page 94, line 1, at beginning insert—

‘(1) Before bringing forward any further reform of the bank levy rates system, the Chancellor shall lay before Parliament a report considering the impact on the total receipts paid to the Exchequer since 2010 by—

(a) UK banking groups;

(b) building society groups;

(c) foreign banking groups; and

(d) relevant non-banking groups.

(2) The report will pay particular attention to receipts from—

(a) corporation tax;

(b) the bank levy; and

(c) bank payroll tax.

(3) A copy of the report in subsections (1) and (2) shall be laid before Parliament.’.

Clause 112 stand part.

[Cathy Jamieson]

It is a pleasure to be here this afternoon to continue what have been interesting debates, as they always are on Finance Bills. I notice that the hon. Member for Peterborough (Mr Jackson) is no longer in his place, but I thought I ought to declare my interest, given his comments to my hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) about tofu-eating, Guardian-reading, sandal-wearing people. If I say nothing other than that I am a vegan, perhaps Members will see that those comments would have been more aptly aimed at me rather than my hon. Friend, who I am assured is not a tofu eater.

The new clause and amendment build on points that the Opposition have made before, both on previous Finance Bills and in various other debates. New clause 5 would require the Chancellor to review and report on the feasibility of reintroducing a bank payroll tax, otherwise known as a bank bonus tax, and on whether the additional revenue could be used to fund a job guarantee scheme for people in long-term unemployment, along the lines that we have proposed. The new clause and amendment are reasonable and relatively straightforward, and there is no hidden agenda behind them. The Exchequer Secretary will know from previous Finance Bills and other debates that I always make reasonable suggestions, and I wish to explain why we believe that the new clause is the right approach at this time.

To put the matter into context, nearly 1 million young people are unemployed, and the time is right to do something about that by repeating the tax on bank bonuses to fund a compulsory jobs guarantee for every young person who has been out of work for more than 12 months. We have been clear that they would have to take that job, or they would lose benefits. The bank bonus tax would help to fund the first year of such a guarantee. As I have said, there are a large number of long-term unemployed people, and the guarantee would help to ensure that not just young people but those over 25 who had been out of work for two years or more got back into work. I will come on to why that is so important, but we believe that the bank bonus tax, coupled with our plan to change pension tax relief, would ensure an annual revenue stream to fund that policy throughout the next Parliament.

I was expecting that Government Members might raise a particular query at this stage, but I will save them the trouble of intervening by saying, for the avoidance of any doubt, that the compulsory jobs guarantee is the only policy that we intend to be funded by the bank bonus tax and the proposed changes to pension tax relief.

Let me give the context of the previous bankers bonus tax—the bankers’ payroll tax, as it was called at the time. Despite comments that Government Members often make, it is generally acknowledged that the banking system survived the financial crash in 2007-08 largely due to the significant support that it received from the taxpayer. Even today, according to the New Economics Foundation, the banks deemed too big to fail continue to receive pretty generous taxpayer support. Barclays, the Royal Bank of Scotland, HSBC and Lloyds enjoyed combined savings of £37.7 billion in 2012, because the financial markets deemed them to big to fail. Arguably, that has left some smaller banks and new competitors at a disadvantage, because they cannot enjoy the subsidised borrowing rates of the big four. Notwithstanding the changes that have been made, about which I will say more, the banking system arguably remains too concentrated and potentially risky. The reality—the Minister and others will be well aware of it—is that, if there is another problem in any of the banks, or another financial crisis, taxpayers would bear the costs of the bail-out.

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[Debbie Abrahams]

I should like to make a quick point about the evidence that links entry-type jobs to future career progression. That evidence is weak, so my hon. Friend is right to say that a sustained approach needs to be taken. Is she also aware that a Prince’s Trust report on long-term youth unemployment shows that one in five young people who are long-term unemployed feel that they have nothing worth living for? Long-term unemployment has a direct effect on finances, but it also affects how young people view themselves in society. The implications of that are—

[The Temporary Chair (Martin Caton)]

Order. This is an extremely long intervention.

[Cathy Jamieson]

My hon. Friend was making a valuable point. I am well aware of the excellent work being done by the Prince’s Trust. Many young people who felt that they had very little hope have been given hope through their involvement in that work. It has given them confidence, skills, training and, in many cases, an opportunity to get their first job, so that they can start earning and contributing to society. That should be our aim for all our young people.

I therefore hope that the Government will agree to our proposal for a report. We believe that the scheme would cost about £1.9 billion. As I have said, the cost would be met in the first year by the tax on bonuses and by the reduction in the rate of tax relief available to those earning more than £150,000 a year. Those measures should generate more than £2.5 billion, and the annual revenue generated by the changes to pensions tax relief would fund the jobs guarantee throughout the next Parliament.

We have consistently argued for the reintroduction of the bankers bonus tax, to ensure that the banks fulfil their obligation to the taxpayer by supporting jobs and growth in the economy. That is why we are calling on the Government again today to stand up for the taxpayer, and for those people who are desperate to get into work, including young people and the long-term unemployed. We are calling on the Government to send a clear signal to the banks by supporting us today.

Amendment 1 to clause 112 relates to the bank levy. This, too, involves a request for a report. In this instance, we are requesting that the Chancellor, prior to implementing any further reforms to the bank levy, should lay before Parliament a report that considers the impact on the total tax receipts paid to the Exchequer since 2010 by UK banks, building societies, foreign banks and relevant non-banking groups. We want the report to pay particular attention to receipts generated from corporation tax, the bank levy and the bank payroll tax.

It is important to set this proposal in context. In the recent Budget, a consultation was announced on the proposed changes to the bank levy. We are concerned that those changes could lead to the bigger banks paying less as a result of the introduction of a band-based system in which the tax of an individual bank would be capped at an upper limit of £375 million. I know that the Government have said that this measure would be cost neutral, but we are not convinced that it would be of benefit. We have made it clear in the past that, when we are in government, we will put in place a bank levy and use the additional funds raised to expand free child care for working parents of three and four-year-olds from 15 to 25 hours a week. Perhaps that is a debate for another day, however. I shall focus on the bank levy.

We have made it clear all along that a bank levy is not a bad idea in itself. As my hon. Friend the Member for Nottingham East (Chris Leslie) has argued in Committee and on the Floor of the House, however, the proposal was unambitious and has been poorly implemented. When the Chancellor announced its introduction in May 2010, he confidently asserted that it would generate more than £2 billion of annual revenues. That is the assertion he has made on several occasions and it has been enthusiastically backed by the Prime Minister.

Transport Infrastructure (North Wales)

Martin Caton Excerpts

Tuesday 26th November 2013 Westminster Hall

[Martin Caton (in the Chair)]

As can be seen from the attendance, there is quite a bit of interest in this debate. Six Back-Bench Members have already indicated that they would like to speak, so if Members can curtail their remarks as far as possible, we will get everyone in.

[Mark Tami (Alyn and Deeside) (Lab)]

I welcome you to the Chair, Mr Caton. It is a pleasure to serve under your chairmanship.

I am pleased to have secured this debate on an important issue. I will mainly concentrate on north-east Wales, particularly its economic importance, the history of the area and why the transport links that we have now and that we hope to have in future are so important.

The area, whether people want to call it the Deeside hub or Mersey-Dee, covers Flintshire, Wrexham, Denbighshire, Cheshire west, Chester and Wirral, with a population of about 1 million and gross value added of some £17 billion a year. Some 83% of the area’s journeys start and finish in the area. More than 17,000 people commute across the border to England, and some 10,000 go the other way. There are also students who go to Chester, and students going the other way to Glyndwr university.

I am pleased to say that the area contains many modern and very successful manufacturers, with Airbus, Toyota, Shotton paper, Tata Steel Colors, ConvaTec and many more on the Deeside industrial park. On the other side of the border, we have Vauxhall at Ellesmere Port, Bank of America and, again, many more. Indeed, north Wales accounts for more than 30% of the manufacturing output of Wales as a whole. I know that colleagues both in England and in Wales are surprised at the size and skill levels of some of those factories and at the number of jobs involved. My hon. Friend the Member for Vale of Clwyd (Chris Ruane) will no doubt talk about the Technium in St Asaph, and my hon. Friend the Member for Ynys Môn (Albert Owen) will talk about Wylfa in Anglesey.

Airbus employs more than 6,500 people, 60% of whom live in Wales, coming from as far afield as Anglesey. The other 40% live in England, coming from as far afield as Derby, or so I am advised—that seems a fairly long commute to me, but apparently it is the case. There is substantial spend in the local economy, but those people need to get to and from their place of work. The supply chain is beginning to site in the local area, which, again, is creating more jobs. The big danger is that we take all that for granted, as if it will be there for ever and a day.

I have told this story before, but I will tell it again because I think it is worth telling. When I entered Parliament in 2001, before giving my maiden speech—I am sure other colleagues did the same—I looked at what my predecessor did. My predecessor, who is now Lord Jones, talked about the two great powerhouses of the area, which were Courtaulds Textiles and British Steel. One of those companies has gone altogether, and the other is still important but employs only a fraction of the numbers it did back then. It still holds the record for the most job losses on a single day at a single plant, when more than 8,000 people lost their job. We cannot assume that, just because companies are big and employ a lot of people, they will be there for ever and a day.

Many other areas that suffered in the 1980s have still not recovered, but because of the efforts of Flintshire county council and others, including my predecessor Lord Jones, new investment was attracted to the area, and we have managed to build on that. Importantly, we want to attract companies that will stay, not just companies that come because they want grant assistance and that will then up stumps and move somewhere else. We want long-term investment not only in buildings but in the work force. Even in good times, we have seen that successful companies can still fail. I remember when we thought that the optical fibre market was doing extremely well, but it crashed overnight and the high-tech factory closed. We lost quality jobs in a relative boom period.

We are getting by okay at the moment, so why do we need to improve and update our transport network? To be honest, we are barely getting by. If we get the level of growth in the local area for which we hope, we will need to improve things, because our transport system is creaking at the seams in places. The Mersey Dee Alliance carried out research, which is included in both the Haywood and the north-east Wales integrated transport taskforce reports to the Assembly, showing that we can expect to get between 40,000 and 50,000 jobs in the next 20 years. That figure comprises Mersey waters enterprise zone, with 20,000 jobs; Deeside enterprise zone, with 5,000 to 7,000 jobs; 4,500 jobs at Ellesmere Port; Ince resource recovery park, with 3,200 jobs; the university of Chester’s Thornton site, with 2,000 to 4,000 jobs; central Chester business district, with more than 1,000 jobs; the Northgate project, Chester, with 1,600 jobs; Wrexham industrial estate and western gateway, with 2,500 jobs; 7,500 jobs in Denbighshire; Vauxhall Motors, with 700 jobs; and Bank of America, with 1,000 jobs. So we hope that a substantial number of jobs will come to the area during the next 20 years, which is positive stuff, but we need a modern transport system that works to ensure that that happens.

We are already over-dependent on car usage. In Flintshire, more than 80% of people use their car to travel to work, which is a very high figure—Flintshire had the highest car usage in the country, but I do not know whether it still does—and I am sure the figure is not much different in other parts of Wales. I do not think that is just because people like using their car; it is because there is a problem getting anywhere using any other system of transport.

The north-east Wales integrated transport taskforce report of June 2013 clearly highlights some of the problems that we are facing. I will illustrate them by referring to a few journeys to the Deeside industrial park. From Flint by car it would take an estimated 16usb minutes, and by public transport 43 minutes, which is not too bad. Rhyl is 39 minutes by car, or one hour and 25 minutes via a bus and a train with one change. Denbigh is 44 minutes by car, or two hours and 17 minutes by public transport—a bus and a train, two changes. Wrexham is 32 minutes by car, or one hour and 25 minutes by public transport—it is a bus and two changes, even from Wrexham. Frodsham is 24 minutes by car, or one hour and 14 minutes by bus and train, again involving two changes.

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[Chris Ruane (Vale of Clwyd) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Caton. I pay tribute to my hon. Friend the Member for Alyn and Deeside (Mark Tami), who secured this debate for us, for his good work in promoting north Wales and his constituency in Parliament.

I will talk first about rail transport in north Wales. In the 19th century, rail transformed north Wales. My home town of Rhyl had a population of 1,000, but when the train came in 1849, it turned Rhyl into a premier tourist destination. Rail also opened up the port of Holyhead and the train route to Ireland, bringing great wealth to north Wales.

In the mid-20th century, rail took a dip with the advent of Beeching. Many smaller lines in north Wales and throughout the UK were closed, but in the 21st century we are looking at a rail renaissance. North Wales MPs must ensure that we receive our fair share of the UK transport budget. London and the south-east have had massive input into their transport infrastructure. They have had Eurostar; Crossrail, one of the biggest construction projects in Europe, is being built; and Heathrow airport has been extended. Many people in the south and London do not want what they believe is over-intensification.

MPs must look at the regional impact of transport investment. There should be a rebalancing towards Wales and north-west England, and we in north Wales must ensure that we tap into that transport infrastructure. We must also ensure that we do not get just crumbs from the table, as we did when Virgin’s rolling stock was upgraded and we ended up with Voyagers instead of Pendolinos. We must ensure that we are not short-changed on electrification of the north Wales line, and that we get transport links to the Manchester end of HS2 so that we have the proper investment to attract tourists and manufacturers to north Wales.

The road infrastructure in north Wales is also important to bring in tourists and manufacturing as well as research and development. I pay tribute to the work of Glyndwr university, which called the A55 a “knowledge corridor”. In my constituency, it has invested in the optic research and development centre, which won a £200 million bid to create the optics for the extra large telescope that will be located in the Atacama desert. That is the sort of 21st-century investment we need in north Wales.

There is a proposal for an A55 science corridor from St Asaph business park in my constituency all the way to Daresbury near Manchester, taking in Airbus and the optic research and development centre to bring that science corridor alive with jobs and investment. That is important.

Airports are essential for us in north Wales. Our regional airports are Liverpool and Manchester, and public transport links to them are very poor. If investment is coming, we must ensure that we have coach and rail links direct to those airports. I take on board the point made by my hon. Friend the Member for Ynys Môn (Albert Owen)—Ynys Môn is fair old distance from Liverpool and Manchester—that there is a definite need for an airport in north-west Wales.

My hon. Friend the Member for Alyn and Deeside mentioned the jobs growth in his constituency at the Deeside industrial estate and at Airbus. There are already tens of thousands of jobs there, and tens of thousands are to come. We must ensure that workers from the unemployment hot spots on the north Wales coast at Holyhead, Bangor, Colwyn Bay, Rhyl and Flint can get on the train in their home town and get off at dedicated stations for the Airbus factory and the Deeside industrial estate, where the jobs are. Will the Minister look at the Department for Work and Pensions transport grants that were available about 10 years ago to help to link people to jobs?

As well as speaking about the big stuff—airports, rail and road—I want to speak about cycling in my constituency. My right hon. Friend the Member for Delyn (Mr Hanson) referred to the north Wales coastal path, which brought 416,000 visitors to his county last year. It is a fantastic facility for north Wales and I pay tribute to Sustrans for attracting millions of pounds of lottery funding for the UK coastal footpath and cycleway. A £4 million dedicated cycle bridge, Pont Dafydd, was opened in my constituency two weeks ago, and I am grateful to the Welsh Government for their investment in that, to the European regional development fund, to Sustrans and to Denbighshire county council. Cycling is an important form of local transport. My constituency has the finest off-road cycle networks in Wales, and I pay tribute to Adrian Walls, the cycling officer for Denbighshire, Gren Kershaw, who set up a cycling attraction in my constituency, and Garry Davies and Howard Sutcliffe from Denbighshire’s countryside services, which have provided fantastic cycling facilities.

Finally, the first hovercraft passenger service in the whole world was from Rhyl to Wallasey in 1963. Is a future transport link possible across the Dee estuary to link the hundreds of thousands of people on the Wirral and Merseyside directly to Rhyl?

[Martin Caton (in the Chair)]

I will call you now, Mr Williams, but I appeal to you to sit down at 10.40 for the wind-ups.

Beer Duty Escalator

Martin Caton Excerpts

Tuesday 5th March 2013 Westminster Hall

[Anne Marie Morris (Newton Abbot) (Con)]

I agree with my hon. Friend that in a rural community very small micro-breweries and pubs are very important. My constituents in Devon are great supporters of Teignworthy, Isca, Hunter’s and Red Rock. However, we need to look at something creative. Has my hon. Friend considered looking at the EU rules in this area? We all seem to be saying that pubs need our support and that if beer in pubs was taxed less than the beer in supermarkets or wholesale, the situation would improve. As I understand it, EU legislation does not prohibit that distinction, but it does not make provision—

[Martin Caton (in the Chair)]

Order. That is very long for an intervention.

[Glyn Davies]

Thank you, Mr Caton. I was enjoying that intervention, although I must admit that I had some initial doubts about the reference to involving the EU and introducing regulations. I have always found myself nervous about encouraging that; we have rather too much of it already. There are instances in which the EU can be useful to us in achieving our objectives, so I will have to consider how that could happen.

A Treasury Minister will respond to the debate today. It could be said that it is an appeal before the Budget—it seeks to influence the Budget. We are talking about a reasonable level of taxation on beer. Most people think that the level of taxation is unreasonable. Due to its negative impact, it does not even produce extra income that might interest the Treasury, because it has risen incredibly quickly.

I felt some association with the comment of my hon. Friend the Member for Bedford (Richard Fuller), who said that the policy was un-Conservative. I do not want to draw a distinction between a Conservative policy and a policy from the other side, but it must be un-Conservative to seek to introduce social change in our country through the escalator’s year on year additional taxation, over and above what might be considered an inflationary increase by the Treasury. It is incredibly un-Conservative and I very much hope that we will see the end of it next week.

A lot of hon. Members have talked about the economic impact. It is a great British industry. Even in my constituency, which has had no tradition of brewing at all— the Eagle Brewery was the last major brewery, and that closed in the 1980s—there are new micro-breweries. They are employing people. One of them has taken over a local pub that was in danger of closing. Monty’s Brewery and the Waen Brewery are the subject of conversation. They are not employing a lot of people, but the potential for micro-breweries across Britain is huge. They are an important part of British industry, and we should not clamp down on them or discourage them.

My last point is that the British beer drinking industry—if I may call it that—is hugely important to the agricultural sector. Not so much in my constituency, where most of the barley grown goes into feedstock, but in England in particular and in some parts of Wales and Scotland, growing malting barley is a massive part of agriculture, and we need to act to protect it. In south-east England, the hops industry is important and a huge number of jobs are involved.

We are used to and accept a reasonable level of taxation, but a 50% increase in five years is not reasonable and not sustainable. It causes huge damage—social damage—across the country and in the end it will cause economic damage to the Government as well. The Minister should sit down with the Chancellor, have a long discussion about this issue as they prepare to deliver the Budget, and bring the beer escalator duty to an end.

Eurozone Crisis

Martin Caton Excerpts

Tuesday 15th November 2011 Westminster Hall

[Several hon. Members]

rose—

[Martin Caton (in the Chair)]

Order. I want to start the winding-up speeches at 10.40 am. At least seven hon. Members are indicating that they would like to speak, so greater brevity of speeches will mean a greater number of them.

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[Neil Carmichael]

Well, we were blasted out of the ERM. We do not want to repeat that fiasco, and we should all recognise that.

We talked briefly about the United States. Gerald Ford, President of the United States in the mid-1970s, refused to bail-out New York, and quite right, too. He was a fiscal conservative. That was the right decision in the long run, and, of course, a decision that did not affect New York’s membership of the dollar. I just wanted to put that on the record.

We must focus on two things, and the Prime Minister identified them both in his speech yesterday. I want to ram home the importance of reforming the European Union, because that is what it needs. In particular, we have to drill down on the single market, to ensure that it is a single market and that competitiveness in goods and services is enhanced. We can really do that.

On euro measures, this country would be making a big mistake if we assumed that the euro will not affect us significantly, because it certainly will. [Interruption.] I shall wind up. I have been so generous with interventions that I do not have the time to point out that we need fiscal union in the eurozone, the ECB to be enhanced—as my hon. Friend the Member for Cities of London and Westminster (Mark Field) rightly said—and much more rigorous auditing of what is going on.

Last but not least, there is a democratic deficit, although the IMF extension was discussed in the House and we voted on 11 July. I have noticed two things. First, Germany and France are effectively bypassing the Commission in a lot of their decisions—

[Martin Caton (in the Chair)]

Order. The hon. Gentleman has gone on beyond the time at which I said that I wanted to start the winding-up speeches. Many Members have asked the Minister questions to which they want to hear the answers. I should be grateful to the hon. Gentleman if he stayed seated now.

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[Mr Baron]

Returning to a previous point, I suggest that the reason why the eurozone crisis is causing a bit of a problem over here is that existing policy is making the situation worse. Denying devaluation is forcing greater austerity packages on populations that are already trying to pare down their debt. That is the problem that the Government do not see.

May I take my hon. Friend back to devaluation? The Government make great play of the fact that only three of the 53 packages go to the eurozone. Can he name one programme outside the eurozone where a country cannot devalue?

[Martin Caton (in the Chair)]

Order. That was a long intervention.

[Mr Hoban]

My hon. Friend seems to believe that devaluation is necessary to restore economic growth. That is not the case. Ireland is a country that cannot devalue, but a consequence of how it implemented its reform programmes is that in quarter 2 growth increased by 1.6%, with a 2.3% increase year on year. That demonstrates that devaluation is not necessary to improve a country’s competitive position, for it to earn its way out of problems or for it to grow. Devaluation may make life easier, but it is not impossible for an economy to grow, even if currency devaluation is not possible. In September, the troika concluded that the programme is on track and remains well financed. In Ireland, the authorities are implementing a programme policy.

In the euro area, we are seeing programmes to restore competitiveness, but those reforms must be made throughout the eurozone, if the eurozone is to strengthen and help to underpin economic growth in the UK. No request has been received as yet for additional resources from the IMF, but the role that it can play in underpinning global economic stability is important, and this is an opportunity that the UK should consider if we are to resolve some of the problems in the wider global economy, tackle the fragility and, by definition, improve stability in the UK.

Summer Adjournment

Martin Caton Excerpts

Tuesday 19th July 2011 Commons Chamber

[Martin Caton (Gower) (Lab)]

According to a European comparative study of children’s exposure to accidents conducted in 2005, the fatality rate for child cyclists in the most vulnerable group—10 to 14-year-olds—was found to be around five times worse in the UK than in the Netherlands and Sweden. Every year about 50 cyclists are killed in collisions with cars. Many more are badly injured.

For health and environmental reasons, there is a consensus across the House and the country that we need to encourage more people, including children, to take up cycling. It is incumbent on us, therefore, to consider how we can improve the cyclist safety record in this country, hopefully bringing it into line with other European countries. A good starting point is to look at the difference between our country and countries such as Sweden and the Netherlands. I am sure there are several differences, but one thing stands out. Here in the UK, if a cyclist or pedestrian is injured or killed in an accident with a motor vehicle, it is for the victim or the victim’s family to prove that the driver of the motor vehicle was negligent. In Europe, we share that approach only with Ireland, Malta and Cyprus.

In every other European country, stricter liability applies for insurance purposes. Under stricter liability, which reverses the burden-of-proof balance, it is for the driver to prove that the cyclist or pedestrian was negligent and therefore caused or contributed to the accident. As Lord Denning said, as long ago as 1982:

“There should be liability without proof of fault. To require an injured person to prove fault results in the gravest injustice to many innocent persons who have not the wherewithal to prove it.”

I believe that adopting stricter liability in this country for road accidents would be an important step forward for justice and, more importantly, would save considerable numbers of vulnerable people from injury and even death.

A report produced for the Department for Transport in 2004, “Children’s traffic safety: international lessons for the UK”, attributed at least some of the differences in the safety record here, as compared with other European countries, to the law of stricter liability in those countries. The evidence points to the fact that stricter liability has the psychological effect of making drivers more aware of the vulnerability of children, cyclists and pedestrians. That is what the 2004 study concluded and it is also the conclusion of many cyclists who have experience of cycling in this country and on the continent. My constituent, David Naylor of the Swansea Wheelwrights cycling group, who first raised this issue with me, is one such person. He wrote informing me that he has toured in the UK, the Netherlands, Denmark, Germany, Austria and Switzerland. He went on to say:

“This has made me aware of how much safer one is over there. Motorists treat cyclists and pedestrians with respect. The better infrastructure helps but my judgement is that the existence of stricter liability is more important”.

When I took that up with the Department for Transport earlier this year, the Minister replied: “Even if there were some benefit for road safety such benefit would need to be weighed against the disbenefit which might result from overturning the well established and effective law that applies in civil liability.” Personally, I think that road safety should trump legal tradition every time.

We would not be revolutionising British law if we applied stricter liability in these cases because it is already part of our civil law on workplace health and safety incidents and on product liability. It is even in the field of motor insurance already, as it applies to car passengers. Extending it to protect cyclists and pedestrians makes sense and I urge the Government to give serious consideration to making the necessary changes even if the insurance industry does not happen to like the idea.