Economic Growth
Nigel Adams Excerpts(12 years, 10 months ago)
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Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
I am grateful for the opportunity to contribute to the last day of debate on the Gracious Speech.
I want to talk about this chaotic Government’s shambolic attempts to revive our flatlining economy. The Government are running on empty. When it comes to the questions the British people most want answered, they have nothing to say. On our flatlining economy, where is the plan for growth? On building more homes, 130,000 construction workers are out of work, but new home completions are at the lowest level since the 1920s.
What assistance is there for small businesses when 1,600 firms in my constituency are crying out for help? I agree with many of the tax evasion and avoidance concerns raised earlier by the hon. Member for Redcar (Ian Swales). When an estimated £120 billion is lost to our economy every year, how can the Government believe that it is a bright idea to slash 10,000 staff from Her Majesty’s Revenue and Customs?
On the increase in child poverty, the explosion in food banks and, worst of all, unemployment, I have felt as if I am in a parallel universe sitting in the Chamber today. I remind Government Members that more than 2.5 million people are without a job, and that 900,000 have been without a job for more than a year—the highest long-term unemployment since 1996. That is nothing short of a crisis, but for this Prime Minister, this Chancellor and this Government, it appears that unemployment is a price worth paying. They have not met the 4,100 people in my constituency who cannot find work—more than a quarter of them are young people. It is an abomination that one out of every five 16 to 24-year-olds are not in employment, education or training.
Labour would rightly offer a guaranteed job for all young people who are out of work for more than a year, paid for by a bankers’ bonus tax. Labour Members understand that spending cuts that push young people into poverty are not savings—they are a cast-iron guarantee of increased welfare spending and higher borrowing, and of an entire generation being thrown on the scrap heap.
Luciana Berger
I would love to take the hon. Gentleman’s intervention, but I am conscious that there are still hon. Members who wish to speak.
The Government should be doing everything they can to get people into work—that is what should be keeping the Government up at night. I have been looking closely at those on the Front Bench and I do not see dark circles under Ministers’ eyes. I do not want to see just any kind of work. We need sustainable, high-quality jobs where employees are respected.
The Queen’s Speech states that the Government are
“committed to building an economy where people who work hard are properly rewarded.”
That is an aim I applaud, but it is not the reality for too many of my constituents. We have seen a massive increase in precarious employment: zero-hours contracts, temporary contracts and agency workers. One million people working part time want to work full time, and there is downright exploitation. There can be no clearer example of that than the experience of my constituent Sophie Growcoot. She is 20 years old, and she and her colleagues have been ruthlessly exploited by one of the most well known companies operating in the UK.
Sophie thought that she had landed her dream job when she was hired to join a Ryanair cabin crew after an intense recruitment process. It was not until she started that she learned she would not be paid for all the hours she put in, only the time when a plane she was working on was in the air. That meant not a penny for every pre-flight briefing she attended, nothing for sales meetings, nothing for turnaround time when a plane was on the ground between flights, and nothing for the hours waiting on the tarmac during delays and flight cancellations. She was only paid for four days each week, and on the fifth day she had to be available on unpaid standby, ready to come in at a moment’s notice but not receiving any payment if not called in. Sophie was told that she had to take three months of compulsory unpaid leave each year, and was forbidden from taking another job during that time. If she wanted to leave within nine months of joining the company, she had to pay Ryanair a €200 administration fee. To add insult to injury, she had to pay a staggering £1,800 to her employer for compulsory training.
Last year, Ryanair recorded profits of just under half a billion pounds. How can its chief executive, Michael O’Leary, think it is fair or acceptable for his company to be profiting on the back of poorly treated staff like Sophie? As her situation grew worse, Sophie knew that there were no other jobs out there for her.
The Economy
Nigel Adams Excerpts(13 years, 3 months ago)
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George Freeman
No, I have already given way to the right hon. Gentleman.
Of course we are in the process of a long and slow recovery, but the evidence—in terms of new jobs, the data on private sector growth, and the business community’s strong support for this statement and the measures previously announced by the Government—suggests that the policy of rebalancing the economy is right and working. We must have an economy that is led by the private sector. We need to do more to support industry and the knowledge economy, which this Government are doing, and we need to do more to support regional growth outside Greater London and the south-eastern area.
It is an irony of the last Labour Government that, despite preaching the language of regional economics, what it came down to was a vast tax transfer through the regional development agency structure. In my own field, more than £15 billion was spent on business support, but according to the Richard report, only 0.5% of that was received by businesses on the ground floor, as it were. The last Government embarked on a major boom in regional spending, but it was not sustainable. One of the sadnesses of this crisis is that many of the people who were offered jobs during that boom in the public sector are paying the price now. That is not their fault; it is the fault of those who were running the economy at the time, and I for one am waiting for them to say sorry.
The net growth figures are low at present, but that disguises a very important and profoundly positive change. We have rightly taken money out of the public sector in order to rebalance the economy and bring our public finances under control. The fact that the net growth figures are positive is a sign of the profound growth that is beginning to happen in the private sector, and which bodes well for our public finances in the long term.
I welcome the Government’s plan A-plus, which is intended to restore our public finances and get the deficit under control, and I welcome the fact that the annual deficit is now down by 25%, although there is more to be done. The plan is also intended to free up money to be invested in infrastructure. More than £20 billion has been committed to infrastructure projects that are long overdue, and last week £600 million of extra investment in science and the knowledge economy was announced. I shall say more about that in a moment. The truth is that we need a plan A-plus plus plus, but we do not need the plan B espoused by the Opposition. That B stands for borrowing, it stands for the bankruptcy of our public finances, and it stands for Balls.
Nigel Adams (Selby and Ainsty) (Con)
My hon. Friend said earlier that he remembered the 1970s. I wonder whether he remembers the late 1960s, when Viv Nicholson, the pools winner, said that she would “Spend, spend, spend.” She eventually went bankrupt. Does my hon. Friend agree that even she would be embarrassed by the Opposition’s approach to spending and debt?
George Freeman
My hon. Friend has made an excellent point. One must choose one’s advisers carefully. When taking advice from rock stars, one should listen to the music, but not spend accordingly. “Spend, spend, spend” is exactly what the last Government did, and we are all paying the price now.
I entered the House after a 15-year career starting companies in the life sciences sector—which involves some of the most exciting parts of the country’s economy: medicine, agriculture and the clean technologies—in Cambridge, Norwich, Scotland and some of the northern cities, and in London. I believe that that sector represents a hugely exciting opportunity for the country as we rebalance our trade away from the sclerotic eurozone and towards the faster-growing emerging nations of the world—some of the BRIC economies, and the “next 11” that were identified by Jim O’Neill in his seminal paper.
Those economies are growing at a rate of 7% or 8% a year, which, compounded over 10 years, amounts to 100% growth. They are the vibrant markets of tomorrow, and we have an opportunity to support them with our knowledge economy and our life sciences. Today that means helping them to develop the basics of public health care, such as nutrition, food security and medicine, but tomorrow they will quickly grow and develop much more sophisticated needs and markets.
The life sciences sector is crucial to our economic recovery and to a sustainable model of economic growth, and I strongly welcome the support for it that has come from the Chancellor and his team. Last week a further £600 million was announced for our science base, which is already paying dividends—in the last year alone, more than £1 billion has been invested in early-stage life science ventures funds in this country—and GlaxoSmithKline has announced a £500 million investment in an advanced manufacturing facility. The strategy is working, and I encourage the Government to stick to it.
I am the Member of Parliament for Mid Norfolk, a rural area which, in recent decades, has been viewed as something of a rural backwater, and has received all too little investment. In our region, the dualling of the A11, the investment in the Cambridge-to-Norwich rail link between the two life science clusters and the £90 million announced recently for support for our research and innovation centres have all been extremely welcome, and are already having positive effects locally. I was in Cambridge on Monday with the Prime Minister, launching the new cancer genomics centre.
There is a spirit of optimism afoot in our region. That speaks for the success of this strategy, which I welcome and commend to the House.
Oral Answers to Questions
Nigel Adams Excerpts(13 years, 3 months ago)
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Nigel Adams (Selby and Ainsty) (Con)
Does the Minister have any explanation as to why Labour never introduced a general anti-abuse rule when in government?
Green Economy
Nigel Adams Excerpts(13 years, 9 months ago)
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Caroline Lucas (Brighton, Pavilion) (Green)
I congratulate the hon. Member for South Thanet (Laura Sandys) on securing this important debate.
I am genuinely pleased to observe a fight-back from many Tory Back Benchers who are now trying to make the Government see the huge economic and employment benefits of a green economy, as well as the obvious environmental benefits. The scale of the challenge that they face was amply demonstrated by the speech of the right hon. Member for Hitchin and Harpenden (Mr Lilley), who sounded as though he was still living in the dark ages.
I do not know where the right hon. Gentleman has been for the past few decades, but when I last looked, Germany did not seem to be an economy that was struggling. Germany is doing incredibly well, and it is being built on an economy that is light years ahead of ours in terms of the use of the green economy. Let me remind the right hon. Gentleman that we ended the stone age not because we ran out of stones, but because we found a cleaner, more efficient way of behaving. In the same way, we will leave the fossil fuel economy behind because we now see cleaner, more efficient ways of behaving.
As for subsidies, there is a world of difference between subsidies that are time-bound until new technologies reach, in this instance, grid parity, and subsidies that have been going on for decades—as they have in the case of nuclear and fossil fuels—and are driving us ever closer to climate catastrophe.
Much of the debate has rightly focused on fiscal measures. Three years ago, the green fiscal commission revealed that a “polluter pays” tax shift would provide a significant boost for UK low-carbon jobs, as well as increasing competitiveness. It suggested that such a measure would reduce emissions by more than 30% by 2020, that it would create about 455,000 jobs, and that it would receive a great deal of public support.
It is important to bear in mind how widespread that support potentially is. Let me quote these words:
“I don’t underestimate how difficult it will be to rebuild public confidence that green taxes are genuine environmental policy… not just stealth taxes… I am… determined to rebuild this trust… As leading green… Professor Paul Ekins has rightly pointed out, this type of green tax switch might be termed a ‘win-win-win’ outcome… The time for action is now. Future generations will not forgive us if we fail.”
Those are all words with which I agree, but if a week in politics is a long time, four years is evidently an eternity. Those words were spoken by the present Chancellor to a Green Alliance conference back in 2008. I agree with all his words from 2008, but unfortunately they have not been matched by any real action since he has been in a position to put them into action.
I hope that today’s debate will enable us to remind the Chancellor of his words of four years ago, and help to convince him that he should throw his weight behind the UK’s aim of becoming a world leader in low-carbon industries. If he does not believe in the environmental reasons for such action, he certainly ought to believe in the economic and employment benefits. I also hope that we shall be able to persuade him to convince the Treasury that its flagship “green bank” ought to be given the power to borrow as soon as possible.
More broadly, I should like the Chancellor to consider measures such as “green quantitative easing”. I was interested to note that even the former Government chief scientist Sir David King has echoed my calls for green conditions to be attached to the billions of pounds that are currently being poured into our banks. I think that the money should be going directly into the economy rather than into private banks, but wherever it is going, the Government should at the very least ensure that green conditionality is involved, so that we can ensure that it goes into low-carbon infrastructure. Crucially, they should also recognise that the low-carbon economy is far more labour-intensive than the fossil fuel economy that it will replace, so it makes good employment sense to invest the funds in green rather than fossil fuel measures.
The one thing businesses are united in calling for is certainty. The CBI says about low-carbon investment:
“Businesses need, above all else, policy certainty, consistency and clarity over the long-term”,
yet that has been conspicuous by its absence under this Government—demonstrating a failure of leadership by them. The sad news about Vestas reversing its previous decision to invest in the wind turbine manufacturing plant at Sheerness is just the latest casualty of the Government’s failure to provide that most basic condition.
Nigel Adams (Selby and Ainsty) (Con)
Is the hon. Lady aware that in the last three days Vestas has also decided to close a manufacturing plant in China?
Caroline Lucas
It does not make me feel any better to know it is also closing plants in other parts of the world. It has clearly said one of the reasons why it did not go ahead in Sheerness was that it did not have enough orders for turbines on the order book. If that is a problem here in the UK, we should be addressing that, rather than worrying about what is happening in China.
One measure that would provide huge and tangible benefits both in my constituency and the rest of the UK is a massive investment in making the UK housing stock super-energy efficient. As others have said, that would not only be good in terms of getting our emissions down and creating lots of jobs; crucially, it would help tackle fuel poverty as well. This measure should be funded not through more levies on energy bills—as the Government plan, and which is inherently regressive—but from using funds such as the revenue from the carbon price floor and auctions of carbon emissions permits through the EU emissions trading scheme. That would have benefits in job creation, tackling high energy bills and achieving rapid emissions cuts. Some 118 Members have now signed the early-day motion on the Energy Bill Revolution campaign, which calls for precisely this step.
Members support that EDM because they know that, sadly, as it is currently designed, the green deal policy instrument is extraordinarily weak and the energy company obligation part of it—the bit that is supposed to be tackling fuel poverty—looks set to fail miserably both against the Government’s own objectives and in terms of doing what is needed to cut carbon emissions and end fuel poverty. The truth is that the final shape of that fuel poverty package could result in a 50% drop in the funding targeted at low-income and financially deprived households. There will be far less money in the ECO than there is in the measures that are being phased out—the carbon emissions reduction target, the community energy saving programme and Warm Front.
Nigel Adams (Selby and Ainsty) (Con)
That is not the first time I have been mistaken for Nigel Evans, and I see that as a great compliment, so thank you, Madam Deputy Speaker.
I am pleased to be contributing to this debate on the green economy and the fiscal support it receives. Like many other hon. Members, I congratulate my hon. Friend the Member for South Thanet (Laura Sandys) on securing it. It is particularly important in my constituency, because of the substantial investment being made in sustainable biomass and carbon capture. Drax and Eggborough power stations are based in my constituency, as is Kellingley colliery, the deepest coal mine in the UK. Drax currently produces more than 7% of the UK’s electricity, having generating capacity of just under 4,000 MW. It has been investing in research and development and in new facilities to co-fire with an increasing percentage of biomass. It has proven that its current plant can successfully operate with 12.5% co-firing, and there are plans to increase that to 20% and to build a new power station that would be fired with 100% biomass. Eggborough power station proposes to convert its 1,960 MW generating capacity to run entirely on biomass.
Those are the big wins we need if we are to secure our targets for reducing CO2 emissions and ensure that the green economy flourishes. Biomass results in 80 to 90% less net CO2 emission than coal, and these are the facilities we need to produce power when we need it and not just when the wind blows. They also currently provide secure employment for a large number of people.
We are talking about world-leading companies that have proven that their technology works and that have solved the supply and materials handling problems. However, they cannot provide a solution on financial viability without having a UK policy framework that supports it, which is why I am delighted that we have a Treasury Minister here with us today. Drax is already the UK’s largest producer of renewable energy, even without yet running its current renewable capacity to the full—the current renewables obligation framework does not make it financially attractive to do so. Drax is willing and able to go further, but the policy framework must support rather than hinder it.
Unlike onshore wind, the transition to biomass in my constituency enjoys considerable local support. The local labour force has the expertise to support the plant and sees it as a great new employment opportunity. Public support is important and these projects enjoy support rather than enduring local opposition. I am afraid that the same cannot be said of onshore wind farms, which are proposed in many numbers in my constituency. There is widespread knowledge about power generation and I am repeatedly reminded that more than 3,000 onshore turbines operating last year, which received nearly £400 million of subsidy, produced only 3.3% of the electricity consumed.
Such a level of subsidy for wind, which proudly claims to be the cheapest form of renewable energy, is not a particularly good use of the money that is being levied from the consumer, driving more of them into fuel poverty every year. Electricity that can be produced as and when required, at any time of the day or night, must be worth more than electricity produced only when the wind blows.
Electricity generated near to the industry and homes it supplies via a major node on the grid must be worth more than power from the wind generated in some remote location. Electricity generated competitively with a local labour force must be worth more than electricity that depends on imported turbines with low UK labour content. We should address those issues and I appeal to the Economic Secretary to the Treasury to allocate our financial resources accordingly.
Finance (No. 3) Bill
Nigel Adams Excerpts(14 years, 8 months ago)
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John McDonnell
Yes, and when the various groups lobbied us last month it was interesting to note how the debate had progressed since the original discussions about the Tobin tax. The debate had become much more refined and concretely related to the global needs that my hon. Friend mentioned. There has been a debate about how we allocate these resources and what the greatest priorities are, and so far it has been about poverty in this country so that we do not in any way undermine support for such taxation among people in the UK, but we must balance that with support for efforts in the developing world. The climate change issue has also come on to the agenda since the Tobin tax was first proposed.
One question that arose in the discussions in Central Hall was what the effect would be if we did raise, for example, £20 billion in this country. It was said that if we spent £4 billion, we could halve child poverty in this country overnight, and if we spent £5 billion, we could insulate every home and therefore take people out of fuel poverty. Such examples bring home the reality of what could be done through such a tax.
It is not a tax on normal retail banking or on savings or mortgages. It does not hit the ordinary saver. It is a micro-tax, and in some ways a tax on short-term speculation banking. It does not fall on UK banks alone either, as foreign banks operate in the City. I would take particular delight in taxing Goldman Sachs in this way—that is a personal grudge—but there are also other hedge funds operating in the City of London. A strong argument, which we have heard today, has been made for seeking international agreement. Negotiations are taking place and there is consensus, even within the European Parliament, on introducing a European-wide financial transaction tax. My concern about that is that the European discussions were about using that tax to fund the European Commission—I might have more than reservations about that proposal.
Nigel Adams (Selby and Ainsty) (Con)
The idea of a Robin Hood tax is noble, but does the hon. Gentleman not agree that without international agreement across all countries, it is very unlikely to get off the ground?
John McDonnell
No. If that was the case, we would not have introduced a stamp tax on transactions. It brings in £5 billion and has been an incredibly successful tax. The concern has been expressed that this country would be disadvantaged if it acted unilaterally, but the International Monetary Fund’s study does not say that. It cites the stamp duty as an example of a transaction tax that has not affected UK business and states that financial transaction taxes
“do not automatically drive out financial activity to an unacceptable extent”.
Banks do not leave, because they know that they are secure in this country—in fact, they know that if they get into trouble we bail them out.
The argument that London’s advantages would evaporate overnight as a result of this sort of tax are just not accurate. The reason this country has these advantages, apart from the experience in dealing with financial transactions that we have built up over generations and centuries, is that it is time zone-critical—it is located between the Asian and New York markets—so it is ideally placed to ensure that financial operations are carried out in London. If companies were to move elsewhere in Europe, where would they go? Germany, our main competitor in the European time zone, is already committed, under Chancellor Merkel, to implementing a financial transaction tax.
The argument that is made now about needing some form of global international agreement is exactly the same one that was used to say that we should not introduce any form of taxation on bank bonuses. When we introduced the one-off tax on bonuses in 2010 we were told of fears that there would be a mass exodus of bankers leaving the country. In fact, the recruitment of bankers has increased—perhaps that is a debate for another day.
The Economy
Nigel Adams Excerpts(14 years, 9 months ago)
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Kwasi Kwarteng
The only question that the markets were interested in at that point was whether Labour would be re-elected. When it became obvious that Labour would not secure a majority in the House, they started buying lots of British Government debt, and the interest rates in the six weeks before the general election came down quite rapidly. Those are the facts, and one could find them out from the Financial Times, Bloomberg or any other information provider in financial services.
Nigel Adams (Selby and Ainsty) (Con)
Since the last election, when we got a Conservative-led coalition, unemployment has fallen in my hon. Friend’s constituency of Spelthorne by almost 5%. Does he think that we would have achieved such a fall if we had followed the Opposition’s policies?
Kwasi Kwarteng
I can give my hon. Friend a very short answer: there is no way that any businessman in Spelthorne—[Interruption.] Well, the short answer is no, but the longer, slightly more involved answer is that there are lots of small businesses in my constituency, and a lot of them are related to Heathrow, and the international market and trade. As a consequence of Labour’s complete failure over the previous 13 years, no Labour councillors were returned to our borough council. In fact, Labour contested only one of the 13 wards in the borough, which is only 35 minutes on the train from Waterloo. That is indicative of Labour’s utter failure to make any headway.
Let me tell the House why Labour was completely wiped out. The people in Spelthorne realise that Labour does not understand anything about the economy. Time and again when I have knocked on doors in Ashford, Sunbury and Shepperton—and even in Stanwell, which was traditionally a Labour area—I have met people who realise what this Government have to do. They say to me, “You’ve been put into power to clear up the mess that the other lot created.” I shall not repeat the unparliamentary language, but they tell me to “something well get on with it.”
Oral Answers to Questions
Nigel Adams Excerpts(15 years, 4 months ago)
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Mr Speaker
Order. From now on, first of all, exchanges must be shorter. Secondly, let it be clear beyond doubt that Ministers answer for the policies of the Government, not for those of the Opposition. That is the end of the matter.
Nigel Adams (Selby and Ainsty) (Con)
2. What fiscal measures he has introduced to provide assistance for pensioners since his appointment.
The Chancellor of the Exchequer (Mr George Osborne)
With your permission, Mr Speaker, if I dare ask for it, I should like to answer this question with questions 6 and 7.
Mr Osborne
Even in these constrained times, the coalition Government have been able to find additional assistance for pensioners. We have re-linked the basic state pension to earnings and provided a triple guarantee that the basic state pension will be raised by the higher of earnings, prices or 2.5% from next April. We have also protected other key pensioner benefits and made the previous Government’s temporary pre-election increase in cold weather payments permanent, because this Government treat pensioners with the dignity and respect that they deserve.
Nigel Adams
I am grateful to the Chancellor for that reply. Many pensioners and those approaching pension age in my constituency of Selby and Ainsty will welcome his words, but will he tell me what will be the impact in future years of the link to earnings in respect of the basic state pension?