Northern Rock

Richard Fuller Excerpts

Monday 21st November 2011 Commons Chamber

[Mr Hoban]

As I said earlier, the FSA will go through its normal process of approving the transfer and sale of this business.

[Richard Fuller (Bedford) (Con)]

Given the failed corporate strategy that led directly to the first run on a bank for more than 100 years, the nationalisation and now the capitalised loss for the taxpayer, is my hon. Friend satisfied that the original directors and chief executive officer of Northern Rock have been held sufficiently to account for their fiduciary responsibilities and will he welcome funding for the Serious Fraud Office to ensure that they are?

[Mr Hoban]

The directors of Northern Rock have been subject to enforcement action by the FSA, but I shall not go into detail about that. I recognise that the directors have their responsibility for the failure of Northern Rock, but the Labour party should also share some responsibility for the architecture of the financial regulation it put in place, which meant that no one was in a position to prevent Northern Rock from being an outlier when it came to its dependence on wholesale funding. It was a consequence of that dependence that led to Northern Rock’s being nationalised and we should welcome the fact that it is returning to the private sector.

Fuel Prices

Richard Fuller Excerpts

Tuesday 15th November 2011 Commons Chamber

[Martin Vickers]

I entirely agree with my hon. Friend. My constituency, which I shall come on to, is another centre for the road haulage industry. It, too, would welcome such a proposal.

Unemployment in my constituency is above the national average, and incomes are below the national average. Much of the available work is seasonal, and jobs can be many miles away. For many people, travel costs are compounded by the Humber bridge tolls, but that is a debate for another day. My constituency not only includes the premier resort on the east coast, also known as Cleethorpes, but the industrial and port complex on the Humber bank, including oil refineries, which are major employers. Indeed, they are good employers that provide the area with much of its wealth, but today I am speaking for my constituents, who are finding travel costs an increasing burden.

My constituency is a major centre for the road haulage industry, which, needless to say, suffers from the present levels of tax and duty on petrol and diesel. That, coupled with the fact that there are many small towns and villages in the vast, rural areas that are a feature of Lincolnshire, means that people do not live close to their place of work or to the essential services that they need to access. Walking and cycling are not realistic alternatives.

Motoring taxes are a greater burden for people living outside major conurbations. The Countryside Alliance has produced figures that show that people in rural areas spent £1.34 per week more in petrol at the beginning of this month than they did at the beginning of the year. They also draw attention to the fact that an-above average number of low-income groups in rural areas are car owners, and that accounts for a much greater proportion of their income. The people I represent think that paying 60% of the cost of a litre of petrol in tax and duty is too much—it is unfair. I have said before in the Chamber that it is a risky business for Governments to talk about fairness, because it is human nature for someone to regard as fair what is beneficial to them, but to regard something as unfair if it benefits someone else.

What people do regard as unfair is the fact that, based on the most recent figures available, £31 billion per annum is collected in tax and duty. Total annual expenditure by the Department for Transport is only £23 billion, so they regard that as unfair.

[Richard Fuller (Bedford) (Con)]

Does my hon. Friend agree that fairness is another reason people are animated by the debate, and support the motion? Too often under the previous Government, both with fuel duty and with council tax, people saw taxes go up year after year with no justification. It is the justification for the tax that is the source of the unfairness in this instance.

[Martin Vickers]

I entirely agree with my hon. Friend, who strengthens my case.

I was discussing fairness. In the two unitary authorities that cover northern Lincolnshire, it is estimated that constituents pay £167 million a year in motoring taxes, compared with the £95 million that is spent on roads infrastructure—again, that is clearly unfair.

Jobs and Growth

Richard Fuller Excerpts

Wednesday 12th October 2011 Commons Chamber

[Ed Balls]

I think the hon. Gentleman got the name wrong. He does not mean Norwich City—he means premiership Norwich City, which is more than one can say for any football team in Suffolk. I will back his campaigns to stop the cuts and to spend more, and I fully support the dualling of the A11. At last some Conservatives have persuaded some Conservative councils to do the right thing about these proposals, which is very good.

[Richard Fuller (Bedford) (Con)]

It is all very humorous here today, but in my constituency we already have above-average national levels of unemployment and unemployment has increased. It is always interesting to hear an economist debate with another economist. However, may I ask the shadow Chancellor what direct personal experience he has of working in business, helping to create jobs, and knowing what it is like to make payroll each week? If he does not have any of that experience, will he please undertake to this House that he will go out and get some?

[Ed Balls]

I have worked in Government and at the Financial Times. I have never run a business, but I respect people who run businesses and I understand why they are so worried at the moment. In the hon. Gentleman’s constituency, where unemployment has gone up by over 400 in the past 12 months, there will be some very worried businesses, and it is important that we listen to them and hear what they are saying.

That is why now is the time for our oh-so-political Chancellor to put politics aside and start to do the right thing. Protecting our economy and protecting valuable businesses and jobs is more important than trying to protect a failed plain. We do not have to wait for another month of unemployment rising, or for 46 more days until we finally get the economic and fiscal forecast from the Chancellor, to know what he is going to have to say. He is going to have to downgrade his growth forecast for this year for the fourth time in 18 months and downgrade his growth forecast for next year. As I have explained, we already have £46 billion more borrowing in the pipeline, and unemployment is now rising. He is going to have to admit that borrowing will be billions higher still than at the time of his last forecast. The Prime Minister says:

“You can’t borrow your way out of a debt crisis”,

but he just doesn’t get it. [Interruption.] No, he doesn’t get it. Because with growth flatlining, and with today’s bleak news of rising unemployment, the Chancellor’s failing plan is leading to not lower borrowing but higher borrowing than he planned.

--- Later in debate ---

[Mr Osborne]

The IMF is clear that on its forecasts, which are some of the more pessimistic forecasts for the UK at the moment, it is not recommending a change in policy stance. That is what it says. It is what the managing director has said; what the article 4 report on the UK said; what the OECD is saying; and what all the business organisations in Britain are saying. That is why the path that the shadow Chancellor has laid out for the country is so incredible and does nothing to deal with the problems that he left to the country.

[Richard Fuller]

Will the Chancellor give way?

[Mr Osborne]

I shall take one more intervention and then make some progress.

--- Later in debate ---

[Richard Fuller]

In response to the question from the hon. Member for Dundee East (Stewart Hosie), I would say that that is not the answer to a debt recession, because a debt recession relies on credibility. One of the key points in the motion is that the Labour party’s so-called plan would provide, through a temporary reverse of the VAT increase, a benefit of £450 for every couple with children. Has the Chancellor worked out the benefit to average families in the country of maintaining the credibility of our country’s finances and ensuring lower interest rates?

[Mr Osborne]

As I was just explaining, a 1% rise in interest rates—I am not talking about the level of interest rates in Spain and Italy—would mean £10 billion in higher mortgage bills for British families. That is the reality of what the shadow Chancellor is proposing.

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[Meg Hillier]

I am afraid that I will not.

That woman told me that she uses the prepay meter key because of her fear of a large quarterly bill at the end of the autumn, even though she knows that it costs more. She is doing what the Government tell her to do. She is a single parent with four children who is working to support her family, but she lives in fear of the bills every day. There is the man who came to my surgery on Monday. He has a job offer, but he faces the choice between a job and a home because of the Government’s short-sighted approach to housing benefit.

Where are the private sector jobs? In my constituency and that of my hon. Friend the Member for Hackney North and Stoke Newington, most small businesses employ fewer than six people and they are struggling. I have been up and down my high street many times since the events of 8 August, but it is not just those events that have caused problems. Businesses are struggling with footfall and because people do not have disposable income to spend. They are worried about what will be down the road.

The Federation of Small Businesses has been very critical of the Government’s approach, as my right hon. Friend the Member for Morley and Outwood (Ed Balls) indicated. Businesses on the high street need quantitative easing, including those that are being incubated by entrepreneurs in my constituency. The Prime Minister is very fond of talking about creating a silicon valley when it suits him, but those high-street businesses are exactly the sort that could be creating jobs for young and older people in my constituency. However, they risk being throttled at birth, or if they do survive—I wish them well and hope they do—they risk not growing at the rate that they could with the right support from Government.

[Richard Fuller]

Will the hon. Lady give way?

[Meg Hillier]

I am afraid I will not.

Families are being squeezed. Prices are going up, with food prices having increased by 6.1% in the past year. For those who drive, petrol has gone up. Energy prices have gone up, VAT is at 20% and we are seeing a huge hike in fare prices thanks to the Tory Mayor of London. If people have a job, they are worried that they will not have it in future, and they are worried because they will not be getting pay rises. Families in my constituency have nowhere to go to get the extra money: not for them the easy credit that is available to many or the bank overdraft that is available at the end of a phone call; not for them the rich family member who can help them out or a cushion that they have saved over years of work, because they have been living a difficult existence as it is and are now squeezing until the pips squeak. They cannot squeeze any more out of their household budgets.

This Government are cutting too far, too fast, and it is not working for families, for young people or for businesses. It is not working at all, nor, sadly, are far too many of my constituents.

--- Later in debate ---

[Richard Fuller]

The hon. Gentleman says “the Government this” and “the Government that”, but if we are talking about jobs, he ought to be talking, as I am sure that he is, to small business owners in his constituency. In those conversations, how many of them have said that they would put at risk low interest rates in this country to pursue some of the policies in the five-point plan, and how many said that they would welcome the job tax that the previous Government said that they would impose on businesses up and down the country?

[Ian Mearns]

Many of the businesses that I speak to in areas such as the Team Valley trading estate, which employs about 20,000 people in the private sector, complain about the pace and depth of the Government cuts. They are impacting on their order books because many of them provide for the public sector. Unemployment in the region now stands at 142,000, which means that 11.3% of the working population in the north-east are now unemployed. The only conclusion that we can draw from the rationale of the parties in government is that, for them, unemployment in the north-east is a price worth paying.

Finance (No. 3) Bill

Richard Fuller Excerpts

Monday 4th July 2011 Commons Chamber

[Chris Leslie]

My right hon. Friend, who has an excellent track record in raising many of these issues, is completely correct. The vice in which many of our poorest constituents find themselves being squeezed is very much apparent. The changes to the social fund that he mentions are part of the context in which we would want to review the circumstances in which high-cost lending takes place. That is the objective of our new clause 11: we want to examine the possibility of regulatory and/or tax measures to address this problem.

[Richard Fuller (Bedford) (Con)]

The hon. Gentleman mentioned the fourfold increase in payday loans. Would he acknowledge that a substantial amount of that increase occurred in the period 2007 to 2009, at the start of the recession, and that although the rate has subsequently increased, its growth has tapered off somewhat? Does he also agree that payday loans are but a sub-segment of the sub-prime, high-cost credit sector?

[Chris Leslie]

Yes, payday lending is indeed a facet of the broader problem. I am not sure about the trends and how things have been moving—the hon. Gentleman may have other statistics that it would be worth sharing if he makes a contribution to this debate—but there is no doubt about the trajectory of that growth, which has been quite marked, which I know is a concern for all Members, in all parts of the House.

--- Later in debate ---

[Stella Creasy]

I am interested in the hon. Lady’s impression that consumer credit is a bad thing, because I do not agree. I would also be interested in her views on research by the Office for Budget Responsibility, which shows that as a direct consequence of the Government’s Budgets an extra £10,000 of debt is being put on to households. Perhaps she would like to comment on the implications of that for family finances. No? Then I will continue.

The problem is not just the high-cost credit industry but the nature of the industry and the way in which it operates, which is causing so many problems. What most worries many Opposition Members is that so many families are struggling. Indeed, we know that 46% of families say that they do not earn enough in a month to pay all their bills. Crucially, of that 46%, 10% say that the reason they are struggling is the repayments on high-cost credit. It is those very products that are pushing them into financial difficulty.

For the avoidance of doubt, I say clearly that I am not trying to put Wonga and the other companies out of business. I do not hold with the constituent of mine who argued that we should learn a lesson from Dante and put them in the seventh circle of hell, but we can make the credit market fairer for all concerned. It is important to set out, therefore, the kind of companies we are talking about and just how quickly this industry is growing in the light of recent economic circumstances.

Many people know about payday lending—the form of credit whereby a borrower gives a creditor a cheque or an authorisation to make an automatic withdrawal from their bank account. That is used as security for a short-term loan to be repaid, supposedly on the next payday. It is a long-established form of credit in other countries, but it is relatively new to the UK—and it is growing rapidly. By 2009, the payday lending industry was worth more than £1.2 billion, and the figures I have gathered from the Department for Business, Innovation and Skills, which were released under a freedom of information request rather than being put in the public domain, show that it is now worth £1.9 billion. Indeed, in its “Keeping the Plates Spinning” report, Consumer Focus estimates that payday lenders are expected to quadruple the scale of their operations in the UK in the next few years alone.

[Richard Fuller]

The hon. Lady says that the payday lending market was £1.2 billion in 2009. According to the Office of Fair Trading review of the payday loan market, it was £600 million. To clarify the situation, and for my education, will she explain the difference between the two numbers?

[Stella Creasy]

I will happily explain the difference between the two numbers. The hon. Gentleman might have heard me say that I made a freedom of information request to obtain the most up-to-date data from the Department, and it is a source of concern that Ministers did not share the information with MPs. Research shows clearly that the market has grown to £1.9 billion. If I tell the hon. Gentleman that 5% of the population have taken out a payday loan in the last year, representing 2 million, perhaps he will understand the discrepancy. Perhaps he might like to account for why the Government did not want to put that information in the public domain.

[Richard Fuller]

I just wish to point out to the hon. Lady that I think there is a lot of consensus, which I hope she does not destroy in her passion for this issue.

As a point of clarification, the 5% figure in the OFT’s analysis came not from the payday loan market but from participation in the high-cost credit market, which includes credit unions and credit cards. Given that my source is the OFT, perhaps she will clarify that point too.

[Stella Creasy]

I am happy to share the figures with the hon. Gentleman, although I am afraid to say that his interpretation is incorrect. One of the things that I have done—perhaps I am getting a reputation for it in the House—is my homework on this market, and I have sought as much accurate information as possible. That was why I made the freedom of information request, and I would be happy to share the data with him. One of the challenges is that the Government have information about how quickly this market is growing, but they are timid about confirming it.

Amendment of the Law

Richard Fuller Excerpts

Wednesday 23rd March 2011 Commons Chamber

[Richard Fuller (Bedford) (Con)]

Does my hon. Friend agree that the previous Government were the worst villains in fiscal drag that this country has ever seen? They failed to raise thresholds year after year, and dragged many taxpayers into higher income tax brackets.

[Mr Syms]

My hon. Friend makes a good point. I welcome what the Chancellor has done with the personal allowance and the £10,000 target. If a central part of the Government’s plans is welfare reform, it is inevitable that we must reduce the tax on the lowest-paid. Otherwise, we will not get people off welfare and into work, which I think is what all of us want.

I will touch on one or two measures, but I do not want to take up too much time. I welcome the Government’s plans to assist the housing market. I wish they had gone farther, because there is a lot of capacity in the housing market, which could provide more jobs and help to get the economy going. However, what the Chancellor announced was very good.

I welcome the Chancellor’s proposals on charities. Poole has one of the biggest charities in the UK, the Royal National Lifeboat Institution, which raises a considerable amount of money from bequests. People getting relief on inheritance tax will be a major boost to that charity and to many others.

I welcome the move back to enterprise zones, because we have to become an enterprise economy. One lesson of the last decade is that we do not want to rely on an overheated south-east and London. We must ensure that future growth is balanced so that it occurs in greater Birmingham, Manchester, Leeds and many of our great provincial cities. What the Chancellor announced will assist in that.

The Government are doing what they can to help people, with limited room for manoeuvre, by putting off the fuel duty rises and freezing council tax. We have a difficult inheritance and the Chancellor has precious little room for manoeuvre. He started his Budget speech by saying that this is basically a neutral Budget. I think that it is right to have a neutral Budget. In some respects, it would be better not to have a Budget at all, but just to let the long-term plans of the Government roll on. That gives the best hope of getting the economy sorted, and of restoring growth to the British economy.

We have heard debate about the OBR forecasts. They are forecasts and will change several times before we know what the situation is. I think that we have an excellent chance over the next four or five years to get growth. I think that the Government’s strategy is right. They are concentrating on training and simplifying the tax code. Hopefully, when we can, we will start to reduce the rates.

--- Later in debate ---

[Dame Anne Begg]

Indeed, the bank levy will come down to just £100 million by 2015-16.

The change to the oil and gas charge has come as a bit of a shock, and it worries me. From looking at the Red Book, I am getting more and more worried about what the Chancellor has announced today. The Red Book states:

“The Supplementary Charge on oil and gas production will therefore increase to 32 per cent from midnight tonight.”

There was no warning, and it will have come as a big shock to the industry. The effect could be dramatic in my constituency. I only hope that the Chancellor has thought the matter through and had some discussions with the industry. I suspect he has not, and I am worried about what will happen.

I wonder what other nasties are lurking in the Red Book. Last time it was the 10% sanction on housing benefit when someone had been out of work for a year, which we did not discover until days afterwards. I am glad that the Government have backed down on that and that today’s Red Book shows that money again.

From a cursory glance at the Red Book, I discover something that comes as a bit of a surprise to those of us who were here for Prime Minister’s questions today. The Leader of the Opposition asked the Prime Minister why the Government were taking the higher-rate mobility component of disability allowance from people living in residential care. Those who were here will remember that the Prime Minister replied, “We are not”—a simple, straightforward answer. However, line d on page 44 of the Red Book is about the plan to

“remove mobility components for claimants in residential care from April 2013”,

with a figure of £155 million to be saved. That is different from the last Red Book, which stated that the change would come in in 2011-12 and save £135 million. All that the Government have done is delay it by two years. As the Leader of the Opposition pointed out, the change is still in the Welfare Reform Bill, and here it is in the Red Book. Perhaps the Prime Minister might want to come to the Chamber and apologise for not having been as accurate as he might have been.

[Richard Fuller]

For clarification, has the hon. Lady checked the following page, page 45, which mentions the disability living allowance reform gateway funds, which will kick in at £360 million in 2013-14 and rise to £1.45 billion? How does that match the figures that she has given, if at all?

[Dame Anne Begg]

They do not match, because they are totally different things. In fact, the Prime Minister did not quite understand that. The DLA gateway is about tightening up the criteria for those coming on to DLA. That will come in with the introduction of personal independence payments. The reform of the gateway is totally different from taking DLA away from people who live in residential care. By any criteria, such people would qualify to get through the gateway. The Government have decided that they will not get the money because they live in residential care, not because they do not fit the criteria.

[Richard Fuller]

I am grateful to the hon. Lady for that clarification. I am sure she will recognise that there are hon. Members on both sides of the House who share concern about the continuation of the mobility component of DLA. I believe that Ministers are looking for a way to both maintain the mobility component and expand personal payments, so that people with disabilities who live in care homes continue to receive the funding that they require for a decent living. If that is not included in the Budget, I will be very interested to talk to her about it.

[Dame Anne Begg]

What I have said is based on a cursory glance at the Red Book, but the evidence from the Welfare Reform Bill, which states that those in residential care will not get higher-rate mobility DLA, and from the Red Book makes it appear that the Government still intend to take the mobility element away from such people, albeit two years later. Those of us who said that the proposal was unfair thought we had won the battle, but it now appears that we have not won it at all. I am grateful to the hon. Gentleman for his intervention, because I know that Members of all parties objected to the proposal. I hope that he will put pressure on his Government to reconsider the matter.

I wish to say a wee bit about the merging of national insurance and income tax. It was trailed slightly in the press, but we needed to find out what it meant in reality. The Chancellor said it would not be the end of the contributory principle, but it is very hard to see how it cannot be. There needs to be a debate about the future of that principle, because other measures that the Government have taken have undermined it. People are quite shocked about what is happening, having paid their national insurance all their lives thinking that they were paying into an insurance scheme and that they would get money out of it when something went wrong. People get only six months’ jobseeker’s allowance of £65 a week as a result of their NI contributions when they are unemployed. Under the Welfare Reform Bill, people will get only one year’s sickness benefit under the new employment and support allowance as a result of such contributions. Most people assume that they get the basic state pension because of their NI contributions. That is the big one, because people are quite happy to pay their NI contributions for that, but the Government plan to introduce a flat-rate, £140 a week state pension. Such contributions pay for the basic state pension state and the earnings-related pension scheme as well as pension credit, and everything then gets divided out.

It is difficult to see how pensions can be based on a contributory record, as the Red Book says they are, if everybody gets the same. The Work and Pensions Secretary said a couple of weeks ago that he will introduce the flat-rate pension, and that that will help women, but it will do so only if it is not dependent on contributions. The Government cannot have it both ways. Either people get the flat-rate pension based on their working record and NI contributions, which will be part of income tax, or they get it because they have fulfilled other criteria, such as residency. The country and all parties in the House need a proper debate on how we fund welfare, the basis of our welfare system, and the future of the contributory principle.

--- Later in debate ---

[Joseph Johnson]

There are problems when a country has a stock of debt as massive as ours. Even with the Government’s plans for fiscal consolidation, it will not start declining for some years to come. Under the Labour Government our stock of debt would have peaked at about 80% of gross domestic product, but under the current Government’s plans it will peak somewhere below 70%—69%, I think I recall. [Hon. Members: “71%.”] Either 69% or 71%. Such a massive stock of debt means that every year, we have to refinance several hundred billion pounds of Government debt. Even if it is not all the debt, that is still a very substantial amount of money.

[Richard Fuller]

Perhaps my hon. Friend will be interested to read on page 25 of the debt and reserves management report issued today that the gap in the five-year forward rate on debt borrowing is at its highest point for 10 years. That reflects the fact that the market is buying only short-term debt. One of the few assets of this country that the last Government did not sell down the river was the long-dated debt that we have compared with other countries. If we had carried on with their policies, even that would have been lost as a result of their profligacy and waste.

[Joseph Johnson]

That is a very good point. Markets can turn on a dime if they detect backsliding, and that is not what they are getting from this Government.

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

Let me start by paying tribute to my hon. Friend the Member for Barnsley Central (Dan Jarvis) on making an excellent maiden speech. He talked about the spirit and aspiration of the people of Barnsley. I know that he will make a very good Member of Parliament and will certainly bring that spirit and aspiration to the House of Commons. Let me also say what pleasure I took in the election result in Barnsley. Seeing the good people of Yorkshire give the Liberal Democrats a real pasting—they put them in sixth place and made them lose their deposit—was enormously pleasurable.

The Chancellor talked about the necessity for growth across sectors and across the country. He also said that growth should be properly shared across all parts of the country. I want to talk about growth and the impact on the regions, and particularly the Yorkshire region and the sub-region in the Humber. We recently had some good news in Hull, which is that Siemens will hopefully set up a manufacturing site in east Hull to build wind turbines. That will result in about 10,000 jobs, which is excellent news for Hull and the Humber region. Like all Members across the House, I want a growing economy, high-skilled jobs for all the people in this country, and a well-educated and well-skilled work force. We have a history in Hull, having lost the fishing industry in years gone by, and other historic employment issues that we still need to address, so growth is important for my constituents and my city.

However, it is important that we take an economic reality check and ask what the Budget will actually deliver. The key thing—this has been mentioned by many hon. Members across the Chamber—is that the growth forecast was down last year, it was down this year and it is down the year after. The hopes and aspirations of all my constituents have been dashed by what has happened since this coalition Government came into power.

I want to set this debate in the context of what it means for my city of Hull. Since last May, £20 million has disappeared from Hull’s local economy because of the coalition’s council cuts. We will see £25 million leaving the NHS in Hull, while £160 million has already gone because plans for the regeneration project in Orchard Park have been axed. Hull’s housing pathfinder funding has gone. There is zero decent homes funding for the next three years. Some £21 million has been cut from Hull’s Building Schools for the Future programme, and the university of Hull is getting a 5% funding cut.

There are major cuts to services across the piece in the public sector in Hull, which has a direct impact on the private sector. I fail to understand why the coalition does not see that cutting the public sector to the extent that it is will not help growth, but produce even more problems.

[Richard Fuller]

Does the hon. Lady acknowledge that the country has record debts, and if so, which public expenditure cuts would she make?

[Diana Johnson]

I am concerned that our economy should grow, and I am trying to set into context—

[Richard Fuller]

rose—

[Diana Johnson]

Will the hon. Gentleman just let me finish? I paid him the respect of listening to his question; I would appreciate it if he would listen to what I have to say.

One way of getting out of the problems that we have experienced as a result of the bankers’ problems—not the Labour Government’s problems, as the hon. Member for Southend West (Mr Amess) tried to suggest—is to grow the economy. I am with the coalition Government on the need for a growth strategy for the economy, but the measures that have been taken so far will not help to grow the economy in Hull and the Humber.

[Richard Fuller]

Will the hon. Lady give way?

[Diana Johnson]

No, I want to carry on making the point about why there is a real need in Yorkshire and, in particular, the Humber to grow the economy. The measures that have been taken are not helping. The result of all that money being taken out of my city is that construction jobs are going and we shall not have the training or the apprenticeships that the Chancellor has talked about. For the first time, we have seen compulsory redundancies at BAE Systems, a major private sector employer just outside Hull on which many of my constituents rely for skilled jobs. It is a place where people want to work, but private sector jobs are being lost there.

The abolition of the regional development agency, Yorkshire Forward, is a huge loss to the region and to the building up of the regional economy. The coalition has introduced local enterprise partnerships to assist regeneration. We all agree that we need to regenerate areas such as East Yorkshire and the Humber, and Yorkshire Forward was doing a very good job of building up the economy. The Government’s answer was to remove the RDA and create a regional growth fund. Now, whenever a question is raised about where funding can be accessed, we are told to go to the regional growth fund. The housing pathfinder has been scrapped, and the Prime Minister told my hon. Friend the Member for Kingston upon Hull East (Karl Turner) to go to the regional growth fund for money. It seems to me that the fund must already have been spent about 100 times over. It is just ridiculous.

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[Richard Fuller (Bedford) (Con)]

May I draw your attention, Mr Deputy Speaker, and that of other hon. Members to the Register of Members’ Financial Interests and to my interests in venture capital and small businesses? I would also like to join others in praising the hon. Member for Barnsley Central (Dan Jarvis) for his maiden speech, which I thought was eloquent, relevant and insightful.

Unfortunately, I cannot apply those three adjectives to the speech of the Leader of the Opposition, which is a great shame. When I listened to the right hon. Member for Doncaster North (Edward Miliband) during Monday’s debate on the UN resolution, I thought he spoke as a serious statesman on behalf of not only his own party, but the whole country. Today, however, I am afraid that his speech was more like a pantomime act than a serious contribution. I hope that the shadow Chancellor will provide a better and more insightful response tomorrow. It is a shame because the people of Bedford and Kempston want to hear not what is not going to be done, but what is going to be done. They heard very clearly from the Chancellor what he was going to do.

It is not my job to tell Opposition Members to do their job, but I think it is time that we heard from them what they would do, which I did not hear. Up until the last speech by the hon. Member for Wirral South (Alison McGovern), I had not heard that at all. If Members are challenged and accept that there is a deficit, it is important for them honestly to come forward and say what steps and measures they would cut. They should not just throw out the next unfunded commitment in response. That does not help achieve consensus in what are very difficult times.

In addition, we are done a disservice because Labour Members’ failure to atone makes their constant outcries sound like a masquerade of keening by discredited professional mourners of the past. It would be much more insightful if they were able credibly to engage in the issue of how to get the deficit back under control. As their own unofficial website, labour uncut says, their current strategy of

“Hang on, I haven’t decided”

does not answer the needs of the time.

[Mr Gyimah]

I think that Labour has a plan. As we discovered from its press conference last week, the plan is to repeat last year’s bank bonus tax and spend the £2 billion that it raises in 10 different ways.

[Richard Fuller]

I shall be interested to see how Opposition Members respond to what my hon. Friend has said.

I would subject the Budget to the tests specified by the hon. Member for Barnsley Central: the impact that it will have on the most vulnerable, and what it will do for growth. It is difficult to introduce deficit reduction measures that do not disadvantage the poorest. What the hon. Member for Wirral South said about the impact of rising prices on people who were not receiving increases in their pay packets was absolutely right. I say to Ministers that—not necessarily for the purposes of the current year, but certainly as we look forward to next year and the year after that—we must think very carefully about what we will do for public sector workers who have experienced a pay freeze in at least one year, and in some cases in a number of years. Members on both sides of the House will want to hear a little more about that.

As I said earlier when I intervened on the hon. Member for Aberdeen South (Dame Anne Begg), the issue of the mobility component of disability living allowance is also of vital interest to Members in all parts of the House. We must ensure that we protect the most vulnerable people in our care homes. I have met the Minister responsible for the disabled—the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Basingstoke (Maria Miller)—on many occasions, and I know that she shares my passionate interest in that subject.

In the context of protecting the most vulnerable, let me first urge Ministers to continue to give full support to the welfare reform measures that are being pushed through by the Secretary of State for Work and Pensions. The universal credit will be of major, long-term, significant and beneficial advantage to low-paid and poor people in our country, and it is a measure that those on the Treasury Bench should support in the years ahead.

Secondly, I should have liked to hear a little more about support for our charities. I was very pleased to hear about the £550 million of support that the Chancellor was offering to them in the form of various benefits, but I should have liked him to be more radical. There are many steps that we can take to ease the rules and regulations and break down some of the barriers that prevent social investment from various sources. We should be a bit more open in relation to the way in which money can flow from social investment to outcomes and social impact bonds. I should have liked to hear about personal tax deductions for charitable donations, and I should very much like the Treasury—either directly or through the big society bank—to help charities to procure local government services. They need that support to arm them in their continuing battles with bureaucracies.

The Budget expresses strong support for those who wish to invest in our small businesses. It strongly supports angel investment and mentoring. Small businesses and entrepreneurs want support from people—from local people who may have started up their own businesses—and we will seek to provide it in Bedford and Kempston. We will seek to bring together successful local business people who can provide financial support through the advantages offered by the Budget in terms of angel investment, and through mentoring to provide guidance and advice so that small businesses can grow.

The Budget challenges us. As many other Members have said, we are about to be tested, and to go through very difficult times. It is important for Members on both sides of the House to argue constructively, but we should also rest on the great creativity and ingenuity of our small business people and entrepreneurs, because they offer the future that will achieve growth in this country.

[Mr Deputy Speaker (Mr Nigel Evans)]

I thank the hon. Gentleman for exercising time restraint.

Air Passenger Duty

Richard Fuller Excerpts

Thursday 20th January 2011 Commons Chamber

[Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)]

I am very glad indeed to have the opportunity to raise in the House of Commons the vital issue of the effect of air passenger duty changes on the Caribbean.

I want to begin by outlining what is intrinsically wrong with the changes—namely, the way in which the duty is calculated. No one in the Chamber is against environmental measures designed to bear down on excessive airline travel, and no one wants the British Treasury to lose money, but the way in which the duties have been calculated, and the way in which the zones have been worked out, are indefensible. The zones are calculated on the basis of where a capital city is. For instance, because the capital of the United States is Washington DC, one would pay less duty under this system to fly to Hawaii or Los Angeles than to fly to the Caribbean. How can that be right? How can it be cheaper to fly those vast distances than to fly to the Caribbean? These are issues of fairness, equity and transparency.

The flight tax to the Caribbean increased by 25% on 1 November 2009. In November 2010, the tax on flights from the UK to the Caribbean increased by a further 50% in all classes of travel. At present, passengers travelling to the Caribbean pay £75 per person in economy and £150 per person in all other classes. There is a substantial amount of traffic between Britain and the Caribbean, particularly at holiday times. As a member of the Jamaican diaspora, I sometimes find myself on those planes packed full of people who are happy to go home and see their relatives. Many of them have saved for two years or more for their flights. I put it to the Minister that £75 might not seem much to the Treasury, but when people are paying for a family of four, five or six, it amounts to a lot of money. People have often saved up for their flights for years, and that sum is a big consideration.

I am appealing not only to the Minister’s humanitarian instincts, however. I know from talking to Ministers of whatever party that I would do that in vain. I also want to talk about the effects of air passenger duty on British business and on the economies of the Caribbean.

[Richard Fuller (Bedford) (Con)]

The hon. Lady is making some excellent points. Before she moves on to business, I would like to encourage her to talk more about the matter of equity, although she says that she would do so in vain. Many people from my constituency travel to destinations in the Caribbean, and many of them came to this country in the 1950s, ’60s or ’70s. They have often spent their careers working in the public sector on very low incomes, and many are now pensioners. For them, £75 is a very significant cost. They have siblings, perhaps aunties, and certainly nephews and nieces back on the Caribbean islands—not only Jamaica but many others. Does the hon. Lady agree, notwithstanding the excellent points that she has made about geography and is about to make about business, that there is a strong equity case for the Minister to review the question of air passenger duty?

--- Later in debate ---

[Richard Fuller]

I greatly appreciate my hon. Friend giving way. I have admired the rigour of her analysis as she has gone about her duties as a Minister as well as her powerful advocacy. If I may, I want to encourage her to use the second part of her talents—her advocacy. There is a strong equity case for people in this country to consider carefully the APD ratings for Caribbean islands. A significant number of people who have made their home here like to go home to their place of birth and origin. We all want to see the environmental goals that she has discussed accomplished, but there is a strong and powerful equity case. I ask her, through her rigour, to give due regard to that case as well as to the other competing pressures.

[Justine Greening]

I am grateful for that intervention. My hon. Friend points out the impact on local communities but, in a friendly way, I would challenge the point about contradictions. In terms of our tourism industry and our need for links with other countries to drive economic growth, this is very healthy. Our relationship with the Caribbean and the role that aviation plays in helping us to maintain that more broadly is particularly important, so we are not necessarily faced with an either/or choice.

One of the most intractable problems we face, which underpins the whole approach in the Treasury, is the unavoidable challenge of tackling the fiscal deficit. We are faced with that while also making sure that the tax measures in place work effectively and do not have the sort of negative impacts that we do not want or need them to have.

Oral Answers to Questions

Richard Fuller Excerpts

Tuesday 21st December 2010 Commons Chamber

[Mr Speaker]

Order. The hon. Gentleman is to resume his seat. He has come in on the wrong question I am afraid; we are talking about bank bonuses.

[Richard Fuller (Bedford) (Con)]

While the Minister reviews the undoubtedly well-stuffed stockings of certain bankers to determine whether they have been naughty or nice, will he acknowledge the significant amount of tax that they pay, and the institutions that choose London as their domain? Will he recognise that, as far as their choice of domain is concerned, the airports of this country will not always be closed?

[Mr Hoban]

My hon. Friend makes an important point. At the time of the spending review the Chancellor made it very clear that we want banks to pay the maximum sustainable tax. That is why on 1 January we will introduce a bank levy, which the Opposition rejected when they were in government. That levy will raise £2.5 billion more than the net amount raised by their bonus tax.

Equitable Life (Payments) Bill

Richard Fuller Excerpts

Wednesday 10th November 2010 Commons Chamber

[Mr Hamilton]

I thank my hon. Friend for making that very good point. We are talking about many hundreds of thousands of policyholders throughout the United Kingdom, but we know that there are about 37,000 or so post-1992 with-profits annuitants. We think there are about 10,000 pre-1992 such annuitants, but the further back we go the fewer there will be, so if it was a difficult, time-consuming exercise to work out relative losses for all policyholders, which it certainly was, which is why Sir John Chadwick was engaged, it will surely be a much easier exercise for the far fewer people who are with-profits annuitants prior to 1991. My hon. Friend’s point goes some way to answering the question.

[Richard Fuller (Bedford) (Con)]

I thank the hon. Gentleman for giving way again. This has been a long-standing issue, and perhaps he can help some of us who are new to the House. He mentioned a total of £100 million from subsequent years’ Budgets, plus £100 million from reserves to be allocated to pre-1992 annuitants who are not covered in the proposals. Is he making an estimate, or is that sum firm is in his mind? That is a key issue. The concerns expressed about computer records do not stand up against a point of principle, but it is important that we have a sense of how firm and solid the hon. Gentleman’s understanding is of the sums that might need to be paid.

[Mr Hamilton]

The hon. Gentleman makes a very good point, and I cannot give him a precise answer. The figures that I have quoted are estimates I obtained from the Equitable Members Action Group, which has quite a lot of good people working for it—people who have been in the financial services industry. I go on their expertise. This is the best estimate that we can gain.

The reality is that many of the annuitants are quite elderly. It is unlikely that in five years we will have the same number we have now. We already know, for example, that every single day since the disaster happened 15 policyholders throughout the entire spectrum of Equitable policyholders have died. We can therefore assume, unfortunately, that more will no longer be with us in the years to come, so the amount of money will be a diminishing sum. The best estimate that we can gain is £200 million, and that estimate comes from EMAG.

--- Later in debate ---

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

The hon. Member for Leeds North East (Mr Hamilton) made an impassioned and moral argument for amendment 1, to which I shall return later.

I have taken a very keen interest in this issue. It has affected a significant number of people in Stratford-on-Avon, to the extent that I have had hundreds of letters and e-mails about it. Like many other Members, I signed the EMAG pledge before the election, and I believe that backing the Government to get the Bill through is delivering on that pledge.

It is probably worth our spending just a few moments thinking about the economic landscape in which we are operating. We are borrowing about £500 million a day. Every time we go to sleep and wake up in the morning, we notch up another £500 million. To service the debt costs about £120 million a day—that is not to pay it down, but just to stand still. It is against that background that we must try to resolve the tragedy of Equitable Life.

Let me spend a couple of minutes on the timelines of the events. In 1988, Equitable Life stopped selling its guaranteed annuity rate policies and, in 1990, those policies became too expensive to honour because of the falls in interest rates and in inflation. In 1999, after the 1997 election, Equitable cut its bonus paid to 90,000 GAR policyholders. In July 2000, the House of Lords ruled that Equitable Life must meet its obligations to its GAR policyholders, thus leaving it with a £1.5 billion liability.

In February 2001, the Halifax agreed to pay £1 billion for the assets. In July, with-profits policyholders saw the value of their savings slashed by 16%—by almost one fifth. In August, Lord Penrose announced his investigation. In October, the then Economic Secretary to the Treasury told the Treasury Committee that the previous Labour Government might consider compensation for some victims if a grave injustice had occurred.

In January 2002, policyholders backed a compromise package. In March 2004, the Penrose report blamed Equitable Life’s management for the whole affair. Following the report’s publication, the Government ruled out compensation and were accused in this House of abandoning policyholders. In April, the parliamentary ombudsman announced that she would reopen her investigation.

In 2007, the European Parliament called on the UK Government to compensate policyholders. In January 2008, Equitable agreed to pay an undisclosed sum to 407 with-profits annuitants who launched proceedings in 2004. The ombudsman’s report was published in 2008. The previous Government said that they would respond by the autumn. When the deadline was missed, the then Prime Minister said that they would respond before Christmas. However, they did not respond until the new year.

In August 2009, Sir John Chadwick published his first interim report, and in March 2010—more than a year after his appointment—he published his third and final interim report with a promise of a final report in May 2010. That date was subsequently extended to July.

I go through these events in chronological order to demonstrate the pain that the victims of Equitable Life have had to go through. This is a true human tragedy. The hon. Member for Leeds North East talked about the e-mails and letters that he has received from his constituents, and the same is happening in all our constituencies.

The Government’s offer is a very good one. My hon. Friend the Member for Cardiff North (Jonathan Evans) said that, at best, he expected them to offer up to £1 billion. Many colleagues and I voiced our concerns the last time we debated this matter in the Chamber. When one makes a pledge, one must try to honour it.

[Richard Fuller]

Like many of us, my hon. Friend is wrestling with this question of fairness and with the political obligation to find a fair payment scheme that was mentioned in the Public Administration Committee and that many of us have signed up to. Hon. Members from both sides of the Committee are caught between wanting to praise the Minister for the swiftness of his recommendations—we praise him for that—and finding, in these difficult times, £1.5 billion. We often talk about that figure in comparison with the Chadwick number. However, does my hon. Friend not accept that we should view the figure with respect to what the Government themselves have said about policyholders’ relative loss, which Towers Watson estimated at, I think, £4.3 billion? Does £1.5 billion represent meeting our obligation of fairness if it is set against the relative figure of £4.3 billion that the Government themselves have accepted?

Oral Answers to Questions

Richard Fuller Excerpts

Tuesday 13th July 2010 Commons Chamber

[Mr Hoban]

The Government are committed to tackling unacceptable bonuses in the financial sector, and we have put forward a series of proposals on that. We have talked about increasing the disclosure of remuneration, we have asked the Financial Services Authority to examine ways in which the link between risk and remuneration can be investigated, and we are taking forward work on the financial activities tax. Also, we have today published a consultation on a bank levy, which will raise an extra £2.5 billion in revenue from the banks.

[Richard Fuller (Bedford) (Con)]

T10. Average wages in my constituency are below the national average, so the rise in the income tax threshold announced in the Budget was most welcome. Can the Minister please give an assurance that he will maintain a focus on increasing the personal tax threshold, as the prospect of being taken out of tax altogether is far more appealing than the prospect that the previous Government offered, which was the non-stop filling in of forms to claim back just a fraction of the money that people had already earned?

[Mr Gauke]

I can confirm to my hon. Friend that it remains our long-term objective to raise the income tax threshold to £10,000, and we have made significant progress.

Budget Resolutions and Economic Situation

Richard Fuller Excerpts

Tuesday 22nd June 2010 Commons Chamber

[Richard Fuller (Bedford) (Con)]

I rise for my maiden speech to applaud my right hon. Friend the Chancellor for his courage in meeting the challenge of the most parlous state of our public borrowings, and for proposing a series of measures that attempts to deal with that problem while striving to protect the most vulnerable. I know it is a task he does not relish, but it is a burden he shoulders on behalf of us all.

I appreciate the opportunity in this robust debate to have a brief interlude—a commercial break, if you wish, Madam Deputy Speaker—to say good things about my home town and constituency of Bedford. I hope that in so doing, I can do as good a job for Bedford as my hon. Friend the Member for Dewsbury (Simon Reevell) did for his constituency in his maiden speech. I shall of course thereby lose the enticing opportunity to correct some of the breathtaking assertions I have heard from the Opposition Benches, not least from the hon. Member for Nottingham East (Chris Leslie), who strains the credulity not only of those of us on this side of the House but of a great proportion of the British public, who really do not understand where he is coming from.

I am the first Member to represent Bedford who was born there since the Liberal Member, Mr James Howard, in 1868. I truly love my home town. It is a wonderful and diverse community, and I am extremely honoured to be able to represent the people of Bedford and the neighbouring town of Kempston. It is an honour that I share with my predecessor Patrick Hall, who was a tireless advocate on behalf of the constituents of Bedford and Kempston. I can say honestly that his work on their behalf knew few limits. He was their constant companion in their navigation of the bureaucratic state that has come to bedevil the lives of so many of us. Patrick was the first Labour MP for Bedford to be re-elected, and in fact he secured a second re-election, a feat so remarkable that I doubt it will ever be repeated by a Labour politician in Bedford.

I also pay tribute to Patrick’s predecessor, Sir Trevor Skeet, who represented the constituency for 27 years. I remember him fondly as I began my political career delivering leaflets for him in 1979. I am happy to say that 150,000 deliveries later, the post finally arrived.

Bedford is a town remarkable for its diversity, both in ethnicity and in culture. It is a most harmonious town and has much to teach the rest of our country about the power and potential of diversity. It can truly be said that a child in the course of their school career in Bedford may well meet other children whose parents come from every single nation in the world. What a fantastic start that gives children in my home town, and what a wonderful job the teachers of my town are doing to ensure that those children have a world-class education.

We are very proud of our education in Bedford, and it is very important to us because we are a town of young families. We embraced the legislative freedoms that the previous Government provided through the opportunity for schools to set up their own trusts. We are also looking forward to September, when two of our finest institutions, Bedford college and the Bedford Charity, join together to establish the John Bunyan academy. I know that many parents and teachers in Bedford look forward to the legislation that my right hon. Friend the Secretary of State for Education will propose, and we intend Bedford to be at the forefront of the free schools initiative.

Great schools beget great Bedfordians. Archbishop Trevor Huddleston was born in Bedford and was a relentless campaigner against apartheid. He was so strong in his actions, against such great odds, that he earned the nickname in South Africa of “the dauntless one”. John Le Mesurier, better known as Sergeant Wilson of “Dad’s Army”, was another Bedfordian and a great man of comedy, who penned his own obituary in The Times thus:

“John Le Mesurier wishes it to be known that he conked out on November 15th. He sadly misses his family and friends.”

It is said that his last words were, in true Sergeant Wilson fashion, “It’s all been rather lovely.”

The challenge for the Government, met in the Budget, is to balance our books while rewarding work; to find a way in which our public services can support and raise up the people of this country who need their help, and not—as happens too frequently, despite the best intentions—hold them down. I believe that a key to that is unleashing the power, potential, leadership and creativity of our social enterprises and charities.

Recently, Bedford college hosted an evening with the entrepreneurs—an opportunity for schoolchildren to meet some of the leading lights in our social enterprises, including Adele Blakebrough of Community Action Network and Tim Campbell of the Bright Ideas Trust. The schoolchildren could hear the passion that guided those people’s lives, and learn about their potential to provide for social services in a better way than the bureaucratic state.

In Bedford, groups of charities have already come together in a formal coalition, Consortico, which will enable them better to compete for the contracts that local government offers. Those charities and social entrepreneurs need the Government as an ally who will enable them to overcome the inertia and intransigence of some arms of the bureaucratic state. We need the leaders of the arms of the bureaucratic state to become champions of unbundling their privileges, not intransigent defenders of their own interests.

Social enterprise is one key, but as has been said many times in the debate, enterprise is absolutely critical. For the arc of my life, my home town has been in economic decline. It is not unique in that—indeed, the causes transcend party and are a pattern repeated throughout our country. Manufacturing jobs have been exported as we plugged into the global economy. There are measures in today’s Budget that will start to address that and rebalance growth throughout our economy. We have witnessed a persistence by Government in permitting those who are able but idle not to contribute to the economy. Again, this Government will tackle that.

In Bedford, we have experienced a doubling of unemployment in the past 10 years. The so-called boom of the past decade seemed to pass our town centre by. It is now in urgent need of regeneration, but incapable of making that happen unless we achieve the economic recovery that we need. The measures the Chancellor proposed today will hasten that recovery.

Our bypass is tantalisingly close to completion after 70 years of waiting. As a town, we need to start punching above our weight to attract more capital to it and to the constituency. We will do that together as a community, by promoting entrepreneurship so that we can start more small businesses, and by opening up our bureaucracies to the social entrepreneurs who can provide a much better service for our community in the long term. We will provide a beacon for other communities to show what can be done by harnessing the opportunities that are presented even in these most difficult times for communities to step forward and fulfil the challenges.

It is said that courage is often found in the most challenging times. With the very difficult measures that he proposed in his speech today, the Chancellor has shown us the courage that is needed, and that he can set us on the right course.

We need a House that can both strive for the most important interests of this country and amplify the weakest and quietest voices in our community. The people need a House that can be a beacon for liberty, freedom and democracy for those in the world for whom those are still ideals and not reality. We need a House that will restore probity to the public finances, so that future generations of Britons are not shackled by the excesses of this generation. The Budget has made a start. I hope, in my time in this House, that I can make a brief and small contribution to achieving those ambitions.