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Prime Minister

Volume 485: debated on Wednesday 17 December 2008

The Prime Minister was asked—


I have been asked to reply. As the House will be aware, my right hon. Friend the Prime Minister is in Iraq today. He will make a statement to this House on his return.

I am sure that the whole House will wish to join me in sending our profound condolences to the family and friends of Lieutenant Aaron Lewis, of 29 Commando Regiment Royal Artillery, who was killed in Afghanistan on Monday. To those who never shy away from danger and who never shirk from their duty, to the families who will be apart from our troops this Christmas and to those who have died in the service of their country, we owe an enormous debt of gratitude.

I thank my right hon. and learned Friend, and may I associate myself with those condolences?

At a time when the price of a barrel of oil has sunk like a stone, why are the energy companies charging the price that that they are for fuel? Surely it is time for more to be done by the Government and those associated with us to bring down the price. Will my right hon. and learned Friend assure me that she can make it possible for me to go back to my constituency and give the assurance that the Government are doing all they can to bring about lower energy prices?

I absolutely agree with my hon. Friend. The energy companies must pass on the price cuts to consumers, both businesses and families. They must also treat all consumers fairly. If they do not, it will not just be Ofgem and the Competition Commission that they will have to worry about—we will change the law to force them to do it.

I join the Leader of the House in paying tribute to Lieutenant Aaron Lewis, who was killed in Afghanistan on Monday. As she said, our thoughts are with his family at this desperately sad time.

We look forward to the Prime Minister’s statement tomorrow about the withdrawal of British troops from Iraq, although we were surprised that since that news relating to national security was leaked by the Government last week no one has been arrested. Across the House, we salute the work of the British forces in Iraq. They will have been there for more than six years, which is a deployment longer than the entire second world war. As we welcome the end of that deployment, is it not now finally time for the Government to establish what the whole nation expects to see—a full-scale independent inquiry into the origins and conduct of the war?

I agree with the right hon. Gentleman’s supportive words for the work of our troops in Iraq. We have had a number of inquiries into Iraq and the Prime Minister has said that there will be no further inquiries until our troops are all returning home. The Prime Minister will make a further statement to the House tomorrow.

Well, the troops are now going to be returning home and it is time for the announcement to be made. The Government have delayed for years the establishment of an inquiry. The learning of lessons that may be relevant to Afghanistan and elsewhere can no longer be delayed.

New figures this morning show a further rise in unemployment of 137,000. It is now at its highest level for 10 years and is obviously set to rise further. We have been pointing out that the big problem is that even viable businesses cannot get the loans that they need. Last week, we asked the Government to look again at the bank rescue package. The Chancellor announced on Monday one of the measures that we have been calling for. Will the Government now accept the urgent need to get money into the hands of the businesses of this country?

I want to reinforce to the right hon. Gentleman that there is no delay in an inquiry. We have made it clear that, while our troops are still in Iraq, which they are, and doing their duty, we will not have a full inquiry into how they went in; we will not have that until after they return. We have to respect the fact that our fighting forces are still in Iraq. There is no delay.

As far as unemployment is concerned, it is always a terrible blow for a person to lose their job. That is why we are stepping up Government action with a £1.3 billion package to protect people who become unemployed. The package will help them to obtain the skills to get new jobs and it will also make sure that they do not lose their homes.

The right hon. Gentleman is right that small businesses are the lifeblood of enterprise and employment in this country. That is why we recapitalised the banks to stabilise the banking system, and that is why in January we will set up a new small business loan guarantee scheme. Although the figures are starting to show increasing lending to small businesses, some businesses are still having problems. That is why the national lending panel has been established.

But things are getting harder for households and businesses that want to borrow, not easier. This country has now been in recession for six months, and a leading Minister said this week that we are

“facing a recession deeper than any that we have known”.

Is it not clear that the Government’s policies have failed so far? People are losing their jobs by the hour, and the small business guarantee scheme to which the right hon. and learned Lady referred covers only one fifth of 1 per cent. of business loans. Do we not now need a national loan guarantee scheme of the kind that we have advocated, before more businesses go to the wall and many more tens of thousands of people are made unemployed?

We are taking action to protect people who become unemployed. Do the Opposition back the £1.3 billion extra that we are putting into jobcentres? No. They have said that they will cut public spending, and they opposed our action to recapitalise the banks.

As far as unemployment is concerned, we agree that losing one’s job is a terrible blow for every individual. That is why we are taking the action necessary—although unemployment is still about 600,000 lower than it was when we first came into office.

The Opposition’s so-called national loan guarantee scheme is not a guarantee of anything to anybody. If it is not backed up by public money, it is not worth the paper that it has been press-released on.

This side of the House did not oppose the recapitalisation of the banks, so let us put that straight.

Will the right hon. and learned Lady confirm that, of the £158 million announced today to help unemployed people, £58 million has been taken from another programme that is already supposed to help train people? The other £100 million is exactly what she announced two months ago, the last time that she and I did Prime Minister’s questions. That money has been announced before, which means that this is a reannouncement of a reannouncement—at Christmas time we are not meant to get only repeats, but that is all that we are getting from the Government today.

The Governor of the Bank of England himself said on Monday that there has been a

“further tightening in the supply of credit to households and businesses which is likely to continue…Additional measures…will probably be required to underpin lending to households.”

This House will not sit for nearly a month. How many more people will lose their jobs while the Government dither about introducing the scheme? Why does the right hon. and learned Lady not tell the Chancellor to pull his finger out and introduce it?

But the Conservatives would not back the £1.3 billion extra that we are putting into jobcentres to help people with retraining and job advice or, crucially, the money that we are putting in to back people up if they become unemployed so that they do not fear that they could lose their home. Not only are the Conservatives failing to back the action that we are taking to support people who become unemployed, but last week they announced a policy that would make matters worse. They said that at this crucial time they would cut public spending. If they cut vital public investment it will be devastating for the construction industry, jobs and the infrastructure of our country. First they said, “No action” and now they are suggesting action that would make matters even worse.

We are calling on the Government to take action; this is a say anything, spin anything, achieve nothing Government and we are calling on them to take action. The director general of the CBI said:

“Getting the credit markets working properly is much more important than the fiscal boost.”

The CBI survey of distributive trades, released in the last hour, which is the key indicator of activity in the retail sector, and includes the 10 days after the VAT cut, shows the worst downturn in retail activity since records began—a massive thumbs down from the consumer. Is it not time for the Government to concede that the temporary reduction in VAT, universally derided at home and abroad, has not been the answer, and that getting credit moving to businesses would be part of the answer to this recession?

I think that there are two responses that we should have to the very difficult economic circumstances. The first is not to talk down confidence and not to talk down the economy. The second is to ensure that as well as interest rate cuts we have a fiscal boost to the economy. Since we are talking about retail, that is why we are taking forward a cut in VAT and we urge the right hon. Gentleman to vote for it. That is why we are bringing forward extra cash help for pensioners from the beginning of next year. That is why we are bringing forward extra child benefit, to put more money in people’s pockets, and why we will have a tax rebate to help 22 million people. We take action while all the Conservatives do is carp and criticise. For the right hon. Gentleman to face these big economic circumstances and say, “It is only down to interest rate cuts and we would put no extra money in the economy” would make a difficult circumstance a disaster.

What we are calling on the Government to do is to get the money to the businesses of the country. We cannot have lectures about talking down confidence from the Cabinet, one of whose members said this week that we are

“facing a recession deeper than any that we have known”.

What is that if it is not talking down confidence? This country has been in recession for six months. The Government have achieved nothing except to let unemployment get worse and debt go up. We now have soaring unemployment, rocketing debt, good businesses going to the wall and heavy tax rises on the way. If this is the Prime Minister saving the world, God help us when he moves on to the rest of the solar system. How many people will have to lose their jobs before the Prime Minister justifiably loses his?

When it comes to party leadership, I happened to be having a look at the right hon. Gentleman’s website, and I suggest that other hon. Members look at it. On, it just says:

“William Hague…Leader of the Conservative Party.”

The country faces unprecedented economic circumstances. There are uncharted waters ahead and there is economic uncertainty, but one thing I want everybody to be in no uncertainty about is that we will take the action necessary to stabilise the economy, to support small business, to support jobs and to protect people against repossession. Unlike the Conservatives, who simply say “No action” and then propose a bogus scheme, we will never say that unemployment is a price worth paying.

Q10. Last Sunday marked 90 years since women first voted in UK elections on 14 December 1918. Will my right hon. and learned Friend ask the Prime Minister to join us at the new permanent exhibition on the suffragette struggle, off Central Lobby, and so give a lead to other hon. Members to take their constituents and visitors, particularly school parties, and to stress to young women the importance of exercising their hard-won, democratic right to vote? (244078)

I will recommend my hon. Friend’s request to the Prime Minister, and I congratulate her on the work that she has done to bring the exhibition to the House. The important thing is not only to have more women in the House of Commons, but that we change the face and the agenda of the House of Commons, and we have done that with new Sure Start centres, with maternity pay and leave and with new laws to tackle domestic violence. She is part of making sure that we deliver for women in this country. We are not complacent; there is more to be done.

May I add my condolences to the family of the brave serviceman who died in Afghanistan?

When the Leader of the House last stood in at Prime Minister’s questions, I asked her about the vicious spiral that was developing in the economy, with rising unemployment and a collapsing housing sector. Since then, it has been confirmed that housing starts this year are at the lowest level since Ramsay MacDonald led a Labour Administration in 1924.

Labour Members ought to remember, because they are in danger of repeating that history. The Leader of the House may not be aware either that, a few days ago, the regulator of the housing associations warned that six of the leading associations are in grave financial difficulty and in danger of collapse. What are the Government proposing to do about it?

We are very concerned about the housing situation, and that is why we will bring forward capital investment, rather than cut it or postpone it. We will be backing up the Housing Corporation, and for those people who fear that a temporary fall in their incomes will cause them to risk losing their homes, we are making arrangements for them to be able to defer their mortgage interest payments, and those who lose their jobs will not have to wait 39 weeks to get their mortgage interest paid; they will be able to get it paid after 13 weeks. We are very concerned about housing, and we will do everything that we can to protect the housing market.

Basically, that was a complacent answer—does the Leader of the House not realise that the investment is not happening, because the housing associations are bust and the Treasury is imposing a crippling funding formula on them? The housing repossession policy is reaching fewer than one in 10 of people in housing arrears. Will she now give the same attention to the financial crisis in the housing associations as the Government are giving to the banks? Will she tell us which of them are in grave difficulty and what the Government are going to do to rescue them and to ensure that the public sector can play a role in kick-starting the moribund housing activity?

We agree that the public sector has an important role to play in capital investment in the construction industry in the housing market. We took the action that we did on the banks so that they can be in a position to start lending again into the mortgage market and to stabilise the housing market for the future.

Q2. Recently, a small group of people with learning disabilities and their support workers went to a karaoke night at the Bull and Butcher pub, Whetstone. The manager was hostile, made it clear that he did not want them there and harassed them until they left in distress. Does my right hon. and learned Friend agree that such an appalling case of discrimination and infringement of human rights demonstrates the need for both the UN disability rights convention and the Human Rights Act 1998, and the need to build on its protections, not to repeal it, as the Conservative party would do? (244070)

I agree with my hon. Friend that discrimination against anyone is unacceptable and discrimination against disabled people has no place in our modern society. He is right to bring that matter to the attention of the House. I know that as an avid champion of human rights, he will ensure that justice is done for his constituents, and I can confirm that we remain proud of the Human Rights Act and stand by it.

Q14. Many pensioners will bear the brunt of this recession, but with interest rates heading towards zero, will the Leader of the House do something to tackle the nonsense whereby pensioners are assumed to earn 10 per cent. on their savings when it comes to calculating their entitlement to benefit? (244083)

We are paying extra money to pensioners, with an extra Christmas bonus—[Interruption.] Well, I think that the extra winter fuel payment is important, the extra Christmas bonus is important, and bringing forward the increase in the state retirement pension to the beginning of the year is important. While we are in no way complacent about people’s income in retirement, the single group of people who have benefited most in terms of their increased standard of living since Labour came into government has been pensioners, particularly single older pensioners.

Q3. What does my right hon. and learned Friend think of the decision of Crawley borough—a Conservative-controlled authority—to reject the free swimming offer for young and older people? With the Olympics looming, and with a focus on health and well-being, does she believe that that decision is wrong? Santa will not be coming to Crawley this year. (244071)

That is just another example of how the Tories do not believe in public services, even important public services. They should be jumping at the chance of free swimming, which is important for people of all ages, not only for leisure but for public health. I hope that Crawley council will take my hon. Friend’s advice and think again.

Given that the troops have been in Afghanistan for more than seven years, and looking at the current situation, including the deeply entrenched forces around Kabul, would the Leader of the House care to speculate on whether the military battle is being won, and crucially, when does she anticipate that the all-important battle for hearts and minds will commence?

We have always said that there is a development strategy, a political strategy and a military strategy. In that military strategy, as well as paying tribute to our troops fighting in the most dangerous circumstances in Helmand province, we recognise that this is a multinational force operating in Afghanistan. Of course, we recognise the political and development strategies as well as the military one.

Q4. May I ask my right hon. and learned Friend to pass on my thanks, and the thanks of many in this House and in our country, to everyone involved in last week’s announcement on the upgrading of the armed forces compensation scheme? She will realise that that will make a massive difference to the quality of life for service personnel and their families. However, can she assure me that everything is being done with regard to the fixtures and adaptations that service personnel need to make a smooth transition when they return home from rehabilitation? (244072)

I support my hon. Friend’s welcome for the increase in compensation for those who have suffered injuries in service to their country—an increase of up to £590,000. In addition, that will be backdated to those who have been injured since 2005, and instead of waiting for them to contact the compensation scheme they will be contacted for their compensation level to be reviewed. He mentions the important question of adaptation. Those who are returning home will have high priority for adaptations in their homes.

Q5. This week, the Government abandoned their planned inquiry into the use of Snatch Land Rovers in Afghanistan and Iraq. Given the increasing number of improvised explosive device attacks, why are the Government still unprepared to give our armed forces the level of protection that they need, want and deserve? (244073)

We are committed to doing exactly that. The Secretary of State for Defence has said that he will listen to and be advised by the military chiefs so that they have the full range of equipment that they need to support our troops in the field.

Q6. Many of my constituents in Cardiff, North, have benefited from the opportunity to work flexibly that was introduced by this Government, who have recognised the stresses and strains of bringing up a family while having to go to work—something that has not always been recognised by the Opposition. Will the Leader of the House tell us when that opportunity will be more widely extended, and what the timetable is for doing so? (244074)

I pay tribute to my hon. Friend, who has long championed the cause of families, and who has pressed for support for families who juggle going to work, bringing up children and caring for older relatives. People want to be able to earn a living and support their family, and that is why we introduced a right to flexible working—unfortunately, the Opposition opposed it—for families with children up to the age of six. I can confirm that from April, we will be increasing that right to request flexible working, extending it to all families with children up to the age of 16.

Statutory arrangements for the improvement of the governance of the National Audit Office were to have been included in the constitutional renewal Bill, but as the future of that legislation is currently unclear, does the right hon. and learned Lady agree with the right hon. Member for Swansea, West (Mr. Williams), who has written to the Prime Minister on the issue, that it might be simpler and more sensible to have a separate, stand-alone Bill, that makes sure that the future of the National Audit Office is safeguarded? Will she talk to the Prime Minister—and to herself, in her capacity as Leader of the House—about that?

I agree with the hon. Gentleman about the important work of the National Audit Office. He will know that in the Queen’s Speech, we said that we would continue discussions and consideration of how we can improve and modernise the constitution.

Q7. Some years ago, I was able to persuade the then Minister to refuse support for a damaging open-cast mining project in Cossall in my constituency. Constituents there were extremely pleased with the move away from the Conservative policy of doing nothing and letting the project happen. I want to ask my right hon. and learned Friend whether it remains the Labour Government’s policy to refuse support for open-cast mining where it would have a disproportionate impact on the environment. (244075)

I can reassure my hon. Friend that there has been no policy change on open-cast mining, and I am sure that he will pass that message on to his constituents, who will continue to be happy with his work as their MP.

Q8. In his speech to the Labour party conference in 1996, the Prime Minister said: “we will not build the new Jerusalem on a mountain of debt”.Why have the Government changed their mind? (244076)

One of the biggest misapprehensions that the Opposition have been peddling is on the question of debt, and I want to address that. When we came into government, our debt as a percentage of gross domestic product, according to the International Monetary Fund figures, was 43 per cent. We paid that off year by year, taking it down to 37 per cent. We acknowledge that now we need debt to rise; we do not resile from that. If debt is not allowed to rise, and we cannot take the action that is necessary to back up the economy, there will be even more debt in the longer term, as a result of the bills for failure and for unemployment benefit. How can the hon. Gentleman’s party put forward proposals for a so-called national loan guarantee scheme while saying that it would cut public spending and not allow debt to rise? It simply does not add up.

Q9. Will my right hon. and learned Friend make sure that pressure is exerted on private water companies, which are imposing new surface water charges on churches, and treating them as if they were businesses? If those companies are not prevented from applying those unfair charges, which amount to thousands of pounds per church, they will be responsible for the closure of places of worship across England and Wales. (244077)

My hon. Friend raises a point that has been made by a number of hon. Members; indeed, the matter has been raised with the Church Commissioners. I know that my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs is reviewing the situation, and I will ask him to write to my hon. Friend, as well as to the Church Commissioners.

Q12. In west Didsbury, Lancastrian school is to lose its secondary provision, and Ewing school, which has won awards for inclusion, is earmarked for closure. Those schools provide top-quality teaching and learning for children with physical incapacities and speech and language disorders, who cannot be educated in the mainstream. Will the Leader of the House join parents, teachers, local residents and me in urging the council to reject those unpopular and unnecessary plans? (244080)

The question of local school organisation is a matter for the local education authority, but I will draw the hon. Gentleman’s comments to the attention of the Secretary of State for Children, Schools and Families. I hope that the hon. Gentleman will welcome the fact that in his area there has been a very big investment in teaching and in school buildings.

Q11. The Building Schools for the Future programme is vital for improving the educational prospects of young people in my constituency and for sustaining and maintaining the construction industry at an extremely difficult time. Can my right hon. and learned Friend tell me what steps are being taken to accelerate that programme? (244079)

My hon. Friend makes a fundamental point that the refurbishment and rebuilding of schools is not only important for education, but vital to keep jobs flowing in the construction industry. To cut back Building Schools for the Future now would deprive local communities of the improved schools, as well as being a devastating blow to the construction industry. That is why, far from doing that, we will bring it forward.