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Prime Minister

Volume 487: debated on Wednesday 4 February 2009

The Prime Minister was asked—


Before listing my engagements, I am sure that the whole House will wish to join me in expressing our profound condolences to the family and friends of Corporal Danny Nield of 1st Battalion The Rifles, who was killed in Afghanistan last Friday. We owe him, and all who have lost their lives, our gratitude for their service. Our armed forces show us week in and week out their courage and commitment, and we will never forget those who have shown such dedication.

This morning I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further meetings later today.

The whole House will wish to send our deepest sympathy to the family of Corporal Nield.

We are experiencing the worst winter weather for 20 years, but new evidence shows that fuel companies are not cutting fuel bills as their costs reduce. Meanwhile, energy giant BP has just posted £14 billion in profits. What urgent further steps can my right hon. Friend take to reassure pensioners and families who are worried about their fuel bills this winter?

First, I pay tribute to the emergency services for the way that they have dealt with all the troubles and difficulties that have arisen from the cold weather. We are determined to provide real help to people who are facing difficulties with their fuel bills, including pensioners who are worried about their ability to turn on their heating at a time when the weather is really cold. So in addition to the money that we have provided through the winter allowance, with 12 million pensioners who benefit by £250 or £400 this year, and at the same time as the £60 that we are giving to every pensioner now—it has been paid out in the past few days—I can also confirm that this Monday half a million vulnerable families became eligible for payments of £25 on the basis of future weather forecasts. Let me also say that 5 million people will get cold weather payments this week, and we will continue to make payments whenever the weather is so poor.

I join the Prime Minister in paying tribute to Corporal Danny Nield, killed in Afghanistan on Friday. We should offer our deepest sympathy to his family and his friends at this time.

Does the Prime Minister share my concern at the decision by the US House of Representatives to pass “Buy America” legislation, and does he agree that a retreat into protectionism is the last thing that the world needs? Yesterday, the Prime Minister’s spokesman refused to confirm that he would specifically condemn these moves. Will the Prime Minister make clear his position today?

I have made it clear throughout the past few months that the biggest danger that the world faces is a retreat into protectionism. I have also made it clear that, as a result of the withdrawal of foreign banking capacity in large numbers of countries, we face a downward spiral whereby these countries cannot borrow from anybody because foreign banks have left. That is all the more reason why, first, we should sign the Doha agreement—that will feature on the G20 agenda—and secondly, we should ensure that every country is analysed by the World Trade Organisation on what it is doing to prevent protectionism. It is also absolutely clear that we should agree, as a world, on a monetary and fiscal stimulus that will take the world out of depression.

The two countries that most need to give ground to achieve action on the Doha round—India and the US—will both be present at the G20. As the Prime Minister said, the aims of the G20 refer to advancing the Doha trade round. Should we not be clear that anything less than removing the barriers to agreement would represent a failure?

I tried very hard before Christmas to talk to both President Bush and the Indian Prime Minister so that we could make progress on this. There are actually only two issues that are left to be decided. The first is a safeguard clause for when there is a surge in imports in any poor country, and the second concerns negotiations on sectorals—different sectors of industry—and how those could be concluded. By the time President Bush had left office, he had made it clear that he would be able to accept the wording on the sectoral agreements, and the Indian Prime Minister has said to me that he wants to make progress on the safeguard clause.

It is now up to President Obama and the Indian Prime Minister to say that they can accept the terms of this agreement. If that were so, we would have a conclusion of the first round of the Doha negotiations. That is in the interests not just of our country, but of the poorest countries in the world, which are now facing poverty as a result of the industrial downturn. Those two issues can be resolved, and I will work very hard to resolve them in the next few weeks.

The point is that if we do not get a conclusion to the Doha round, the existing policy space allows countries to double the level of tariffs. Everyone can hear that the Prime Minister says that it is important to avoid protectionism, but is he not himself guilty of encouraging protectionist sentiment? Does he agree that use of the slogan “British jobs for British workers”—[Interruption.] Does he agree that using that slogan showed a lack of judgment, and does he now regret it?

First, on the trade negotiations, let us be clear that we have done everything in our power. The Brazilians have come on board; the Argentinians have come on board; the South Africans have come on board; the rest of Europe has come on board. It is important that we make all the efforts we can with other countries to get this trade agreement. Pascal Lamy, the head of the WTO, has just published a report on the protectionist tariffs that are being imposed by different countries during the present downturn. At the moment, those tariffs are limited and it is important that we continue to see that they are limited.

On the second question, can anybody here say that they do not want British workers to get jobs in our country? Can anyone here say—[Interruption.] Can anyone here say that they do not want us to help British workers get the skills necessary to get jobs? Let me also say that in an open environment and a global economy where there is competition for jobs, it is crucial that we do everything in our power to help people get the jobs that are available. That is why we are investing in apprenticeships; that is why we are investing in helping the unemployed get back to work; that is why we have a new deal; that is why we are increasing public investment. The pity is that the Opposition do not support us, because they want to do nothing.

Does the Prime Minister not understand that when he spouted his slogan, what he was doing was opportunistic, protectionist—[Interruption.]

He was pandering to people’s fears and he knows it. This is what the Chairman of the Home Affairs Committee, his former Europe Minister, had to say. He said that the slogan

“lacks credible arguments”


“appears to amount to little more than employment apartheid” .

He was asked to repeat the slogan, and because he has got some judgment he refused. Let me ask the Prime Minister again: is not the use of this slogan an error of judgment and a huge mistake, and should he not apologise instead of twisting?

I have already shown that we are far from protectionist as a Government. We are trying to get a world trade agreement. I have already said to the right hon. Gentleman—he does not want to listen—that in an open, global environment where there is competition for jobs, it is our duty to help British workers get the skills necessary for jobs. As far as opportunism is concerned, I have to tell him that there is nothing more opportunistic than his saying in the autumn that he wanted to give all-party support to this Government’s efforts to take us out of a global financial crisis and then, the next moment, withdrawing all that support. That is opportunism.

Does the Prime Minister not understand that he is taking people for fools again? At international summits, he lectures the world on the evils of protectionism, but back at home, with his slogan “British jobs for British workers”, he is pandering to protectionist fears. Does he not understand that he has been found out?

Let me just bring the right hon. Gentleman up to date with what is happening in the industrial dispute, so that he realises what is going on. An ACAS proposal has been put to the work force, and I hope that they will now accept it despite their initial reservations. I can also tell him that the construction and engineering association has issued new guiding principles for companies to consider when using non-UK contractors and labour on engineering construction sites. I hope that the whole House will welcome the fact that it now states in the new advice:

“Always consider whether there are competent workers available locally. If there are, it is good practice for the non-UK contractor to explore and consider the local skills availability and to consider any applications that may be forthcoming.”

That is the common-sense way of dealing in practical terms with the difficulties that we face.

Does the Prime Minister not realise that one of his problems is that he refuses to admit mistakes, even when those mistakes stare him and the whole country in the face? He says “British jobs for British workers” when he knows that it is not deliverable. He says that he ended boom and bust when we are in the deepest recession for a generation. He says that our economy is well prepared when the IMF says that we are going to have the deepest recession of all. I have to tell him that he should just look behind him—they are so ashamed of what he has said about British jobs for British workers. [Interruption.] Let me ask him one final time—[Interruption.]

I do not know why the right hon. Member for Rotherham (Mr. MacShane) is shouting—it was he who specifically criticised the Prime Minister for using that phrase. He said that

“every politician from a Prime Minister down to the most junior”


“in the House of Commons has to choose their words carefully.”

[Interruption.] I think that the right hon. Gentleman will have to learn to shout carefully, too.

Let me ask the Prime Minister one final time: was not using that phrase an error of judgment and a big mistake, and will he make a promise not to do it again?

The biggest error of judgment would be to do nothing during this period of the world downturn. The biggest error of judgment would be to fail to invest in the economy and help people get the skills that are necessary for jobs. We are creating 35,000 apprenticeships, we are helping 500,000 people into work and we are investing in the construction industry to create more jobs. The right hon. Gentleman goes around the world talking the pound down; he goes around the world saying that we are going to have to go to the IMF; he goes to Switzerland and says that the British economy is weak. He has decided that it is in the interests of the Conservative party to talk Britain down, and he should be ashamed of himself.

I am aware of several potential bidders to save Wedgwood and the hundreds of jobs affected in north Staffordshire. Although the administrators seem to be doing a very good job of keeping things running, I am worried that they are rapidly running out of time. Will my right hon. Friend look at what Government support can be given to assist the administrators to ensure that Wedgwood can keep running while they consider all potential bidders to save it?

I am grateful to my hon. Friend, who has taken a huge interest in this matter. We did try to help Wedgwood over the Christmas weeks, to see whether the company could be saved before it went into administration. I am very happy to talk to him about how we can speed up the process to help British workers there, and I am very happy to meet him to do so.

I add my expressions of sympathy and condolence to the family and friends of Corporal Danny Nield, who tragically lost his life serving this country and the people of Afghanistan in Helmand province.

Week after week, I have been asking the Prime Minister why he is not getting tough on tax avoidance. Every time, he tells me that he is doing all that he can. This week, newspapers have confirmed that big companies are using loopholes to get out of paying £14 billion in corporation tax alone. Instead of going on about British jobs for British workers, is it not time that he went on about British taxes for British companies?

This needs not only the efforts that we are making to clamp down on tax avoidance and tax evasion, but an international agreement. The right hon. Gentleman may be aware that there is a case in America at the moment in relation to Swiss tax avoidance. Once it is resolved, I believe that it is possible to get an international agreement for the exchange of information about tax cases. That would be the way to move forward our proposals for the exchange of information on tax and clamping down on tax evaders.

The Prime Minister is living in denial. He created a system that lets big companies run rings round the Treasury, lets peers in the other place not pay their full taxes in this country and allows City bosses to pay less in tax on their capital gains than their cleaners pay on their wages. He is losing this country billions of pounds, which could be used to give big permanent tax cuts to ordinary families. Why should anyone trust him when he makes one rule for the fat cats and another for everyone else?

I remember that the chief donor to the Liberal party got into real trouble because he was a tax evader, and the Liberals never returned the money. Perhaps it is the leader of the Liberal party who is in denial at the moment.

We do everything we can, and will continue to do so, Budget after Budget, to remove the possibility of tax avoidance and tax evasion. In the end, it will need what the right hon. Gentleman should support—an international agreement. In the light of the Swiss case in the United States of America, I hope that we can make big progress on that, and I hope that the hon. Gentleman will support it.

Over the weekend, 400 job losses were announced in my constituency, with the closure of the Stampworks in Ayr, the last truck axle manufacturer in the UK, and 145 job losses in Girvan—work is being transferred to Norway from one of the few sizeable employers in the Girvan area. Will the Prime Minister agree to meet me to discuss what can be done to help?

I know that my hon. Friend takes a huge interest in increasing employment and ensuring that employment opportunities are available in her constituency. We have talked on many occasions about how we can get more jobs into that area. I would be happy to meet her to discuss these particular redundancies and see what we can do. If the jobs cannot be saved, it is important that we help people get back into work quickly—200,000 people a month can still get new jobs and there are half a million vacancies in the economy. While I understand the feelings and sentiments of people who are in danger of losing their jobs, and I feel for them at this difficult time, we will do everything we can to help them back into work.

Q2. Given yesterday’s decision by Ocean Parcs and Pontin’s to create 2,000 new jobs and invest £50 million in seaside resorts, including £10 million in Southport, does the Prime Minister agree that, especially in a recession, the time is right to promote British holidays for British and non-British people? (253829)

I agree with the hon. Gentleman about the importance of the announcement by Pontin’s yesterday of a £50 million expansion plan. I know that Southport will benefit from that with extra jobs. I can also tell him that, in addition, Southport will receive a £4 million grant to help create a new cultural centre in the area under the Department for Culture, Media and Sport’s sea change programme, which aims to regenerate coastal areas. We will continue to do our best to create jobs and to boost the British tourism industry, which, I believe, will do well this summer.

Q3. Given the need for social housing, for retaining skills in the construction industry and for people to get mortgages, will my right hon. Friend consider allowing local authorities to introduce mortgages and, secondly, to build council houses? (253830)

I am grateful to my hon. Friend, who has pushed this matter for many years, since he was a local authority leader. The decline in mortgage lending is mainly the result of the loss of capacity in the mortgage market. So even if existing banks lend more to home owners, the loss of foreign and other capacity in the market makes it more difficult for people to get mortgages at a price that they can afford. That is why we are saying that local authorities that already have the power to issue mortgages should be encouraged to do so, and why the Minister for Housing has announced a lowering of the standard interest rate. We are now considering what more we can do to help individuals and households meet their housing needs. I hope that the answer I give my hon. Friend on his 68th birthday is acceptable.

Q4. The south-east plan will change the face of Guildford for ever. Of 74 local authorities, more than half the responses to the consultation so far have come from concerned Guildford residents. Will the Prime Minister tell us just how many people need to say no before he scraps the ill-thought-out, ill-conceived and unsustainable south-east plan? How many? (253831)

I think that the hon. Lady would also accept that the draft plan designates Guildford as a regional hub, as a focus for transport growth and investment. These changes were made following the recommendations of the independent panel of inspectors who examined the draft plan. The final plan will be published in the spring. The Government are still looking at the responses to the consultation. The Government remain committed to the green belt. This is a selective review of part of the metropolitan green belt and we will listen to all responses that have been made.

Q5. Does the Prime Minister agree that the threat to British workers does not come from other European workers, but from the workings of the unregulated capitalism that is enshrined—[Interruption.] On this, Mr. Speaker, there can be no cross-party consensus. What I am asking the Prime Minister is this: will he support calls to reform the—[Interruption.] They have knocked me off balance. Will he support calls to reform the posted workers directive, in order to bring some fairness back into the workplace? (253832)

We all agree about the need to introduce reform in financial regulation and we will be announcing further plans to do so very soon. However, I think that my hon. Friend agrees with me that this has to happen at the international level, as well as the national level, and I hope that the Conservatives will recognise that. As for the posted workers directive, an expert review has been set up in the European Union to look at the impact of the Laval, Viking and other judgments, and a group of employers and the work forces are also meeting to review that at the same time. When they reach their conclusions, we will look at what they have to say.

Is it responsibility for the past or concerns for the future that the Prime Minister thinks is the dominant influence on his poll rating and the fear on the faces of those behind him?

The answer to the problems that we have today is not to do nothing, as the Conservative party says it is. I have the manifesto of the Conservative group in the European Parliament, and what does it start by saying?

“The financial and economic crisis should not be taken as an excuse to do nothing”.

Even the European Conservatives agree on the need for action.

Q6. Free bus travel for the over-60s has given thousands of pensioners in Derbyshire their lives back. Many, however, are absolutely furious that some unscrupulous bus companies seem to be issuing tickets for far longer journeys than people have made and then overcharging local authorities. Can the Prime Minister reassure pensioners in Derbyshire that any such practice will not jeopardise a service that many older people have come to rely on? (253833)

This extension of free and concessionary travel to elderly people is one of the emancipating forces of our time, because it allows people to travel round the country and not just in their local areas. We have invested £212 million in this new, extra funding for travel. If there is any problem that my hon. Friend brings to the attention of the Secretary of State for Transport, he will of course look at it, but the truth is that this scheme is a big investment in older people, to help them become more mobile in the later years of their lives.

Just over a week ago I tabled a question to the Chancellor of the Exchequer, asking about the scrutiny and conditions imposed by the Financial Services Authority when the Chelsea building society sought to establish an offshore bank in Guernsey. I received a reply from the Economic Secretary to the Treasury, the hon. Member for Dudley, South (Ian Pearson), which said:

“The matters raised in this question are the responsibility of the Financial Services Authority, whose day to day operations are independent from Government control and influence.”—[Official Report, 29 January 2009; Vol. 487, c. 682W.]

In the nearly 26 years I have been in this House, I have never known a senior Minister refuse to answer a question on a subject where he had responsibility. I am sure that the Prime Minister, when he created the Financial Services Authority, did not intend it to be exempt from scrutiny by this House, and I would be grateful if he would confirm that.

We set up a unified Financial Services Authority and this House of Commons gave it the legislative power to take the action necessary to deal with the regulation of individual institutions. Of course we are now looking at the powers and the responsibility of the Financial Services Authority for the future. If the hon. Gentleman wishes to raise this individual matter with me, I am very happy to look at it, and I know that the chairman of the Financial Services Authority will be writing to him soon.

Q7. Given that between 35 and 60 per cent. of the agricultural industry has now been destroyed across the Gaza strip, and that only one crossing point is open through which to import goods, will my right hon. Friend ask the Israelis why they are ignoring the pleas of the United Nations Relief and Works Agency and of non-governmental organisations such as Oxfam and the World Food Programme to open all the crossings so that the humanitarian crisis on the strip can be properly addressed? (253834)

My hon. Friend is absolutely right to say that the Israeli Government have a responsibility to help humanitarian help to get into the Gaza area. I have just written to Prime Minister Olmert asking him to take urgent action to ensure that the crossings are open so that the lorryloads of help can be brought into the area. I am urging him to open the crossings and also to provide proper humanitarian access. I think that people know that the UK has trebled its humanitarian efforts. I have been talking to leaders in the Arab countries about what more they can do, and there is a conference in Egypt over the next few days to pool the resources to ensure that humanitarian help is available not only to provide immediate aid but to rebuild the Gaza area. I believe that all Members of the House will want to see aid getting into Gaza as quickly as possible.

The Competition Commission reported last year that the large supermarkets

“transfer excessive risk and”—


“costs to suppliers”,

which is damaging consumer interests and detrimental to farmers and growers, both here and in the developing world. Does the Prime Minister agree that the commission’s proposed remedies to tackle this problem should now be implemented without further delay?

The hon. Gentleman is absolutely right to highlight this problem—first, because of the failure to introduce early payment to many of the suppliers. We are asking the supermarkets to do that. Secondly, in relation to developing countries, we have been in talks with supermarkets such as Asda about how they can source their produce from those countries at a fair price. We will continue to push that as quickly as possible.

Q8. On 12 February, the globalisation report will be published by the Welsh Affairs Committee. One of the key themes of the evidence that we received from witnesses was the importance attached to higher-level skills to build the knowledge economy. Will the Prime Minister give serious consideration to the report’s recommendations, particularly in the context of the present restructuring in the steel industry, of the demands by the steel unions for better opportunities for skills training, and of the coal industry, which is now reviving and could face a skills shortage? Does my right hon. Friend agree— (253835)

I agree with my hon. Friend about the need for more investment in skills and training in Wales and the rest of the country. Through the Assembly, Wales has developed a new programme called ProAct to help people to stay in jobs rather than be made unemployed, and a great deal of work is being done by us to look at that scheme and at how it could apply to other parts of the United Kingdom. We are also putting aside £250 million for training opportunities during the course of this downturn, and we are determined to do everything we can to help people to get into the jobs that are available.

A quarter of all council tax is now used to pay for local authority pensions. A former chief executive of Northamptonshire county council left his job 18 months ago at the age of 52 with a lump sum payment of £291,000 and a £97,000 a year index-linked pension, which is costing the county £600,000. Nice work if you can get it! When will the Government have the courage to tackle this national pension outrage?

The first thing I should say to the hon. Gentleman is that it is a Conservative council that he is referring to, and the second thing is that most local authority workers do not have that level of pension entitlement. I hope that the Conservative party is not going to make the mistake of identifying one case as representative of what is happening to ordinary local authority workers who, as we found with the emergency services, do a good job when called upon to do so.

Q9. Rumour has it that the Under-Secretary of State for Transport, my hon. Friend the Member for Gillingham (Paul Clark) will be in the north-east next week to launch the initial implementation of the Local Transport Act 2008. This is a good Labour Act which has the potential to bring about the biggest improvement in public transport for many decades, but is my right hon. Friend aware that the Conservative party is committed to repealing the Act if it ever comes to power? Is that not just one more good reason for people to vote Labour at every possible opportunity? (253836)

I am surprised at the Conservative attitude to public transport, particularly the need to improve bus services around the country. I believe that the new transport Act has been widely welcomed because it recognises that country buses in particular are a lifeline to many communities. The Act is about giving options to local authorities, not being prescriptive about what they should do. It is for local authorities to take advantage of the new powers. My hon. Friend is telling me that Labour local authorities will take that advantage; I hope that Conservative authorities will serve their public as well.

As the Prime Minister is understandably anxious to exercise national leadership in these difficult times and as he must understand that national leadership depends on a degree of consensus, will he invite my right hon. Friend the Leader of the Opposition and the leader of the Liberal Democrats to No. 10 Downing street to see whether common ground can be found among them?

I am afraid it has been very difficult to find common ground, even across the Dispatch Box today, on how we deal with the problems of the economy. The hon. Gentleman may remember that in October there was talk of all parties working together to solve the economic problem. The Leader of the Opposition and his shadow Ministers were given access to the Bank of England and to the Treasury to find out what was happening; unfortunately, a week later, they withdrew their support. I am very happy to work with all parties to deal with the problems we face. I am very happy to work with all parties so that we can have the fiscal stimulus that is necessary. I am happy to work with all parties to ensure that we invest properly in the future. I hope that the Conservative party will change its position on those issues, so that that co-operation could happen.

bill presented

Apprenticeships, Skills, Children and Learning Bill

Presentation and First Reading (Standing Order No. 57)

Secretary Ed Balls, supported by the Prime Minister, Mr. Chancellor of the Exchequer, Secretary Jack Straw, Secretary Alan Johnson, Secretary Hazel Blears, Secretary James Purnell, Secretary John Denham, Secretary Paul Murphy, Jim Knight, Mr. Siôn Simon and Sarah McCarthy-Fry presented a Bill to make provision about apprenticeships, education, training and children’s services; to amend the Employment Rights Act 1996; to establish the Young People’s Learning Agency for England, the office of Chief Executive of Skills Funding, the Office of Qualifications and Examinations Regulation and the School Support Staff Negotiating Body and to make provision about those bodies and that office; to make provision about the Qualifications and Curriculum Authority; to make provision about schools and institutions within the further education sector; to make provision about student loans; and for connected purposes.

Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 55) with explanatory notes (Bill 55-EN).