(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on whether he will instigate a Budget leak inquiry, in view of the accurate pre-reporting of a number of the detailed proposals in his Budget statement, including one of the matters that was agreed under the Provisional Collection of Taxes Act.
As with every Budget, we have seen a vast amount of speculation, and, as ever, a vast amount of it has proven to be unfounded. As the Chancellor has said, a Budget produced within a coalition is different. The days of the Chancellor coming up with a Budget in secret are gone. This was not a Conservative or a Liberal Democrat Budget; it was a coalition Budget. In the course of coalition Budget negotiations, various proposals were raised, discussed and debated. That occurred more widely than in the past, when the Chancellor told the Prime Minister what was in the Budget the day before or, as in even more recent days, when the Prime Minister told the Chancellor what should be in the Budget the night before. The Treasury does make announcements throughout the year. For my own part, people will have seen the work on tax transparency and personal tax statements, which was in response to a consultation on this very issue laid before the House in November and subject to a ten-minute rule Bill from my hon. Friend the Member for Ipswich (Ben Gummer).
On the specific question, it is a long-established practice of the Treasury not to comment either on whether a leak inquiry has been established, or on its conduct or outcome. There will be ample opportunity to debate the Budget over the coming days. Today is the second of four days of debate on the Budget. It is perhaps an unfortunate consequence of this urgent question that this is being delayed, and so is delaying the shadow Chancellor, from whom I am sure the House is eager to hear.
Coalition government is absolutely no fig leaf for these very serious breaches of the ministerial code—[Interruption.] Government Members may wish to listen. Paragraph 9.1 of the code states:
“When Parliament is in session, the most important announcements of Government policy should be made in the first instance, in Parliament.”
There have been clear and flagrant violations of this crucial principle. It is a significant insult to the primacy of Parliament and this House of Commons, to whom the Chancellor should be accountable. It is a shame he was not able to come here to answer for himself on this matter.
Our constituents expect that Members of Parliament should be the first to hear and question policy announcements from the Chancellor, and hold him directly to account. The Chancellor is treating Parliament as a peripheral afterthought, and that is totally unacceptable. But this is not just about the sovereignty of Parliament; if the Chancellor and his acolytes are prepared to pre-brief and leak key information about very sensitive tax changes, that risks handing privileged information to those who can take advantage of any advance knowledge.
The ministerial code is enforced by the Prime Minister, who should instigate a leak inquiry if the Exchequer Secretary refuses to do so. He did not say whether he was or was not going to have an inquiry—at least he could leak that little bit of information for us today. It is also necessary, of course, to include an investigation of conversations between the Chancellor’s special advisers and the civil service and the media. Of course, civil servants are guided by the civil service code. It is unlikely that newspapers will reveal their sources, but Ministers and special advisers should be interviewed and asked who they spoke to, when the conversations occurred and who sanctioned those conversations. If information was released pre-Budget without approval from the Chancellor and was leaked, it is a very serious breach of security and of the civil service code.
Yesterday’s Budget was described by The Economist as
“more of a newspaper review than a Budget”.
Another view was that
“the Budget has had all the leak-free qualities of a teabag in a sieve.”
It might be quicker to list what the papers did not publish before the Budget, but for the benefit of the House I shall list some of those measures that did come out: the reduction in the 50p rate appeared in The Guardian last week and in the Financial Times; the changes to the personal income tax allowance appeared on ITV News on Tuesday night, when the exact figure was given; the stamp duty land tax changes appeared very precisely in the Financial Times and in basically all the newspapers on Wednesday morning; the changes to stamp duty land tax on residential property associated with capital gains tax changes appeared on the “Andrew Marr Show” at the weekend; and the North sea oil and gas commissioning certainties appeared in the Herald Scotland on Saturday 17.
The one Budget change that was not leaked was the £3 billion raid on pensioners, now dubbed the “granny tax”. Some 4.5 million pensioners are to lose an average of £83 next year. In times gone by, Chancellors did the honourable thing when it was revealed that their Budgets had leaked. In contrast, when asked about the Budget leaks on this morning’s “Today” programme, the Chancellor said:
“inevitably the days when the Chancellor dreamt this all up in secret, shared it with the PM 48 hours before he delivered his speech...are gone”.
Well times are not so different that they give licence to the Chancellor to fling around the contents of the Budget red box to any passing journalist, regardless of the consequences. Mr Speaker, we have heard the usual dismissive indifference from the Minister to these serious concerns, so perhaps I need to ask you, as a point of order, for general guidance about how the rights of this House, and the public’s expectations of orderly policy announcements, can be protected? Can you take steps to ensure that the Chancellor does not treat Parliament and the wider public with such utter contempt in the future?
I was not entirely sure whether that was a question or a point of order, Mr Speaker, and at one point I was not entirely sure whether the hon. Gentleman was complaining about measures not being briefed in advance or being briefed in advance. He referred specifically to the 50p tax rate. In the days running up to the Budget there were various reports about the 50p rate and it was public knowledge that the Chancellor had commissioned HMRC to undertake a report on the 50p rate and how much that tax was raising—an issue that I am sure the hon. Gentleman does not want to debate for very long. In that time, it was very clear that the Chancellor was going to make a statement, but what did we see in the press? We saw stories that it was going to stay at 50p, be cut to 45p or be cut to 40p. We saw press reports that it was going to happen this year or next year. There were at least five different versions of what was going to happen on the 50p rate, so it is not surprising that one of them turned out to be correct. However, it is also the case that four of them turned out to be incorrect.
The hon. Gentleman asked about sensitive numbers. I can assure him that the numbers on the stamp duty land tax—the increase to 7%—which I am sure he welcomes, certainly did not come from the Treasury, and neither did the exact number regarding the personal allowance as far as I am aware. We also heard from the hon. Gentleman that in days past these things did not happen. May I remind him what happened when he was last a Government Minister? In the 2005 Budget there was a leak about tax credit increases that turned out to be correct, a leak about alcohol duties that turned out to be correct, a leak about fuel duty that turned out to be correct, a leak about inheritance tax that turned out to be correct and a leak about stamp duty that turned out to be correct. There were also leaks about council tax refunds and the winter fuel allowance, all of which were entirely correct.
I could look at more recent announcements such as those about VAT in 2008, about the green bank, the youth jobs package, fuel duty and schools, all of which turned out to be accurate. I am sure that Government Ministers would then have said that that was speculation and I am sure that in many cases they were absolutely correct. It is difficult to give full credit to the hon. Gentleman given that detailed information about Budgets has been put into the public domain by previous Governments for many years, but he has only now suddenly become very upset. I am not surprised that the Labour party wants to focus on an issue of process rather than on the substance because this Budget is going to get the country growing again and is reforming the tax system in a sensible and growth-friendly way.
Given the failure of Ministers to admit whether they will benefit from the cut in the top rate of tax and the description by the Chancellor of tax avoidance as “morally repugnant”, will the Exchequer Secretary now ensure that all Ministers’ tax arrangements are published?
Order. May I remind the House that this is a narrowly focused urgent question seeking a leak inquiry? It is a matter of great importance, but it is on that matter that exchanges should be focused. This is not a rerun of the Budget debate, which will be continued, but is about the subject of the urgent question.
Does my hon. Friend agree that there will obviously be wild speculation before any Budget, much of which turns out to be wrong, and that we do not need any lectures from Opposition Members, who leaked everything all the time when they were in government?
Surely a leak is an unauthorised or inadvertent publication of restricted and confidential information. On that basis, this could not have been a leak, because it was clearly not inadvertent and it was clearly authorised. It was none the less in severe conflict with the ministerial code, and that surely is what the Prime Minister should investigate.
I am not sure that there was a question there, but I thank the hon. Gentleman for his views. The Government clearly authorised some information to be put out in advance of the Budget. For example, there was a speech by the Prime Minister. The Prime Minister makes speeches from time to time; I am not sure that people should be getting upset about that.
Order. Let us be absolutely clear about this. The hon. Lady can make a general charge. She cannot and will not make a personal charge against an individual Member in any part of the House. I trust that the hon. Lady is not accusing the hon. Member for Nottingham East (Chris Leslie) on the Opposition Front Bench of hypocrisy.
Is my hon. Friend aware that Labour’s record of leaking is as long as its record in office. Not only did the last Govt leak like a sieve but Hugh Dalton, a previous Labour Chancellor, was forced to resign for leaking Budget secrets—
Will the Minister concede that the Chancellor has shot himself in the foot with such widespread leaks, because all that he had to announce yesterday was the tax grab on grannies, which he hoped people would not notice? Will he concede that the leak inquiry that may or may not be going on now in the Treasury should consider the leaks of Office for Budget Responsibility judgments, and that now is the time to put the OBR on a proper independent basis similar to that of the Office for National Statistics?
Does my hon. Friend agree that the only possible explanation for the general hypocrisy on the Opposition Benches, given their own leaking of this urgent question before the Speaker’s Office announced it, is their desire to avoid the good news of GlaxoSmithKline’s investment announced this morning?
I am interested to learn that this story was apparently briefed before any decision emerged. [Interruption.] I understand that that is incorrect and that it was not announced on Twitter before your decision, Mr Speaker. If it was, I am sure that there will be an internal Labour party inquiry.
The reference to Hugh Dalton in 1947 is of course wrong, because he resigned and the leak had been reported in an evening newspaper before he sat down. What we are talking about now is the ministerial code and the accurate and extensive reporting of what was in the Budget across the media the morning before the Budget statement. That is the difference, and that is what we want to be investigated. Are we going to have an investigation or not?
I have answered the hon. Gentleman’s first point. I should also reiterate that we have a coalition, which means that there are negotiations and discussions involving both sides. It also means that the Budget tends to be finalised some days in advance of the Budget speech. That is quite a contrast to previous years, when revisions were made, documents pulped and decisions taken at the last minute. I think that we have a much better process, thanks to the discussions within the coalition and the involvement of the Office for Budget Responsibility.
Leeks are normally very popular in Wales, but given that only 4,000 people in Wales pay the 50p rate of tax, compared with 94,000 in London, taken alongside the regional pay leak, this represents a massive transfer from poorer people in Wales to richer people in London. Does the Minister not agree that spreading that sort of fear through leaks ahead of the Budget announcement is disgraceful, and has he not admitted that he has given leaks by referring to our alleged leaks?
One of the reasons why Budget leaks are particularly serious is that they facilitate tax avoidance. When the Budget speech was leaked in 1984, Lord Howe instituted a police inquiry and everybody working on the Budget was interviewed by the police. Why does the Chancellor of the Exchequer not do the same?
I know that the hon. Lady speaks with great knowledge on this issue. I agree that it is very important that sensitive information is protected and can assure her that, on the one potentially sensitive area of stamp duty, the Treasury was not involved. If something is announced in the morning, even if it comes into effect at midnight, people still have the opportunity to exchange contracts in the interim period, as indeed was the case when previous Governments raised stamp duty.
I was an avid reader of pre-Budget commentary in the newspapers and found that there was plenty of new content in the Chancellor’s presentation yesterday that had not been covered at all and plenty that the media had got wrong. Is this not a complete waste of parliamentary time, and will my hon. Friend ensure that none of his official time is wasted in the pursuit of this phantom leak?
By describing the systematic and orchestrated leaks as somehow an accident, does the Minister not realise that he and the Chancellor remind people of Captain Renault in “Casablanca” when he goes into Rick’s place and is shocked to discover gambling going on, even as he collects his own winnings? Is this approach not simply amoral, and should Ministers not have a higher standard around the Budget?
I have a dream in which the Budget is merely the confirmation of ideas that have been fully consulted on and people can actually understand what the tax regime will be in advance. I commend the Minister for his work in trying that, rather than worrying about this flim-flam.
My hon. Friend makes a good point about our more deliberative and consultative process for tax policy making, and some of the announcements in the Budget yesterday were the culmination of a long process of consultation, for example the reforms of controlled foreign companies, which have been widely welcomed. As a corporate tax regime, ours is increasingly recognised around the world, and I am delighted that, as my hon. Friend the Member for Mid Norfolk (George Freeman) pointed out earlier, we had the announcement from GlaxoSmithKline this morning.
How does the Minister explain the headline on Wednesday morning in the Financial Times—it could have been any of the major newspapers—which stated: “Osborne in tax grab on top-end property”? The article went on confidently to assert that the duty would be 7% on properties priced at £2 million and above. Surely that was a leak. If it was not, what was it and what will he do about it?
I do not believe that the figure of 7% came from the Treasury, but we also ought to recognise that in last year’s Budget the Chancellor made it clear that we were looking at getting more money from those owning high-end properties, so it should not have come as a complete surprise that there was an announcement along those lines in the Budget yesterday.
It was widely reported in the press before the Budget, and in fact before Monday, that on Monday morning the quad would meet for a final sign-off of the Budget. Surely anything that was in the papers about the Budget before that point would have been complete speculation?
My hon. Friend mentions the consultation work that the Treasury does in order to reach final positions on the Budget. One of those was shown yesterday, with the new regime for oil and gas and decommissioning—something that the industry very much welcomes and which will provide a great boost. Does my hon. Friend agree that such consultations lead to speculation but are vital in terms of getting into the Budget the right result for people?
On stamp duty specifically, will the Minister implement an inquiry into how many transactions of more than £2 million took place between the time that such reports were in the newspapers and the Budget announcement, and into how much that cost the hard-pressed British taxpayer and pensioners who are having to pay the granny tax?
On the general point about leak inquiries, I have said what I have to say on that, but we have to bear in mind that identifying a property of more than £2 million, reaching a conclusion on negotiations and exchanging in the course of one morning is somewhat ambitious.
If the Minister is ever tempted to go down the route of a leak inquiry, will he at least commit to backdating it to 1997?
The Minister has said three times now in his responses that the Treasury was not responsible for leaking the stamp duty changes. The first time that he said so, he added, “as far as I know.” Is not the point that he should know and, therefore at least on that point, that a leak inquiry should be instituted immediately?
I have absolutely no evidence that the Treasury briefed on the 7% stamp duty announcement, but none the less an announcement was made in the morning, and the measure came into effect at midnight last night. We also ought to make the point that that measure, on stamp duty land tax, is going to get more money out of the wealthy, and much more successfully, than the Labour party managed with its failed 50p rate.
I congratulate the Minister on some excellent press management this morning, and on the headlines, which have been very helpful to us. But I want to be helpful, so that he can be specific about the area of suspicion. Can he now say that no Treasury Minister directly, or special adviser indirectly on their behalf, gave information to the press about any Budget measures prior to the Budget yesterday?
Just to be clear, I will give the hon. Gentleman a Budget measure that was confirmed yesterday: personal tax statements. Ministers were aware that we were going to inform the press about personal tax statements, so the question he asks is extremely broad. There were measures announced yesterday in which Ministers were involved, but I am not aware of any Minister being aware of the briefing of market-sensitive information.
Does my hon. Friend agree that it is a bit rich to be asking this question today—[Hon. Members: “A bit rich!”] Does he agree that it is more than unfortunate to ask the question today, when articles such as the one I have with me, from The Guardian on 11 March 2008, state:
“Alastair Darling is set to deliver his first budget to the House of Commons tomorrow…but in reality, much of it has already been trailed”?
Some things are not entirely new. The Labour party really does have to think back to its time in government and to the behaviour undertaken then. What is remarkable is that Opposition Members managed to brief some of their announcements, given that most were decided only at the very last minute.
Will the Minister clarify whether he expounds the virtues of advance notification and discussion because we have a coalition, or whether he thinks that it is a bad thing to leak? Was the one thing that he did not share with his coalition partners perhaps the granny tax?
All Budget decisions were agreed by the Government as a whole, and the quad was heavily involved at all stages in that. People in a coalition will always make their arguments and set out their case, and some of that will be done in private, some of it in public, but it is a far more orderly process of Budget policy making than we have seen for many years.
In the context of coalition government, there will inevitably be much pre-Budget discussion and much greater media coverage. Does my hon. Friend agree that such coverage is bound sometimes to be right, and that it is ridiculous to interpret it as leaks?
I refer my hon. Friend to, for example, the 50p debate, which the hon. Member for Nottingham East (Chris Leslie) mentioned. In the days before the Budget there were five different versions of what was going to happen. One turned out to be correct and four turned out to be incorrect.
Does my hon. Friend agree that Budget leaks are to be deplored, as indeed is the alleged break-in at the Leader of the Opposition’s office, purportedly to find his Budget policies? I can inform the House that the would-be thief left empty-handed.
Does the Minister agree that, if any profiteering took place due to leaking the announcement on stamp duty land tax, it would be morally repugnant? What action will he take if his secret leak inquiry finds evidence that it took place?
We ought to put the matter into proportion. The idea that someone would be able to identify a property and exchange contracts in the course of a morning is highly unlikely. As I have said, I have no reason to believe that the Treasury was in any way involved in briefing that particular item, but there was a lot of speculation that there would be something on properties, and that speculation turned out to be correct.
Does the Minister agree that such discussion as that which took place between the coalition parties leading up to the Budget is more healthy—more open and transparent—for our democracy than leaving things all in the hands of one, lone control freak?
I certainly agree that we do not want to return to the days when a Chancellor, in close co-operation with his special adviser, worked in a sort of secret bunker, not sharing any information with anyone, including the Prime Minister. That is not healthy, and, as we saw, it did not result in sensible tax policy making.
Is not the most serious aspect of leaks the further degradation of ministerial code reform? The Public Administration Committee has been told by the previous independent adviser on the code that the Prime Minister himself is in breach of the code. If the Committee decides unanimously that the present adviser on the code is not fit to hold office, should Sir Alex Allan resign?
I would not dream of accusing anybody on the Opposition Benches of hypocrisy, but the last time I saw more assembled piety than there is on those Benches today was when I visited a Catholic convent in the southern Philippines in 1985. Has it occurred to the Minister, as it has occurred to me, that this urgent question is simply a distraction from the debate on a Budget for jobs and growth that helps working people? That is what my constituents in Gloucester want to hear us debate today.
Given that the centrepiece of the Chancellor’s Budget yesterday was an increase in the personal tax allowance that gives a tax break to 24 million people on low and middle incomes, and given that that was in the coalition agreement, does the Minister agree that a journalist would not need to be Sherlock Holmes to speculate that that increase would be in the Budget?
The hon. Member for Nottingham East (Chris Leslie) based his case on different speculation in the newspapers about the future of the 50p rate. Does the Minister not recall that when the 50p rate was introduced by the previous Government, the first news of it came from a newspaper, not the Dispatch Box?
In 2005, the Evening Standard covered details of the entire Budget; in 2008, the Daily Mail covered the details of VAT and The Daily Telegraph had details on fuel; in 2009, The Observer covered details on youth jobs; in 2010, there were details on the green investment bank. Would my hon. Friend welcome at least some consistency in policy and practice rather than the lack of constructive opposition that comes from Labour Members?
Before 10 o’clock this morning, the Labour party press office announced on Twitter:
“Urgent Question in the House this morning @ChrisLeslieMP calling for a Budget leak inquiry”.
Yet I understand from your office, Mr Speaker, that the urgent question was not officially announced to the House until exactly 10 o’clock. Will the hon. Member for Nottingham East (Chris Leslie) now call for a leak inquiry on that urgent matter?
Earlier this morning, the hon. Gentleman denied it. [Interruption.] He is shaking his head now, so he is clearly denying that that is the case. Presumably, it is reasonably easy to work out what time a Twitter post was made and to know what time the urgent question was announced. But it is not for me to lecture the Opposition; I am sure that they would be very concerned if there had been such a leak and they would be cracking down on it straight away.
It is not really a matter for the Minister. These matters are dealt with in a very specific and orderly fashion—the submission of a request, the consideration of the matter at the appropriate time of the day by my colleagues and me, and the disclosure of the result of the request to the interested parties. All was done—I know the hon. Member for Kingswood (Chris Skidmore) will be satisfied that it was—in an absolutely orderly way on this occasion as it is on every other.
Has the Minister discussed this matter with his colleague the Chief Secretary to the Treasury? I have found the earliest published source of information on the Budget. It was written by my right hon. Friend the Chief Secretary—on the front page of the Liberal Democrat election manifesto nearly two years ago.
And it was all going so well. I confess that I have not spoken to my right hon. Friend the Chief Secretary this morning and that I have not read all that manifesto. But I would say that the Budget has Liberal Democrat policies and Conservative policies. It is a coalition Budget that is good for the whole country.