As Deputy Prime Minister, I support the Prime Minister on the full range of Government policies and initiatives. I take special responsibility for the Government’s programme of political and constitutional reform, including reform of party funding. Let me briefly update the House on that issue. I wrote to party leaders in February asking them to nominate representatives for cross-party discussions on party funding. Meetings took place on 11 and 30 April. Representatives are meeting again today, and will hold a further discussion next week.
We all know the parameters. This is not about reinventing the wheel. The Kelly report provides a sound basis for agreement. We simply need to demonstrate the political will to make progress, and I hope and expect that to be possible before the summer recess.
This week the Deputy Prime Minister spoke of the wasted talent in the country caused by the lack of social mobility, and I concur with his comments. However, given the direct link between poverty and some of the indicators that he will be using, such as birth weight, why are the Government pursuing cuts in tax credits and benefits, which will simply lead to more children living below the poverty line?
As the hon. Lady knows, our welfare reforms are based on the simple principle of ensuring that work always pays. That is what these controversial reforms are about, and that is what universal credit is about. For years and years under Labour the welfare budget ballooned and the incentive to work diminished. That is what we are seeking to change through our welfare reforms.
T2. People in Broxtowe will have been pleased by today’s news that inflation has come down. What other measures does the Deputy Prime Minister think the Government should be taking to help hard-pressed families throughout the country? (108476)
I think it is significant that in one week we have seen the release of official statistics showing that both unemployment and inflation are down, and today we have heard from the IMF that the policy prescription that we are pursuing is exactly the right one to repair the mess left by the Labour party. There are many reforms that we need to introduce, but one that I would highlight is a simpler, fairer tax system. Because of the tax reforms that we have introduced, as of next April more than 2 million people with low earnings will be paying no income tax whatsoever.
It has been a bad week for the Germans. First they are beaten by Chelsea, and then they get an economics lecture from the Deputy Prime Minister. Can he tell us why he is qualified to lecture anyone about economic policy when his Government have left us with a double-dip recession and 1 million young people looking for work?
The right hon. and learned Lady must be suffering from amnesia. Does she not remember how her Government sucked up to the City of London, went on a prawn cocktail offensive which let the banks off the hook and presided over increases in youth unemployment year after year after 2004, the biggest peacetime deficit ever seen in this country, and the largest decline in manufacturing—even larger than the decline in the 1980s? That is Labour’s record, and I am proud of the fact that we are trying to fix the mess that she left behind.
When we left office, the economy was growing and unemployment was falling. Today the Deputy Prime Minister has been prancing around preaching about social mobility, which is frankly ludicrous when he is cutting tax credits for low-income families, providing a tax cut for millionaires, and scrapping an important measure designed to narrow the gap between rich and poor, namely clause 1 of the Equality Act 2010. It is always the same with this Deputy Prime Minister: he says one thing and does another. For all the difference that he makes in Government, he might as well be chillaxing or beating his own record at Fruit Ninja.
That was laboured even by the standards of the right hon. and learned Lady. She referred to the upper rate of income tax, and she is ranting and railing against the new 45p rate that we will introduce next April. Perhaps she can answer a simple question. Why did the Labour party maintain a lower tax rate of 40p in the pound for upper-rate earners for the 12 years and 11 months for which they were in office? I know that the right hon. and learned Lady does not like the 45p rate; perhaps she wants to advocate the rate that she maintained for most of her time in office.
Just today, Christine Lagarde of the International Monetary Fund that
“when I think back myself to May 2010, when the UK deficit was at 11%”
—that was Labour’s gift to us—
“and I try to imagine what the situation would be like today if no such fiscal consolidation programme had been decided…I shiver”.
That is a judgment on the legacy of the right hon. and learned Lady.
T4. Can the Deputy Prime Minister confirm that House of Lords reform was in the manifestos of all three main political parties, and does he agree that it is absolutely right and proper that politicians should now keep to their promise and enact this much-needed reform? (108478)
Yes, I strongly agree that, as I have said, we should just get on with reforming the House of Lords with the minimum of fuss. I ask those who want to hold the whole of Government and parliamentary business hostage on this matter why on earth they think it is such a priority for the country that that business should be brought to a standstill. Given those manifesto commitments, we should work on a cross-party basis to finally complete reform of the House of Lords.
T5. I did not hear the Deputy Prime Minister say anything about ethnic inequalities in his speech on social mobility this morning, yet black youth unemployment is twice that of white British young people, ethnic minorities are under-represented in apprenticeships and although increasing numbers are entering higher education, they are more likely to attend less prestigious universities. If the Deputy Prime Minister is serious about social mobility, does he agree that we need targeted policies to address ethnic inequalities in education and employment? (108479)
I certainly agree with the hon. Lady’s characterisation of the problem for many young people in our black and minority ethnic communities. It is one of the reasons why I have commissioned some work to look at the strong anecdotal evidence that it seems to be harder for young black and minority ethnic entrepreneurs to secure loans from banks on the same reasonable rates as others. That is just one issue among many that we need to address. However, I draw the hon. Lady’s attention to the fact that the targeted interventions that we are delivering—£8 billion on pre-school support for two, three and four-year-olds, a new free pre-school support package for all disadvantaged two-year-olds as of April next year, the pupil premium and so on —disproportionately benefit those who are disadvantaged in the communities to which she refers.
T11. Last week we had some fantastic news: 700 new jobs at Ellesmere Port Vauxhall factory, making the new generation of Astras. Does the Deputy Prime Minister agree that that is a fantastic example of how flexible working can help rebalance the economy in the United Kingdom? (108485)
I strongly agree. That was a very important moment, as it underlines something that has been quietly building for some time: a real return to form for British manufacturing. The fact that as a country we are now exporting more cars than we are importing for the first time since the 1970s shows that, notwithstanding all the anxieties and concerns about the economic situation generally, this is an area of emerging strength for Britain.
T6. May I refer the Deputy Prime Minister to an answer he gave a few moments ago, and ask whether he is aware that figures have been placed in the House of Commons Library this morning showing that public sector debt has risen from £12,500 per head in May 2010 to £16,200 per head in April 2012? Is this figure—[Interruption.] It’s higher. Is this higher figure a result of the Deputy Prime Minister having taken his eye off the ball by concentrating on Lords reform instead of getting on with jobs and growth and getting our 1 million young people back to work? (108480)
The reason for those figures is the shocking state of the public finances left by Labour. Today’s IMF report very precisely identified three reasons why the British economy still faces real headwinds: first, increasing global commodity prices last year, which was not something we could control; secondly, the uncertainties of the eurozone, which is also not under our control; and thirdly, the hangover of monumental public and private debt, which was, indeed, a debt crisis made in No. 10—the No. 10 of Gordon Brown, aided and abetted by the backroom boys, the current Labour leader and shadow Chancellor. It is they who created the crisis in the first place.
We all know that that is a problem for all political parties. The controversies and scandals about party funding, the opaque way in which it is organised and the imperfect way in which political parties are held to account has damaged all political parties. That is why it is overwhelmingly in our shared interest to come to an agreement. As I said earlier, it is merely a matter of political will. The Kelly committee has show in outline what the bare bones of an agreement should look like and I hope that we will now be able to reach one.
T7. The Government have been taking a bit of a “pastying” in the west country recently and, as a result, we are told that the Deputy Prime Minister is listening—at least to the voices of his own MPs in panic. Will he also listen to the voices of Welsh workers at Talgarth Bakery, the Old Parish Bakery, Ferrari’s, Pin-it Pastry, Jenkins the Bakers and Peter’s pies and make a hasty—or should that be a “pastry”—retreat on the pasty tax? (108481)
That is Christmas cracker stuff from the hon. Gentleman. As I said earlier, we have extended the period of consultation on that issue. I recognise the strength of feeling about the issue from him and from many Members on both sides of the House. We have listened very closely to the representations of many figures in the industry and I hope that we will be able to make proposals shortly.
On 10 May, Rosehill street in Cheltenham was devastated by a major gas explosion. Within 24 hours, 600 residents of Hatherley in my constituency had also been evacuated following a police explosives alert. Will the Deputy Prime Minister join me in congratulating the emergency services, the council and residents on their response to that unprecedented combination of emergencies and send a letter of special support to the jubilee street party in Rosehill street, which is going ahead anyway in a great show—
T8. Last week, the Deputy Prime Minister said:“There is going to be no regional pay system. That is not going to happen.”Are not his Government drawing up plans for precisely such a system? (108482)
As my hon. Friend will know, the Select Committee is still carrying out its inquiry on recall. I know that he recently gave evidence to the Committee on the subject and, in keeping with our approach to many other items on the constitutional reform agenda, we are keen to gather views and consult widely before we produce draft legislation.
T9. The Deputy Prime Minister will know that Bristol has decided that it wants an elected mayor. Will he support the official Liberal Democrat candidate or the man who has just resigned his Liberal Democrat membership after 25 years because he thinks that being outed as a Lib Dem will sound the death knell for his political ambitions and is therefore standing as an independent? (108483)
I think the hon. Lady was trying to be stinging, funny or both, but I could not quite work out what the question was. It is up to the Liberal Democrats in Bristol, as it is to all political parties, to decide how to put forward candidates for mayoral elections.
In deciding the new individual voter registration system, with which we are proceeding with, I hope, cross-party support, we have looked exhaustively at the checks we consider necessary to bear down on fraud in the electoral system. That is the whole point of individual voter registration and it was right that the Government brought forward the timetable we inherited from the previous Government so that it is introduced sooner rather than later.
T10. Given the slow progress with the related legislation, will the Deputy Prime Minister tell us what share of the lobbying market is accounted for by companies that did not register with the UK Public Affairs Council? What will the penalty be for those companies that do not co-operate with the Government’s proposed statutory register? (108484)
I am afraid that I cannot give the right hon. Gentleman the statistic he asks for, but I will look into it and see whether I can provide it later. On his second point, we are consulting right now on that exact issue of penalties and sanctions.
If we are going to give more power to the electorate by removing privilege and patronage from a reformed House of Lords and giving voters the power of election, will the Minister confirm that there is no compelling reason for a referendum?
I am personally unpersuaded that we should waste £100 million of taxpayers’ money on an issue on which, unlike with electoral reform of this place, there is cross-party consensus, with manifesto commitments to reform from all three parties. I would take seriously advice from all those critics who say that we should not proceed with House of Lords reform at all. They claim that it is not an issue of significance to the British public, so I do not think we should waste a great deal of the public’s money on a referendum when we all, nominally at least, agree that this reform should happen.
T12. The Deputy Prime Minister has been quoted in the media as saying, rightly in my opinion, that social mobility will take a long time to change, so why, on coming to power in May 2010, did he agree to the reduction or elimination of measures such as the education maintenance allowance and Sure Start long before their long-term effects could be judged?[Official Report, 24 May 2012, Vol. 545, c. 15-16MC.] (108486)
As I hope the hon. Lady knows, we have protected the money for Sure Start, but there is, I acknowledge, greater discretion for local authorities to decide how to use it. I am aware of 10 outright closures of Sure Start centres across the country, and of course it is important to know why local authorities have taken those decisions. I hope that she is also aware of the extra investment that we are now putting in, particularly for early years—for children even before they go to school. We know from the evidence that that makes the most dramatic difference for subsequent social mobility. As of April next year, 40% of all two-year-olds in this country, including all two-year-olds from the most disadvantaged families, will receive for the first time 15 hours of free pre-school support.
Absolutely. We listened to many representations on this point when we considered what should be included in the Bill on individual voter registration and we have indeed, as I hope he has noticed, included a civil penalty to ensure that the civic duty to register to vote is properly maintained.
T13. Following on from the G8 summit at the weekend, may I ask the Deputy Prime Minister how the plan to support the Afghan Government after 2014 will have the slightest prospect of success without real progress on problems of politics and governance, which, according to almost all reports, have got worse, not better, in recent years? (108487)
The hon. Gentleman makes a very serious point. Anybody who has visited Afghanistan or examined the conflict there will know that there was never any prospect of a military solution alone. In a sense, all that military intervention can do is create the space in which social and political stability can take root. I share his concerns that we are still some way from that. It is immensely important at this stage, as we are moving towards real transition in Afghanistan, that we include other countries in the region, notably Pakistan, so that they play their full part and bring their influence to bear in order that political stability can indeed take root in Afghanistan.
My right hon. Friend the Deputy Prime Minister mentioned in his speech this morning plotting the advances made by children on free school meals. Some of the schools in my constituency have more than 50% of pupils on free school meals. Will he undertake to increase the value of the pupil premium over the life of this Parliament so that the schools already making huge progress can build on their achievements so far?
The pupil premium is currently worth £1.25 billion, and that will double to £2.5 billion by the end of this Parliament. That is additional money on top of the baseline funding provided to schools. Last year, on a per pupil basis, the pupil premium was worth about £480. It is now worth £600 and will go on to increase. Given those statistics, it is remarkable that Labour in Manchester voted to scrap the pupil premium altogether. How on earth is that going to help social mobility?
In his speech on social mobility this morning, the Deputy Prime Minister said:
“It is my strongest political conviction that…if we have a chance to open up success to all, we must seize it.”
What is he going to do to put an end to the scandal of unpaid internships, particularly in politics, the media and our creative industries?
I pay tribute to the right hon. Lady’s work on internships, not least in this place as part of the Speaker’s Panel. As she knows, the legislation is clear: if an intern is, in effect, doing work that should be remunerated, he or she should be remunerated. There are cases of interns doing work that falls outside that legal definition. Having looked closely at the issue, and she and I have corresponded on this, we have decided that it could be self-defeating if we sought to outlaw altogether across the piece—not least, for instance, in charities—some unpaid internships. I agree, however, that even in those cases, it is incredibly important to ensure that internships are available to everybody, and that basic costs, such as travel costs and lunch costs, are properly covered, even in those cases.
As the hon. Gentleman may know, the McKay Commission, established to look into the so-called West Lothian problem, is doing its work and will report by the end of the Session. I urge him to give evidence to that commission, perhaps, and certainly to follow its work closely.
Order. I am sorry to disappoint colleagues who have been standing. I say in a spirit of impartiality that the Deputy Prime Minister is box office. Lots of people want to ask questions and, sadly, there is not time to accommodate them all, but the right hon. Gentleman will return to his slot ere long, and colleagues can doubtless reheat their questions.