House of Commons
Monday 11 April 2016
The House met at half-past Two o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Secretary of State was asked—
Migration (Africa to the EU)
1. What steps the Government are taking to tackle migration from countries in Africa to the EU. 
We are working closely with European and African partners to address illegal migration to the European Union. November’s Valletta summit created a coherent framework and road map for action. As current chair of the Khartoum process, the Government take a leading role in driving forward projects to combat people smuggling and trafficking from Africa, focusing on capacity building, training and communications.
Just before Easter weekend, 52 suspected migrants, many of north African descent, were held after two lorries were stopped at the Dartford crossing and in Canterbury. Given that Kent is on the front line of these desperate attempts, can my right hon. Friend outline what additional support can be provided to our region’s police and border guards to prevent these clandestine actions?
My hon. Friend raises an important issue. I recognise the role that Kent plays in these matters, being on the front line, as she says. There is a dedicated unit in Kent and specialist debriefers to support the police to gather further intelligence to deal with this vile trade, but importantly, of course, we want to stop people from arriving in the UK clandestinely. That is where the work we are doing, particularly with the French Government, on improved security at the juxtaposed controls in Calais and elsewhere on the continent is important, as is the work of the National Crime Agency, Immigration Enforcement and, in particular, the border crime command in dealing with partners across Europe and in Africa to break the criminal gangs and to stop trafficking and people smuggling taking place.
The deal with Turkey was brokered after intense negotiations, which seem to be lacking in respect of north Africa. I hear what the Home Secretary says about the Khartoum process, but the numbers coming from north Africa to Italy have increased by 80% over the last year, and only last night President Obama said that Libya was the worst mistake of his presidency. Italy faces a summer of crisis. Does the Home Secretary agree that one way to stem this is to enable international boats to enter Libyan coastal waters to intercept those criminal gangs and stop them duping innocent people into putting their lives at risk?
The right hon. Gentleman is right that we need to look carefully at what is happening and at what happened last summer for people coming through Libya into Italy, primarily through Lampedusa, but also, now that the spring and summer months are upon us and the weather is better, at what could happen again. It is not just about boats entering Libyan waters—the United Nations has discussed the action that can be taken in relation to these matters. It is also about working upstream. It is about working with the source countries to ensure that people have less incentive to be moving away—that is where our development aid work is particularly important—and also about working with transit countries to break the model of the smugglers and people traffickers, so that people see that making this dangerous journey does not enable them to settle in Europe.
The Home Secretary may remember that at our last Question Time when we discussed this, I asked a specific question about whether we were searching all lorries, and she told me I had misunderstood the situation. I am not sure I have, because we now read that only half the lorries are being searched. Many people are stowing away in lorries; they are arriving here, and they are never sent back. It is making a mockery of our immigration rules, so will she give a direct answer to a direct question: will all lorries now be searched at Calais?
I apologise to my hon. Friend if there was any misunderstanding in the answer that I gave last time round. We do search lorries at the juxtaposed controls. The point of having the juxtaposed controls is that it enables us to do more, but it is a question of using various techniques to try to ensure that we can identify clandestines who may be aboard lorries. One of the challenges we face is that, because of the extra security measures we have taken, particularly at Calais and Coquelles, it is obviously much harder for people to get on lorries at those places. We are now having to work with the French Government—it is not just about searching lorries; it is about working upstream as well—to try to identify places further afield where people may be trying to get on the lorries, so that we can catch them at that stage, rather than relying on searches or techniques that are used at the border.
The Home Secretary will be aware that organisations such as UNICEF and Save the Children are urging the British Government to do much more to help vulnerable refugees and especially unaccompanied children. She has mentioned the people traffickers and stopping the organised gangs, but there is a very real risk of child sexual exploitation with these vulnerable children travelling across to Europe, so what more are she and the Government doing to make sure this problem is tackled?
We are very conscious of the issues that could arise concerning children, particularly children who are being trafficked and exploited in the way that the hon. Gentleman suggests. That is why the expertise of the independent anti-slavery commissioner, Kevin Hyland, is being used. He has already had discussions with people in Calais and he will visit hotspots elsewhere in Europe in the coming weeks to ensure that he can help to identify these issues and share his expertise so that others can identify those who might be exploited or trafficked.
2. What plans she has to relocate or offer asylum in the UK to refugees in mainland Europe. 
5. What plans she has to relocate or offer asylum in the UK to refugees in mainland Europe. 
The Government are opposed to EU relocation proposals, which do nothing to address the underlying issues the EU is facing and simply move the problem around Europe. Our focus should be on securing the external border, returning those with no right to be in the EU and addressing the underlying issues in source and transit countries, so that people no longer feel that they have no choice but to travel to Europe.
At the weekend, it was reported that the Children’s Commissioner had written to the French Government urging action to speed up asylum claims to help lone children in the Calais refugee camps to reach relatives in the UK. These children must be absolutely petrified and feeling completely isolated and vulnerable—a situation that we would not countenance for our own loved ones. What discussions has the Home Secretary had with her French counterparts in order to stress the critical need to get these poor children safely reunited with their families in the UK?
The Home Secretary and her colleagues have had regular discussions with their French counterparts precisely on this matter in order to speed up the process. Indeed, I can report that there has been a significant improvement over the last few weeks in the time it takes to process these applications.
Charity workers at Calais have deep concerns about the 129 missing children, following the dismantling of parts of the jungle. Does the Home Secretary agree that the authorities must do more, and will she make representations to the French authorities urgently to seek these children out and, in particular, to determine with haste which of these children are eligible to come to Scotland and the rest of the UK?
I am pleased to report again that there are regular discussions between the Home Secretary and her French colleagues on this matter. The Department for International Development recently announced the provision of a further £10 million-worth of special funding precisely to help unaccompanied children in Europe. Details about how the money will be allocated will be announced shortly.
Does the Minister agree that, far from lagging behind the European Union on this issue, the UK is actually doing far more than any other country in Europe through its massive support for the camps and the refugees in the region, while also resettling the most vulnerable refugees from the camps to the UK?
My hon. Friend makes an extremely good point. The Government believe that relocating children around Europe is not the answer. Under our scheme to relocate the most vulnerable people from Syria and the countries around it, 51% of the people being brought over here are children. I hope that Members on both sides of the House would accept that this is a well measured and well carried-out scheme, which has led to significant improvement in many children’s lives.
Nevertheless, thousands of children are still waiting to be resettled. We have been having this debate for weeks and months. I am ashamed when I listen to debates in the European Parliament about this issue and hear concern and compassion—something that seems to be singularly lacking in this place.
The right hon. Lady will be aware, I am sure, that under our resettlement scheme many children have been resettled—more than 50% of those coming here are children, as I have said. I remind her and other Members that the policy of UNHCR is to keep children in the areas around Syria, and it has been very successful in identifying children with the greater families to make sure that they have a good chance of a better life in the future.
23. Will the Government expand the current definition of the family unit to include de facto family members and simplify the system so that vulnerable children can come here much more quickly than is currently the case? 
As the right hon. Gentleman will know, the Government are currently looking at reports from the UNHCR on precisely the issue of unaccompanied children, and I hope he will agree that lots of efforts are under way to ensure that that happens.
I call Callum McCaig.
22. Thank you, Mr Speaker; I was not expecting to be called. The Government have rightly made a big deal of the Syria donor conference in London, but the UNHCR has said that financial solidarity is not enough. Why will the United Kingdom Government not listen, and why did they not step up to their responsibilities at the Geneva conference and do more to help Syrian refugees? 
I was at the Geneva conference on behalf of the Government, and I wish to place on the record that the British Government were congratulated by many other Governments on the work that they have done in relocating Syrian refugees. Our programme for resettling them has been significantly greater than those of all the other countries in the European Union put together.
At Easter, along with three other SNP Members, I spent several days visiting the camps at Calais and Dunkirk. During our visit, we met many refugees with strong ties to the United Kingdom. Why is the Government’s record on “take charge” requests under the Dublin convention for those with strong ties to the UK so poor, and what exactly will the Government do to ensure that there is greater awareness of, and a faster process for, such requests?
The hon. and learned Lady has rightly mentioned the Dublin convention and its effect. It is our Government’s policy to ensure that the convention works properly. With that in mind, we have seconded officials not just to France, including Calais, but to other parts of Europe—Athens, Rome and Germany—to ensure that what she has asked for happens and that the process is speeded up significantly.
I am afraid that the Minister’s answer is not good enough. There was no evidence of any Home Office presence in any of those camps, and what is happening to children in the camps is utterly disgraceful. In the Grande-Synthe camp—
It is up to the French.
If I am allowed to speak, I shall try to continue.
Order. The hon. Member for Isle of Wight (Mr Turner) is chuntering, from a sedentary position, “It is up to the French.” The hon. Gentleman is welcome to his opinion, but his opinion is not enhanced by his suddenly winking at me as though in self-justification. The hon. and learned Lady is a distinguished advocate, and she must be heard. Even if she were not a distinguished advocate, she would still be heard.
This is not a laughing matter, and it is not “up to the French” when those children have connections with the United Kingdom. That is my point.
In the Grande-Synthe camp, I met a 16-year-old girl who was working hard for exams in a pop-up school in a tent. She had made the journey to northern France on her own. Her father is in the United Kingdom, but owing to the absence of guidance from the French authorities and the failure of our Government to act, she was stuck in limbo and uncertain about her future. Children like her are very vulnerable in the camps. It is time for the Home Secretary to show leadership. Will she give us a commitment that her Department will ensure that those with a legal right to join their families in the United Kingdom are granted that right as a matter of urgency?
I shall try to avoid repeating what the chunterers were saying earlier, because the hon. and learned Lady has made a serious point. However, I must reiterate that those children are in France and are predominantly the responsibility of the French Government, with whom we are working very closely by placing officials with them.
The children in question have a clear path. They should claim asylum under the Dublin convention, which they are perfectly allowed to do. It is then the responsibility of the Home Office—the British Government —to ensure that their asylum claims are processed speedily and effectively. If they do have the relationships with families in the United Kingdom that the hon. and learned Lady has been told that they have, I can assure her that the process is very much speedier and more efficient than it used to be.
3. What assessment she has made of recent trends in the level of cybercrime. 
While overall crime has fallen by more than a quarter since 2010, it is also changing, as the hon. Gentleman knows. An accurate national picture is critical to informing our response to cybercrime, which is why the Office for National Statistics has now published, for the first time, initial estimates of the number of cybercrimes committed, based on a preliminary field trial. The ONS estimates that there are 2.5 million incidents of computer-misuse crime per year.
The Office for National Statistics estimates that there were some 5.1 million incidents involving such crimes last year, which adds about 40% to the baseline figure for crime in the UK. Will the Minister accept that crime appears to be going up, rather than down?
I think crime is changing. The hon. Gentleman is right that this is about skills, which is why we established the National Cyber Crime Unit in the National Crime Agency, and about resources, which is why we have put £1.9 billion into this area of work. However, the issue is also about recognising that many such crimes can be prevented through straightforward good practice by citizens.
I think—I know you do too, Mr Speaker—that questions should always have a purpose beyond challenging the Government and should actually deliver positive results for Members. Following the hon. Gentleman’s question, I will write to him and to the whole House with details of how he can advise businesses in Scunthorpe and his constituents on how to stop these kinds of cybercrimes.
I await that with eager anticipation.
The west of England is leading the way in tackling cybercrime following the £1.9 billion investment announced by my right hon. Friend the Chancellor last year. Given the atrocities in Brussels last month, will the Minister update the House on how he is working with our allies to tackle cybercrime?
What is critical in tackling cybercrime is the partnership between the private and public sectors, which is why the Home Secretary launched a joint taskforce to look at how allies, comrades, friends and others can work together to tackle this issue. It is also important to emphasise that GCHQ states that 80% of such crimes can be prevented by the straightforward good practice that I identified earlier, which is precisely why I take the matter so seriously and why public information is at the heart of what we do.
For five years, the Government’s alibi has been, “We cut police, but we cut crime.” The Police Minister has told Sky that citizens are more likely to have a crime perpetrated against them online on their computers while they are asleep than in the street. With cybercrime statistics set nearly to double the national crime rate, will the Minister finally admit that, far from the alibi of the past five years being the case, crime is not falling? Crime is changing and the truth is that crime is rising.
It is always unfortunate when a shadow Minister prepares a question in advance and does not listen to what has been said immediately beforehand. I said in my first answer that crime is changing. It is falling, but it is also changing and because it is changing we need the additional skills, resources and approaches that I described to the hon. Member for Scunthorpe (Nic Dakin).
Given that the hon. Member for Birmingham, Erdington (Jack Dromey) made a bit of a hash of his question, I want to help him as much as I can: I refer him to the two sets of guidance that we have just published, which I will happily furnish him with following questions.
Fire and Rescue Service (Funding)
4. What assessment she has made of the effect of changes in the level of funding on the work of the fire and rescue service. 
Fire and rescue authorities have delivered significant savings since 2010, and fire deaths and injuries are at near historical lows. Authorities can still work smarter and reduce costs. Between 2009-10 and 2014-15, single-purpose fire authorities’ non-ring-fenced reserves rose by 136% to £561 million. Those resources should be targeted at achieving long-term efficiencies.
Last year, an on-duty firefighter tragically took his own life at Stalybridge fire station citing a number of workplace pressures, which is part of a pattern of abnormally high firefighter suicides in Greater Manchester over the past few years. As fire and rescue budgets have been severely reduced, the job of a firefighter is clearly now even more demanding. What can the Home Secretary say to reassure me that the Home Office takes seriously the pressures that firefighters face and is working to ensure that firefighters do their job in a safe and well-supported environment?
First, may I send my condolences to the family of that individual firefighter in the hon. Gentleman’s constituency? The suicide of any firefighter is a great tragedy, and of course we recognise the pressures and the difficult job that firefighters do. However, the number of fires they are having to be called to has been reducing—as I said, the number of fire deaths and injuries is now at near historical lows—and so the job of being a firefighter has been changing over the years. For example, firefighters are now doing more fire prevention work, which is very valuable work for communities. As we look forward to greater collaboration between firefighters and the police service, we can look to an even better service being provided for communities.
As I am currently on attachment with the Northamptonshire fire and rescue service, as part of the fire service parliamentary scheme, I have had the privilege over the past few months of seeing the increasingly close way Northamptonshire’s police and fire and rescue services are working together to deliver more effective emergency services, at a far lower cost. Will the Home Secretary take this opportunity to congratulate both Northamptonshire police and Northamptonshire fire and rescue service on the innovative and enthusiastic way in which they are facing these challenges?
I am very happy to join my hon. Friend in doing exactly that, as we see in Northamptonshire a very good example of the benefits collaboration can bring. Indeed, my right hon. Friend the Minister for Policing, Fire, Criminal Justice and Victims was in Northampton last week to open a joint fire station and police station, which shows the benefits of collaboration, not only in saving money, but in providing a better service to the public.
18. Fire services for the six largest cities outside London will have had their budgets cut by half between 2010 and 2020, and thousands of firefighters will have lost their jobs and many fire stations will have closed. Firefighters do a superb job, as we know, but can the Home Secretary say honestly that community safety is not being compromised and that no lives will be lost as a direct result of the cuts? 
As I indicated, we have seen a significant reduction in the number of incidents; from 2004-05 to 2014-15, the number of incidents fire and rescue services went to declined by 42%. As I said in response to the question from the hon. Member for Stalybridge and Hyde (Jonathan Reynolds), although firefighters do still find themselves being called to fires, a lot of their work is also about other services to the community. They are doing an excellent job but we want to see how that can be done even better and how they can work better in collaboration with the police, as we have seen in places such as Northamptonshire.
Cuts to the fire and rescue service have already cost us 6,700 front-line firefighters and cuts to the police have already cost us 12,000 front-line police officers. As the Home Secretary knows, reserves can be spent only once and there are significant, real cuts to come. With the public less well protected with every day that passes, will she admit that her cynical plan to merge both services will not protect or restore a single police officer or firefighter to the front line, or make a single member of the public safer?
Yet again, the Labour party goes down the road of thinking that the only thing that matters is the number of police officers or firefighters available. The hon. Lady talks about full-time firefighters, but may I pay tribute to those people who volunteer as firefighters in their community, as they are often overlooked when we examine the issue of firefighters? What matters is not just the number of people we have, but how we are spending the money and how we are deploying our resources. That is where the efficiencies we have seen and the collaboration we see will result in not just savings, but a better service to the public.
Asylum (Unaccompanied Children)
6. What support her Department is providing for local authority provision for unaccompanied children seeking asylum. 
The Home Office provides financial support to local authorities by meeting reasonable additional costs for those local authorities taking on responsibility for the care of unaccompanied asylum-seeking children. The Immigration Bill will underpin arrangements to secure more equitable dispersal between local authorities.
I thank the Minister for that answer, but given the number of cases where people over the age of 18 are pretending to be children, what can local authorities do to ensure that their limited resources are being best directed to very vulnerable children?
I thank my hon. Friend for his question. I also thank those in Northamptonshire for the work they are doing to deal with the pressures they have experienced and for the way in which they have approached this through the discussions and round-table meetings that have taken place. Clear age-assessment tests are undertaken to ensure that support is provided to those who require it and not to those who do not. Let me add that I will be writing to all local authorities this week with an update on progress on the national transfer scheme to aid the more equitable dispersal.
20. Can the Minister say how much money from the overseas budget has been used to help local authorities to resettle asylum seekers? 
The hon. Gentleman is asking not about unaccompanied asylum-seeking children but a broader question about the Syrian vulnerable persons resettlement scheme. We have set out the different funding mechanisms available to those who are resettled and some of that is fundable through overseas development aid. That is how we are ensuring that appropriate support and welcome are given to the people arriving.
I think the Minister would agree that we can perform our duty as a country only if all areas take up their responsibility, so it is good to hear his answer. May I ask him about education support? Vulnerable children should not lose their chance of a future, so how will local authorities with experience of helping asylum-seeker children support those with less experience of educating those children?
We have had discussions with the Department for Education and the Local Government Association about the voluntary dispersal arrangements we want to see, underpinned by the Immigration Bill currently in the other place. We are continuing the dialogue on precisely how elements of that are implemented and on how we can learn from the expertise of authorities that have had greater involvement in these matters.
24. During the recess, Scottish National party MPs visited the Calais and Dunkirk refugee camps and witnessed unaccompanied children being forced to share bed space with unrelated adults. That is clearly a troubling and serious matter. Does the Minister think the Government are doing enough to support those children? Surely it is time to step up to the plate and do more. 
We are working closely with the French Government. As my hon. Friend the Under-Secretary of State for Refugees said in answer to a previous question, we have had a secondee working in the Ministry of the Interior in France to speed up the process in relation to children identified as having links to family here in the UK. Equally, the French Government are putting greater support in through a charity to raise awareness and identify children better to give them the help they require.
It is good to see the hon. Member for Ilford South (Mike Gapes) back in his place.
Recruitment (Overseas Workers)
7. What discussions she has had with her ministerial colleagues on the effect of changes to immigration rules on recruitment of overseas workers. 
The Home Office works closely, at ministerial and official levels, with interested Departments on all significant changes to migration policy. The reforms we have announced have been collectively agreed. May I too welcome the hon. Gentleman to his place?
May I thank all colleagues who sent me messages during my involuntary absence? I’m back.
Will the Minister explain how it is that his Department is proposing a £35,000 salary threshold, which will have a detrimental impact in many areas where we have shortage occupations? Can he explain why the initial priority list of jobs did not include NHS nurses? I was treated by nurses from all over the world, including some from European Union countries, and I know that in London there will be a major recruitment problem. Already, we cannot provide enough nurses for our NHS and, if we take away recruitment opportunities from NHS trusts in London and elsewhere, we will have major shortages.
It is great to see the hon. Gentleman back in his place, and clearly fighting fit.
In essence, the £35,000 threshold applies to gaining settlement, allowing people to extend their time in the UK. We took considered advice from the Migration Advisory Committee at the time it was set, back in 2011, and employers have had five years to prepare for the change. Occupations on the shortage occupation list, including nursing and other shortage skills, are excluded from the requirement. We have carefully considered the independent advice from the MAC on that important matter.
Has the Home Office assessed the impact of the changes on the Scottish economy? Is it not the case that the new arbitrary target, combined with the abolition of the post-study work visa, prevents Scotland from attracting and retaining the brightest and best the world has to offer? Why have this Government prioritised narrow political interests over measures to grow our economy?
I am afraid that the hon. Lady has got it completely wrong. The Government have made it clear that the UK remains open for business. I would gently say to her that we take advice from the expert Migration Advisory Committee, which has advised against different salary thresholds in UK countries and regions. Our thresholds are based on UK-wide data, and salaries in Scotland are slightly higher than the UK average. Advancing the point that she makes might lead to higher salary thresholds in Scotland.
Police and Crime Commissioners
8. What assessment she has made of the effectiveness of police and crime commissioners in reducing levels of crime.
9. What assessment she has made of the effectiveness of police and crime commissioners in reducing levels of crime.
11. What assessment she has made of the effectiveness of police and crime commissioners in reducing levels of crime. 
Elected police and crime commissioners are providing accountable, visible leadership, and are making a real difference to policing locally. Overall, PCCs have presided over a reduction in crime of more than a quarter since their introduction, according to the independent crime survey for England and Wales.
In Fylde, concerns have been raised about the police and crime commissioner spreading resources away from rural areas. What assurances can the Home Secretary give me that police and crime commissioners will be accountable to the Government for failure to spend adequately in rural areas?
One of the changes that has been brought about as a result of the introduction of police and crime commissioners is a greater focus in some areas on rural crime. The national rural crime network, for example, has been set up, and I pay tribute to Julia Mulligan, the PCC in North Yorkshire, for being a leading light in developing that. It is an issue that I discussed with Chris Salmon, the PCC in Dyfed-Powys, and farming representatives when I was in mid-Wales a few weeks ago. We can now ensure, in some police areas, that PCCs put the right focus on rural crime, but to do so the right PCC needs to be elected.
Police and crime commissioners provide crucial accountability in the criminal justice system. They ensure that the public have a direct input in how their local streets are policed. Does the Home Secretary agree that it is now time to widen the scope of the work of PCCs to see where else in the criminal justice system they can make a contribution?
My hon. Friend makes an important point, and he is absolutely right. We used the title, “police and crime commissioners”, when we set up the office, precisely because we thought that they could have a wider role. I am pleased to tell him that the Lord Chancellor and Justice Secretary and I have commissioned work to look at precisely the issue that he has raised. What else can PCCs do in the criminal justice system, and what further responsibilities can they take on in the interests of providing better services to the local community?
In Cheshire, crime is down, and John Dwyer, the police and crime commissioner, has managed to get 2,000 police officers on the beat. Does my right hon. Friend agree that we need a Conservative PCC in Cheshire to keep crime down and keep our communities safe?
I commend the work that has been done by John Dwyer as the first PCC for Cheshire. He has done an excellent job in getting, as my hon. Friend said, more police officers and in managing the budget well. As my hon. Friend said, crime is down, and a Conservative PCC in Cheshire after the 5 May election will continue to do an excellent job and provide an excellent service for local people.
Is the Home Secretary aware that, in areas such as mine in north Wales, the police and crime commissioner has had to put up the precept at more than the rate of inflation to compensate for Tory Government cuts? Is it a fair use of taxpayers’ resources to compensate for cuts imposed by central Government?
The right hon. Gentleman knows full well that we are protecting police budgets when the precept is taken into account, which is in sharp contrast to proposals from his Front-Bench team, who want to cut police budgets by 10%.
The Home Secretary might know that we are very pleased with our police and crime commissioner in West Yorkshire, but has she picked up from PCCs the problems with intelligence gathering in particular communities that are impenetrable owing to their language and culture? Police have real difficulty penetrating organised gangs.
There are obviously challenges in relation to dealing with certain communities with organised gangs where, as the hon. Gentleman says, there may well be language difficulties. Police and crime commissioners are finding many innovative ways around that. Looking at their recruitment policies and at how volunteers and special constables in particular can be used to ensure that the language skills are available is a very good idea, which has been adopted by some PCCs around the country.
On Friday, the South Yorkshire PCC announced the loss of 850 police staff because of Government cuts. Also last week, the National Crime Agency’s application to the Home Office for support for Rotherham’s 1,400 victims of child abuse was rejected. How are we meant to bring down child sexual exploitation when the Government are cutting police resources?
I indicated earlier that overall the Government are protecting police budgets when the precept is taken into account. We have also made money available to the national policing lead precisely in relation to the issue of child sexual abuse and child sexual exploitation, and ensured that the National Crime Agency has the resources it needs to be able to do that job. The hon. Lady has an excellent record in dealing with this issue. Her constituency has faced particularly challenging times as a result of child sexual exploitation, and I can assure her that I and other Ministers involved take the issue very seriously indeed. That is why we have taken steps such as setting up the Goddard inquiry, and why we have made money available to the national policing lead in order to better co-ordinate the work that is done in this area.
Unaccompanied Child Migrants
10. What recent assessment she has made of the risks of trafficking or exploitation to unaccompanied child migrants in France who intend to seek asylum in the UK; and if she will make a statement. 
The French and UK Governments have put in place a programme, run by the non-governmental organisation France terre d’asile, to identify and help potential victims of trafficking in the camps around Calais. As has been said in previous answers, unaccompanied refugee children in France should claim asylum there. That is the best way to ensure that they receive the protection and support they need. It also provides a legal and safe route to the UK for those with close family in the UK.
But as we know from the earlier questions to which the Minister referred, there are 129 missing children, who are obviously those most at risk of such exploitation. I had a very welcome letter recently from her colleague, the Immigration Minister, about the situation of children in the camps. He said that these cases are being given priority so that the children can
“receive the protection and support they need and are reunited as soon as possible with any close family members in the UK.”
How many have been reunited?
The right hon. Lady knows that we are not giving a running commentary on numbers, but I can assure her that the work is taking place and that any unaccompanied asylum-seeking child in France should claim asylum there with the support of the NGOs, and if they have family in the UK, we will reunite them.
In view of the clear link between trafficking and forced prostitution, and following the French Government’s change last week to their prostitution laws, criminalising sex buyers but not the vulnerable women involved, and similar changes in Sweden and Norway years ago which reduced trafficking substantially, do Ministers agree that that should be considered in this country?
I know that my hon. Friend takes a keen interest in this issue and we have discussed the point outside the Chamber. I am aware also of the Home Affairs Committee’s current inquiry into the matter, and I look forward to seeing the evidence.
12. What steps the Government are taking to tackle (a) criminal gangs and (b) paedophiles operating online. 
This Government have committed to spending £1.9 billion on cyber-security over the next five years, including for tackling cybercrime. Our response to online child sexual exploitation includes law enforcement agencies taking action against online offenders, finding and safeguarding victims, and working with the internet industry to remove illegal images.
We await the new child sexual exploitation response unit, which will be established any day now. Can the Minister assure the House that the new unit will result in a step change, not just bringing abusers to justice, but working with parents, communities and schools to provide children with the skills, understanding and confidence to keep themselves safe online?
I thank my hon. Friend for his support for the response unit, which will deliver significant benefits by assisting local areas experiencing particular issues and/or high volumes of child sexual exploitation cases, by offering a range of support, including advice from expert practitioners who have first-hand experience of tackling child sexual exploitation.
Going missing can be an indicator that a child or young person is being exploited by organised gangs to traffic drugs across county lines. What more can be done to ensure that police forces work together and share information on missing children in order to combat the criminal exploitation of young people?
The hon. Lady, who has incredible expertise in this area, is absolutely right; we need police forces to take this seriously and recognise that a missing child is a child who is being exploited while they are missing. There is therefore a fantastic opportunity for intelligence gathering and safeguarding those children to stop them going missing in future.
One of the proposed measures for tackling criminal gangs and paedophiles online is the Investigatory Powers Bill, which will start its line-by-line scrutiny tomorrow. One of the main concerns that we have outlined about the Bill as currently drafted is the proposed test that judges would undertake when considering applications for warrants to use the most intrusive powers, specifically the reference to judicial review. Lord Judge, the former Lord Chief Justice and current Chief Surveillance Commissioner, told the Bill Committee in oral evidence just before Easter that judicial review was “not a sufficient test” to apply and that the Government should look at this again. Given that someone of his seniority who is held in such respect feels that the test is not good enough, will the Government reconsider the Bill’s wording in relation to judicial review?
The hon. and learned Gentleman has great expertise in this area, but I am not sure that I necessarily agree with his comments. There is a double lock, and it is about necessity and proportionality, but he is right to make the point that the Bill is incredibly important when it comes to protecting children, as the National Society for the Prevention of Cruelty to Children pointed out in oral evidence to the Committee considering the Policing and Crime Bill.
Violence against Women and Girls
13. What steps the Government have taken to tackle violence against women and girls. 
Our new violence against women and girls strategy, published last month, sets out an ambitious programme of reform, backed by increased funding of £80 million, to make tackling these crimes everybody’s business, to ensure victims get the support they need and to bring more perpetrators to justice. We have also introduced a new domestic abuse offence to capture coercive control, and we have consulted on new measures to protect victims of stalking.
Last month, True Honour, an honour-based violence charity led by my constituent Sarbjit Athwal, and of which I am proud to be a trustee, was recognised with charity status. Will my right hon. Friend update the House on her Department’s progress in tackling honour-based violence?
First, I commend True Honour, the charity in my hon. Friend’s constituency, and Sarbjit Athwal for the work they do in this area. It is an incredibly important issue. Of course, the Government have already significantly strengthened the law on forced marriage and female genital mutilation. We have issued a range of materials to support professionals, including new statutory multi-agency FGM guidance, and our forced marriage and FGM units are carrying out ongoing outreach programmes. It is very important that we help people to identify where young people may be subject either to forced marriage or to female genital mutilation and to take appropriate action.
Serious and Violent Crimes
15. What assessment she has made of recent trends in the level of the most serious and violent crimes. 
Violent crime is 25% lower than it was in June 2010, according to the independent crime survey for England and Wales. Our new modern crime prevention strategy includes actions to tackle a range of crimes, including violent and knife crime.
Noureden Mallaky-Soodmand is a convicted violent Iranian criminal who was transferred to my constituency upon release from prison because the paperwork needed to deport him could not be sorted out. He is now back in prison after brandishing a cleaver and threatening to decapitate people in Stockton. Can the Minister tell me when I will get full answers to my parliamentary questions on which authorities in Stockton, if any, were told about this dangerous man in our area?
The hon. Gentleman will know that I cannot comment on the specifics of the case. If he will forgive me, I will write to him.
T1. If she will make a statement on her departmental responsibilities. 
In 25 days’ time, the public will go to the polling booths to vote for elected representatives in local authorities, the Welsh Assembly, the Scottish Parliament and for the mayoralty of this great city. We have a great tradition of democratic accountability in this country, and I am proud that on 5 May that principle will be extended to policing. For the first time since we introduced them in 2012, the public will be able to hold their local police and crime commissioner to account for their record in office. It is easy to forget what went before PCCs: the unelected, unaccountable and invisible police authorities, which no one knew existed. Today, a majority of the public know about their PCCs, and PCCs have been associated with greater clarity of leadership and heightened accountability by the Home Affairs Committee. Even the Labour party, which until recently opposed PCCs, and the Liberal Democrats, who did everything they could to sabotage the first elections, support the role and have nominated candidates in May’s elections. PCCs have worked hard over the past three and a half years to keep their communities safe, so I hope that the House will join me in congratulating the first PCCs on their successes and encouraging the public to hold them to account in the most powerful way possible on 5 May: at the ballot box.
Levels of violent crime and domestic abuse remain unacceptably high in Croydon, and the borough was of course hit hard in the 2011 riots, so it is very worrying that it is about to lose a third of its remaining neighbourhood police bases, on top of 83% of its police community support officers—reductions that are much higher than the average in London. Will the Home Secretary therefore meet me to discuss real public concerns that these cuts will damage the fight against crime in Croydon?
To repeat what I said earlier, I remind the hon. Gentleman that the Government have protected police budgets over the comprehensive spending review period, when precept is taken into account, which is in sharp difference to what the Labour Front Bench suggested—cutting them by 10%.
T2. My right hon. Friend may be aware that I am participating in the police parliamentary scheme, seeing at first hand the excellent work of Greater Manchester police. What is being done to ensure that there are adequate and safe levels of community policing in my constituency? 
I congratulate all hon. Members who take part in these parliamentary schemes. I would also recommend the fire scheme and the armed forces scheme. With the Chancellor’s help, we have managed to protect budgets, subject to the precept. For anyone interested in neighbourhood policing, I would say that those who have a Conservative police and crime commissioner and a Conservative mayor have more chance of having more officers on the beat.
In the aftermath of the attacks in Brussels and Paris, the security of the UK border is uppermost in people’s minds. However, we are a fortnight into the new financial year, and the Home Secretary is still refusing to answer questions on the budget for Border Force. A whistleblower says staff were told three weeks ago to expect front-line cuts of 6%, although, since media reports of that came out, we hear that the Home Office has been back-pedalling. I hope the Home Secretary is backing down, because our borders cannot face cuts on this scale. I therefore invite her to clear the issue up today: what is the 2016-17 budget for Border Force, and is it up or down on last year?
The right hon. Gentleman has written to me on this subject, and I have responded to him. The Home Office’s budget was published under the comprehensive spending review as normal last November. As with the rest of the Government, individual allocations within Departments are not routinely published. However, what matters—he is right—is that we have a secure border, and that is why we have a transformation plan with Border Force and why we have changed Border Force over the last few years from the dysfunctional United Kingdom Border Agency we inherited from the last Labour Government.
It will not have escaped the notice of the House or anybody watching that the Home Secretary has not answered the question. We know that financial transparency and this Government do not go well together, as we are about to hear, but what are the Government trying to hide? I hope the delay in publishing the budget is due to the fact that she is listening to us and backing down on those 6% cuts.
Let me turn to another area where the Home Secretary is moving under Labour pressure: police bail for terror suspects. I have called on the Government for months to close a loophole that has allowed individuals on bail, such as Siddhartha Dhar, to leave the country for Syria. I welcome the fact that the Government last week indicated that they are prepared to move on the issue, but I am worried that they are not going far enough. Does the Home Secretary agree that passports and travel documents should be surrendered as a condition of release from police custody? Will she work with Labour to amend the Policing and Crime Bill to that end?
We have been looking at this issue for some time, and we have decided that we will bring forward an amendment to the Policing and Crime Bill. However, it is important that the police continue to have a degree of operational judgment about the conditions they wish to put in place in relation to bail. The type of bail the right hon. Gentleman is talking about is pre-charge bail—a situation where somebody has not yet been charged with an offence. Decisions will be taken, as they were in the case of Siddhartha Dhar, by individual police officers as to the conditions that should be applied, and that should continue to be the case.
T4. How many of the approximately 800 British citizens who have joined militant groups in Syria have returned, and how many of them are back in communities? 
Around half of those who have travelled to Syria have returned to the United Kingdom. Obviously, the sort of action it might be necessary to take against individuals is considered on a case-by-case basis. That includes considering the sorts of activities in which they may have been involved in Syria and whether any intervention is necessary.
T3. Last week, 18-year-old Mohammed Hussain, a Kurdish refugee, died underneath a lorry as he attempted to flee violence and be reunited with his family in Manchester. The tragic story of Mohammed highlights the dangerous routes that many refugees are forced to take. When will the Government open up family visa opportunities to British citizens and settled residents so that we can prevent deaths like that of Mohammed from happening again? 
The hon. Gentleman highlights the appalling risks that some people have taken to get through the security and other steps that have been put in place. Our very clear message to those people is that they should claim asylum in France. On the issue of resettlement, we are certainly making the process clearer and working with the Red Cross and others on the guidance provided.
T5. Has the Home Office team had time to reflect on the extraordinary National Union of Teachers motion that condemned the Prevent duty? Do Ministers agree that we all have a responsibility to do all we can to prevent young people from engaging in terrorism and extremism? 
It was Ruskin who said:
“Let us reform our schools, and we shall find little reform needed in our prisons.”
It is in that spirit that the Prevent duty missions teachers to identify those vulnerable young people and safeguard them from being drawn into terrorism. Schools are stepping up to that mark, as they know their students best. They are well equipped and well prepared, and they are safeguarding our children and so securing our future.
Thank you for reminding us of Ruskin.
T6. The Home Secretary recently said at the launch of the Conservatives’ PCC election campaign that “the Conservative Government has protected overall police spending for the next four years”.However, Sir Andrew Dilnot, the chair of the UK Statistics Authority, has confirmed House of Commons Library research that shows that forces will see a £160 million cut next year alone. In the light of that, and given the importance of the upcoming elections, will the Home Secretary admit that funding for our police forces has not been protected and is being cut again for each of the next four years? 
If we take the precept into account, we can see that police funding has been protected over the past four years. The one person we did not listen to was the Labour shadow Secretary of State, because he wanted to cut it by 10%.
T7. What success have the Government had in recent months in deporting overstayers who have been working here illegally? 
I underline the important work in confronting crimes linked to those working illegally. In 2015, more than 38,000 people were removed or deported from the UK, including a 28% increase in voluntary returns. That highlights the fact that people realise that it is so much tougher to get work here.
What recent discussions have Ministers had with chief constables about the growing menace of scrambler bikes being ridden recklessly on our roads, with the potential to cause great accidents, usually by young men wearing masks and without number plates?
I had those sorts of discussions when I was at the Department for Transport, and we continue to have them. Unlicensed, unauthorised and unsafe vehicles on the roads are a menace, and the police should use all the powers they have.
T8. The Investigatory Powers Bill, which is going through the House, provides important capabilities, along with new safeguards, to tackle cybercrime. Will Ministers update the House on how the changing nature of crime is being fought by the Bill?
The motives of terrorists, paedophiles and people traffickers may differ, but their means are the same, and they take advantage of the internet. The Bill will provide the police and security services with powers that are necessary to keep us safe. Powerful new measures, steely determination and an iron will mark all that we do.
Anyone from Malawi who wants to visit the UK has to apply online with a credit card. Given how few people in Malawi have access to electricity, let alone the internet or banking facilities, what steps is the Home Office taking to make sure that people who have a legitimate request can apply?
The hon. Gentleman has raised that issue with me previously, and I am happy to continue to discuss it with him and with the all-party group. Clearly, agency and other mechanisms are available, but we will continue to ensure that we have a high-quality visa service.
T9. It is right for the police to be given more powers in relation to the use of Tasers, stop-and-search and the Investigatory Powers Bill, but with greater powers should surely come greater responsibility. Therefore, will the Home Secretary confirm to the House that proper safeguards will remain in place to ensure that the police continue to have the support of the general public? 
I am happy to give my hon. Friend that assurance, in relation to the Investigatory Powers Bill and, crucially, the double lock authorisation that will be available for the use of the most intrusive powers; in relation to the work that we have done in introducing the “best use of stop-and-search” scheme, to ensure that stop-and-search is properly used and properly targeted; and in relation to the work that we have done with Chief Constable David Shaw to identify rather better how Tasers and other restraint are being used. The police need those sensitive powers. What people want to know is that they are being used properly, and the Government are ensuring that that is the case.
Over the past 12 months, a further 39 uniformed police officers and PCSOs have been lost from Enfield’s streets, while violent crime, including assault and possession of a dangerous weapon, has increased by 13%. Ten days ago, there was an attempted drive-by shooting in my constituency. That situation in a London suburb is totally unacceptable and very frightening for residents. There can be no doubt that the hollowing out of neighbourhood policing is putting public safety at risk. What does the Minister intend to do about this situation?
What we intend to do, with the help of the Chancellor, is to make sure that the Metropolitan police has got the funding that it asked for, not to cut funding by 10%, as the Labour party requested. Neighbourhood policing is an operational matter for the commissioner and the Mayor, but I repeat what I said earlier: looking at the statistics, we can see that if we want more police on the beat, we should vote Conservative.
As part of special branch, Hampshire marine unit provides vital crime prevention along our coastal borders and within the marine environment of the Solent and the Isle of Wight, through operations such as Project Kraken. Will my right hon. Friend confirm that that vital crime prevention service is protected under current reforms?
My hon. Friend raises an important point and describes the variety of tasks that our police forces carry out, and the variety of skills and operational capabilities that they need. I am very conscious of the marine capability requirements in Hampshire. It is, of course, an operational matter for the police to determine how they spend their budget and what they use it for. Crucially, my right hon. Friend the Chancellor has ensured that we can protect police budgets, when precept is taken into account, over the next four years.
Two weeks ago, when four of my colleagues and I were in Calais, the French authorities tear-gassed the Calais camp simply because a protest was going on outside it. Does the Home Secretary approve of such measures, and if not—if she agrees with me that measures should be proportionate to the situation and that refugees must be treated humanely—will she contact her French counterpart and express the concerns of this Parliament?
I was in Calais last week having discussions with the French authorities about those issues, and the very clear message was that those who are there should claim asylum. That is the best and most effective way for them to get the help that they need, and that is the clear message that needs to come from this House.
With permission, I would like to make a statement on the Panama papers.
Dealing with my own circumstances first, yesterday I published all the information in my tax returns not just for the last year, but for the last six years. I have also given additional information about money inherited and given to me by my family, so people can see the sources of income I have: my salary, the benefit in kind of living in No. 10 Downing Street, the support my wife and I have received as Leader of the Conservative party, the renting out of our home and the interest on the savings that I have. Since 2010, I have not owned any shares or any investments.
The publication of a Prime Minister’s tax information in this way is unprecedented, but I think it is the right thing to do. But let me be clear: I am not suggesting that this should apply to all MPs. The Chancellor has today published information on his tax return, in a similar way to the shadow Chancellor and the First Minister for Scotland. This begs the question of how far the publication of tax information should go. I think there is a strong case for the Prime Minister and the Leader of the Opposition, and for the Chancellor and the shadow Chancellor, because they are people who are or who wish to be responsible for the nation’s finances. As for MPs, we already have robust rules on Members’ interests and their declaration, and I believe that is the model we should follow.
We should think carefully before abandoning completely all taxpayer confidentiality in this House, as some have suggested. If this were to come in for MPs, people would also ask for a similar approach for those who ask us questions, those who run large public services or lead local government, or indeed those who edit news programmes or newspapers. I think this would be a very big step for our country. It certainly should not take place without a long and thoughtful debate, and it is not the approach that I would recommend.
Let me deal specifically with the shares my wife and I held in an investment fund or unit trust called Blairmore Holdings, set up by my late father. The fund was registered with the UK’s Inland Revenue from the beginning. It was properly audited, and an annual return was submitted to the Inland Revenue every year. Its share price was listed in the Financial Times. It was not a family trust; it was a commercial investment fund for any investor to buy units in. UK investors paid all the same taxes as with any other share, including income tax on the dividends every year.
There have been some deeply hurtful and profoundly untrue allegations made against my father, and if the House will let me, I want to put the record straight. This investment fund was set up overseas in the first place because it was going to be trading predominantly in dollar securities, so like very many other commercial investment funds, it made sense to be set up inside one of the main centres of dollar trading.
There are thousands of these investment funds and many millions of people in Britain own shares, many of whom hold them through investment funds or unit trusts. Such funds, including those listed outside the UK, are included in the pension funds of local government, most of Britain’s largest companies and, indeed, even some trade unions. Even a quick look shows that the BBC, the Mirror Group, Guardian Newspapers and—to pick one council entirely at random—Islington all have these sorts of overseas investments. To give one further example, Trade Union Fund Managers Ltd, based in Congress House, has a portfolio of over £50 million of investment in the trade union unit trust, with 3% of its net assets based in Jersey. This is not to criticise what it does; it is to make the point that this an entirely standard practice, and it is not to avoid tax.
One of the country’s leading tax lawyers, Graham Aaronson, QC, has stated unequivocally that this was
“a perfectly normal type of collective investment fund”.
This is the man who led the expert study group that developed the general anti-abuse rule—so much debated and demanded in this House—which Parliament finally enacted in 2013. He also chaired the 1997 examination of tax avoidance by the Tax Law Review Committee. He has said that it would be
“quite wrong to describe the establishment of such funds as ‘tax avoidance’”
and, further, that
“it would be utterly ridiculous to suggest that establishing or investing in such funds would involve abusive tax avoidance”.
That is why getting rid of unit trusts and other such investment funds that are listed overseas has not been part of any Labour policy review, any Conservative party policy review or any sensible proposals for addressing tax evasion or aggressive tax avoidance.
Surely, it is said, investors in these funds benefit from their being set up in jurisdictions with low or no taxes. Again, this is a misunderstanding. Unit trusts do not exist to make profit for themselves; they exist to make a profit for the holders of the units. Those holders pay tax, and if they are UK citizens, they pay full UK taxes.
It is right to tighten the law and change the culture around investment to further outlaw tax evasion and discourage aggressive tax avoidance, but as we do so, we should differentiate between schemes designed to artificially reduce tax and those that are encouraging investment. This is a Government—and this should be a country—who believe in aspiration and wealth creation. We should defend the right of every British citizen to make money lawfully. Aspiration and wealth creation are not somehow dirty words. They are the key engines of growth and prosperity in our country and we must always support those who want to own shares and make investments to support their families.
Some people have asked, “If this trust was legitimate, why did you sell your shares in January 2010?” I sold all the shares in my portfolio that year because I did not want any issues about conflicts of interest—I did not want anyone to be able to suggest that, as Prime Minister, I had any other agendas or vested interests. Selling all my shares was the simplest and clearest way that I could achieve that.
There are strict rules in this House for the registration of shareholdings. I have followed them in full. The Labour party has said it will refer me to the Parliamentary Commissioner for Standards. I have already given her the relevant information, and if there is more she believes I should say, I am very happy to say it.
I accept all of the criticisms for not responding more quickly to these issues last week, but, as I have said, I was angry about the way my father’s memory was being traduced. I know he was a hard-working man and a wonderful dad, and I am proud of everything he did to build a business and provide for his family.
On the issue of inheritance tax, there is an established system in this country. I believe that, far from people being embarrassed about passing things to their children—for example, wanting to keep a family home within the family—it is a natural human instinct to do so, and is something that should be encouraged. As for parents passing money to their children while they are still alive, that is something that the tax rules fully recognise. Many parents want to help their children when they buy their first car, get a deposit for their first home or face the costs of starting a family. It is entirely natural that parents should want to do those things, and, again, something that we should not just defend but proudly support.
Let me turn to the Panama papers and the actions that this Government are taking to deal with tax evasion, aggressive tax avoidance and international corruption more broadly. When we came into office, there were foreigners not paying capital gains tax when selling their UK homes, private equity managers paying a lower rate of tax than the people who cleaned their offices, and rich homebuyers getting away without paying stamp duty because houses were enveloped within companies. We have put an end to all those things. In the last Parliament alone we made an unprecedented 40 tax changes to close loopholes, raising £12 billion. In this Parliament we will legislate for more than 25 further measures, forecast to raise £16 billion by 2021. No British Government, Labour or Conservative, have ever taken so much robust action in this area.
Through my chairmanship of the G8 at the summit at Lough Erne in 2013, I put tax, trade and transparency on the global agenda, and sought agreement on a global standard for the automatic exchange of information over who pays taxes and where. Many said it would never happen, but today 129 jurisdictions have committed to implementing the international standard for exchange of tax information on request, and over 95 jurisdictions have committed to implementing the new global common reporting standard on tax transparency. Under that new standard, we will receive information on accounts of UK taxpayers in all those jurisdictions. In June this year, Britain will become the first country in the G20 to have a public register of beneficial ownership, so everyone can see who really owns and controls each company. This Government are also consulting on requiring foreign companies that own property or bid on public contracts to provide their beneficial ownership information, and we are happy to offer technical support and assistance to any of the devolved Administrations also considering such measures.
As the revelations in the Panama papers have made clear, we need to go even further. So we are taking three additional measures, to make it harder for people to hide the proceeds of corruption offshore, to make sure that those who smooth the way can no longer get away with it and to investigate wrongdoing.
First, let me deal with our Crown dependencies and overseas territories that function as financial centres. They have already agreed to exchange taxpayer financial account information automatically, and will begin doing so from this September. That never happened before I became Prime Minister and got them round the Cabinet table and said, “This must happen.” We need to go further, however, and today I can tell the House that we have now agreed that they will provide UK law enforcement and tax agencies with full access to information on the beneficial ownership of companies. We have finalised arrangements with all of them except for Anguilla and Guernsey, both of which we believe will follow in the coming days and months. For the first time, UK police and law enforcement agencies will be able to see exactly who really owns and controls every company incorporated in those territories: the Cayman Islands, British Virgin Islands, Bermuda, the Isle of Man, Jersey—the lot. That is the result of a sustained campaign, building on the progress that we made at the G8, and I welcome the commitment of the Governments of those territories to work with us and implement those arrangements.
The House should note that that will place our overseas territories and Crown dependencies well ahead of many other similar jurisdictions, and also—crucially—ahead of many of our major international partners, including some states in the United States of America. Next month we will seek to go further still, using our anti-corruption summit to encourage consensus not just on exchanging information, but on publishing such information and putting it into the public domain, as we are doing in the UK. We want everyone with a stake in fighting corruption—from law enforcement, to civil society and the media—to be able to use those data and help us to root out and deter wrongdoing.
Next, we will take another major step forward in dealing with those who facilitate corruption. Under current legislation it is difficult to prosecute a company that assists with tax evasion, but we are going to change that. We will legislate this year for a new criminal offence to apply to corporations that fail to prevent their representatives from criminally facilitating tax evasion. Finally, we are providing initial new funding of up to £10 million for a new cross-agency taskforce to swiftly analyse all the information that has been made available from Panama, and to take rapid action. That taskforce will include analysts, compliance specialists, and investigators from across HMRC, the National Crime Agency, the Serious Fraud Office, and the Financial Conduct Authority.
This Government will continue to lead the international agenda to crack down on tax evasion and aggressive tax avoidance. That battle is important and must be combined with the approach that we take in this country—low tax rates, but taxes that people and businesses pay. That is how we will tackle these issues and build a strong economy that can fund the public services we need. That strong economy, creating jobs and rewarding aspiration is the true focus of this Government—something that would never be safe under the Labour party—and I commend this statement to the House.
I thank the Prime Minister for advance sight of his statement—it is absolutely a master class in the art of distraction. I am sure that he will join me in welcoming the outstanding journalism that went into exposing the scandal of destructive global tax avoidance that was revealed by the Panama papers. Those papers have driven home what many people have increasingly felt: that there is now one rule for the super-rich, and another for the rest. I am honestly not sure that the Prime Minister fully appreciates the anger that is out there over this injustice. How can it be right that street cleaners, teaching assistants and nurses work and pay their taxes, yet some at the top think that the rules simply do not apply to them?
What has been revealed in the past week goes far beyond what the Prime Minister has called his “private matters”, and today he needs to answer six questions to the House, and—perhaps equally importantly—to the public as a whole. First, why did he choose not to declare his offshore tax haven investment in the House of Commons Register of Members’ Financial Interests, given that there is a requirement to
“provide information of any pecuniary interest”
that might reasonably be thought to influence a Member’s actions? The Prime Minister said that he thinks he mishandled the events of the past week. Does he now realise how he mishandled his own non-declaration six years ago, when he decided not to register an offshore tax haven investment from which he has personally benefited?
Secondly, can he clarify to the House and to the public that when he sold his stake in Blairmore Holdings in 2010, he also disposed of another offshore investment at that time? In particular, were any of the £72,000 of shares that he sold held in offshore tax havens?
The “Ministerial Code” states that
“Ministers must ensure that no conflict arises, or could reasonably be perceived to arise, between their public duties and their private interests, financial or otherwise,”
and that all Ministers
“must provide…a full list…of all interests which might be thought to give rise to a conflict,”
including close family interests. So did the Prime Minister provide the permanent secretary with an account of his offshore interests and if not, did he not realise that he had a clear obligation to do so, when part of his personal wealth was tied up in offshore tax havens and he was now making policy decisions that had a direct bearing on their operation? For example, in 2013 the Prime Minister wrote to the President of the European Council opposing central public registers of beneficial ownership of offshore trusts. So, thirdly, does the Prime Minister now accept that transparency of beneficial ownership must be extended to offshore trusts?
The Panama-based law firm Mossack Fonseca registered more than 100,000 secret firms in the British Virgin Islands. It is a scandal that UK overseas territories registered over half the shell companies set up by Mossack Fonseca. The truth is that the UK is at the heart of the global tax avoidance industry. It is a national scandal and it has got to end. Last year, this Government opposed the EU Tax Commissioner Pierre Moscovici’s blacklist of 30 un-co-operative tax havens. That blacklist included the Cayman Islands and the British Virgin Islands. So my fourth question is: will the Prime Minister now stop blocking European Commission plans for a blacklist of tax havens? It turns out that Lord Blencathra, the former Conservative Home Office Minister, was absolutely right when he wrote to the Cayman Islands Government in 2014 to reassure them that our Prime Minister was making a “purely political gesture” about cracking down on tax havens at the G8. It was designed, he said, to be
“a false initiative which will divert other member states from pursuing their agenda.”
Last June, Treasury officials lobbied Brussels not to take action against Bermuda’s tax secrecy. According to the European Union’s transparency register, the tech giant Google has no fewer than 10 employees lobbying Brussels. Bermuda is the tax haven favoured by Google to channel billions in profits. Conservative MEPs have been instructed on six occasions since the beginning of last year to vote against action to clamp down on aggressive tax avoidance. This is a party incapable of taking serious, internationally co-ordinated action to tackle tax dodging. Across the country and on the Opposition side of the House, there is a thirst for decisive action against global tax avoidance scams that suck revenues out of our public services, while ordinary taxpayers have to foot the bill. It undermines public trust in business, politics and public life. It can and must be brought to an end.
We welcome the Prime Minister’s announcement today about new measures to make companies liable for employees who facilitate tax cheating, but it is also too little, too late. In fact, it was announced by the former Chief Secretary to the Treasury a year ago. People want a Government who act on behalf of those who pay their taxes, not those who dodge their taxes in offshore tax havens. Yesterday, my hon Friend the shadow Chancellor set out a clear plan for transparency. He is a Member of this House who has spent all his time in Parliament exposing tax havens and tax avoidance. His paper included a call for an immediate public inquiry into the Panama papers revelations to establish the harm done to our tax revenues and to bring forward serious proposals for reform.
I say gently to the Prime Minister that a tax taskforce reporting to the Chancellor and the Home Secretary, both members of a party funded by donors implicated in the Panama leaks, will be neither independent nor credible. So will the Prime Minister back a credible and independent public inquiry into the abuses revealed by the leaks?
Our task transparency plan called for a specialised tax enforcement unit to be properly resourced, which is key. Since 2010, there have been only 11 prosecutions over offshore tax evasion—a situation that the Public Accounts Committee described as “woefully inadequate”. Having slashed resources and cut 14,000 staff since 2010, will the Prime Minister today guarantee that resourcing to Her Majesty’s Revenue and Customs will increase in this Parliament?
We support real action to end the abuses that allow the wealthy to dodge the rules that the rest of us have to follow. We need to ensure that trust and fairness are restored to our tax system and our politics and to end the sense and the reality that there is one rule for the richest and another for everybody else. The Prime Minister has attacked tax dodging as immoral, but he clearly failed to give a full account of his own involvement in offshore tax havens until this week and to take essential action to clean up the system, while at the same time blocking wider efforts to do so. There are clear steps that can be taken to bring tax havens and tax dodging under control—[Interruption.]
Order. There is a Minister standing at the Bar shrieking in an absurd manner. He must calm himself and either take a medicament if required or leave the Chamber.
Thank you, Mr Speaker.
I suggest that the Prime Minister’s record, particularly over the past week, shows that the public no longer have the trust in him to deal with these matters. Do he and Conservative Members realise why people are so angry? We have gone through six years—yes, six years—of crushing austerity, with families lining up at food banks to feed their children, disabled people losing their benefits, elderly care cut and slashed and living standards going down. Much of that could have been avoided if our country had not been ripped off by the super-rich refusing to pay their taxes.
Let me say this to the Prime Minister: ordinary people in the country will simply not stand for this any more: they want real justice; they want the wealthy to pay their share of tax just as they have to pay when they work hard all the time.
Let me first join the right hon. Gentleman in congratulating the journalists who have broken this story about this huge cache of information from the Panama papers. What matters now is that that information is shared with the tax authorities, including here in the United Kingdom, so that action can be taken.
The right hon. Gentleman accused me of a distraction, but I have to say that the biggest distraction today has been waiting for the right hon. Gentleman’s tax returns, which we finally got published at about 3.35 pm, after this statement had begun. How incredibly convenient that no one can scrutinise them.
Let me answer each and every one of the questions that the right hon. Gentleman asked. First, he asked whether we would resource HMRC with the right amount of money. We have put £1.8 billion into various initiatives since 2010 to make sure that it has the resources to find this money. That is the first point. Secondly, the right hon. Gentleman asked me about my entry in the Register of Members’ Financial Interests. I have complied with every aspect of that Register, and even before the Labour party’s complaint arrived at the commissioner’s door, I provided her with all the necessary information.
Thirdly, the right hon. Gentleman asked when I made the sale of these shares. I sold the Blairmore shares in January, and I sold everything else in June. Next, he asked me whether I shared a list of these shares with the Cabinet Secretary. It was quite difficult because I had sold them, but I sat down with the Cabinet Secretary and went through all my interests, all my connections, all my friendships and all my family, as all Ministers are advised to do. This was a proper conversation with the Cabinet Secretary that I conducted in that way.
Fourthly, the right hon. Gentleman asked why we were not extending the arrangements relating to the beneficial ownership of companies to the beneficial ownership of trusts. The reason is that we want international action to take place, and the very clear advice that I received was that if we included trusts in our initiative, we would not get any international action. This Government have done more than any other to lead the world and make co-operation happen.
The right hon. Gentleman asked about the tax taskforce. HMRC, the National Crime Agency and others will investigate all the information coming out of Panama, and they have operational independence. If they find people to prosecute, they prosecute them; if they find information of illegality, they act on it. They are independent operationally, and that is exactly what they will do. They will report to the Home Secretary and the Chancellor because we want to make sure that radical action is taken, but they have total operational independence. If the right hon. Gentleman is questioning the professionalism of the Inland Revenue, the National Crime Agency and the Serious Fraud Office, he should not be doing so.
Let me now answer the right hon. Gentleman’s last question, which concerned the action that we have taken in respect of the overseas territories and the Crown dependencies. No Government have done more to encourage them to take part in exchanging information, reporting tax information, and making sure that they give us the information on beneficial ownership. The leader of the Labour party has suggested that we should force them. How is he going to force them? What is he going to do? Have we finally found a potential Prime Minister who wants to give the Falkland Islands back to Argentina and invade Gibraltar? Is that what it has come to?
What we have seen are the Labour party’s true colours when it comes to inheritance tax. If you want to pass your home to your children, Labour will tax it. If you want to help your children, Labour will tax that. We have seen Labour’s true colours. It is the enemy of aspiration and the enemy of families who want to support each other, and that is the real lesson of today.
Several hon. Members rose—
I was going to call the Chair of the Treasury Committee, but he is toddling out of the Chamber.
Well, if you would like to call me, Mr Speaker—
Let us hear from Mr Tyrie. Get in there, man.
Thank you very much, Mr Speaker. [Interruption.]
Order. I am sure that it will be worth waiting for.
It is very good of you to give me the floor, Mr Speaker.
I do not think that the Prime Minister has done anything wrong, except, possibly, to comment on the Jimmy Carr case. Tax evasion is illegal and should be very vigorously pursued, if necessary with criminal prosecution and imprisonment. Tax avoidance is not illegal. If the Government or Parliament do not like it, there is no point in moralising. Does the Prime Minister agree that to deal with tax avoidance we need reform to close the loopholes, and vigorous tax simplification to ensure that there are fewer of them?
I am very glad that my right hon. Friend was detained before leaving the Chamber. I think that he is absolutely right. Tax evasion is illegal, and tax avoidance, if the Government disapprove of it, should be legislated against. That is the approach that we have taken. However, as I have said before and am happy to say again, there are some practices of very aggressive tax avoidance that I think do merit proper questions and then legislative action. To be fair to Jimmy Carr, as soon as it was pointed out that he was in a scheme to reduce his income artificially, he immediately changed his arrangements. He made that very clear, and I pay tribute to him for doing it.
Let me begin by welcoming the Prime Minister’s statement and the new measures that he has announced to deal with tax evasion and aggressive tax avoidance. I also welcome the publication of his tax information, and, indeed, his apology for the way in which he has handled it.
It is estimated that between $21 trillion and $32 trillion of private financial wealth is located, untaxed or lightly taxed, in tax havens around the world. Illicit cross-border financial flows are estimated at more than $1 trillion per year, which is 10 times more than the global foreign aid budgets combined. The Panama papers leak is so large that if one printed the files, the final document would be 650 million pages long. It is right that a special taskforce has been set up to go through the leaked information, and the Prime Minister was right to say that charges will hopefully follow if criminality can be proven.
The public are indignant here and around the world. People are rightly angered by the rules for normal taxpayers being different from those for a small ultra-rich elite, but we must ask ourselves whether the scale of the problem has been taken seriously, because it has quite patently not been thus far, domestically or internationally. The UK bears a particular responsibility given that the UK and its overseas territories and dependencies collectively sit at the top of the Tax Justice Network’s financial secrecy index.
In Scotland, we are confronted by the reality of a small number of landowners owning huge swathes of the country, many through tax havens. From Perthshire to Jura and across Scotland, land is owned through non-transparent firms based in tax havens such as Panama and the British Virgin Islands.
I want to ask the Prime Minister the following specific questions. Will he please revisit his decision not to co-operate fully with European Union partners on overseas trusts? To whom will the welcome register of beneficial owners across all British Crown dependencies and overseas territories be available and when? Will it be publicly available? If not, why not? Will the Prime Minister prioritise bilateral tax treaties with Panama and other tax havens as part of global efforts towards better co-ordination against tax avoidance, and will he regularly update this House on progress? Lastly, given that the UK Cabinet agrees Government policy on tax rules, potential loopholes and arrangements with tax havens, will he ensure that all his Cabinet colleagues confirm whether they have ever benefited through offshore financial dealings?
First of all, let me agree with the right hon. Gentleman that there is no doubt that some bad things are happening in some of these jurisdictions and countries in terms of the hiding of assets and wealth and the avoidance of tax. That is why we want our authorities to go through everything that they can to recover that money. However, just because those bad things are happening, we should not condemn the unit trusts that many investors, such as, as I have said, local government pension funds, trade union pension funds and—who knows—even the pension fund of this House, might well use as a totally legitimate way of investing and then paying tax. I want to make that point.
The right hon. Gentleman also said that we need as many criminal charges as possible. I of course agree with that, but we should not do down the civil action and civil penalties that Revenue and Customs can use. It has 1,100 cases going through and can charge up to 300% of the money.
On whether we have taken this agenda far enough, I would say that this is the first country in the G8 or the G20 to make tax and transparency the No. 1 issue at a G8 or a G20 summit. No one had done it before. We have now done it and it is permanently on the agenda and we see permanent improvements.
I do not think that the right hon. Gentleman is being fair on the Crown dependencies and the overseas territories. For years, there was a reputational and potentially real problem. They have done a huge amount to address that. They are now better placed than other similar jurisdictions. As I said, there are states in the United States of America that have less disclosure and transparency. Let us not be unfair on the Crown dependencies and overseas territories, which we—certainly on this side of the House—are proud to have as part of our family of nations.
As for Scottish trusts and transparency, we are happy to work with and help the devolved Administrations in every way we can. We are also happy to work with and are working with European partners on trusts. My point is that we would not have made any progress on beneficial ownership if we had included trusts in that debate in the G8, but we did make progress for the reason that we gave.
The right hon. Gentleman asked to whom the information about beneficial ownership in the Crown dependencies and overseas territories will be available. It will initially be available to law enforcement agencies, including, crucially, our own. These places are not producing public registers yet. I want them to, but let us be frank: only about three countries in the world, including Britain now, have these public ownership registers. If we had tried to push that on to the Crown dependencies straightaway, we would not have got nearly as far as we have got today. On tax treaties, I am keen that we sign as many as possible. On Cabinet Ministers, I think that the current rules for registering Members’ interests are right, but, as I have said, in the case of Prime Ministers and Chancellors we are going further.
According to the official Office for Budget Responsibility forecasts, we are likely to lose £7.3 billion of tax revenue to multinational companies over the ensuing five years because they will sue us in court and get the European Court of Justice to overturn the taxes we wish to impose, and there is another £35 billion at risk. What can we do here to make sure those companies pay their fair amounts, which this Parliament wants but the ECJ does not?
We took a whole series of actions in the Budget, and of course we have the diverted profits tax, which is a tremendous weapon for making sure these companies pay their tax in the jurisdictions where they are rightly earning the money. This tool of being able to exchange tax information and having a common reporting standard, which is what we set in train in 2013, will make the biggest difference.
One of the main benefits of the journalism that uncovered the Panama papers was that it shone sunlight on areas where some people did not want it to go. The Prime Minister makes great play of saying that his Government have done a great deal to improve corporate tax transparency, but this is nowhere near enough. When is he going to step up and make sure that corporates publish their tax information so that everybody—the public—can see where tax is being paid?
I am not saying that we have a perfect record, but this Government have done more than any previous Government to make this happen. I will answer the hon. Lady very directly: of course our system is based on full disclosure by companies to the Revenue but with a basic deal of taxpayer confidentiality between companies and the Revenue. That is the way our system and most other systems work. That is why the common reporting standards and the exchange of information between tax jurisdictions is so important, to make sure that these companies are telling the truth to us and to other jurisdictions. Only when that happens will we be able to recover the money.
The beneficial ownership register that comes into place in just over six weeks’ time, plus the announcement the Prime Minister has made on Crown dependencies and the new criminal act, will do much to deal with tax evasion. If the House will forgive me, let me say that it will do far more to ensure that the proceeds of crime and of terrorism cannot be laundered through this jurisdiction, which is to be welcomed. I think I should do a little ticking off here, because I know, personally, that we would not have got the agreement with the Crown dependencies without his personal intervention and without his being very tough, and he should be congratulated on that. Just fancy, it was actually delivered without a single shot being fired or the Leader of the Opposition putting boots on the ground!
What my right hon. Friend will remember from his time in government—he is doing a brilliant job as my anti-corruption lead—was that we got the Crown dependencies and the overseas territories around the table in the Cabinet room, on the same day as the trooping of the Colour, I believe, and said, “We have to make these changes. You don’t have to go all the way to publishing registers, although that is what we would like, but you have got to make this information available.” As he says, that will mean not only more tax paid, but greater ability to uncover corruption.
May I ask the Prime Minister some questions about his welcome announcement on Crown dependencies? First, have the British Virgin Islands, Bermuda and the Cayman Islands agreed to compile a register of beneficial ownership? Secondly, will HMRC have access to that register? Thirdly, if he does not succeed in getting those territories to publicly publish those registers, will he use his powers, through the Privy Council, to order the tax havens to publish them?
Basically, we have been asking the Crown dependencies to do three things: one is to exchange tax information, the second is to have a common reporting standard, and the third is to establish registers of beneficial ownership. They have now done all three, so the answer to the right hon. Lady’s first question—have they agreed?—is yes. We still need agreement from Guernsey and from Anguilla, but we hope that that will come in the coming days. The answer to her second question—will our Revenue have access to their register?—is yes, it will. The answer to her third question—will we force them to have public registers?—is we think they should; we think that that is the right way to go. But let us be clear: very few countries in the world—I think Spain, Britain and possibly one or two others—have public registers of beneficial ownership. Our Crown dependencies and overseas territories will now be far in advance of most other countries, so instead of attacking them, we ought to praise them and thank them for what they have done.
Should not the Prime Minister’s critics just snap out of their synthetic indignation and admit that their real point is that they hate anyone who has even a hint of wealth in their life? May I support the Prime Minister in fending off those who are attacking him, thinking particularly of this place, because if he does not, we risk seeing a House of Commons that is stuffed full of low achievers who hate enterprise and hate people who look after their own family and who know absolutely nothing about the outside world?
I am grateful for my right hon. Friend’s support. We have a system for Members’ interests which was put in place at the end of 13 years of Labour Government. I think we should maintain that system. I do not want us to discourage people who have had a successful career in business or anything else from coming into this House and making a contribution. That is why I have said that for Prime Ministers and Chancellors, shadow Prime Ministers and shadow Chancellors, it is a different set of arrangements.
Does the Prime Minister recall that in the time after he became Prime Minister in the coalition, when he was dividing the nation between strivers and scroungers, I asked him a very important question about the windfall he received when he wrote off the mortgage of the premises in Notting Hill and did not write of the mortgage of the premises the taxpayers were helping to pay for in Oxford? I did not receive a proper answer then. Maybe “Dodgy Dave” will answer it now—[Interruption]—and by the way—[Hon. Members: “Withdraw!”]
Order. I must ask the hon. Gentleman—[Interruption.] I do not require any assistance from some junior Minister—an absurd proposition! I invite the hon. Gentleman to withdraw the adjective he used a moment ago. He is perfectly capable of asking his question without using that word. It is up to him, but if he does not wish to withdraw it, I cannot reasonably ask the Prime Minister to answer the question. All he has to do is withdraw that word and think of another.
I think he knows—the word beginning with D and ending in Y that he used inappropriately. Withdraw—it is very simple.
I know what you are talking about, Mr Speaker. This man has done more to divide this nation than anybody else, and he has looked after his own pocket. I still refer to him as “Dodgy Dave”—[Interruption.] Do what you like! [Interruption.]
Order. I am sorry, I must ask the hon. Gentleman to withdraw the word—
Not a chance!
The Speaker ordered Mr Skinner, Member for Bolsover, to withdraw immediately from the House during the remainder of the day’s sitting (Standing Order No. 43), and the Member withdrew accordingly.
Needless to say, no reply is required to that question.
Well, it is a shocking scandal: we now know that the Prime Minister divested himself of all his shareholdings before he became Prime Minister and has paid his taxes in full.
Shocking. However, there is a wider question that I would like to put to the Prime Minister, and it follows the question from the Chair of the Treasury Committee. As long as we have the longest tax code in the world after India, will not hard-working families always use legitimate ways to try to minimise their tax bill? Some of us have been arguing for years for a flatter tax system to merge rates. Let me give the Prime Minister a suggestion. The best way to stop people avoiding the payment of inheritance tax—that iniquitous tax—it is to abide by our manifesto commitment and abolish it.
I am grateful to my hon. Friend for his support. We met our manifesto commitment on inheritance tax, which was to exempt the family home. My hon. Friend is right that we need to simplify, but there are things moving in different directions. We want to simplify taxes, but when we see abuses occurring, we sometimes need to write new tax code to make sure that those abuses cannot be used, which can lead to complications. However, I am well aware of his general point, and I think he is right.
Will the Prime Minister now answer a question that both he and the Chancellor refused to answer a few years ago, and confirm that they both benefited personally from their cut to the top rate of tax? On the day that universal credit cuts mean that part-timers could be over £1,000 a year worse off, does he think that the several thousand pounds a year from which they both benefited is fair?
The information is contained in my tax return, which is in the House of Commons Library, and everyone can go and look at it. The key point is not only that since we reduced the top rate of tax from 50p to 45p we have not only raised more revenue, which we can spend on the public services that the right hon. Lady supports, but that the richest 1% in the country pay a higher overall percentage of income tax at 27%.
Will my right hon. Friend clarify again the fact that tens of millions of our fellow citizens benefit from tax-exempt investments, as most pension schemes do not pay tax on their investment income, which directly benefits hard-working people saving for, and receiving, pensions?
My right hon. Friend is absolutely right about that. I would reinforce the point that many millions of our fellow citizens own shares, and many people choose to make their investments through unit trusts, which are a relatively safe form of investment because they share the risk. Many unit trusts are listed in other countries—many of them now in Dublin—and they are set up in that way not to avoid tax but to make sure that the revenues are returned to the unit trust holder who then pays tax, which is the key point.
Does the Prime Minister accept that the revelations last week that he intervened personally in 2013 to water down the effects of EU transparency rules on trusts damages his efforts to portray himself as some kind of champion of fair tax? Will he now commit to fully supporting EU transparency rules, including country-by-country reporting by corporations showing exactly how much profit they make and where?
Let me be absolutely clear with the hon. Lady. There were no EU proposals—the whole thing was based on a British proposal or initiative to encourage all countries to have registers of beneficial ownership. The EU then joined in and suggested extending it to trusts, and we pointed out that if that happened no one would take it up because trusts, as she knows, are set up for all sorts of reasons: the care of a disabled child, support for a local school—any number of things that are perfectly reasonable under English common law. The advice I had was that if we went for beneficial ownership of companies and trusts, the move that we have made, which is genuinely helping to change the world in that regard, would have completely failed.
Will my right hon. Friend encourage the Leader of the Opposition to write to him to set out in detail the allegations he makes against him, either of breaking the law of propriety or the rules of this House? Having listened carefully to the Leader of the Opposition, I fail entirely to comprehend what he is going on about.
On a separate issue, I am glad to see my right hon. Friend stand up for the overseas territories. He will know that when I was Attorney General, I had quite a lot of dealings with the Attorneys General of the overseas territories in encouraging them to change their transparency rules. In fact, they showed themselves to be properly responsive to those representations. He may also agree with me that the overseas territories are entitled to provide financial services and not to be damned for trying to ensure the wellbeing of their own citizens.
My right hon. and learned Friend is absolutely right. What we have tried to do with the overseas territories is to say that there is a perfectly legitimate business of providing financial service, but they, like us, should be doing it on the basis of high standards, not low standards. I think that is an argument that they now accept and are carrying out, and we should thank them for it. As for the first half of my right hon. and learned Friend’s question, I listened to the right hon. Gentleman, and I am not sure I want to read all about it again in a letter because I do not think there is much to answer.
One could be forgiven for believing that the only virtue was transparency, but privacy and equality are both important virtues that we value in this country. Does the Prime Minister agree that given the many thousands of opinion formers, policy formers and decision makers in this country paid publicly through private service companies, if we are to set any principle, it should be that with public finance comes public transparency—who is paid what by us, the taxpayers? If we can establish that principle first, we can have a wider discussion about transparency.
I agree with the first half of the hon. Gentleman’s question: there is a value in privacy. That is why I think we need a balance between what is disclosed and what is not disclosed. I have tried to set out the way forward today. On the hon. Gentleman’s point about private service companies, the Chancellor had something to say about that in the Budget. There is a case, particularly where public money is involved, for making sure that people declare these arrangements in the proper way. The changes that the Chancellor has spoken about will make sure that whether someone chooses to have a private service company or chooses to be self-employed, the amount of tax that they pay will be much more similar.
I welcome the Prime Minister’s announcement that there will be a new criminal offence applying to corporations that fail to prevent their representatives from criminally facilitating tax evasion. That reflects the failure to prevent bribery offence which already exists under the Bribery Act 2010. There are nearly 40 other economic crimes listed in the Crime and Courts Act 2013, which are susceptible to deferred prosecution agreements. Will my right hon. Friend have discussions with the Ministry of Justice and the Law Officers to make sure that we can add not only the tax offence that he refers to but those other economic crimes, so that they can be dealt with under the “failure to prevent” system?
My right hon. and learned Friend has much expertise in this area. I think the point he is making is that as we set out these economic crimes—the Home Secretary has led the charge to ensure that we address this issue properly—we make sure that they are properly publicised, properly understood and then properly prosecuted. We need to make sure that the National Crime Agency and the Serious Fraud Office work together in the way that I know he was keen to see when he was doing that job.
The Prime Minister says that he is leading on international efforts to crack down on tax evasion, so can he explain why he wrote to the then European Council President Herman Van Rompuy in 2013 and asked him to water down the impact of EU transparency rules by treating trusts differently from companies in anti-money laundering rules, despite warnings that such a move could create loopholes for tax dodgers?
With great respect to the hon. Lady, I have answered that question several times, most recently to the leader of the Green party. We were keen to get progress on the beneficial ownership of companies, and if we had accepted proposals to include trusts, that would have got completely bogged down and would not have made nearly the progress that we have made. We have got every G7 country and most G20 countries signing up to having action plans on beneficial ownership of companies. If we did that with trusts, my advice was that the whole thing would have slowed down to a trickle and we would not have got all the international co-operation and all the extra money that we are going to raise.
As far as I am concerned, it is perfectly clear that neither the Prime Minister nor his father has done anything wrong at all. In his statement my right hon. Friend said that we must defend the right of every British citizen to make money lawfully. That is something that I agree with wholeheartedly, but it is slightly at variance with the description of people who have done just that as morally repugnant. Will the Prime Minister give us a promise that from now on he will uphold the rule of law and the view that the rule of law is what is important in this country, and not question the morality of people who act lawfully with regard to their tax arrangements?
I am grateful to my hon. Friend for his support, and I agree with what he says about the importance of enabling people to make money within the law; he is completely right that the rule of law is what matters overall. The simple point that I have often made, and which I will continue to make, is that of course it is tax evasion that is illegal, not tax avoidance. There are many ways that people avoid taxation, not least by putting money into a pension or an ISA, or by other perfectly legitimate ways of planning for their future, that of their family and all the rest of it. However, we have sometimes seen very aggressive measures—I mentioned some of them in my statement—such as putting properties in company envelopes in order to avoid paying stamp duty, where it is sometimes difficult for the Government to catch up quickly enough with the huge changes taking place. I think that a bit of leeway on that is necessary, but my hon. Friend is right: it is the rule of law that matters.
Does the Prime Minister not realise that there is a world of difference between the vast majority of our constituents who pay their tax in the usual way, it being deducted at source or by other means, and the very rich tax spivs who use tax havens for obvious reasons? That is why the accusation is made about them and the people I have referred to.
Of course there is bad practice, not least in some of these jurisdictions, and that needs to be dealt with. That is what tax transparency, the sharing of information, the registers of beneficial ownership and all the rest of it are about. The other thing to recognise that happened last week is that the £11,000 personal allowance came in, so people can now earn £11,000 before having to pay any income tax at all. That completed our work of taking 4 million of the lowest paid people in our country out of income tax altogether.
The Prime Minister has paid his taxes and behaved perfectly properly, and I commend him for standing up to those who have sought to besmirch his father’s reputation and memory. Will he remind us how much extra money has come into the Exchequer as a result of his Government’s closing the loopholes that were set up under 13 years of Labour government?
The point is that we raised an extra £12 billion in the last Parliament, and we want to raise another £16 billion in this Parliament, stretching out to 2021 the figures that I gave. Also, by having a lower rate of corporation tax, we have actually seen more corporation tax come in. Low tax rates, but tax rates that people pay—those are our watch words.
We have heard that the rule of law is paramount. The Government control what is legal and illegal in tax law. Can the Prime Minister guarantee that the law will make offshore tax dodging in all its forms illegal?
Evading tax is already illegal, whether it is done in the UK or elsewhere. The point that I have been making is that we need to have this information sharing and the ability to look at information in these jurisdictions, in order to see whether people have been evading tax, and that is what we are now getting. But we should not use that to say that it is wrong for people, trade unions, companies or pension schemes to invest in unit trusts listed in other countries, because that is a perfectly normal way of investing.
May I congratulate my right hon. Friend the Prime Minister on bringing transparency to the office of Prime Minister by publishing his own tax return? Does he have any thoughts on whether that should be extended to former Prime Ministers, many of whom still receive public money? Personally, I would be very interested to see a tax return of one Mr T. Blair.
I have no proposals to make in that regard. I am not claiming to have some perfect record, but on becoming Prime Minister I cut the Prime Minister’s pay by 5% and froze it for the Parliament, I rejected the Prime Minister’s tax allowance of £20,000 a year, and I reformed the Prime Minister’s pension so that it is now contributory for the first time. As Mr Speaker knows, the Speaker, the Lord Chancellor and the Prime Minister have all given up the great offices of state pension that used to give half their salary in perpetuity—[Interruption.] Opposition Front Benchers say that that was done by the Labour party, but it was not actually brought in until I became Prime Minister. I did it. All those steps have been taken, which I think was the right thing to do.
Will the Chancellor of the Exchequer be clarifying the tax situation of his family company, Osborne and Little, which he holds shares in, but which has paid no UK corporation tax in seven years?
The Chancellor’s family firm is exactly the sort of manufacturing small firm we want to encourage in our country. For many years, I gather, it has not been making a profit, but I am glad that the company is doing well and now paying a dividend—that is something we should welcome. Its tax matters are entirely a matter between the company and the Inland Revenue, and that is the way it should be.
I join other Conservative Members in welcoming the Prime Minister’s statement this afternoon. When he meets world leaders in London this May for the first global anti-corruption summit, will he press them to agree actions to expose corruption, wherever it exists?
It is good that we are having this summit. As I am writing in a document that will be released before the summit, no country, no politician—no one—can claim that they have a perfect and unblemished record in this regard; all countries are battling against these problems, as we did in the House of Commons with the problems of expenses and all the rest of it. However, I want to encourage people, and the Prime Minister of Afghanistan and the President of Nigeria are contributing, and they are admitting that their countries are rife with corruption and it needs to be dealt with. The problem is that, if nobody actually stands up and talks about these issues and sets out the action plans for delivering on these issues, nothing will get done.
At the last count, 36,364 properties in London were owned by offshore companies—that is one in 10 in one London borough and 7% in another London borough. We should know who owns those properties. Many believe that this is about dirty money from countries such as Russia and from the middle east. This is driving up costs, with a 50% increase since 2007. What is the Prime Minister going to do about dirty money propping up the London property market?
The first thing, which we have already done and which has had a huge impact, is to say that, if a company owns a property in a so-called envelope structure, so that we cannot get to the name of the person who owns that property, they have to pay an annual stamp duty charge of something like 15%. That has been a massive money raiser, providing money to spend on public services, and a huge disincentive for that sort of behaviour. However, I want to go further; as I said in my speech in Singapore, we need to have more information about who owns what in our country.
May I thank the Prime Minister for his very clear statement? This afternoon, I received a furious email from Martin in my constituency, who said he watched the “Murnaghan” show on Sky News yesterday. He was shocked that the shadow Chancellor
“deliberately misled viewers...His ignorance, whether deliberate or not, should be exposed in Parliament. For a Shadow Chancellor to be so blatantly misleading is not acceptable. The Marxist Moron’s political motivations are obvious but not an excuse.”
He adds that the Prime Minister
“could not have paid inheritance tax even if he wished to as the tax is levied on the estate”—
Order. I am extremely grateful to the hon. Lady. As the Clerk has just pointed out to me, however, this is all very well, but it is nothing to do with the responsibility of the Prime Minister. [Interruption.] Order. Do not argue with the Chair—that is not a wise course of action. The Prime Minister is not responsible for what the shadow Chancellor has said. I say that to the hon. Lady kindly but with some authority in these matters, believe me.
No one in this House should have to feel that family members are being attacked unfairly, and, in that, the Prime Minister is absolutely correct. May I tell him, though, that it is not clear to me what he believes about holding shares in offshore trusts in tax havens? Does he think that that is perfectly okay, in which case, why would his holding them have been a conflict of interest, or does he think that tax havens are a problem that needs fixing, in which case, why did he have such shares in the first place?
That is a very good question. Let me answer it in full, because I think it is very important. Do I think it is okay to own shares in a unit trust that is registered in another country, whether it is in Dublin, Guernsey or elsewhere? Yes, I do. That is why trade unions, companies and pension funds hold such shares. Many people in our country hold unit trusts because—here is the key point—the unit trust does not exist to make money for itself; it makes money for the unit holders, and if the unit holders live in Britain they pay British tax, British income tax, British capital gains tax and all the rest of it. That is why these arrangements have been in place for many years and no Labour Government, Labour policy review or Conservative policy review has ever thought of getting rid of them. It is important that they are administered and run in the proper way. That is my answer to the hon. Lady’s first question.
The hon. Lady’s second question was why, if I thought there was nothing wrong with a holding like that, did I sell my shares because there might be a conflict of interest. I sold shares in every company that I owned, because I thought there were two options: you can either put things into a blind trust, as Ministers in Labour and Conservative Governments have done. There is nothing wrong with that—it is a very good way to go about it—but I thought it may be even simpler and more straightforward to just sell everything, because then I would not own any shares. So, if any of the companies in which I had previously had a shareholding had any dealings with the Government, there was no way that, even if somebody could look inside a blind trust, they could find any conflict of interest. That is why I sold the shares. I happen to think it was quite a sensible thing to do.
Will the Prime Minister confirm that the only irregular thing about the summary of his tax return is the fact that he voluntarily and privately forsook the £20,000 prime ministerial tax-free allowance, which was enjoyed by many of his predecessors, including those from the Labour party? Instead, he rightly focused on increasing the personal allowance so that millions of low-income earners could avoid paying tax altogether. Will he pledge to continue that policy?
I am very glad to give my hon. Friend that reassurance. We have the target in our manifesto of a £12,500 personal tax allowance and we want to meet that. What I did as Prime Minister was the right thing, not least because, as it says in the information from my tax return, there is support for me and my wife from the Conservative party in terms of some of the costs and issues of travel and other things that you have to deal with as the leader of a party. I thought that was a better way of doing it—not taxpayers’ money, but party money, on which I pay a tax charge.
Is it the right thing to do to claim expenses to live in a grace and favour apartment while at the same time making a big profit out of your own main home?
I am a little bit baffled by the hon. Gentleman, because he announced over the weekend that he was going to refer me to the Parliamentary Commissioner for Standards, so one of my office pitched up there this morning with all the information necessary, only to hear that the hon. Gentleman has not actually yet made a complaint. I hope he will find the time later to do what he said he was going to do.
I think the hon. Gentleman has misunderstood. I am very lucky to live in No. 10 Downing Street—actually, Nos. 11 and 12 Downing Street, to be precise. As a result, I receive a benefit in kind, which is calculated at, I think, some £7,000, and I pay a tax on that benefit in kind for living in the house. It is not a subsidy I am getting; it is a benefit, which I am very grateful for, and I give the taxman money in respect of it.
May I tell the Prime Minister that he should not be ashamed that he had the good fortune to be born into a well-off family, and that it is not a sin for his parents, quite naturally, to want their savings to be cascaded down through the generations? He has nothing to be ashamed about, but may I warn him that, no matter how much information he wants to divulge, nothing will satisfy some of those on the Labour Front Bench?
I am very grateful for what my hon. Friend says. I think there is a point at which you have to say that I have published the information that I think is relevant—I have gone back over the last six years —and that is the limit of what I am going to release. Some people say, “Well, what about your wife’s tax return and your mother’s financial affairs?” I really think that there comes a time when we should say that we have a register of Members’ interests. Prime Ministers and Chancellors and Opposition leaders and shadow Chancellors have done more than that, and we should rely on the register of Members’ interests to police the rest of our affairs.
Given that more than half of the companies implicated in the Panama leaks are registered in UK overseas territories and Crown dependencies, does the Prime Minister regret telling this House in 2013:
“I do not think it is fair any longer to refer to any of the overseas territories or Crown dependencies as tax havens”?—[Official Report, 9 September 2013; Vol. 567, c. 700.]
Could he try to rebuild some of the public trust he has lost in the last week by making sure that, particularly in terms of publishing information about beneficial ownership, Crown dependencies and overseas territories follow the UK’s example, and will he take concrete action by putting that at the centre of his own anti-corruption summit next month?
The reason why I made that statement in 2013 was that we had got the Crown dependencies and the overseas territories, for the first time, to share automatically tax information with the United Kingdom Government. That is something that did not happen under the last Labour Government. It is something that we achieved. It was a different approach. Now—the hon. Gentleman is right—we want to go further, and the announcement today set out that not only will they share that information and follow the common reporting standard, but they will give us access to their information about beneficial ownership.
Just so the hon. Gentleman knows how different things were under the last Government, the then Financial Secretary to the Treasury, in response to questions about the overseas territories, said this:
“The negotiation of tax information exchange agreements with other jurisdictions, including the UK, is essentially a matter for the Crown Dependencies themselves.”—[Official Report, 19 May 2009; Vol. 492, c. 1370W.]
He was saying, “Nothing to do with me, guv; it’s up to them.” That is the Government that we replaced. We took a different approach, and we have made a lot of progress.
Forgive my lack of voice. May I say that I totally understand the Prime Minister’s predicament and his instinct to protect his father? I would have done exactly the same. His father did nothing wrong whatsoever.
The Prime Minister mentioned the long and thoughtful debate that is to come. May I say most gently that, when public figures get into trouble, there should be no more knee-jerk reactions, and that a long and thoughtful debate should be had to avoid unnecessary consequences for everybody else?
I thank my hon. Friend for his support. He makes an important point, which is that we should try to make decisions about these things calmly and rationally after debate. I felt, after all the questions that I was being asked, that the right thing to do was to publish the information, but I could not have made it clearer today that I do not want to see that as some precedent that every Member of this House, or indeed every member of my Cabinet, has to follow. We should think very carefully. We have always had a system in this country based on full disclosure to the Revenue but taxpayer confidentiality. Some other countries have complete publication of all tax returns and all tax information. That has not been our way. We have had a different system, and I do not think that we should give it up lightly.
It saddened me that the right hon. Member for Rutland and Melton (Sir Alan Duncan) seemed to suggest that, if someone was not a millionaire, they were a low achiever. Speaking as a low achiever—[Laughter.] The biggest multinational company earns more in a single week than the incomes of all MPs combined. The Prime Minister has spoken before about transparency, and he did so again today. Many of us across the House, from all parties, want to make sure that the country-by-country information that multinationals will be obliged to provide to HMRC will be put in the public domain. Will he or a Minister meet me and other members of the Public Accounts Committee to discuss that proposal?
I have always thought of the right hon. Lady as a high achiever. She certainly put the boot into my predecessor more effectively than I ever did. I remember that very well.
No, not that one. The point about country-to-country reporting is that what we are trying to achieve, as I said in my opening statement, is a common reporting standard, so that companies report to tax authorities in the same way; and the sharing of that information, so that we can see whether company A is paying x amount of tax in one jurisdiction and y amount in the other, and if that is not right, we can do something about it. That, at the moment, is the most powerful way of achieving what we want to achieve. There are those who say that we need to go even further in public declarations of tax. That is a very interesting argument, but let us not make the best the enemy of the good. We have got a very solid way now of making sure that these companies pay tax properly, and I want to see that completed.
Does my right hon. Friend agree that any course of action designed to reduce tax that does not constitute tax evasion must, by definition, be legal, even if some may regard it as aggressive tax avoidance? It is up to this Parliament to legislate to make such courses of action illegal.
My hon. Friend is absolutely right. Where there is aggressive avoidance taking place that is clearly against the spirit of the law, Parliament should act. As I have said many times, that is what the Chancellor has done, and that is what HMRC advises us about. I think that sometimes there are occasions when the tax avoidance is so aggressive that it is right to warn those taking part in it that legislation will follow, and therefore they should not take part in the scheme in the first place. That often happens.
The Prime Minister has described the tax arrangements being discussed today as standard practice and normal. Assuming we are still all in this together, will he issue guidance—perhaps in the form of a leaflet to every UK household—so ordinary taxpayers can find out how they, too, can benefit from offshore tax havens?
The point is that there are many people in our country—I think there are now over 12.5 million shareholders—who hold shares in things such as unit trusts. There is plenty of information about them, and they do not need any from me. The point is that, if you invest in one of those and you are a UK resident, you must pay UK income tax and UK capital gains tax, just as you would if you buy a share in any other organisation.
I would not recommend doing this, but, having read back through Hansard over the 13 years of the previous Labour Government, I could not find a single occasion on which the right hon. Member for Islington North (Jeremy Corbyn) raised any of these issues. The closest he came was when he described the Labour Government’s decision to use Orders in Council to take control of the Turks and Caicos Islands as “mediaeval” and “extremely undemocratic”, but he now advocates that policy for all territories. Is it not fortunate that after 2010 we had a Government who actually took up this agenda?
I am interested to see that the right hon. Gentleman has conducted a U-turn because recently he has been suggesting taking control of these territories. I can now see a use for the nuclear submarines as they head off towards the Isle of Man, and as the Corbyn invasion force begins to mass to take over this territory. It is much more sensible to get them to do the things they ought to be doing.
Why does the Prime Minister think so many companies are registered in Panama in the first place, not in London or New York?
The reason why a lot of unit trusts register in different countries—a number of them have been named; right now, many of them are registering in Dublin—is that they want to be able to market their services not simply to UK residents, who pay UK taxes, but to other people. That is why, if we look at the Inland Revenue and the way it arranges this, it actually wants to make sure that UK fund managers can be involved and pay their taxes in the UK, and we can build the investment industry that this country can rightly be proud of.
May I thank my right hon. Friend for his open and frank statement today? In the mind of any reasonable person, he has completely exonerated himself. Will he confirm that, under HMRC rules, all supporting documentation for a tax return should be retained for seven years? Since the Leader of the Opposition was late supplying his tax return, should he be fined?
There is obviously no fine for the fact that the right hon. Gentleman did not come to the House having already published it, although it was disappointing that we got it at 3.35 pm, when I was on my feet. Obviously, the matter of fines for late production of tax returns is a matter for HMRC.
In 2013, the Prime Minister’s colleague Lord Blencathra was found guilty of an egregious breach of the Commons and Lords rules for misleading a Committee of inquiry in 2011 and for taking £10,000 a month as payment for lobbying for the Cayman Islands. He had no punishment from his party, and was allowed to get away with it, with a brief apology to the House of Lords. Will the Prime Minister tell us whether, if in future any parliamentarian in his party uses and prostitutes his privileged position in order to make a private gain, he will act and discipline them?
The point is that we now have rules in the House for the declaration of Members’ interests; we have a policeman, as it were, in terms of making sure that they are properly carried out; and we do have punishments, including expulsion, for misdeclarations and misbehaviour. I am not as familiar with the situation in the House of Lords, but I think it has been moving in the same direction and that is all to the good.
While the conversations about Panama are no doubt interesting to Opposition Front Benchers, one reality check is that most of my constituents who are struggling to get on to the property ladder actually benefit from inheritance as a result of a lot of the tax changes that happened during the previous Parliament. Does my right hon. Friend agree that now is the time to reform inheritance tax further to help more people, mainly those of my age, to get on to the property ladder?
There is a role for making sure that people can pass on the family home exempt from inheritance tax. That is why we have set out steps during this Parliament to make sure that can happen, completing what was set out in our manifesto.
The public would be more inclined to take the Prime Minister at his word when he says that he wants to clamp down on tax avoidance had his Government not appointed Edward Troup as executive chair of Her Majesty’s Revenue and Customs in 2012. This is someone who said:
“Taxation is legalised extortion and is valid only to the extent of the law.”
Will the Prime Minister say what source of money he got to pay Mr Troup? Does someone with those views belong in HMRC?
Edward Troup is a dedicated public servant who does a very good job for HMRC. As reports in the papers this morning pointed out, he had a commercial career at Simmons and Simmons, one of the most respected City legal practices there is. Frankly, it is a good thing if we can attract people from private practice into HMRC to make sure that we collect all the money we should.
Will the Prime Minister assure the House that any future changes to taxation will do nothing to diminish the aspiration of working families, so that those families who want to do the right thing—provide for their future, save for their retirement and pass something on to their children—can continue to do so?
My hon. Friend is absolutely right. Our reforms to inheritance tax and pensions are enabling people to take and spend more of their own money as they choose. People are also able to pass that money on to their children and to help with those key purchases such as the first home or the first car, helping young people with their families. Having all of that wealth cascading down the generations, and helping people to do that, is absolutely part of our goal.
I welcome, of course, the Prime Minister’s announcement that people will be criminalised if they assist with tax evasion, particularly as that was announced by the then Chief Secretary to the Treasury, Liberal Democrat Danny Alexander. Will the Prime Minister revisit other Liberal Democrat proposals put forward in coalition to see whether they can also play a significant role in dealing with the really difficult issue of tax evasion?
It is certainly true that the coalition Government achieved a lot in this area. That agenda was led and driven by myself and the Second Lord of the Treasury, in particular at the G8 and the G20, but at the time we had the full support of our coalition partners.
I welcome my right hon. Friend’s statement, and I listened carefully to the Leader of the Opposition. Does the Prime Minister share my concern that the Leader of the Opposition seemed to forget—possibly he is unaware—that aspiration, determination and the prospect of eventual financial reward are ingredients of our strong economy, leading to jobs and incomes for many? Does my right hon. Friend agree that we should condemn the politics of envy, and will he stick to the politics of opportunity and aspiration?
My hon. Friend is absolutely right. We want an aspiration and enterprise society, in which we set low tax rates and encourage people to make the best of themselves, for their families. That will build not just a stronger economy but, in my view, a stronger society.
The Prime Minister referred to his anti-corruption summit. Will he tell us which countries will be represented there? Will an invitation be extended to either President Putin or some of his corrupt cronies, and those who fund the RT propaganda channel, to explain the $2 billion held in Panama by that corrupt regime?
The hon. Gentleman has been restored to rude health. I welcomed him earlier, and I know that the Prime Minister will welcome him.
I am glad to see the hon. Gentleman back in his familiar place. It is fair to say that the guest list for the anti-corruption summit is still being worked on. The point is that we will ask people not on the basis that they run perfect countries or perfect Governments but on the basis of whether they will commit to public declarations on things like open beneficial ownership registration, sharing tax information, and making sure that when assets are looted we can confiscate them and restore them to the people they belong to. If countries want to sign up to that, we will be encouraging them to come and do just that, however imperfect their record may have been in the past.
My mother spent 32 years working in an ICI factory. She is 81 and, like the Prime Minister’s mother, she has lost her husband and wants to hand some of that money down to the next generation. Some remarks from over the past few days must have been deeply hurtful to the Prime Minister, and I urge him to tell the House what message we want to send to millions of people in our constituencies who want to do the right thing by the next generation.
I am grateful for my hon. Friend’s remarks, and I am sure that my mother will be too. She said that like me, she is developing a thicker skin with every week that goes past. He is right to say that many people want to pass down wealth, assets and help their children in all the ways they can. That is not something we should be ashamed of; it is something that we should actively encourage, because it can help to build the strong society that we want in our country.
The Prime Minister acknowledged in his statement that under current legislation it is difficult to prosecute companies that assist with tax evasion, and I and many others—including the right hon. and learned Member for Harborough (Sir Edward Garnier)—would add fraud and corruption to that list. The Government promised in their manifesto to extend the new corporate offence to deal with all economic crime, not just tax evasion. Will the Prime Minister commit today to reviewing urgently the current position, and to extend the offence of tax evasion to incorporate fraud and corruption?
The hon. Lady makes an interesting suggestion that I will consider carefully. We have announced our proposal, and identified an opportunity in the Gracious Speech to include that measure in a future Bill. At that time we can consider an extension and a tidying up of the offences so that they can be used in the same way, and I will look carefully at what she suggests.
Several hon. Members rose—
Order. I am sorry to disappoint remaining colleagues, but we have had a full exchange and must now move on to the second statement.
UK Steel Industry
With permission, Mr Speaker, I will make a statement on Britain’s steel industry.
We are all familiar with the perfect storm of factors that led to the global price of steel collapsing during 2015, but for all the economic challenges that we face, the real tragedy is a human one. Over the past 11 months I have visited steelmaking communities across the UK. They are very different plants in very different places, but one thing that unites them is the pride and dedication of the highly skilled people that I met. All they want is to carry on doing what they do so well, and I am doing everything I can to help them do that.
I will speak first about Port Talbot. Since becoming Business Secretary I have been in frequent contact with the senior management of Tata, which included several meetings with the group’s chairman last year and this. Several weeks ago, Tata told me in confidence that it was seriously considering an immediate closure of Port Talbot—not a sale, a closure. That could have meant thousands of hard-working men and women already out of a job, and thousands more facing a very bleak future. I was not prepared to let that happen, and in the days that followed, I worked relentlessly to convince Tata—[Interruption.]
Order. The statement must be heard. The record shows that the Chair always facilitates a full and thorough interrogation, and although the Secretary of State would expect nothing less, he is entitled to the courtesy of being heard.
Thank you, Mr Speaker.
In the days that followed, I worked relentlessly to convince Tata that it was in everyone’s interest to keep the plant open and find a new buyer. I also made it clear that the Government are totally committed to supporting and facilitating that process. That work has paid off. Last month Tata announced its intention to sell the plant and its wider UK assets, rather than to close it. Since then, I have continued to meet its executives here and in Mumbai, and I was joined in that by my right hon. Friends the Secretary of State for Wales and the Minister for Small Business, Industry and Enterprise. We have secured assurances that Tata will be a responsible seller and allow appropriate time to find a buyer.
The formal sales process begins today. I have been in contact with potential buyers, making it clear that the Government stand ready to help. That includes looking at the possibility of co-investing with a buyer on commercial terms, and we have appointed EY as financial advisers on behalf of the Government. Commercial confidentiality means that I cannot go into detail about ongoing discussions. However, I will update the House as soon as it is appropriate to do so. Let me also take this opportunity to thank the First Minister of Wales for all his hard work so far. His support in these talks has been invaluable.
I shall turn now to Tata’s long products division. I am sure that all Members will join me in welcoming today’s news of a conditional agreement between Tata and Greybull. That agreement will protect jobs and minimise the cost to taxpayers. We have been closely involved in the sales process from day one, including making a commercial offer on financing if required, and we will continue to work with those involved to make sure that this deal gets done.
Moving on to Scotland, on Friday we saw Liberty House receiving the keys to two Tata mills, in Motherwell and Cambuslang. That is a great result for the people of Scotland, and the Scottish Government deserve thanks for helping to secure it.
Since January, the global price of steel has started to recover but it is still a long way from its pre-crisis peak. So there has been some positive news for Britain’s steelmakers, but our support for the industry and the supply chain continues. The Steel Council, which met for the first time early last month, is bringing together Government and industry to find solutions. We have also been working closely with the unions, and let me take this opportunity to thank Community in particular for its positive and constructive approach.
We have also taken action on power, and £76 million has already been paid to steelmakers to compensate for high energy bills. We expect to pay more than £100 million this year alone. We have also taken action on procurement. New rules will make it easier for the public sector to buy British, and we are leading calls for EU action against unfair trading practices. We voted in favour of anti-dumping measures on wire rod and on steel pipes in July and October last year, and we voted in favour of measures on rebar and cold rolled products in February this year. These measures are already having a real effect, with rebar imports down 99%. However, we are still looking at ways of improving the EU tariff mechanism so that we can help the steel industry without harming other sectors, and I am happy to hear any suggestions from hon. Members on that front. Let me be very clear on this: we have repeatedly demanded and voted for tariffs on unfairly traded Chinese steel and we will continue to do so.
I would love to stand here today and declare that this crisis is over, and to say that not one more job will be lost in Britain’s steel industry. That is not a promise that I or anyone else in this Chamber can make, but this Government have consistently done all we can to support Britain’s steel industry and I can promise that we will continue to do so. We know that there are no easy answers and that the challenges facing the industry are vast.
Too many jobs have already been lost, but where that has happened, we have worked to ensure that nobody is left behind. For example, we committed up to £80 million to help those affected by the closure of Redcar and we stand ready to support steel communities facing redundancies, wherever they might be. However, that is something that I will do everything in my power to prevent, because Britain’s steel industry is a vital part of our economy. I want to secure its long-term future and to see “Made in Britain” stamped on steel that is used around the world. I want to protect the jobs of the skilled men and women who work in the industry because the people of Port Talbot, of Scunthorpe and of the steelmaking communities across the UK deserve nothing less. I commend this statement to the House.
I thank the Secretary of State for his statement and for giving me advance sight of it. I also welcome the good news today on the sale of the long products division at Scunthorpe after nine months of negotiations. I note that the Business Secretary is claiming this as a Government success. In fact, it is down to the hard work of the steel unions and the plant management, one of whom has said:
“We needed massive help from the Government and that has not been forthcoming”.
Since the House rose for the Easter recess, the problems in the UK steel industry have turned into a full-blown existential crisis, and the Government and this Business Secretary have been found wanting. When I met workers at Port Talbot on 18 March, it was obvious that the mood was darkening, and they were increasingly worried about the likely outcome of the Tata board meeting on 29 March in Mumbai. Indeed, my hon. Friend the Member for Aberavon (Stephen Kinnock) was so concerned that he flew to Mumbai with the general secretary of the Community union to meet Tata directly.
Where was the Business Secretary at this crucial moment? Was he fighting tooth and nail to ensure the future of a UK foundation industry? He was not. We all now know that he was on his way to Australia to fulfil a few pleasant engagements down under, outrageously leaving his junior Minister to take all the flak back home. It is this laissez-faire approach—this incompetence, this inaction—that has characterised his response to the crisis from the beginning. He has claimed he was caught unaware by Tata’s decision to sell its entire UK steelmaking operations, putting at risk up to 40,000 UK jobs, but Labour Members have been warning for months that there was a gathering emergency and that it was coming to a head. Labour MPs have raised steel issues no fewer than 200 times since the general election a year ago and we have been fobbed off with warm words and no effective action month after month. The Business Secretary’s indifference destroyed the prospect of future steelmaking in Redcar, an act of industrial vandalism that will not be forgiven in the north-east for a very long time.
The Government have been accused of “floundering” and issuing “contradictory and meaningless statements”, and that is by one of their own Back Benchers, the hon. Member for Wellingborough (Mr Bone). Since the steel crisis made the front pages, we have had a sudden shift from torpor to hyperactivity. From an ideological disinclination to get involved because of their free market dogma, there appears at last to be a recognition by the Government that this could be an existential moment for the whole of the UK manufacturing base. I welcome the long overdue admission from the Government that it is their duty to help to find a future for UK steelmaking. I just hope it is not a case of too little, too late. If the Business Secretary is now finally telling the House that he has suddenly overcome his ideological distaste for Government action, then we say, “About time.”
Given that the Scunthorpe deal took nine months, can the Secretary of State tell the House how long Tata is willing to keep the Port Talbot plant operational while a buyer is found? Will he confirm that it is the Government’s intention to ensure that any sale is of integrated operations? Does the Secretary of State agree that if jobs and skills are to be retained in the industry, it is crucial that the UK retains the capacity to make as well as recycle and process steel? What steps will he now take, therefore, to ensure that the blast furnaces at Port Talbot will remain in operation under a new owner? What support are the Government willing to make available to assist in securing a successful sale to a responsible owner?
If he has not already done so, will the Secretary of State undertake today to contact all those in the current customer base and reassure them that the plants have a viable future and will remain open for business, so that they can be confident enough to continue placing orders? What is the Government’s plan B for UK steelmaking if no responsible buyer can be found in the timeframe immediately available? The Business Secretary has previously ruled out temporary nationalisation, but his junior Minister has not. Which is it?
On the dumping of Chinese steel, will the Secretary of State now urgently reconsider his opposition to the repeal of the lesser duty rule? Will he do so especially in the light of the tariffs that the Chinese have provocatively imposed on some EU-produced specialist steel?
Finally, on procurement, the coalition Government scrapped the defence industrial strategy, which made British jobs and industries the first priority in all decisions on Ministry of Defence contracts. With a £178 billion MOD budget for defence equipment over the next 10 years, will the Government now change that and ensure that this investment supports the British steel industry?
It is a shame that the hon. Lady has taken this attitude. Instead of working together, she seems much more interested in taking cheap political shots—at the process, rather than the substance. I suggest she learns from her friend the First Minister of Wales, who has been nothing but constructive and positive in his approach.
The hon. Lady talks about Labour’s long-running concern for the steel industry, so let us look at the facts. During Labour’s last term in office between 1997 and 2010, 40,000 jobs were lost in the British steel industry, with output more than halved. During those 13 years, the hon. Member for Wallasey (Ms Eagle) mentioned the word ‘steel’ twice in the House of Commons, while the current Leader of the Opposition did not manage to mention that word once during that period. The hon. Lady talks about her long-running concern, but in the last Parliament, how many times did the then Leader of the Opposition, the shadow Chancellor and the shadow Business Secretary between them manage to mention the word ‘steel’? Not once—not once in five years. I suggest once again that the hon. Lady should end the cheap political shots and work in a constructive manner with this Government because the hard-working people in this industry deserve nothing less.
The hon. Lady talks about an industrial strategy. We have dozens of sector councils and we set up the steel council. We are interested not in picking winners, but in doing what works—not ideology, but what actually works. Since 2010, manufacturing is up, exports are up and employment is up. For example, our auto and aerospace industries, both users of British steel, are having their best years ever. I suggest that the hon. Lady spend a little less time obsessing about whether this support is called a strategy or a policy and spend a little more time celebrating the stunning success of British industry.
The hon. Lady asked about the actions we have taken so far. Action has been taken on energy costs and compensation for energy-intensive industries, which will now be moving towards a policy of exemption. We have provided flexibility on emissions regulations, and we have changed procurement policies, which now apply to all parts of the public sector. We have taken action on unfair trading, which the hon. Lady has asked for. A total of 37 measures are in place at the moment, 16 of which concern China. When it comes to trade measures, we are interested in measures that actually work. If we look at the measures on rebar, we find Chinese imports down 99%; on wire rod, they are down 90% and on seamless tubes and pipes, they are down 80%.
In determining what works, we will be driven by the evidence. The evidence is clear that so far, the way in which the EU has acted works, but we want it to act faster. As I said in my statement and say again, we are not interested in rewriting the whole rulebook for trade; when it comes to steel, we are interested in taking action that works. If the hon. Lady and others have suggestions that are focused on steel, I will of course listen.
The hon. Lady talked about timing in respect of the Tata strip sale. We have had discussions with Tata. The key discussion was the one that took place in Mumbai where Tata said that, although it does not have an unlimited amount of time, which is something that we of course understand, it is not putting a set timeframe in place, and it will work to ensure that a reasonable amount of time is made available to find a buyer. Today, it will release more information on the sales process. I believe that Tata’s actions will reflect that.
The hon. Lady asked about the support that the Government are willing to provide in order to secure a sale. The Government have been working on this for weeks. Because the decision by Tata was commercially very sensitive, we were not able to discuss it in Parliament earlier. As I have made clear, the Government are looking at a number of areas, including power supply, pensions, plant and infrastructure. In doing so, we will work with the unions, the trustees of the pension plan and the Welsh Government to come forward with the best offer we possibly can.
The hon. Lady asked about nationalisation. Let me be clear: we have not ruled anything out. I have been clear about that. We are also clear, however, that the best steel operators in the world are commercially and privately run and that nationalisation is rarely the answer. We are working towards finding a commercial buyer to ensure the long-term future of Port Talbot and all the other parts of Tata Steel.
I could not be clearer in saying that steelmaking is a vital industry for the UK. It is important for our economic security and our national security. I do not want to live in a country that relies on importing all its steel. None of us wants to do that. That is why we will do everything we can to secure a future for steel, because the hard-working men and women in this industry deserve nothing less.
Does my right hon. Friend agree that Tata is an excellent company that has made a great success of Jaguar Land Rover, turning it into one of the finest car companies in Europe, something that defeated every Government when it was a nationalised industry? Does the fact that Tata cannot make a go of British steel not demonstrate the seriousness of the problems that my right hon. Friend is facing?
Will my right hon. Friend continue to reject the simplistic solutions that are on offer, such as tariff wars on China regardless of whether there is dumping, subsidy competition with Italy in breach of the EU rules on which we have always insisted, and nationalising Tata on the basis that we just carry on paying for the losses, pour billions of pounds into the liabilities at the taxpayer’s expense, and seek to prevent anything from changing? Given that we all want to see the good news in Port Talbot that we have just seen in Scunthorpe, will my right hon. Friend continue to search for a reputable, sensible investor who understands steel, has a proper business plan, and can give a credible future to the best products of parts of this business, which could no doubt have a long-term future if we had the right business plan for it?
I agree wholeheartedly with my right hon. and learned Friend, who speaks with a great deal of experience. Tata—beyond steel, but, of course, including it—has shown itself to be a responsible investor in this country. When I have talked to the workforce, the unions and others at Port Talbot and elsewhere in the Tata group, they have had nothing but good things to say about Tata, its responsibility and its values.
I agree with what my right hon. and learned Friend said about tariffs and being careful to strike the right balance. I also agree with what he said about nationalisation. The way forward must involve a commercial operator: that is how the best companies in the world are run, and that is how we want to see British steel companies being run.
I thank the Business Secretary for giving me advance sight of his statement.
I welcome the news that Tata appears to have found a buyer for its operations in Scunthorpe. I hope that that will prove to be good news, and I hope that the same can be done for Port Talbot and other sites, although there is concern about possible erosions of workers’ terms and conditions as a result of the deal. Let us be clear, however, that this has happened in spite of the Government’s shameful approach to the crisis. They have done as little as possible—as little as they thought they could get away with. The fact that the Business Secretary was literally on the other side of the world at the height of the crisis provides a perfect metaphor, and a perfect personification of the Tory approach to the steel industry.
That contrasts starkly with the proactive, professional and diligent way in which the Scottish Government approached the crisis facing the Scottish plants at Clydebridge and Dalzell. Nicola Sturgeon said that her Government would leave no stone unturned to save a crucial industry, and that is exactly what happened. Liberty House has now bought the sites to maintain a crucial industry in Scotland, and I welcome the Business Secretary’s commendation of those efforts.
SNP Members stand in solidarity with the steelworkers of England and Wales. We hope that the UK Government will now work more proactively and co-operatively with EU colleagues on anti-dumping measures, energy costs and other issues that face the industry, so that there can be a long-term future for a crucial part of the manufacturing sector. Imagine what could have been achieved had the Prime Minister spent the last year touring European capitals and pressing for action on steel, rather than testing the patience of European counterparts and colleagues with his EU referendum gamble.
Will the Business Secretary now publish details of all meetings, phone calls, visits and correspondence involving the steel industry in which he, the Prime Minister, the Chancellor and other members of the Cabinet have engaged with EU and international trade counterparts in the last year? If he has done the work that he claims to have done, he has nothing to hide, and publishing those details may well repair his tarnished reputation.
As I said in my statement, I commend the Scottish Government for what has been done in respect of the two mills in Scotland, but I hope the hon. Gentleman recognises that the scale of the problem in the rest of the UK is a great deal larger, and I hope he can find it within himself to appreciate the challenge that the industry faces throughout the UK in particular.
I think that the hon. Gentleman is wholly wrong to suggest that the Government have not taken action already in providing help for the industry. I gave a number of examples in my statement, but the action on energy prices is making a big difference, and the action on procurement is also making a difference. I urge the hon. Gentleman to work with his colleagues in Edinburgh to see whether they can change their procurement rules to help not only Scotland, but the UK.
Will the Secretary of State look at finding a long-term, cheap energy solution for Port Talbot, which is crucial? What constraints is the European Union placing on aid to the steel industry?
I can give that commitment to my right hon. Friend, who speaks with a great deal of experience both of Wales and of business. He is right to identify energy as an issue. I do not believe that the constraints are coming from the EU, and we have demonstrated that there is action that we can take, but there is more that we can do. My right hon. Friend has good ideas and I look forward to discussing them with him further.
To secure a long-term, sustainable, profitable future for the British steel industry, the focus needs to be on developing high-value, niche downstream products in particular sectors or for particular technologies, collaborating closely with customers in product development and design. Parts of Tata Steel, such as the Hartlepool pipe mill and facilities in Corby, do that, but they are not part of the potential sales process with Greybull Capital or Liberty House, so how will the Secretary of State ensure that the downstream capability in Hartlepool and elsewhere is maintained while a potential buyer is found?
In the Secretary of State’s response to the shadow Business Secretary, he mentioned sector groups. What specific work has he facilitated with industrial strategic sector groups, such as the Automotive Council and oil, gas and offshore wind industrial councils, to ensure closer collaboration with customers and the supply chain in order to provide a great future for British steel?
First, I thank the hon. Gentleman for his approach to this matter, in particular through his chairmanship of the Business, Innovation and Skills Committee. He is right to say that Hartlepool, Corby and other parts of the downstream steel business are where the high-value product is. Tata has made it clear in its approach to the sale that it will not cherry-pick. It knows that the downstream process is important to any potential buyer, so it will ensure that any buyer can purchase the whole group, which is an important commitment that we have managed to secure.
The long-established sector councils cover many different sectors. I mentioned earlier the automotive and aerospace sectors, both of which use British steel. We are working with them on the general supply chain to see how British products, including steel, can be used. We will continue that work.
Does the Secretary of State agree that the best support that we can give the steel industry is a long-term vision that supports a good-quality, private sale with an attractive Government support package and to encourage customers to buy in this country?
I know from my hon. Friend’s work on the Business, Innovation and Skills Committee that she takes an interest in this. She is absolutely right that none of us wants to be back in this situation in one, two or three years from now. We want to find a long-term buyer that will invest in the business. That requires Government support and we are ready to work with that buyer.
Before I start, I want to pay tribute to the 13 steelworkers who are in the Public Gallery today along with the outstanding general secretary of the Community union, Roy Rickhuss. I also want to join the Secretary of State in paying tribute to Carwyn Jones, who has been doing a fantastic job. What a contrast to the British Government. Within days, Carwyn Jones had put £60 million on the table, so he is someone who is actually closing the gap—[Interruption.]
Order. I said when the Secretary of State was speaking that he should be heard with courtesy and the same goes for the hon. Member for Aberavon (Stephen Kinnock). It is not appropriate for people to yell “shame” at an hon. Member who is asking a legitimate question. Learn it.
I hope that the UK Government will take note of the fact that the Welsh Assembly Government so rapidly put £60 million on the table.
The Secretary of State asked for some focused suggestions and questions, so here are three for him. First, what are the Government doing to secure the customer base—key clients such as Honda, Nissan, Jaguar Land Rover? I hope he and his colleagues are picking up the phone to those customers and ensuring that we retain the integrity of the order book. Secondly, on the blast furnaces, I would like to follow up on what was asked by my hon. Friend the shadow Secretary of State. Does the Secretary of State believe that the blast furnaces in Port Talbot should continue as an integral part of the UK steelmaking industry? Thirdly, can he explain why the British Government continue to block the scrapping of the lesser duty rule? The entire industry and the European Commission repeatedly tell us that by scrapping that rule we would give the anti-dumping measures real teeth to deal with the dumping of Chinese steel. Perhaps the reason is that the UK Government would rather cosy up to Beijing than stand up for British steelworkers.
First, let me say that this is obviously a very difficult situation for the hon. Gentleman’s constituents. I am working with him, and I stand ready to work in any way I can to help him and to listen to what he has to say. The meeting I have already had with him was very useful, but I look forward to many more as we jointly try to help with this situation. He asked three questions, one of which was about the customer base. One of the most important things we can do—and we are doing it—is provide confidence that we can help to find a buyer that will secure the long-term interest of the steelworks, because that is what the customer base is going to want. We are in touch with many parts of the customer base—I talked earlier about the auto and aerospace industries—and providing that confidence is going to be key to reassuring them that they do not need to look elsewhere.
The hon. Gentleman asked about the blast furnaces, which I went to see in action just last week. They are hugely important, but I do not think I am in a position to say exactly what the structure of the business should be going forward. We will work with all parties to make sure that we can secure as many jobs as possible and that steelmaking continues. Lastly, he asked about the lesser duty rule. I point out to him that it has been the long-standing view of the previous Labour Government and this Government that in general the lesser duty rule gets the right balance in terms of the interests of industry and consumers. The last two British Trade Commissioners that were sent to Brussels, both appointed by Labour and both Labour peers, strongly supported that rule. As I said earlier, what I am interested in is what actually works to help the industry and what we have seen so far is that the tariffs imposed actually work, leading to massive reductions in Chinese imports.
Labour’s Front-Bench interest in steel production is a new phenomenon; in the last Parliament, the current Leader of the Opposition mentioned steel three times, but only in relation to Trident. Given the recent grandstanding by certain elements of Welsh Labour, does my right hon. Friend agree that this contributes absolutely nothing to assisting the many Tata Port Talbot steelworkers who live in my neighbouring constituency of Gower?
I was pleased that my hon. Friend and I were able to talk in the past few days to discuss his constituents’ concerns. I agree with what he said, but I would like also to take this opportunity to reassure him that we will work closely with him and other Members to bring confidence to constituents that we truly are doing everything we can to help.
There is a real danger that the Secretary of State is at times presenting the idea that everything has been done and that he has done everything in his power. Let us look at the issues facing the industry as a whole. On energy, we still see prices that are 89% higher than those of European competitors. On procurement, the Ministry of Defence is not even keeping records of where its steel comes from; and on tariffs, he says he will do everything, but, as we have just heard, he will not take action to scrap the lesser duty rule and to change it, and this country is being seen as the ringleader on this in Europe. What is he going to change in those industry fundamentals that will prevent us from seeing crisis after crisis after crisis in the steel industry?
Let me pick up on one of the three important issues affecting the industry that the hon. Gentleman has identified—energy costs. One reason why those costs are higher for energy-intensive industries in Britain—in fact, it is the key reason—is the Climate Change Act 2008, which he would have supported and which was introduced by the last Labour Government. [Interruption.] The Conservatives did support it, but ever since we have been working on mitigating some of the problems it created for industry. I would have thought the hon. Gentleman supported that.
We should be under no misapprehension that the future of the global steel industry will be brutally competitive for many years to come. If my right hon. Friend is successful in finding safe harbour for the Motherwell, Scunthorpe and Port Talbot steelworks, that will be a significant accomplishment, but he must do that while upholding the lesser duty rule. The rule underpins free trade and it secures jobs in many other sectors of our economy. Regarding tariffs, some hon. Members have talked about the Americans imposing a 200% tariff, but that that was done solely because the Chinese, on that one issue, provided no information in defence. By the way, in that same instrument, the Americans put a 50% tariff on UK steel manufactured by Tata.
I always listen carefully to what my hon. Friend has to say. He is a respected member of the BIS Committee and he has deep experience in business. He is right to highlight tariffs. The concern for any Government is always to strike the right balance in taking action where there is clear evidence of dumping and unfair trading, but not going any further than that, because the people who pay the cost are consumers. Such measures are like a tax; they are hardly progressive and the poorest are hit the hardest.
Steelworkers watching this debate—including those from Llanwern and Orb in Newport, who have travelled here today as they have many times to press the Government for more action to help the industry—are asking that their businesses, with full order books and assets such as the Zodiac line in Newport, remain saleable in this crisis; that the Government act on the pension fund; and that there is a long-term industrial strategy to give potential buyers confidence. The Secretary of State’s statement has not made clearer what practical measures he will take to do that. Please will he expand on that now?
The hon. Lady is right to raise her and her constituents’ concerns. I reassure her that we are looking at everything. I think she is aware of much of the action we have taken, but I am sure she understands that there is no magic wand here. No Government can make these problems go away overnight. These are international challenges—just in the last few days we have heard about problems in the US, Australia and many other developed economies. If she respects that, she will work with us on trying to find long-term solutions.
I commend the Government on their plans to roll out guidance on procurement practice to the entire public sector. What is my right hon. Friend doing to ensure that UK steel companies are aware of all the bidding opportunities and how they can get in the best possible place to win the contracts?
We were the first EU country to change our procurement rules to take advantage of new flexibility to take into account economic and social factors. We have now extended that to the entire public sector—not just central Government. We are working on the visibility of the pipeline. We have £300 billion of infrastructure planned over the next five years—a huge amount of British business for British steel—and we are working with the industry and groups including UK Steel to ensure maximum visibility.
Last year, the Secretary of State and even the Prime Minister said they were doing everything they could to keep steelmaking on Teeside. Despite knowing for months that SSI was in trouble, nothing was done. Three thousand jobs were lost, 175 years of steelmaking were gone and a town was dealt a devastating blow. So when the Secretary of State says again that he is doing everything he can to help, why should the workers of Port Talbot and anywhere else in the country believe a single word he says?
The hon. Lady has fought hard for her constituents and is still doing a lot to help workers who lost their job. I and my right hon. Friend the Minister for Small Business, Industry and Enterprise have met her and we will continue to work with those who have lost their job—of course we will—but she will also know that the situation at Redcar is not directly comparable with that at Port Talbot and Tata Steel. The business was not viable after hundreds of millions of pounds of investment and no commercial buyers were coming forward. I know it is difficult news, but the hon. Lady knows that. If we look at today’s news about Tata long products, however, we see that it is possible to find a commercial buyer.
I have no doubt that the Business Secretary is focusing on the key issues for potential investors in Port Talbot, including the pension fund and energy costs. As for a bright, long-term future for steel from Wales, may I encourage him to have early discussions with the Chancellor and the Secretary of State for Energy and Climate Change about an announcement on the chair of the marine energy review, particularly regarding the proposed tidal lagoons in south Wales, which would be an enormous boost, both to morale and in practice, to the producers of steel in south Wales?
My hon. Friend makes a good point. Energy is a big issue, and will remain so for all our energy-intensive industries. The tidal lagoon is an important issue. We have begun a feasibility study, and my Department is in discussions with the Department of Energy and Climate Change and the Treasury on that very issue.
May I make it absolutely clear to the House that this is an issue relating not just to Wales or Port Talbot? It is a UK problem, and the Secretary of State will agree that it is a national issue. The 900 steelworkers in my constituency whose jobs are on the line expect him to guarantee that he will do whatever it takes to give them the future that they deserve. There was an optimistic note in what he said. He mentioned co-investment. Will he explain to the House what that is, and whether it guarantees that the Government are willing to intervene and do whatever is necessary to save our industry?
The hon. Lady is absolutely right: this is a UK-wide problem. We have discussed Scotland and, of course, Wales, but it also affects south Yorkshire, Corby and many other parts of the UK so she is right to bring that to the attention of the House.
On co-investment, I said that to demonstrate that when I say that we will look at all options, we really will do so. It is possible—I do not know at this point, because the sale process has only just formally begun—that someone might come forward and ask for investment or funds from Government in lots of different ways. That has to be done on commercial terms, but that demonstrates how far the Government can go to make sure that this deal is successful.
My right hon. Friend will be only too aware that customer confidence, which was mentioned by the hon. Member for Aberavon (Stephen Kinnock), is crucial. Will my right hon. Friend assure the House that he, his ministerial colleagues and officials are doing all that they can regarding existing customers for British steel to assure them entirely and conclusively that the British Government are committed to a long-term future for British-made steel in this country, and that they can feel safe and secure about placing future orders?
I can give my hon. Friend that assurance. He is absolutely right to point out the confidence that customers and, equally, the supply chain need. Suppliers need confidence that there is a long-term business, so we are working with both suppliers and customers to provide that reassurance.
To help prospective buyers, may I ask the Secretary of State whether the UK Government will take on the pension liability of £15 billion for 130,000 Tata workers and former workers, and will they redress the imbalance caused by the reduction of the workforce over many years, as more people now take money out of the scheme than pay into it?
The hon. Lady is right to raise the issue of pensions. I have said before that it is likely that any buyer who comes forward will want some kind of pension solution. It will be a challenge, but I can reassure her that we are looking carefully at that. We are in discussions with pension trustees, and we want to come up with something that will back the members and help to find a buyer.
I am proud of British manufacturing, and I was proud last night when Yorkshire golfer Danny Willett pulled on his green jacket at Augusta, as the cloth in that jacket was woven and dyed in my constituency, on the outskirts of Huddersfield. I am also proud of the HS2 infrastructure project. Will the Business Secretary confirm that he will do everything he can, with the full support of the House, to put British steel at the heart of the transformational HS2 project?
I am sure the whole House congratulates Danny Willett on his victory. On my hon. Friend’s question about HS2, projects by National Rail have used 98% British steel and Crossrail has used 95% British steel. Aircraft carriers procured by the Government have used over 90% British steel, and we will do everything we can to make sure that British steel is used in HS2.
In his statement the Secretary of State admitted that UK Government Ministers knew in advance about Tata’s intentions for Port Talbot, and a Welsh Government Minister recently boasted in the Financial Times that the Welsh Government knew before Christmas, yet neither Government were present at the crisis meeting in Mumbai when the fate of the plants was determined. That does not contrast particularly well with the decisive action of the Scottish Government, who nationalised Tata’s operations in Scotland to facilitate a private sale. Is it a case, once again, of the Welsh economy and the Welsh workforce being let down by a careless Tory Government here in Westminster and by a complacent Labour Government in Wales?
The hon. Gentleman’s comments could not be further from the truth. The meeting in Mumbai that he refers to was a board meeting to decide whether to accept the decision that was being made by the executive management of Tata Steel from the CEO downwards. If the British Government had waited for that meeting and just turned up at that time, it would have been too little, too late. Action was required weeks before that, so when we first heard about closure, we took action. I am sure the hon. Gentleman would agree that a sales process that has the ability to secure the workers’ future is far better than outright closure.
Last week I had a meeting with constituents in Suffolk who are heavily involved in the steel industry. We spoke about now, but we also spoke about the future and how to use innovation more effectively in the sector. Will my right hon. Friend meet me and my constituents with a view to extending research and development credits to the steel sector to support the 21st-century steel industry that Members across the House have been talking about?
My hon. Friend makes a very good point. In some parts of the UK where steel plants are based there are enhanced credits and capital allowances through enterprise zones. She makes an interesting suggestion about R and D tax credits that could help the industry more widely, so of course I will meet her.
When the Secretary of State comes to the Dispatch Box, he has to be careful about what he says. In his statement he referred to the £80 million promised to Redcar. I would dispute that figure in relation to what has been delivered in our area in the past six months. Today in our all-party parliamentary group meeting the Secretary of State did not rule out the option of Tata potentially remaining in situ at all steel sites, not just in relation to strip products. What type of co-investment plans can he put forward to the House so that we can discuss on the Floor of the House the options available for UK steel?