House of Commons
Tuesday 18 April 2017
The House met at half-past Two o’clock
[Mr Speaker in the Chair]
Business before Questions
New Southgate Cemetery Bill [Lords]
Third Reading opposed and deferred until Tuesday 25 April (Standing Order No. 20).
Oral Answers to Questions
The Chancellor of the Exchequer was asked—
The Government are protecting the core schools budget in real terms, reaching almost £41 billion this year. The Department for Education has consulted on a national funding formula to address the current postcode lottery in schools funding. The consultation lasted for 14 weeks, and received over 25,000 responses. The Government are considering the responses carefully, and will publish a response in the summer. For the St Ives constituency, the proposals would mean an increase in schools funding of 0.4%.
The majority of schools in my constituency are rated good or outstanding, due to the hard work and determination of teaching staff and their heads. However, Government funding for schools has not kept up with costs, which, according to the House of Commons Library, increased by 3.4% in 2016-17 and will increase by 8.7% by 2020. What message can I take back to my schools, which tell me they cannot maintain those standards if school funding does not keep up with these increased costs?
The Government do recognise that schools, like other organisations, face additional costs, such as salary increases. That is why the Department for Education is supporting schools to become more efficient, including with over £1 billion of savings from better procurement by 2019-20. It is also worth pointing out that, by protecting the total schools budget in real terms, as pupil numbers increase, so will the amount of money in our schools.
As I have said, the reality is that the total core schools budget is increasing, and it can increase only if we have a strong economy that can pay for it. It is also right that we have a fairer funding formula to ensure that that money is distributed fairly.
The Government are taking action to give the UK the world-beating digital infrastructure that it needs. Broadband across the country has been transformed by the Government-led £1.7 billion superfast programme, extending coverage at 24-plus megabits per second to 95% of UK premises by the end of this year. At autumn statement 2016, we committed over £1 billion more to support the market to deliver full-fibre broadband networks, to enable 5G mobile and to keep Britain at the forefront of the development of the internet of things.
The reduction in business rates on new fibre roll-out is hugely welcome, but will the Chancellor assure me that we will incentivise the roll-out of more fibre in such a way that no tax is paid until the fibre is first used, rather than from when it is first installed?
The Government’s clear intention is to incentivise investment in fibre broadband networks. The Department for Communities and Local Government will shortly publish a consultation on the implementation of this relief, which will set out more detail on how new fibre will be defined, and we look forward to the responses to that consultation.
Why does the Chancellor not shake up some of his colleagues, and start investing in the digital infrastructure in the north of England, in Yorkshire in particular? Will he also look at other infrastructure, such as railways? When are we going to get the electrification of the TransPennine Express route?
At autumn statement, we announced £23 billion of additional investment in our infrastructure, and key priority areas such as research and development, specifically designed to address the UK’s productivity problem. This investment has to be spread across the whole of the UK economy to make sure that we deliver improved productivity and improved economic growth across the economy as a whole. Such investment is going in: public capital investment will be at a higher level in this Parliament following the announcement of this decision than it was before the financial crisis.
While the Government boast about the speed of fibre broadband across the United Kingdom, there are many areas—especially in parts of my constituency—where sending mail by pigeon would almost be quicker than sending it through the fibre network. What action does the Chancellor intend to take to ensure that farmers, small businesses and others relying on digital means of communication in rural areas have a greater ability to deliver such messages?
I cannot speculate on how fast the pigeons are in the hon. Gentleman’s constituency, but I can tell him that all consumers now have a right to 10 megabits broadband. By the end of this year, 95% of properties will have access to 24 megabits broadband. The Government are investing more money to reach the last 5%, the hard-to-reach that are often in rural areas.
In Scotland, the original plan was as for the UK: 95% coverage by this year, additional funding for rural areas, money for wi-fi in public buildings and a superfast broadband target of 100% property coverage by 2021. Given that this should be a common endeavour, will the Chancellor welcome the steps taken in Scotland to deliver on those performance targets?
I thank the Chancellor for that. However, the issue is not simply about the provision of infrastructure, but paying for digital usage. Will he give a guarantee to the House that when the UK Government enter the Brexit negotiations there will be no return to the super-expensive roaming digital phone charges for UK citizens working and living in the EU, and for EU citizens living and working in the UK?
I hear the hon. Gentleman’s concern and I am absolutely sure that the vast majority of our constituents would agree with his suggestion that we seek to maintain cost-effective access for UK phone users whenever they are roaming within the EU. I think that will be an issue for this Parliament post-Brexit unless we choose, in the course of the exit negotiations, to reach a reciprocal agreement with the European Union.
The Government are protecting the total core schools budget in real terms. That is possible only through careful management of the economy. As a result, school funding is at its highest ever level, at almost £41 billion in 2017-18. Spending will increase to £42 billion in 2019-20 as pupils numbers rise. We are also delivering our manifesto commitment to implement fairer schools funding. The recent national funding formula consultation includes generous transitional protections for schools that would see a reduction in their funding. The Government are carefully considering replies to the consultation and will respond in the summer.
The 2015 Conservative manifesto promised that
“the amount of money following your child into school will be protected”.
However, the National Audit Office found that schools face a real-terms cut of 8% per pupil by 2019-20, even before the cuts the new national funding formula will bring to more than 9,000 schools in England. Will the Government therefore confirm that the Tory manifesto pledge on per pupil funding is now in tatters?
The Government are clearly not protecting pupil per capita funding in York, which is currently the seventh-worst funded local authority and will experience a £288 per child cut in funding. How is that protecting the formula?
I would expect the hon. Lady to share my view that it is not right that we fund schools on the basis of what has happened historically. Every pupil in England should be assessed on the same basis. It cannot be right, for example, that pupils in Hackney receive 50% more than pupils in Barnsley. That does not seem to me to be fair and it is right that the Government address that.
Economic Growth Outside London/South-East
The Government are supporting economic growth across the whole country as a key part of our productivity agenda by investing in infrastructure and skills, and by developing our industrial strategy. At the autumn statement, I launched our northern powerhouse strategy and earlier this year set out our midlands engine strategy. We recently allocated a further £1.8 billion from the local growth fund and an initial tranche of £185 million of local transport funding across the English regions.
From Merseyside to Teesside, ports are a great northern success story. Will my right hon. Friend look into the potential for the creation of free ports throughout the United Kingdom? Free trade zones would increase trade, create manufacturing jobs and boost regional growth, which are all key ingredients of our future economic prosperity.
My hon. Friend has made the case for free ports, and the Government have heard that case very clearly. We will consider all options that have the potential to support our ambition to see Britain as a great global trading nation, but before making any decisions we shall need to consider carefully not only the advantages that free ports can deliver, but the costs and potential risks associated with them.
If towns and cities in our economy—including those in the north of England —are to flourish, we need banks and building societies that support them. Does the Chancellor agree that those banks and building societies should keep their branches open? Leeds Building Society has just announced that it will close its branch in Armley Town Street, which is in my constituency, following the closure of branches of HSBC and Yorkshire Bank in the last two years.
Of course we want there to be a viable branch banking network across the country, but we must recognise that the nature of banking is changing. More and more of us are using online digital banking, and that is bound to be reflected in the configuration of the branch networks that the banks operate.
As the entrepreneurial heart of England, Buckinghamshire provides an excellent bridge to the east midlands and beyond. Will my right hon. Friend look into how investment in Buckinghamshire can help to stimulate growth throughout the country, not just in London and the south-east?
I am sure you are delighted, Mr Speaker, that my hon. Friend has lighted on the key role of Buckinghamshire as a bridge between the north, the south, the east, the west and every other part of the country. I should be happy to receive, and I confidently predict that I will receive, my hon. Friend’s detailed submission on the case for greater infrastructure investment in Buckinghamshire.
As the article 50 notice letter set out very clearly, the Government are seeking to negotiate a deep and special partnership with the European Union, at the heart of which will be a comprehensive free trade agreement covering goods, services and networks. That will allow us to continue to work closely with the European Union after leaving the organisation.
The Government do carry out detailed analysis to inform their negotiating strategy, but I am sure the hon. Gentleman would not want me to reveal the outcome of that analysis, which would be of great use to our negotiating partners on the other side. That is not the way to get the best deal for Britain in these negotiations.
My hon. Friend has made an important suggestion, and I will undertake to look at it carefully. No doubt an exercise will take place over the next few weeks that will involve our thinking about what commitments we want to make for the future, and I will take his question as a representation.
An important driver of economic growth, both inside and outside London and the south-east, is productivity. Notwithstanding the rosy picture painted by the Chancellor, the Financial Times’s chief economist says that our productivity performance is “calamitous” and that the disparity in performance has widened regionally. Who do we believe, a respected economist or a backtracking Chancellor?
I do not recognise the picture that the hon. Gentleman paints of my position. I have stood at this Dispatch Box on countless occasions and lamented the fact that Britain has a poor productivity record—worse than Germany’s, and worse than those of the United States, France and Italy—but simply lamenting that fact is not enough. What we must do is put together a plan for tackling it, and it will be a long—
If the right hon. Gentleman checks the records, he will discover that this problem has existed for 40 years. It would be better if we tried to tackle this challenge in a spirit of bipartisan recognition and if we both recognised that there is a real problem that we have to tackle by investment in infrastructure, by investment in skills and by actions to spread growth and prosperity across the country.
Yes, seven years.
Although the £6 billion investment for a new two-mile lower Thames crossing is welcome, how does such imbalanced infrastructure spending help to close the economic gap of regions outside London and the south-east? Does not that simply reaffirm the Government’s pathological incapacity to see much beyond the M25? I will be happy to buy the Chancellor a satnav if he wants to take the opportunity to use it.
I am not going to take any lectures from the hon. Gentleman on regional awareness, but perhaps he should speak to the Mayor of London, who has a view on infrastructure investment and what should drive it. The Government are clear that we need to spread infrastructure investment around the country in a way that will tackle the productivity challenge. One of the ways we will tackle it is by harvesting the benefits of our city regions in the west midlands, in the northern powerhouse and elsewhere, which evidence across the developed world has shown can be major drivers of productivity improvement. That is what we have to focus on.
Probate Registry Fees
As the hon. Gentleman may be aware, the Ministry of Justice recently ran a consultation on this issue and received 853 responses in total. The Government response to the consultation was published on 17 March and is on gov.uk. They have since laid the statutory instrument to implement the changes set out in that response.
The majority of the responses to the consultation were against the proposals because, in a civilised democracy, access to justice should not depend on being rich. Unfortunately, this Government do not agree; they are intent on lessening access to justice by greatly increasing court fees. The increase in probate fees is another stealth tax and one that will affect almost half the estates in England and Wales. It is an attempt by the Government to hide the massive cut in inheritance tax for their rich friends. Will this dying, cut-and-run Government abandon their tax on access to justice?
I certainly do not recognise that characterisation of the fee structure. These fees are about helping to sustain an effective justice system that supports some of the country’s most vulnerable people and victims. It is fair to ask those who can afford to do so to support it. In fact, more than half the estates in England and Wales will pay no probate fees at all.
I reassure the hon. Gentleman that the Treasury and the Department for Exiting the European Union are working closely on that issue. As we exit the EU, we will look to negotiate the best deal possible so that we can continue to work together to maintain justice and security both in the UK and across Europe.
The Panama papers showed that thousands of UK-based banks, accountants, lawyers and other intermediaries have helped to set up shady and opaque corporate structures to handle illicit cash flows after registering in the Crown dependencies and overseas territories. Almost a year on from the anti-corruption summit, will the Minister commit to a public register of beneficial ownership covering the Crown dependencies and overseas territories?
If only we could do that; we do not have the ability to do so. What I can say is that in March 2017 we published the draft money laundering regulations and announced plans for a new watchdog to ensure supervisors and law enforcement work together more effectively. Since 2010, law enforcement have seized £1.4 billion in illegal funds.
The EU is to blame for many things, but it is not to blame for money laundering and, in fact, any solution that looks to the EU to solve money laundering is missing the point that it is an international problem. Therefore, will the Minister confirm that he will be engaging internationally and not through the parochial lens of the EU?
Exiting the EU: Public Finances
We’ll see how lucky, Mr Speaker.
The Government have undertaken a significant amount of work to assess the economic and fiscal impacts of leaving the EU, and they continue to carry out that work. This is part of a continuing programme of analytical work covering a range of possible exit scenarios, including sectoral analysis, but I have to say to the House that we are seeking the best possible deal for the United Kingdom, recognising that there is a range of possible outcomes to the negotiations, and the work being done reflects this. The Government have also committed to keeping Parliament informed, but it would not be appropriate to publish analysis that risks undermining our negotiating position.
Throughout the last seven years, the needs of the British people have had to play second fiddle to the needs of the Conservative party. As a result, the Chancellor has been forced to disown the manifesto commitment to balance the Budget in this Parliament. Is it not the truth that today’s announcement about a general election is another example of this Government putting their party’s interest ahead of the country’s interests at a time when there is a desperate need for stability in this country?
In terms of the effect on the public finances, the decision that the Prime Minister made today is very much in the national interest, to strengthen her hand as she goes into the negotiation with the European Union, to provide a clear mandate for the type of exit that she set out in the letter she wrote to President Tusk two and a half weeks ago, and to ensure that the UK can negotiate its exit from the European Union, execute that exit, and then transition to the new arrangements with a clear run before the next general election.
After that party political broadcast on behalf of the Conservative party, may I ask the Chancellor a very serious question? Many billions of pounds of EU structural funds are invested annually in the UK, particularly in our deprived areas and regions. Wales, and Merthyr Tydfil and Rhymney, have benefited significantly from this funding. What steps will he take to replace this essential investment when we leave the EU?
As we have said on many previous occasions from this Dispatch Box, we recognise that alternative arrangements will have to be put in place. We will no longer be making large subscriptions—payments—into the European Union, but on the other side of the equation we will no longer be receiving some of the funding that we have been receiving for many years, including the structural funds. That places the opportunity back in the hands of this House—this Parliament—to decide how we should use our taxpayers’ funding to achieve the objectives of the UK Government and to achieve economic development in the way that is most appropriate for the UK.
Does my right hon. Friend look forward to getting net £10 billion a year into the Exchequer, and does he note that the claims for tens of billions of euros from our friends in Brussels merely illustrate the financial incontinence on the continent?
Any Chancellor would always welcome any net tens of billions of pounds, or even any net billions of pounds, from pretty much any source whatsoever. In terms of the numbers bandied around in Brussels relating to the so-called exit charge, we should recognise them for what they are: an opening gambit in what will be a long and complicated negotiation—nothing more, nothing less.
Does the Chancellor agree that, whether inside or outside the European Union, the best way of delivering strong public finances is a strong economy supported by low tax and low regulation, and is that the future we can look forward to?
The only way of delivering strong public finances is through a strong economy, with sensible and balanced regulation. We have a very large financial services sector in this country, which is a very important contributor to our fiscal balances, and its success depends on our getting that regulatory equation exactly right: too much regulation and we would drive away industry from London; too little regulation and we may lose our reputation as a safe and secure place to do business. We have to get it right.
The Chancellor recently said that Brussels had set out a very aggressive starting line on the UK’s bill for quitting the EU. What assessment has he made of the worst case scenario, reported to be in the region of €60 billion, and what impact would that have on public finances?
I am not sure what the worst case scenario that the hon. Lady is talking about relates to. We have heard various figures bandied around in Brussels in terms of an exit charge. The work that the Government have been doing—which I was asked about earlier—relates to the economic and fiscal impact of different possible exit scenarios. The numbers being bandied around in Brussels are simply a question of a potential demand which would be raised in the negotiating process, but they are simply that: a negotiating strategy.
I agree with the Chancellor that one of the biggest contributors to the UK’s public finances is the tax revenue that we receive from the financial services sector. Now that we have had the triggering of article 50 and the Government’s White Paper, will he tell us whether he is confident that that revenue will not be significantly reduced, either through the loss of jobs or the loss of any major areas of financial activity?
Yes; the negotiating strategy and the objectives that we have set out in the article 50 letter would create an environment in which the financial services industry in the UK would be able, by and large, to continue the levels of commercial activity that currently take place with the European Union 27. But of course that will depend on negotiating the right arrangements with the European Union, and it is essential that we go into these discussions in constructive mode, recognising that there are real issues on both sides and that the UK’s financial services industry is an asset not only of the UK but of the whole of the continent of Europe. European businesses depend on those financial services.
I share the Chancellor’s assessment that there is a mutually beneficial deal for us and the EU to agree on, if this Government have the ability to deliver it. Will he therefore state unequivocally that, as a result of the deal that the Government will seek to negotiate, there will be no significant loss of jobs in any major financial institutions, no removal of any major City-wide functions such as clearing, and no relocation of any EU-wide regulatory agencies such as the European Banking Authority?
On the hon. Gentleman’s last question, the location of the European Union’s agencies is clearly a matter for the European Union. We cannot credibly seek to leave the European Union and at the same time dictate to it where it should locate its agencies. On the initial items on his list, it will indeed be the UK Government’s objective, as we go into the negotiations, to protect our financial services sector.
Since the EU referendum, the substantial sterling depreciation has seen exports increase and the balance of trade deficit reduce from £13.7 billion in quarter 3 of last year to £5 billion in quarter 4. However, the Chancellor has repeatedly said that he is not concerned about the exchange rate. Is it not just plain wrong to dismiss the significance of the exchange rate?
I have never said that I was not concerned about the exchange rate. I have said that the Government do not take a view on what the appropriate exchange rate should be; that is very much a matter for the markets to determine. I am sure that the hon. Gentleman will have been delighted to note that my right hon. Friend the Prime Minister’s statement this morning has sent sterling up in the markets, demonstrating the confidence that the markets have in a future for this country under a Tory Government with a new mandate.
Tax Evasion and Avoidance
As the hon. Lady would expect, given the emphasis that we have placed on tackling avoidance and evasion during this Parliament and indeed since 2010, the subject is regularly discussed among Cabinet colleagues. With regard to Treasury Ministers’ discussions with their European counterparts, I can confirm that this is something that we discuss with them on a regular basis. Most recently, the Chancellor spoke at an informal ECOFIN in Valletta as part of his regular ongoing dialogue with EU colleagues.
I am glad that everyone seems to be having a nice time having conversations, but as my 2015 Conservative opponent discovered when he came up from Chelsea to fight the Clwyd South constituency, most people in our part of the world work hard and pay their taxes. Will the Minister try again and give us a proper answer as to what is being done about this on an international level?
The question was about what meetings had taken place, and I plead guilty to answering it as asked. If the hon. Lady wants details, she can look at the many measures that have been put through since 2010, and, indeed, already in this Parliament. In fact, if she sticks around for the Second Reading of the Finance Bill, she will hear about even more things that the Government have planned to crack down on avoidance and evasion across the spectrum.
Had the tax gap continued on the trajectory left by the last Labour Government, it would be £47 billion, and the public purse would be £11 billion poorer. Instead, as a result of the policies of this Government, the tax gap is at £6 billion, which is its lowest level ever. Does my hon. Friend agree that talk is the best that some parties can offer on tax evasion and avoidance, and that it takes a Conservative Government to get something done about those problems?
That is exactly right, and this is something that we have taken extremely seriously. The UK’s tax gap is one of the lowest in the world, and it is certainly one of the most transparent and best documented. Since 2010, Her Majesty’s Revenue and Customs has secured £140 billion in additional tax revenue as a result of tackling avoidance, evasion and non-compliance. As I have said, the Government are ambitious to do more.
Economic Growth (South-east Coast of England)
Would you mind, Mr Speaker, if I started by sending my congratulations to Brighton & Hove Albion on their promotion to the premier league? They are an important part of the south-east economy.
At the autumn statement, we allocated £351 million to the south-east from the local growth fund, and the south-east will also benefit from more than £21 million from the coastal communities fund.
I thank the Minister for his response and I, too, congratulate Brighton & Hove Albion. We have just under six miles of motorway in Sussex, and the Brighton & Hove Albion stadium is on one of our motorway junctions. Does he agree that we need to dual the A27 to make the south coast more economically viable? Will he join me in meeting other Sussex MPs to discuss how we can take that forward?
Regional Infrastructure Development
We recognise the importance of infrastructure provision in all regions of the United Kingdom. That is why at autumn statement 2016 we committed additional capital to fund high-value economic infrastructure through the national productivity investment fund. We are committed to putting local and regional needs at the heart of this fund. For example, we are spending £1.1 billion on local projects to improve our existing transport networks. That will deliver improvements to hundreds of roads across the country.
My hon. Friend is a tireless advocate of the case for Southend. Indeed, we met in November to discuss some of these issues. It is worth pointing out that the Government have supported improvements to the A127, with more than £35 million of local growth funding. Furthermore, local authorities will have the opportunity to bid into the £490 million local transport pot as part of the national productivity investment fund.
The Government are investing more than £13 billion in transport projects in the north and supporting local road schemes such as the Manchester airport relief road and the Heysham M6 link road. The Government are also looking at options for the Highways England north-west quadrant that should ease congestion in places such as Westhoughton.
This Government cannot even begin to pretend that they are interested in boosting infrastructure outside London and the south-east. We need only look at transport spending for proof of that. In London, transport spending is £1,000 per head; in the north-east it is not even £300. Does that not tell us about the Government’s record and their priorities?
As I said a moment or so ago, we are investing more than £13 billion in transport projects in the north. HS2 will benefit the north of England. We make no apologies for also wanting to ensure that we invest in Crossrail to deliver for London, yes, but also for the economy of the whole United Kingdom.
Before the last general election, Conservative Ministers were committed to the electrification of the Leeds-Harrogate-York line, on which commuters still suffer from travelling on Pacer trains. Will we do any better after the next general election and finally see the electrification of this line?
As I said, we are investing in our infrastructure. We already had significant plans before the autumn statement, which involved further investment to give us scope to improve our transport infrastructure. It is worth pointing out, however, that aggregate investment in economic infrastructure will rise by almost 60% between 2016-17 and 2020-21.
My hon. Friend makes an important point about interconnection between northern towns. It is worth pointing out that we are putting local and regional needs at the heart of the national productivity investment fund. That is why we are spending £1.1 billion on local projects to improve our existing transport networks.
In the same vein, I congratulate the Economic Secretary to the Treasury’s local team on their success, and I hope that I will be joined in congratulating Livingston FC, who have also gained promotion.
On infrastructure spending, there is no doubt that Crossrail is an engineering feat, but it is costing nearly more than a third of Scotland’s national budget. When will we see more devolution of infrastructure funding—perhaps to fix some of the problems of the Minister’s colleagues?
Scotland benefits from the Barnett consequentials of investment in things such as HS2, which will provide a step change in rail connectivity along the east coast corridor, bringing significant benefits to the UK economy as a whole. However, we can afford to spend money on infrastructure only if we have a stable and strong economy to deliver it.
Tourism: VAT Reduction
The Government have carefully considered the evidence for applying a 5% reduced rate of VAT on accommodation and visitor attractions, which has come up several times in the House, but we believe, on balance, that the costs of doing so outweigh the benefits. We keep all such things under review, but there are no plans for a reduction in the rate of VAT on tourism activity.
That is a disappointing answer. The campaign for a reduced rate of VAT for tourism estimates that a 5% rate would produce a higher tax take and could create 121,000 jobs across the country. That would be of particular benefit to many economically fragile coastal and island communities. Will the Minister meet campaigners to discuss things in more detail?
I am familiar with the right hon. Gentleman’s figures, and Treasury officials have met campaigners over several years to look at them. We will always look at the evidence, but we disagree with the campaign’s economic assessment. Together with HMRC, the Treasury assesses that such a cut would cost around £10 billion a year—approximately £7 billion for restaurants and bars, and about £3 billion for leisure and accommodation.
We look to support the tourism sector in a whole range of ways, and the sector is doing very well. We have seen great increases in the number of tourists, and my hon. Friend is a great advocate for his region. Tourism is one of the highest performing sectors in the economy. For example, the UK has one of the highest VAT registration thresholds in the EU— [Interruption.] The highest. That helps many small businesses that are providing goods and services to tourists without charging VAT at all.
With particular reference to that, does the Minister recognise the additional disadvantage faced by the tourism industry in Northern Ireland, particularly in border constituencies such as mine, given that the VAT rate on tourism in the Republic of Ireland sits at 9% and ours sits at 20%?
We explored those issues when I gave evidence to the Select Committee on Northern Ireland Affairs, so I know what the hon. Lady is alluding to. One example is that the Government’s decision in last year’s autumn statement to focus on investment in infrastructure will result in an increase of more than £250 million to the Northern Ireland Executive’s capital budget, which gives them the means to boost productivity and promote regional growth in Northern Ireland.
In addition to the earlier answer to Question 4, in Scotland and Wales the Government are investing almost £1.3 billion in city deals for Glasgow, Aberdeen, Inverness, Cardiff and Swansea, and we are discussing further deals for Edinburgh, Stirling, the Tay cities and north Wales.
When will the UK Government start to consider the Ayrshire growth deal seriously? The SNP Government back the growth deal and the local councils are all working together, so it is the UK Government who are holding back the delivery.
The UK has spearheaded improvements in the transparency of beneficial ownership information. Her Majesty’s Revenue and Customs is already building a register of trusts with tax consequences, which will improve transparency and assist law enforcement agencies.
The Government recognise the challenge that Britain’s productivity performance represents, and we are resolved to tackle the issue. At last year’s autumn statement we launched the national productivity investment fund to provide £23 billion-worth of additional spending, focused on areas key to boosting productivity. We went further at the Budget by investing an additional £500 million in technical education to ensure that businesses can access the skills they need.
Exiting the EU: Alternative Trade Agreements
As the Chancellor mentioned, the Government have undertaken a significant amount of work to assess the economic impacts of leaving the EU. It is part of our continuing programme of rigorous and extensive analytical work, covering a range of scenarios, as the hon. Gentleman would expect, sector by sector.
Small businesses manufacturing car components in my constituency are hugely concerned that, post-Brexit, this country may have to revert to the World Trade Organisation agreements, which would mean increased tariff costs and further regulation, and could have an impact on the viability of the booming motor industry. What assessment has the Chancellor made of that impact?
Treasury Ministers, and indeed Ministers right across government, are speaking to individual businesses and sectors all the time to understand their concerns about issues of this sort. Obviously, we are seeking the best possible deal for the UK, and all the work being done reflects that, including in respect of understanding how we can respond to those concerns and get a great deal.
My priority is to ensure that the economy remains stable and resilient as we conduct our negotiations with the European Union. That means building upon this Government’s achievements in reducing the deficit by two thirds and getting unemployment down to the lowest rate since the 1970s, while tackling the long-term challenges of productivity enhancement and making steady progress towards our goal of a balanced budget. I am pleased to be able to tell the House that in the past few minutes the International Monetary Fund has upgraded its UK growth forecast for 2017 by 0.5%, to 2%.
Farms and other agricultural businesses are often deterred from making investments in new buildings and infrastructure because of a complex system of capital allowances, including agricultural buildings relief. Will my right hon. Friend examine this issue, particularly in respect of giving the agricultural sector a boost in the wake of Brexit?
Agricultural land and buildings are, of course, exempt from business rates, although I know my hon. Friend was talking in particular about some of the capital allowances. We are committed to a capital gains tax system that supports investment and growth right across the economy, which is why at Budget 2016 we reduced CGT rates from 28% to 20%, and from 18% to 10% for gains on most assets. Owners of agricultural businesses benefit from the same CGT rates and reliefs as other business owners.
As you know, Mr Speaker, this morning the Prime Minister called a general election. She is breaking her commitment not to hold an early election, which was made only weeks ago. She has blamed Brexit, she has blamed our European neighbours and she has blamed the Opposition parties, but the real truth is that after seven wasted years of failure the Tories have failed to close the deficit; they have added £700 billion to the national debt; pay has fallen behind prices; 4 million children are growing up in poverty; our schools are in crisis; more people than ever are on NHS waiting lists; more families are homeless; and more elderly people are not getting the care they need. Will the Chancellor use this last opportunity before the election to apologise to the British people for the utter failure of this Government’s economic policies and for the pain he has inflicted on this country?
The right hon. Gentleman has some brass neck to stand there and accuse us of having failed to eliminate the deficit, given that his policy is to add another £500 billion to it overnight. The British people understand very well what is going on here: we have a Conservative Government who are maintaining growth, and who have got unemployment down and record levels of employment, and a steadily closing deficit; and we have a Labour party which remains as fiscally incontinent as ever and which, if given a chance, would wreck this economy once again.
There we have it: not one word of apology—no contrition whatsoever—from a Chancellor who has broken his promises to the British people and is still failing to deliver on a manifesto on which he was elected only 23 months ago. The Government are entering this election having scheduled £70 billion-worth of tax giveaways—for whom? It is for the super-rich and for the corporations, and is over the next five years. The Government are entering an election with a £2 billion unfunded black hole in the Budget the Chancellor delivered only a few weeks ago. So will he now use this opportunity before the general election to put on the record that his party will rule out raising VAT and rule out raising income tax? Will he commit unequivocally to support legislation to protect the triple lock? If the Tories cannot be straight with the British people, Labour will be.
The truth is that promises made from the Opposition side of the House are not worth the paper they are written on. The voters, pensioners and workers of this country understand that very well, and they will give their verdict on Labour’s promises on 8 June.
Assuming the House votes for an election, will the Chancellor confirm that he will seek to truncate the Finance Bill, remove its controversial measures, such as making tax digital, and thereby enable everybody to focus on the economic issue that will matter most to the whole country over the next few months: which party can best be trusted to run the economy?
I certainly agree with my right hon. Friend on that last point. On the matter of process, assuming that the House votes in favour of my right hon. Friend the Prime Minister’s motion tomorrow, there will then be the usual end-of-Parliament process of negotiation with the official Opposition on measures that are currently before the House, with a view to passing them in whatever form is appropriate before prorogation.
Improved rail resilience in the south-west is a priority, which is why we committed £5 million in Budget 2016 and £10 million in autumn statement 2016 to support that work. The Government will continue to work with Network Rail to develop options for future investment in the south-west in Network Rail’s control period 6.
In most cases, the Ministry of Justice expects that banks will be able to release enough cash from the estate to pay the probate fee, and we know from HMRC that the average estate is 25% cash. The MOJ is working with the British Bankers Association and others to put arrangements in place.
The hon. Lady will know that my right hon. Friend the Secretary of State for Education is considering responses to the consultation on the school funding formula. At the Budget, we announced a substantial increase in funding for 16-to-19 technical education, which will make an important contribution to improving the UK’s productivity.
I know that my hon. Friend regards the islands as particularly important, and I concur with him on that. The Government support continuing economic growth across the south-east, including all regions and islands. The Solent local enterprise partnership receives more than £180 million from the local growth fund, including funding for investment in local skills and business start-ups, with the Isle of Wight receiving about £15 million of investment in local infrastructure and skills.
As someone who also represents a coastal community, I am pleased to say that coastal areas will benefit from nearly £40 million of investment through the latest round of the coastal communities fund, and that we will do all we can to get the very best possible deal.
We are making real progress in realising our holdings in the banking sector. We continue the programmed sale of our shareholding in Lloyds, which is now down from 43% to less than 2%. Just last month, we sold £12 billion of Bradford and Bingley mortgages in a highly competitive process. The Government are not at present actively marketing their stake in RBS. Our policy remains to return the bank to private hands as soon as we can achieve fair value for the shares, recognising that fair value could well be below what the previous Government paid for them. We must live in the real world and make decisions on the future of our holding in RBS in the best interest of taxpayers.
In the real world, seven years ago, a Tory Chancellor stood at the Dispatch Box and said that we had to cut the money to every single local authority in Britain by up to 40% because we needed to get rid of the deficit. Now, seven years later, that deficit is still more than £60 billion. Will the Chancellor apologise to the people of Britain for that lousy mistake?
Following the football theme of this afternoon, I am sure that everyone would wish to know that Cleethorpes Town has finished as champion of the Northern Counties East League, which means that even more people will want to travel to Cleethorpes. Infrastructure development was mentioned earlier. Will the right hon. Gentleman give an assurance that all roads will lead to Cleethorpes?
Can the Chancellor confirm that HMRC takes eight months to fill a vacancy in the national minimum wage compliance unit? If that is so, what will he do properly to resource that service so that workers can get a decent day’s pay for a decent day’s work?
In my constituency I held a public consultation on creating an enterprise zone or a business park. The Labour county council has blocked it considerably and constantly. Would my right hon. Friend the Chancellor like to come to my constituency and listen to what my constituents are saying about having an enterprise zone?
Business of the House
With permission, I should like to make a short statement about the business for tomorrow.
Wednesday 19 April—The House will be asked to approve a motion that allows for my right hon. Friend the Prime Minister to seek an early parliamentary general election under the Fixed-term Parliaments Act 2011. This will be followed by consideration of Lords amendments to the Technical and Further Education Bill, followed by a debate on a motion relating to section 5 of the European Communities (Amendment) Act 1993.
The business for Thursday 20 April remains Backbench Business Committee business, as I previously announced. I shall make a further announcement about future business in the usual way on Thursday.
I start by thanking the Leader of the House for his statement and for coming to the House to inform us of the change of business to a motion calling for a general election. I now understand why it was so difficult to get out of the Leader of the House a date for the forthcoming Queen’s Speech, despite consistently asking him for it. Obviously, the Prime Minister’s U-turn has been a long time in the planning.
I am concerned that the Prime Minister chose to make her statement outside No.10 rather than come to the House. This is a massive U-turn. At least seven times, most recently on 20 March, the Prime Minister has ruled out an early general election. She said:
“I’m not going to be calling a snap election. I’ve been very clear that I think we need that period of time, that stability to be able to deal with the issues that the country is facing and have that election in 2020.”
Clearly, this Government cannot be trusted.
Given that the general election is on 8 June and there are 25 working days until Parliament can be dissolved, can the Leader of the House let us know the exact date for the Dissolution of Parliament? May I repeat that a statement of such importance should have been made to the House of Commons, given the nature of this massive U-turn. Her Majesty’s Opposition will ensure that we will promote stability, and that there is an alternative fairer vision for this country.
The hon. Lady asked about the date for Dissolution. That is laid down in statute: it has to take place 25 days before the proposed date of polling day. Therefore, the date of dissolution will technically be at one minute past midnight on Wednesday 3 May, so in effect we are talking about Dissolution at midnight on the night of 2 to 3 May.
I do not recollect any previous Labour Prime Minister announcing a general election on the Floor of the House of Commons. My right hon. Friend the Prime Minister went about things in the time-honoured fashion this morning. She is putting to the country the case for this Government to go forward on the basis of a clear mandate to provide the clarity and stability that the entire United Kingdom needs, as we approach the historic task of implementing the referendum decision taken by the British people and forging the new, deep and special partnership with our friends and allies in the European Union that we all want.
May I thank the Leader of the House for making a statement at the earliest possible opportunity, and the Prime Minister for making an announcement that was not leaked to the media in advance? Will my right hon. Friend confirm that it is not in the gift of the Prime Minister to decide whether there is a general election? It will be this House that decides, and if Her Majesty’s Opposition do not want a general election, cannot face it, or are worried about annihilation, they will not vote for it tomorrow.
I thank the Leader of the House for his short but incendiary statement. Here we were believing that this was not the time for these types of big decisions, and that the core focus of this Government should really be on their hard Brexit. This is one of the most extraordinary U-turns in political history, and the Fixed-term Parliaments Act 2011 has been about the biggest possible waste of this House’s time. The calling of a general election now returns to a Prime Minister, and the interests of party now come before the interests of country. In the coming election, we will ensure that Scotland continues to be fully protected from this Tory Government’s attempt to take our nation off the cliff edge of their hard Brexit and from their obsession with austerity. The Tories might play their petty party political games, knowing that they are up against a woeful and pitiful Labour party, but the Scottish National party will ensure that Scotland is fully protected from the worst of this Government’s clutches.
The Prime Minister and the party she leads will take to the people the case for the Union of the four nations of our United Kingdom, and our belief that those four nations are better off working together in that unique enduring partnership of the United Kingdom. I say to the hon. Gentleman that the Prime Minister took her decision—a decision that, as she said this morning, she took with considerable reluctance—because it is in the interests of the people of this country. It is in the interests of the entire nation that we have clarity, stability and constancy of purpose as we move forwards.
Does the Lord President agree that this is actually one of the rare occasions when it is absolutely right that the statement was first made to the British people—not to this House—because it is they who are being asked to use their sovereign power to determine the composition of a new House?
The Prime Minister was not for calling a snap general election, but now she is, perhaps sensing a political opportunity. The choice to go for an election now is hers and hers alone, as was the choice of a hard Brexit. Will the Leader of the House make time available before the general election campaign starts for this House to discuss the party of government’s failure on the NHS, tackling violent crime, and dealing with people with disabilities and their benefits?
I am astonished that the right hon. Gentleman, on behalf of the Liberal Democrats, was able to talk about political opportunism with a straight face. The Prime Minister alone has to take the decision to put forward the motion tomorrow, but it will be a decision for every Member of the House of Commons when we meet tomorrow to decide whether that motion is approved.
The usual discussions are under way between the usual channels about the handling of business that is currently before Parliament. On the assumption that the motion is carried by the House tomorrow, those discussions will intensify. I hope that I will be able to provide the clarity that my hon. Friend seeks as soon as possible.
The Leader of the House has given us an image of the Prime Minister being dragged, kicking and screaming, into calling a general election when she did not want one. Can we find time in what is left of this Parliament to have a debate about why she decided to trigger article 50 and then throw the entire planning into doubt by then calling a general election, which will waste at least three months of the precious, short time we have left to get the best deal for Britain?
Far from throwing things into doubt, the Prime Minister’s decision has, assuming that the people return this Government—it will be a choice for the people to take—ensured that there will be the clarity of a mandate behind her and her Government to deliver a successful negotiation, and to implement it over the course of a five-year term.
Some Members of this House are labouring under the impression that the next general election will be a rerun of the referendum. Will the Leader of the House confirm that article 50 having being triggered, regardless of who wins the next election there is no turning back?
The wording of article 50 is clear, and it is clear that any change to the two-year timetable can happen only if it is agreed unanimously by all member states, including the departing member state. As my right hon. Friend the Prime Minister has made clear, whatever side we took in the referendum campaign, we must respect the sovereign decision of the British people.
I thank the Leader of the House for his statement and assure him that the Democratic Unionist party will support the motion tomorrow. We say, “Bring it on: bring on the election and let people support the Union and the Unionist cause in Northern Ireland.” Will he clarify tomorrow the last date for people who wish to register to vote to do so, so that there is clarity and certainty about the registration process, especially in Northern Ireland?
What the Prime Minister was doing this morning was making her ambition clear about the timeframe for the general election. I have to say to the hon. Lady that the specific date would have been the first question put to the Prime Minister, in the House and outside, had she not named one.
Mr Speaker, you may remember—as you took an active part in it—a debate in January 2000 that went on all night so that the next day’s business did not exist. Given that in debating the Finance Bill the House can sit until any hour tonight, what will the Government do in the event of tomorrow not existing?
The Leader of the House will agree, I am sure, that the prime responsibility of this House is to hold the Government to account. Does he not think that many, not just in this Chamber but outside across the country, will regard the Prime Minister’s rush to an early general election as a strategy to evade responsibility for the chaos we have had in this country since the previous Government arranged a referendum that they actually lost?
The Prime Minister’s decision is about inviting the British people, in the national interest, to return her to provide the leadership, the sense of direction and the clarity which this country needs and which those in the hon. Gentleman’s party are so clearly unable to provide themselves.
Will the Leader of the House confirm that should the motion pass tomorrow we are not voting for a new Prime Minister for just two years over the course of Brexit, but a new Prime Minister for the duration of a Parliament of five years? Many of us are expecting that either the current Prime Minister or the leader of the Labour party will walk through the door of No. 10 post 8 June. Will the Leader of the House encourage my right hon. Friend the Prime Minister to go head to head with the Leader of the Opposition in as many TV debates as possible before 8 June?
Will the Leader of the House confirm that in the event of a two-thirds majority not agreeing to tomorrow’s motion, the only way the Government could call a general election would be to table a vote of no confidence in themselves? When does he plan to do so?
The Prime Minister was inconsistent about Brexit, and now her iron determination not to call a general election transmutes into a leaden determination to have one. May I assure the Leader of the House that, with Labour in a writhing mess, we in Plaid Cymru relish the opportunity to provide a Welsh alternative to this ideologically driven, opportunist, right-wing Tory Government, and that we will be voting yes tomorrow?
For weeks constituents have been emailing me and telephoning my office because they are terrified of the changes to the personal independence payment regulations, which we were finally going to be allowed to debate and vote on tomorrow, but the Leader of the House has suspended that. Will he guarantee that this House, this Parliament, will have a chance to vote on and debate them before Dissolution?
The Liberal Democrats welcome the opportunity to take on this divisive, destructive Tory Government and their hard Brexit, but how much will this general election cost; and if the Prime Minister wanted to do it, why did she not call it for 4 May? The decision not to do so is going to cost a lot of taxpayers’ money.
The timetable for any general election is laid down by the Fixed-term Parliaments Act and the Political Parties, Elections and Referendums Act 2000. A general election on the same day as the local elections would not be possible, given what the laws require.
Inflation is rising, real living standards are potentially going to decline and we know that there will be very difficult negotiations with our European Union partners. Is not the real reason that the Prime Minister has called this election so that she can avoid having a general election in 2020, which would be very dangerous for her party? She thinks that she can win now in order to avoid dealing with the consequences of a hard Brexit.
The country I look at is one in which unemployment is falling, employment is at record levels, the deficit is down and there are record levels of spending on key public services, which is made possible because of the strong economy that my right hon. Friends the Prime Minister and the Chancellor have fostered. I look forward to a general election and to making the case to the people for that programme of political commitment and the leadership of my right hon. Friend the Prime Minister to continue.
The Government’s ridiculous rape clause came into force on 6 April, with no parliamentary scrutiny. The usual channels had promised that a Delegated Legislation Committee would be held to provide some parliamentary scrutiny of that despicable policy. Will that now happen, given that Parliament is to be dissolved very soon?
There is no statutory provision for the cancellation of a by-election when a general election is in progress. It is up to the judgment of the acting returning officer, whom one might expect to regard the by-election writ as having been superseded. That was the course of action taken by the acting returning officer in the one precedent that I have found, which dates back to November 1923.
Will the Leader of the House tells us whether the Prime Minister took soundings from the Secretary of State for Northern Ireland as to the impact of this announcement on the ongoing inter-party talks, and does the Secretary of State for Northern Ireland still intend to bring legislation through this House and the House of Lords in the wash-up in respect of rates and topping up the mandate for the current Assembly to appoint an Executive?
My right hon. Friend the Northern Ireland Secretary is of course considering what difference, if any, should be made to his announced plans as a result of the Prime Minister’s announcement this morning. I will try to provide the hon. Gentleman with absolute clarity as soon as possible, but my expectation is that there will continue to be a need for such legislation.
Will the Leader of the House acknowledge that we will none the less elect a metropolitan Mayor in Greater Manchester on 4 May, who will take up office and responsibility for transport in the city region? Will the Government confirm that the Bus Services Bill will complete its parliamentary passage before Dissolution?
In calling a snap election, do the British Government seriously take the view that a UK election will really change the EU 27 negotiating position? If so, are they not guilty of living in a land of fantasy?