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Commons Chamber

Volume 646: debated on Tuesday 11 September 2018

House of Commons

Tuesday 11 September 2018

The House met at half-past Eleven o’clock


[Mr Speaker in the Chair]

Business Before Questions

University of London Bill [Lords]

Second Reading opposed and deferred until Tuesday 9 October (Standing Order No. 20).

Oral Answers to Questions


The Chancellor of the Exchequer was asked—


Pubs are a vital part of our local communities and the Government are committed to supporting them, which is why I froze all alcohol duties in the 2017 Budget. That freeze, and cuts in alcohol taxes since 2013, mean that a typical pint of beer is 12p cheaper than it would otherwise have been.

Pubs are also benefiting from recent wider reforms of business rates that will be worth £10 billion by 2023, including the doubling of rural rate relief to 100%, the switch from retail prices to consumer prices indexing, reforms in small business rates relief that have taken 600 small businesses out of rates altogether, and the introduction and then the extension of the £1,000 business rates discount for pubs.

Will the Chancellor join me in congratulating the Friends of Haden Cross, a pub in my constituency? Will he, in particular, join me in congratulating Tim Haskey and Jim Mumford, who rescued the pub when it was on the point of closure, and who, working with new management, have seen a 500% increase in takings since November? Does he agree that the Government should continue to provide good fiscal support for pubs, given their importance to our local communities?

My hon. Friend has detailed a remarkable turnaround in the fortunes of a pub. I congratulate the Friends of Haden Cross on that success, and on making such good use of the “assets of community value” scheme to save their local.

The Government remain clear about the fact that local pubs are instrumental in facilitating the support networks and social interactions that are such a vital part of local communities. We will continue to protect them, and it is welcome news that pubs such as the Friends of Haden Cross are benefiting from the measures that we have taken.

Will my right hon. Friend join me on a pub crawl in Shrewsbury? [Laughter.] I am buying.

My right hon. Friend has mentioned some very positive figures relating to Government support for pubs, but I should like him to come to the Salopian Bar, my local in Shrewsbury, and hear at first hand about the extraordinary rises in business rates with which some pubs have had to deal. I should like him to gain first-hand experience, by talking to landlords, of some of the financial pressures that they are under.

Provided that I can have it in writing that my hon. Friend is buying, I am very tempted to consider his offer. I will negotiate with him.

I understand the pressure that pubs and many other traditional businesses are facing. Pubs in Shrewsbury have benefited from recent cuts in alcohol duties and business rates, but of course we recognise the challenge that many smaller businesses face, and we will keep that challenge very much in mind as we formulate our policies.

The Chancellor is obviously very welcome to join me in a pub crawl around Darlington as well. I always stand my round.

Many of us who represent towns are fighting very hard to support our high streets, and the business rate pressures that have confronted retail businesses are exactly the same when it comes to pubs and catering outlets. In my town, there are so many anomalies in relation to pubs and business rates that such anomalies have become almost normal. The situation needs to be looked at as a matter of urgency. Will the Chancellor investigate the way in which smaller pubs are particularly disadvantaged by the business rates system?

It is true that pubs are assessed in a different way from other retail premises for business rates purposes. We looked into that recently and concluded that the current system was in fact the best system for pubs, but I shall be happy to look into it again.

We all recognise—every single one of us, whichever part of the country we represent—that high streets are under pressure, primarily because the behaviour of consumers is changing. I think that our challenge is to support the high street as it undergoes that process of change. We cannot simply turn our backs on a change that is driven by consumer behaviour, but we must support businesses as they make it.

I am sure the Chancellor will agree that there is a need to encourage entrepreneurs and small business start-ups, including the setting up of new pubs. Will he agree to follow the lead of the Welsh Labour Government, who have set up a micro small business fund that provides up to £500,000 a year to enable small businesses to protect and create jobs? A UK-wide scheme could protect a great many small industries, including the pub industry.

The hon. Gentleman will know that we have the start-up loan scheme, which provides support for entrepreneurs starting small businesses, and the Government will continue to encourage small businesses to be established and then to grow.

NHS Funding

3. What recent discussions he has had with the Secretary of State for Health and Social Care on NHS funding. (906780)

We have regular meetings with the Health Secretary and have recently allocated an additional fund of a 3.4% rise per year to the national health service, which will equate to £20 billion by 2023.

In Bedfordshire, children with mental health issues are travelling up to 100 miles to access services. Their recovery is hugely compromised by sending them away from their families and friends. Will the Chancellor now commit funds to local specialist facilities for young people and reinstate the mental health beds in Bedford that his Government took away?

We recognise that there is increasing demand for the NHS, which is precisely why we have allocated the additional funding, and the Health Secretary will shortly publish a 10-year plan with mental health as one strand of it.

Is it reasonable for me to expect to pass my assets and property to my heirs unencumbered and intact and at the same time to expect the taxpayer to pay for my social care?

We recognise that social care is an area where reform is needed, and my right hon. Friend the Health Secretary will shortly publish a Green Paper to outline some of the options and to make sure we have a proper discussion as a country about the future of social care.

My clinical commissioning group in north Derbyshire has seen an uplift of only 1% over the five-year funding settlement from 2016-17, resulting in a deficit of £51 million to find this year in cuts and of £71 million next year. It is having to cut everything that it is not statutorily required to provide, including all voluntary services. Will the Chancellor look at the funding that has gone to the national health service over the past six years to make sure this can be met?

No doubt, the hon. Lady will welcome the additional money allocated to the NHS to reflect the increasing demand. I point out that under the plans proposed by the Labour party, which would mean fewer businesses, fewer jobs and less tax revenue, there would be less money going into the NHS and the hon. Lady’s local services.

There is strong public appetite for increased spending not only on the NHS, but on education, defence and a whole host of other areas, and, if the polls and all the petitions are to be believed, there is a strong public appetite to pay more tax in order to finance those spending increases. Will the Minister bear that in mind in the upcoming Budget?

I am sure my hon. Friend will recognise that we are not going to announce the contents of the Budget at today’s Treasury questions, but I point out that we are a Government who believe in low taxes: we have reduced taxes on basic rate taxpayers by £1,000. Of course, as well as putting that extra money into the NHS, my job as Chief Secretary is to make sure we get value for money from every penny we spend, and that is why we are developing a 10-year plan. We are improving the use of technology and we are getting better value for money from the drugs budget as well.

Is the Chief Secretary aware in the discussions the Health Secretary may have had on NHS funding whether he mentioned his unilateral plan to ditch the 2013 pensions deal agreed with representative bodies, which was supposed to last for 25 years, and which may affect 1 million NHS staff?

What I am aware of is the deal that has been done with NHS workers to give them a 6.5% pay rise in exchange for reform over the next three years. We know that on average public sector workers get approximately 10% more in terms of pensions than their private sector counterparts, but we are also making sure that we have the right wages to recruit and retain people in the NHS.

Clearly, the Chief Secretary to the Treasury does not even know what she has put out in her name. The pension changes snuck out on Thursday evening could negatively affect the pensions of a further 4 million public sector workers—[Interruption.] No, that is not the case. So I ask on behalf of those dedicated public sector workers—nurses, doctors, social workers, teachers, support staff and refuse collectors—will the Chancellor withdraw these snidey proposals and honour his predecessor’s deal? Is that too much to ask? Or will millions of staff in the public sector be let down and betrayed yet again by this Government?

I think the Labour party has misunderstood the announcement we made last week, which will actually ensure that more money goes into public sector pensions, in line with the deal that we did with the unions previously.

Household Debt

The Government are taking a proactive approach to supporting boroughs and enabling them to manage their money well and help those in problem debt. We reformed consumer credit regulation in 2014, and I am now working on setting up a single financial guidance body to help those who are in difficulties.

One in eight workers is living in poverty, and the average worker is earning £25 a week less than they were 10 years ago. Many of my constituents who are working all the hours they can find still have to come to my office for food bank referrals and debt advice. Does the Minister accept that the rhetoric is talking down the people who are working as much as they can but still living in poverty?

No, I am sorry; I would not accept that. I accept that this Government are committed to doing all they can for hard-working people. That is why we have raised the national living wage, which means £600 for those who are working full time. I am sure that the hon. Lady would also want to welcome the wage data that have come out today.

According to the Money Advice Service, the proportion of people in Greenwich and Woolwich who are over-indebted is higher than both the UK and the London averages. I know from my advice surgery that a significant amount of that is down to the behaviour of rip-off lenders. What more will the Government do to clamp down on predatory lending?

The primary responsibility for rogue lending lies with the Financial Conduct Authority, and its report at the end of May brought in a number of measures, including a cap on rent to own. I accept that more can be done, and that is why I am working hard with my colleague, the Under-Secretary of State for Work and Pensions, my hon. Friend the Member for Hexham (Guy Opperman), on the financial inclusion forum to look at the expansion of alternative affordable forms of credit for the poorest in our society.

May I urge the Minister to take firm action against people who exploit the most vulnerable in our society? I refer particularly to loan sharks, payday lenders, rent-to-own outfits such as BrightHouse, rip-off bank overdraft fees and exploitative doorstep lenders. Will he be firm, to ensure that we protect the most vulnerable?

I am happy to give my hon. Friend that assurance. I have deep conversations on this matter with the Financial Conduct Authority regularly. I also met representatives of Scotcash and the credit unions over the recess to see what alternative supplies of affordable credit are available.

Under Labour, household debt rose in every year bar one, but the Office for National Statistics now shows that, since 2010, the number of children in workless households has fallen by a staggering 637,000. Does that not demonstrate the huge contrast between the economic achievements of this Government and the track record of the Labour party?

I thank my hon. Friend for reminding us of those facts. During the Labour Government, there was also an increase in the welfare budget of 65%, or £84 billion in real terms. We have to spend money wisely, and my hon. Friend’s observations are welcome.

British families are currently spending considerably more than their disposable income and, as a consequence, debt levels in relation to income are rising back to crisis levels. At the same time, France and Germany have big savings surpluses. Which is the most sustainable of the two options?

What is sustainable is that real household disposable income is up by 4.6% since 2010. I acknowledge that there are those who are experiencing challenges, and that is why I have set out the measures the Government are taking and are determined to take to assist those in a vulnerable position.[Official Report, 9 October 2018, Vol. 647, c. 1MC.]

The way to combat poverty and generate prosperity is to create jobs and raise wages. In that context, is it not welcome that a combination of the massive increase in the minimum wage and the rise in the personal allowance since 2010 have increased the net wages of someone working on the minimum wage by 39% when CPI during that period has been only 19%?

My hon. Friend is on top of the figures, as always, and sets out the positive story that this Government have to tell, but there is no room for complacency. This Government are committed to getting as many people back into work as possible, and we welcome the current record figures.

18. Kingston upon Hull has the third highest levels of household debt in England and Wales while Kingston upon Thames has the second lowest. Why does the Minister think that is? What is he going to do about it? (906795)

There are different profiles of debt across the country, which is why the Government are committed to making interventions through the Financial Inclusion Forum to expand affordable credit and to assist those who are in difficulty. There is no room for complacency, and the Government are committed to assisting where necessary.

Does the Minister share my view that one of the best ways of helping hard-working families is to enable them to keep more of the money they earn by keeping taxes low? Will he confirm that this Government will continue to keep taxes as low as possible for working people?

This Government may say that they are taking action on household debt, but the fact is that they rely on that excessive debt for economic growth. The Office for Budget Responsibility says that nine tenths of all GDP growth last year is attributable to household consumption, which is being fuelled by unsustainable levels of debt. Instead, we should raise investment, both public and private, which in the UK is well below the average for a developed country. We have plans to do that, but will we see any such proposals from the Government in the forthcoming Budget?

The Chancellor has set out in successive Budgets our commitment to invest in this economy with the national productivity plan. We must recognise that we need affordable investment, and we have found out over the past 24 hours that the Opposition’s plans are confused. If £500 billion is just a down payment and the start of the investment, where will it end? Is that affordable?

Let us have some facts. The OBR predicts that unsecured household debt will reach 47% of income by 2021. The last peak was 45% in 2007. Families are using credit to pay for essential items. The people who are going to food banks are often in work, because work is not paying. What is the Treasury going to do? Will Ministers admit that austerity has created this mess?

The Government are creating the conditions for growth and raising the national living wage. When I visited Glasgow just a few weeks ago, it was encouraging to see the constructive way that the 1st Class Credit Union and Sharon MacPherson of Scotcash are working with the poorest to help them when they are in difficulty.

I am really pleased that the Chancellor said that he will consider visiting a local pub. Will he consider coming to the Community Food Initiatives North East food bank in my constituency, which has today called for more food because its shelves are empty? If he was to come and visit a food bank such as CFINE’s, he would find out at first hand the effect that Tory UK Government policies are having on individuals up and down the country. The Minister cannot stand there and say that employment is up when the reality is that people are poorer than ever.

I will take no lectures from the hon. Lady about food banks. The Trussell Trust was founded in my constituency. I have a dialogue with the charity, which has done a great deal to assist many people up and down the country, and I am proud of its work.

Infrastructure: East Midlands

Over the course of this Parliament, long-term investment in our infrastructure will reach levels not sustained since the 1970s. In the east midlands, for example, we are investing from the national productivity investment fund to reduce congestion. We are investing £125 million this year on local road maintenance, and we announced this summer £780 million for a series of works to upgrade the east coast main line.

As my near neighbour in Nottinghamshire, the Minister will be aware of the Robin Hood line that runs through my constituency from Nottingham. Proposals to extend the line across Warsop in the north of my constituency have now appeared in various Budgets. The Transport Secretary has ensured that the new franchisee will have to consider the business case for that extension. Can the Minister confirm that the Treasury will support it financially if that business case comes forward?

My hon. Friend and my hon. Friend the Member for Sherwood (Mark Spencer) have been campaigning on this for several years, and we recognise its potential to unlock economic opportunities in Mansfield and Ollerton. Within the east midlands franchise, we have included a requirement that the operator should come to the Secretary of State for Transport within a year with a business case for extending passenger services to my hon. Friend’s communities. The Department for Transport and the Treasury will consider that business case very carefully.

Does the Minister accept that crucial investment from the European Investment Bank and the European regional development fund recently underpinned the midlands engine investment fund and that a hard Brexit risks pulling the rug from underneath many critical investment projects? He knows in his heart that a “cake and eat it” Brexit is a pure delusion and that his European Research Group colleagues still cannot explain how it would work. Would it not be better if we just let the public sort this out and have a say with a people’s vote?

The public have already had a say, and in the east midlands, which we are discussing, the public were very clear that they want to leave the European Union. Infrastructure investment will be substantially higher over the course of this Parliament than it was under the last Labour Government—25% higher in the east midlands and 40% higher in Yorkshire and the Humber. The primary reason for that is this Government’s responsible management of the public finances.

Will my hon. Friend take the time to point out where some of this infrastructure spend is going? At the moment, Derby station is being remodelled—£200 million —and the M1 is being upgraded to a smart motorway. This is massive investment for the long-term future of the east midlands.

My right hon. Friend is absolutely right. Of course he was the Secretary of State for Transport who led many of these important investments. In the east midlands, we are investing in the smart motorway, in the upgrade to the east coast main line, in Derby bus station and in new green buses in Nottingham. The list continues, and only because of this Government’s management of the public finances, which is keeping the economy growing.

No, no, no. Bishop Auckland and Na h-Eileanan an Iar are both admirable places, but last time I looked neither was situated in the east midlands, to which this question is devoted.

Mayflower Celebrations

6. If he will provide additional resources to the Department for Digital, Culture, Media and Sport to support the Mayflower 400-year anniversary celebrations. (906783)

We recognise that the Mayflower commemorations are an important moment for this country to celebrate our tied history with the United States and the unending quest for religious freedom and toleration. The Government gave £0.5 million to the Mayflower 400 project in the 2015 spending review, and we will continue to support it in the years to come.

Given the significance of the voyage of the Mayflower—in historical terms, it was one of the planet’s most influential journeys and it helped to found our democracy and freedom—will the Minister respond positively to the letter he has received from the all-party parliamentary group on the Mayflower pilgrims requesting that we have sufficient resources to celebrate this amazing event in a spectacular fashion?

At the suggestion of my hon. Friend and of my hon. Friend the Member for Plymouth, Moor View (Johnny Mercer), I met Charles Hackett, the chief executive of the Mayflower 400 project. We had a productive meeting, and we are considering the materials that the project left with us. I advise my hon. Friend the Member for South West Devon (Mr Streeter) and the organisers of Mayflower 400 to continue working with the Department for Digital, Culture, Media and Sport and the Treasury as they continue to formulate their plans, which will benefit not just Plymouth but Boston, Bassetlaw and communities across the country.

For the edification of those observing our proceedings, I can advise that the hon. Member for Huddersfield (Mr Sheerman) has just been chuntering at me that his grandmother had a link with the Mayflower, about which I think we are to be enlightened.

Some Members may think that I was on the Mayflower, although as a young man I did emigrate to the United States. Some of my ancestors, the Sheermans, could have been on the Mayflower—[Interruption.] Just hold it for a moment. This is the 400-year anniversary. Is it not time that we celebrated migration and the talent, the genius, the innovation and the ideas that we in this country and America get from migration? Should we not use this quadricentenary to celebrate migration across the world?

The hon. Gentleman is testing my knowledge of the pilgrim fathers, but of course they were inspired by William Bradford, who came from Yorkshire, I believe. He was the one who said that from small things great things can emerge, and that it takes just one small candle to light a thousand, which was the way that the whole pilgrim fathers’ enterprise was summed up. So I want to see the commemorations take place in Yorkshire, as well as in Plymouth and the rest of the country.

I urge the Minister not to forget Immingham in my constituency, which also played a major part in where the pilgrim fathers sailed from. Will he ensure that Immingham is a major player in any celebrations?

I have tried to list all the places where the pilgrim fathers came from. I was not aware that some came from Immingham as well, but I am sure that that will be included in the celebrations.

Discussion of DDCMS support for the Mayflower celebrations raises the problem that DDCMS regional funding is deeply unfair, with far more in London. Indeed, that is the pattern on infrastructure, which the Minister was talking about before. So to what extent does the Minister believe that unfair patterns of Government spending are the cause of the fact that household income in the north-east is only £15,000 per year, whereas in London it is £27,000?

As the hon. Lady will be aware, the Arts Council has a formula to distribute funding across the country. We believe, like she does, that it is important that all communities in this country can have access to culture and heritage. It is for that reason and others that we funded the Great Exhibition of the North, which has been a huge success; and of course the Chancellor, in his Budget two years ago, supported the huge economic and cultural opportunity of restoring Wentworth Woodhouse, near to the hon. Lady’s constituency.

Prisons: Contracting Out

8. Whether he has made an assessment of the adequacy of his Department's cross-departmental guidance on the contracting out of public services as a result of recent disturbances in prisons. (906785)

Guidance on contracting out public services is set by the Cabinet Office, and my right hon. Friend the Chancellor of the Duchy of Lancaster and Minister for the Cabinet Office has reviewed the guidance thoroughly.

Appropriate transitions from prisons to the community are central in successfully reintegrating prisoners into society and bringing down reoffending rates, yet it is my understanding that some prisoners are being prevented from moving from category C to category D as they near their release date. Could the Minister confirm whether that is the case, and whether that is just another example of ineffective cost-saving measures?

My right hon. Friend the Justice Secretary recently released a strategy about how we are going to get more offenders into employment. We have a cross-Government working group on that, to ensure that people make the appropriate transition. I suggest that the hon. Lady speak to the Justice Department to get further details.

Fuel Duty

To support British households, the Government have frozen fuel duty for eight successive years. By April 2019, these freezes will have saved the average car driver £850 compared with the pre-2010 escalator, and the average van driver over £2,100, but it is important that we remember the other side of this coin. The fuel duty freezes since 2011 have meant that the Exchequer has forgone around £46 billion in revenues through to 2018-19, and a further £38 billion will be forgone over the Budget forecast period, as a result of these previously announced freezes. For context, that is about twice as much as we spend on all NHS nurses and doctors each year.

A Treasury study in 2014 said that freezing fuel duty benefits the economy to offset almost all the loss of tax to the economy, and it said that GDP would increase by £4.5 to £7.5 billion over the forthcoming years. Given the rise in petrol by 13p and diesel by 15p over the past year, does he agree with his own Treasury report that maintaining the fuel duty freeze would benefit the economy and help hard-working people in our country?

The analysis that my right hon. Friend refers to is from 2014, and obviously that analysis would have to be looked at again in the context of the economy today. I do understand that the way the rise in oil prices has had feed-through to the pump represents a real pressure for motorists, and we will take it into account.

The Chancellor will know that the freeze on fuel duty is only a sticking plaster and cannot go on forever. One way of cutting down on emissions is electric cars, but in my constituency there is not a single electric car charging point. Will he commit to investing in more electric charging points across the country?

I don’t know about forever, but it has gone on for eight years, as I have just explained to the House. The hon. Gentleman is right: the car fleet has to electrify if we are going to meet our carbon emissions targets. We set up a £400 million fund in the last Budget to support the roll-out of electric charging infrastructure, which is clearly critical for us to meet those targets.

One of the other major impacts on the wages of the lowest-paid is a national living wage. Does my right hon. Friend agree that it is our reforms as a Government that have boosted the incomes of the lowest-paid significantly?

Of course. We have sought, despite the very difficult fiscal circumstances, to address drivers of cost for households, for example by freezing fuel duty and alcohol duty. On the other side of the equation, we have reduced the tax that people are paying on their wages and raised the earning of those on the lowest wages by introducing and then increasing the national living wage.

Despite the freeze in fuel duty, diesel is currently at £1.33 a litre. Rural communities in particular are finding it very difficult. Will the Chancellor indicate the help he can give to rural communities that are dependent on their vehicles to get to work and have a life?

Many people are dependent on vehicles for everyday living and for work. As I have already said, we understand the pressure that higher oil prices and their feed-through to the pumps presents for individual consumers. We take all such matters into account when setting future policy.

I hope the House will join me in welcoming the hon. Member for East Dunbartonshire (Jo Swinson) back from her maternity leave.

Technology Companies: Tax

10. What steps he is taking to ensure that large international technology companies pay an appropriate level of tax in the UK. (906787)

Mr Speaker, I echo your welcome to the hon. Lady. It is good to see her in her place. It is absolutely right that all companies in this country should pay a fair rate of tax. The Government recognise that for some businesses—typically online companies—the current international tax regime is not entirely appropriate. We are working with the OECD and the European Union to find a solution to that, and we have made it clear that in the event we cannot reach a position where we can move multilaterally, we will take unilateral action.

I thank the Minister for that answer. The fact that Amazon’s UK profits trebled, yet it ended up paying less tax, shows how the tax model is broken for large international tech companies. He said that the UK may act unilaterally if international progress is not made at sufficient pace. With the OECD report not expected until 2020, is he prepared to wait that long before starting to act? Does he anticipate perhaps joining in with our European Union allies on the 3% interim revenue tax before then?

We are not only working with the European Union; we are also working closely with the OECD. At our persuasion, it has recently decided to bring forward that report to 2019. We are making progress at the multilateral level, but as I have clearly stated, we should all be in no doubt that we are prepared to take unilateral action, should that be appropriate.

The question is whether there is a level playing field. When my right hon. Friend hears that bookshops pay around 11 times more total tax than Amazon on the same £100 of turnover, does he think we are striking the right balance to enable our town centres and communities to thrive?

When it comes to business rates, which are the heart of the taxes that my right hon. Friend referred to, we have done a great deal since 2016. We will by 2023 have provided reliefs totalling some £10 billion, much of which will fall as relief to the high street. I take on board the comments he has made. As with all taxes, we will keep business rates under review.

Contrary to the comments of the Financial Secretary to the Treasury, international co-ordination on tax has frequently been blocked by the Government. We saw that particularly when it came to the taxation of trusts with both David Cameron and now the current Government arguing against more transparency. It is no surprise that, as a result, a director of Fidelity International and other experts are saying that the Amazon case shows

“how tax policy hasn’t moved on.”

Why are this Government letting giant multilaterals get away with it and letting everybody else down?

Let me be extremely clear to the House: this Government have an exemplary record on clamping down on avoidance, evasion and non-compliance. We have one of the lowest tax gaps in the entire world, at 5.7%, far lower than was the case under the Labour party. We have brought in a number of rules under the base erosion and profit-shifting project—a project of which we were in the vanguard. For example, tax deductions for interest expense came in in 2016 and yielded £3.9 billion by 2021, and the diverted profits tax that we introduced in 2015 has already raised some £700 million.

Employee Buy-outs

11. What assessment he has made of the effectiveness of tax incentives to support the sale of companies to employees. (906788)

We have brought in a number of incentives to encourage employee share ownership, not least employee ownership trusts, which provide a capital gains tax advantage to those businesses selling shares into the trust and tax advantages to employees alike. We have also brought in enterprise management incentives, company share option plans, the save-as-you earn scheme and the share incentives plan as well.

Small and medium-sized businesses are the lifeblood of the economies of local communities, but with 60% of small businesses with no succession plan after their founders retire, what are the Government doing to ensure that employee ownership is one of the options going forward to keep businesses going?

I have set out a number of the schemes that the Government are moving forward with, and, of course, that has been with great success. In 2016-17, some 3 million employees entered into SIP share arrangements, 400,000 entered into arrangements under save-as-you earn with an average value of shareholding of some £5,000, and 3,500 employees were offered EMI schemes in that particular year.

Wage Levels

Today’s data show regular wages growing at the fastest rate for three years. The Office for Budget Responsibility forecast that wages will continue to grow, reaching 3.5% by 2021, while consumer prices index inflation will continue to fall, reaching the target of 2% by the end of this year. That is welcome news for everybody. Nevertheless, the Government recognise the pressure on household budgets, which is why we introduced the national living wage, delivering a 7% pay rise in real terms for the lowest, paid from April 2015 to April 2017. It is why we raised income tax thresholds, saving the average taxpayer more than £1,000 this year and, at the last Budget, froze fuel and alcohol duties for a further year.

Under the current business rates system, city centre-based businesses are paying more in rates than large out-of-town-based warehouses, severely restricting the amount that they can put towards wages and hampering wage growth for employees. Will the Chancellor today commit to reforming this outdated business rates system so that businesses are able to pay their staff higher wages while boosting our high street economy?

I have already acknowledged the pressure that the high street is under, and it is certainly something that the Government are extremely concerned about. I do not think that we can hold back the tide of changing consumer behaviour, but it is certainly right that we seek to facilitate high streets as they evolve. I remember, when I came into this House 21 years ago, that there was a similar angst among our electorates about the growth of out-of-town supermarkets and the impact that that was having on high streets. High streets evolved and survived and, in many cases, prospered. Now they are facing another challenge and we must help them again to rise and meet it.

Sheffield city region has the lowest hourly pay of any city region, at £1.15 below the national average. A real living wage, action on zero-hours contracts and tougher labour market regulation would transform the lives of hard-pressed working people across South Yorkshire. When will the Government recognise that and do something?

The hon. Gentleman needs to look a little deeper. The real answer to low wages is improving productivity. The challenge for this Government—for any Government in this country—is to work with industry, trade unions and training institutions to ensure that we address our productivity challenge. That means investment in infrastructure and skills, support for businesses to improve management and access to capital for growing businesses. Only when business is growing, successful and productive can it pay the higher wages that we all want to see.

One of the people most interested in the trends in wage growth and inflation—and who gives the Treasury Committee evidence about that—is the Governor of the Bank of England. Will my right hon. Friend indicate to the House when he expects to be able to let us know about the discussions that he has been having with the current holder of that post about extending his position?

I know that he does have such views, Mr Speaker. As my right hon. Friend asked—and I know that her Committee questioned the Governor on this subject last week—I can now announce to the House that I have been discussing with the Governor his ability to serve a little longer in post in order to ensure continuity through what could be quite a turbulent period for our economy in the early summer of 2019. I can tell the House today that the Governor has agreed, despite various personal pressures to conclude his term in June, that he will continue until the end of January 2020 in order to help to support continuity in our economy during this period.

Will the Chancellor please confirm that the income of the lowest-paid has grown more than twice as fast as the income of the very highest over recent years?

Green Finance

14. What steps the Government are taking to ensure that the UK remains at the forefront of green finance. (906791)

Green finance is a key Government priority. The Chancellor recently announced the creation of a new green finance institute to ensure that our world-leading green finance expertise is available to UK and international firms. This was the first recommendation of the green finance taskforce, and further responses from the Government will come in due course.

I commend my hon. Friend for the action that the Government have already taken in this area, but does he agree that we should encourage green investment to support new technologies, especially in the energy sector, to help develop devices that can bring down household bills, make us more efficient, waste less energy and cut down on our greenhouse emissions? That is the subject of my ten-minute rule Bill tomorrow.

I agree with my hon. Friend. It is absolutely the case that every household and small business will have those advantages by 2020 through the supply of smart meters. According to data from a leading energy supplier, we are already seeing energy efficiency savings of around 4% on annual consumption.

The Minister will know from the UN that by 2050 there will be more plastic in the sea than fish, so will he ensure that the Chancellor brings forward a Budget with a comprehensive fiscal strategy that ensures that plastic producers pay 100% of the recycling and that targets tax on plastics according to their recyclability?

We are very interested in that area and have published a response to the call for evidence. I am sure that the Chancellor will have heard the hon. Gentleman’s representations.

21. Will the Minister respond positively to the report of the Environmental Audit Committee on green finance, particularly by encouraging investment institutions such as pension funds to consider the long-term risks that climate change may pose to their investee companies? (906798)

Absolutely. Only two hours ago, the Department for Work and Pensions published its consultation response on pension trustees’ duties, which clearly sets out the Government’s intention to raise the profile of financially material climate change factors in investment decisions.

19. The Minister will be more than aware of the Ernst and Young report earlier this year indicating that Scottish GDP, including Scotland’s geographical share of renewable energy, oil and gas, grew at 3.4% as opposed to the UK’s 3.1%, despite lots of inaction from the current Government. Will the Government provide Holyrood with the powers over energy revenues to ensure that Scotland can continue with this lead in economic growth and make sure that the green energies of the future are invested in properly? (906796)

Absolutely. Green energy is very important to the UK economy as a whole; it is just very unfortunate that the rate of growth in the Scottish economy is half as strong as in the rest of the United Kingdom.

Topical Questions

My principal responsibility is to ensure economic stability and the continued prosperity of the British people, both during this period of heightened uncertainty and beyond it after Brexit. I will do so by building on the plans that I set out in the autumn Budget and the spring statement. This Government will continue to take a balanced approach to the public finances that enables us to give households, businesses and our public services targeted support in the near term as well as investing in the future of this country and getting debt down to cut interest costs and deliver fairness to the next generation.

South Essex has the potential to play a huge part in delivering on those aspirations, as I and some of my Essex colleagues saw last Friday as we took a Clipper journey from Purfleet out to Southend and back. It was an extraordinary experience. May I therefore invite the Chancellor to come and join us and see the part that south Essex can play in making Britain great again?

There are only weeks to go now before a deal has to be agreed with our European partners, but there are still mixed messages coming from Government Ministers. The Foreign Secretary says that crashing out of the EU without a deal would be a

“mistake we would regret for generations”,

the Brexit Secretary says that no deal would bring “countervailing opportunities”, and the Prime Minister says that it

“wouldn’t be the end of the world.”

The Chancellor has a critical role to play in bringing some rationality to this debate. The Treasury has calculated that no deal could result in the UK’s GDP being over 10% smaller. Will he outline, and be absolutely clear to some of his colleagues, what that would mean for jobs, wages, investment and living standards?

There is no ambiguity at all about the Government’s objective. We want to strike a deal with the European Union based on the White Paper that we have published, which we believe will be good for Britain and good for the European Union. We are devoting all our efforts over the coming weeks and months to securing that deal and protecting the British economy.

The problem is that time is running out, and increasingly people on all sides of this issue are feeling let down, so let me put this to the Chancellor: can we both try to get the message across to the Prime Minister, who continues to insist that no deal is better than—[Interruption.] She continues to insist that a bad deal is better than—[Interruption.] I will negotiate that again, Mr Speaker. She continues to insist that a bad deal is better than no deal. Business organisations are clear. The CBI is warning of a “catastrophe”, the National Farmers Union says it would be “an Armageddon scenario”, and, according to the TUC, a no deal Brexit would be “devastating for working people”. So may I appeal to the Chancellor? He knows the consequences of a no deal scenario, so will he now show some leadership and make it clear to his colleagues that he will not accept it?

First, I would love to know what it actually said on the right hon. Gentleman’s bit of paper. Let me be very clear to him. I, the Prime Minister and all members of the Cabinet are committed to achieving a deal that protects British jobs, British businesses and British prosperity going forward. That is what we are committed to. He is absolutely right that time is running out. We are working against the clock; we understand that. We will be working flat out over the coming weeks and months to achieve that.

T5. The Treasury will be well aware of the passion that my residents in North Cornwall feel about the scourge of marine plastics. After the record response to the Treasury’s consultation on single-use plastics, can the Chancellor say how far he is prepared to go in the Budget? (906808)

First, I recognise my hon. Friend’s long-standing commitment to this cause and the role that his constituency has played in bringing to people’s attention the catastrophe going on with plastics in our oceans. We want to be the first generation that leaves the environment in a better state than we found it, and tackling the scourge of plastic waste is a clear priority to support that. As he said, the response to the call for evidence represents the level of public concern. I want to be clear that we are committed to acting to tackle plastic waste and to using tax alongside other tools to change behaviour. I am working closely with my right hon. Friend the Secretary of State for the Department for Environment, Food and Rural Affairs, and I will bring forward further proposals in the Budget.

T2. London’s Mayor Sadiq Khan is investing in frontline policing, but like police and crime commissioners across the country, he is swimming against the tide of deep Government cuts, which is why violent crime in the last three years has doubled in Essex, in Cambridgeshire, in Warwickshire, in Hampshire and in Norfolk—the Tory shires. Is it not time for the Government to accept that they need to refocus on cutting crime, not police, particularly in the light of the damning report from the National Audit Office today? (906804)

We have protected the police budget in real terms since 2015. Is it not time that the London Mayor started taking responsibility for what is happening in the city that he is meant to be leading? When it comes to Crossrail and crime, he is not taking responsibility, and he needs to stop passing the buck.

T7. Last week, the East of England all-party parliamentary group launched its Budget submission, prepared in conjunction with business and local government. Does my right hon. Friend recognise the region’s enormous economic potential, and will she work with us to unlock it? (906810)

I was delighted to visit my hon. Friend and see the booming businesses in Lowestoft and St. Peter’s Brewery, which is exporting around the world, and Baron Bigod, which I think has the only raw milk vending machine in the whole of the UK. We will look closely at his submission and continue to invest in this vital part of the country.

T3. With frontline police officers cut by over 22,000 since 2010 and police forces such as mine in Cheshire having their budgets slashed by a massive £56 million—that is a fact—surely the National Audit Office report exposing the crisis in funding for our police service is a wake-up call to the Treasury. (906806)

We have protected police budgets in real terms since 2015. Of course, the nature of crime is changing, and police forces across the country have to adjust to that. We also recently announced a 2% pay rise for frontline police officers.

T9. When this Government were first elected in 2010, their defining mission was to fix the deficit. Will the Chancellor update us on what progress has been made and how that has benefited my constituents in the north-west? (906812)

In 2010, the Government inherited the largest Budget deficit since the second world war, at 9.9% of GDP. Our balanced approach to fiscal policy means that we have significantly reduced the deficit by over four fifths, to 1.9% of GDP last year. That has had benefits for all our constituencies, as the economy has continued to grow. My hon. Friend’s constituents will have seen that benefit: in the north-west, more than 268,000 more people are in employment over that period, and there are 93,000 more businesses.

T4. Anyone who attended the Unison briefing this morning will know how worried local authority workers are about the impact of austerity on the services that they provide. Can the Chancellor reassure them that they will see in his next Budget a level of money that means we do not see many more authorities facing the catastrophe that Northamptonshire has had and that we have all witnessed this year? (906807)

When the Conservatives came into government in 2010, the vast majority of money spent locally was raised centrally, damaging accountability. We have now switched that around, and more money—the vast majority of it—is being raised locally. Of course, we have recently given councils more power to raise council tax, to meet growing demand in areas such as social care and children’s services, and we will continue to look at that.

This summer, we saw the devastation of the collapse of an elevated roadway in Italy. In Chelmsford, the main route into the city is over the Army and Navy flyover, which is now 40 years old. I am not suggesting that it is on the brink of an Italian disaster, but it will need replacing. What funds might be available to assist?

My hon. Friend and I met earlier in the summer to discuss the flyover, and she raised concerns then. I appreciate that it has been closed, owing to safety concerns, over the summer. Funding is available through Essex County Council, and of course through her local enterprise partnership, which has received almost £600 million over the spending period.

T6. The Chancellor will be aware of Macmillan Cancer Support’s long campaign to introduce a duty of care on financial services providers to ensure that vulnerable customers get the support they need to stop financial problems escalating. The Financial Conduct Authority has now published a discussion paper on the introduction of a duty of care. Will the Chancellor commit to meeting Macmillan to discuss the consultation after it closes on 2 November? (906809)

One of the first things I did was to encourage the FCA to bring forward that paper, and I would be very happy to meet those involved in Macmillan care again to discuss their concerns following its publication in July.

The Economic Secretary to the Treasury saw at first hand when he visited East Renfrewshire a couple of weeks ago how small businesses are utilising FinTech to become more efficient and agile. What are the Government doing to help more small and medium-sized enterprises, such as First Floors in Giffnock, which he visited, to understand and take advantage of the opportunities FinTech presents?

My hon. Friend is absolutely right. It was a privilege to meet David Hepburn at First Floors and see the value of new products. The Government are committed to stimulating more investment in FinTech, and it was a privilege to visit FinTech Scotland, which is doing a lot, too. We have invested a considerable amount to increase the numbers of people who are taking this step to innovate in finance, and with open banking we will see more.

T8. In response to a recent written parliamentary question, the Secretary of State for International Development confirmed that she paid her Department’s cleaners the living wage—the London living wage. Sadly, when I asked the same question of the Treasury, the response was that Her Majesty’s Treasury “does not hold” the information. Will the Chancellor take this opportunity to clarify why he and other Front Benchers do not know how much the cleaners who clean their desks every day are paid, and will he promise to introduce the London living wage not just in the Treasury but for every single cleaner who works in Whitehall? (906811)

I imagine the reason is that the provision of these services is contracted out, but I will investigate and write to the hon. Lady.

The Chancellor can rightly take pride in his policies which result in South Leicestershire having one of the highest employment rates in Britain. On Friday, I am meeting local businesses in Lutterworth, where Councillor Neil Bannister, leader of Harborough District Council, will be hosting a “Meet your MP” session with local businesses. What other positive messages does the Chancellor have for local businesses in Lutterworth and South Leicestershire?

In areas of the country like the one my hon. Friend mentions, we have seen a resurgence of the entrepreneurial spirit since the financial crisis, with high levels of employment and good levels of wages. Now we need to see businesses being prepared to invest and innovate to grow productivity so that we can carry on seeing wages rising to create the sustainable high-wage economy that we all want to see.

Starving the NHS of finance has led to South Tyneside Hospital being forced into an unpopular merger with Sunderland Hospital. Not only is South Tyneside Hospital losing key services, but staff are at risk of being placed into a private, wholly owned subsidiary where their terms and conditions are under threat. Cuts forcing back-door privatisation are either a deliberate design of the Government’s plans for the NHS, or incompetent financial management. Which one is it?

I find it astonishing that no Opposition Member is prepared to congratulate the Government on the announcement of the £20 billion that we are putting into the NHS because of increasing demand.

The Chancellor has been an outspoken advocate of a fairer distribution of regional spending. Has he read the letter that we sent him in late July? Will he commit to the Transport for the North strategic investment priorities in his forthcoming Budget?

I know that my right hon. Friend the Chancellor has my hon. Friend’s letter. Over this Parliament, we will spend more central Government funding per capita on transport in the north than in, for example, London or the south-east. We will consider carefully the business case for Northern Powerhouse Rail when we receive it from Transport for the North later in the year.

This is further to the points raised by my hon. Friends the Members for Ilford North (Wes Streeting) and for Weaver Vale (Mike Amesbury). In the light of the National Audit Office’s recent comments that there are signs that police forces are struggling to deliver effective services and that the Government do not know whether the police system is financially sustainable, what real reassurance can the Chancellor give me that police forces will be given a real increase in funding, so that they can cope with growing demand?

Police force funding has been protected in real terms. The nature of crime is changing, and police forces are reforming to reflect that.

Corby and East Northamptonshire are seeing considerable housing growth, and it is essential that the infrastructure keeps pace, so will my right hon. Friend consider a new round of enterprise zone bidding opportunities to support more growth and jobs?

For the past hour, we have heard everyone on the Treasury Bench spouting about this wonderful situation that they are in, with money to burn. Why then has Tory-controlled Derbyshire County Council’s first decision been to close 20 libraries and cut the hours of every librarian in the county? What is the Chancellor doing to stop it?

I suggest that the hon. Gentleman either has a hearing test or relies on the Hansard of this session, because he has misheard what we have been saying today.

Region deals are an excellent example of Scotland’s two Governments working together to make it a better place in which to live and work. Will my right hon. Friend outline the progress she has made with the Scottish Government to ensure that constituencies such as Angus benefit as much as cities?

My hon. Friend is right: we have seen a number of beneficial city deals in Scotland, and we have devoted £1 billion to them. I am delighted that we are making progress on the Tay cities deal; I will be visiting the Tay cities very soon to have further discussions.

A recent Treasury Committee report on household finances found that arrears to local authorities are growing, and there is an overzealous pursuit of those arrears by bailiffs. The same goes for some central Government Departments. What will the Treasury do urgently to ensure that people are not penalised, and vulnerable households are not criminalised, by the Government?

We have made several interventions since we responded in 2014 with bailiff law reform. I have spoken to the Ministry of Justice, and we continue to look carefully at the matter. We have arrangements in place through the Her Majesty’s Revenue and Customs time to pay scheme, and the Cabinet Office has its fairness group as well.

Next year, we move into a post-Brexit economy with new global trading opportunities for UK economic growth. Will the Chancellor update the House on his commitment to investing further in the Royal Navy, which is a vital tool for maintaining safe seas and oceans, so that trade coming out of north-east and other ports can be sustained and can underwrite economic growth?

I certainly agree with my hon. Friend that the Royal Navy is vital to the defence of Britain’s interests around the world, and in peacetime it is the principal way in which we can project our power and military influence around the world. We are waiting for the conclusion of the modernising defence review that is being undertaken by the Defence Secretary with the Cabinet Office. Once we have received that, we will be able to work with the Ministry of Defence to find a way forward out of the very considerable budgetary challenges that that Ministry faces.

In March, the Government postponed the closure of the childcare voucher scheme to new entrants to 4 October, during the forthcoming parliamentary recess, reflecting concerns about its impact on low-income families in particular. With the closure now imminent, what work have the Government done to assess the impact on low-income families?

The issue with the current childcare vouchers scheme is that only people whose employers sign up to the scheme are eligible. Under tax-free childcare, everybody will be eligible, regardless of whether they are self-employed or working for an employer. We wanted a bit more time to transition from one scheme to the other. Tax-free childcare is now up and running, and we are ready to transition to that system.

Points of Order

On a point of order, Mr Speaker. Whether people agree or disagree with the hon. Member for Bolsover (Mr Skinner), he is respected across the House. I invite the Chancellor to apologise for the personal remarks he made.

I must say I have never found anything wrong with the hon. Member for Bolsover’s hearing. I think it was an off-the-cuff remark. It probably was not the best chosen, but it is a matter for the Chancellor to judge whether he wants to say anything.

The Chancellor is shaking his head. Fair enough. The right hon. Member for Hayes and Harlington (John McDonnell) has registered his point. Knowing the hon. Member for Bolsover as I do, I very much doubt he will lose any sleep over it.

Further to that point of order, Mr Speaker. The only thing I would say to the Chancellor is why doesn’t he answer the question? It is pretty clear that he knows the Tory county council has played a blinder by throwing people out of work. That tells you a lot about this economy.

I am sure it is a genuine point of order, not one of frustration or a Treasury question that was not asked. We look forward to hearing the hon. Gentleman.

Thank you, Mr Speaker. I wanted to clarify and correct the record in relation to something I said yesterday. The House will have heard me ask the Education Secretary about Brookfield Community School in Chesterfield, an outstanding local authority school that was forced into being an academy. I said yesterday that it now required improvement and that the governing body was being replaced. I have subsequently been told that I misinformed the House: the school has actually been rated as inadequate, with serious failings. So I wanted to make the House aware, at the earliest possible opportunity, that things are even worse under the Tories’ education policy.

That is notably candid of the hon. Gentleman. It is certainly not, it has to be admitted, an expression of frustration. He has put his point on the record and I thank him for doing so.

Online Forums

Motion for leave to bring in a Bill (Standing Order No. 23)

I beg to move,

That leave be given to bring in a Bill to make administrators and moderators of certain online forums responsible for content published on those forums; to require such administrators and moderators to remove certain content; to require platforms to publish information about such forums; and for connected purposes.

On 18 June 2017, Darren Osborne drove a van into a crowd of people gathered outside a north London mosque, killing one man and injuring 12 people. He had also intended to murder the Leader of the Opposition and the Mayor of London. Just one month earlier, Osborne was a different person with no history of extreme ideology or beliefs. His ex-partner claimed he had been radicalised in just three weeks. The ground was laid by his mental health problems, long-term unemployment and alcohol abuse, but the catalyst was a television drama about grooming gangs in Rochdale. After seeing it, Osborne spent the next three weeks consuming anti-Muslim extremist propaganda online from sources including Tommy Robinson and Britain First, after which he was ready to kill innocent people.

Whether it is inspiring domestic terrorism, young British people being pulled into fighting for terrorists overseas, or facilitating the resurgence of the far right, online radicalisation is a frighteningly dangerous process, which we are not currently equipped to counter. Moreover, the spreading of hate, racism, misogyny, antisemitism or misinformation, knowingly and without any accountability, is dangerous and is having a profound effect on our society.

Our newspapers, broadcasters and other publishers are held to high standards, yet online groups, some of which have more power and reach than newspapers, are not held to any standards, nor are they accountable. It is about time the law caught up. The Bill is an attempt to take one step towards putting that right. It would make those who run large online forums accountable for the material they publish, which I believe would prevent them from being used to spread hate and disinformation, and for criminal activity. It would also stop groups being completely secret.

Most of the examples I will use in my speech relate to forums or groups on Facebook. As the most popular social media platform, it is the subject of the most research and press coverage on this issue. Facebook groups range from a few members to hundreds of thousands. They are run by administrators and moderators, who are charged with upholding Facebook’s community standards. Groups are set up to help old school or university friends keep in touch, and for people with a common hobby or interest to come together for the first time. However, there are also numerous examples of forums being used for utterly appalling ends, and deliberately so.

One such group is the Young Right Society, which is run by a Breitbart journalist and was uncovered by Hope not Hate. The charity revealed that the group was

“frequently awash with appalling racist”

content, white supremacy, jokes about the holocaust, and antisemitic conspiracy theories. It was also used to organise the members for events. Because it was set to secret, it was only exposed when one member alerted the charity to its existence.

It is not only racism that is allowed to thrive on such forums. Marines United was a secret group of 50,000 current or ex-servicemen from the US and British militaries. Members used the forum to share nude photos of their fellow servicewomen. A whistleblower described

“revenge porn, creepy stalker-like photos taken of girls in public, talk about rape, racist comments.”

That it was allowed to grow to a membership of tens of thousands before anyone thought something had to be done demonstrates the need for greater transparency.

Research by Professor Jen Golbeck of the University of Maryland shows that members of online forums feel at risk of becoming a social pariah in closed groups if they report objectionable posts, so they do not. It is the format of the forums that normalises the content for their members. People will receive far more “likes” for a post to a group, which will be seen by a far wider audience, than something they post about their personal life on their own page, but any posts that go against the grain result in harsh criticism and potential exclusion from the group. That can have a profound effect on society’s attitudes on a number of issues. Many of the people in the forums will not have joined because they agree with the most extreme content, but if they regularly read posts espousing unacceptable or wrong content that go unchecked, it can alter their perceptions.

There are already several examples of such forums having troubling effects in the real world. Canada’s largest far-right organisation started as a Facebook group on which Islamophobic conspiracies were circulated, the claimed Islamification of Canada was criticised, and members were encouraged to send pigs’ heads and blood to mosques—plans that were then carried out.

The most disturbing example I have come across is a forum of 8,000 parents of autistic children here in Britain. It is the sort of group that Facebook might point to as an example of how the site can bring people in a difficult situation together to share their experiences, but it was being used in a truly horrific way. Members told the group that giving their child so-called “bleach enemas” would cure their autism. Several parents carried them out and then shared images of what they believed to be parasites—but which were, in fact, the children’s bowel linings—leaving their children after the process. The group’s secret setting meant that charities like the National Autistic Society were locked out until one member contacted the police.

One thing we know is that social media companies cannot be relied upon to monitor and regulate the forums themselves. They have proven that time and again.

The Russian Internet Research Agency’s actions in the lead-up to the 2016 US presidential election show that these forums are an open door to our democracies. Our political parties are also struggling with the phenomenon. Abusive and hateful views and misinformation about politics or politicians can quickly take hold unchallenged, and unacceptable views can become normalised, such as antisemitism or that violence is an appropriate political tactic.

I am talking not about censorship or small private gatherings but about accountability for powerful and large-scale publishing and sharing. Social media can be a wonderful thing that brings together people who might otherwise have never met, but there is no reason why we cannot maintain that while also regulating the space to prevent its abuse. So far we have largely left the online world as a lawless wild west. If 1,000-plus people met in a town hall to incite violence towards a political opponent, or to incite racism or hate, we would know about it and deal with it. The same cannot be said of the online world.

Figures from the House of Commons Library show that, in 2007, 498 people were convicted under the Communications Act 2003 for sending grossly offensive messages. After a decade in which social media became a prominent part of most people’s lives, this figure had nearly tripled, but the Act they were convicted under was passed in 2003, before Facebook even existed. Stalking and harassment represent 60% of online crime, but, despite the increase, online hate crimes are still rarely prosecuted and go largely unreported. Our laws desperately need to catch up. Today I am proposing a small step to establish clear accountability in law for what is published on online forums and to force those who run the forums no longer to permit hate, disinformation and criminal activity. I commend the Bill to the House.

Question put and agreed to.


That Lucy Powell, Nicky Morgan, Robert Halfon, Robert Neil, Mr David Lammy, Anna Soubry, Mr Jacob Rees-Mogg, Ruth Smeeth, Luciana Berger, Stella Creasy and Jess Phillips present the Bill.

Lucy Powell accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 26 October, and to be printed (Bill 263).


Emergency debate (Standing Order No. 24)

I beg to move,

That this House has considered the recent escalation of violence in Yemen.

I thank you, Mr Speaker, for granting this urgent debate under Standing Order No. 24. With the United Nations Human Rights Council and General Assembly this month, we are approaching what could be a pivotal moment in the Yemen conflict. I am extremely grateful to colleagues from all parties who supported my application yesterday, and I am pleased that the House has this opportunity to consider the ongoing conflict in Yemen before the conference recess.

This has been an ugly conflict, with all warring parties committing atrocities. The Houthi attack on Riyadh’s main international airport last year was described by Human Rights Watch as

“most likely a war crime”,

while there have been widely documented civilian deaths attributed to the Saudi-led coalition. The Houthis have been accused of indiscriminate shelling of civilian areas, of besieging the city of Taiz and of using “wide area effect” munitions in built-up parts of Yemen. If confirmed, these acts would constitute violations of international humanitarian law. Our aim must be to ensure the protection of civilians, humanitarian workers and supplies, as well as working through diplomacy to bring all the parties together around the table to negotiate peace.

Tragically, August was one of the most violent months so far in this conflict. In the first nine days of August alone, it is estimated that more than 450 civilians lost their lives, including 131 children—nine days, 131 children! Three events, in particular, stand out: the coalition attack on 2 August on a market and hospital, which killed 55 and injured 130; a week later on 9 August, the coalition airstrike that hit a school bus full of children, killing 40 children and leaving 56 injured; then on 23 August, at least 22 children were killed trying to escape fighting in the port town of Hodeidah.

Abdul’s son was one of those who died in the 9 August school bus attack. The bus, he says, was returning from a picnic. As he searched through the wreckage of the bus to find the remnants of his son, he broke down and said, “I didn’t find any of his remains, not a finger, not a bone, not his skull—nothing.” The parents of those killed cannot even hold a proper funeral because of security concerns. This is the horrifying reality for the people of Yemen. Families are losing children every day.

To my knowledge, the Government have not condemned these August attacks. A statement by the Department for International Development and the Foreign and Commonwealth Office earlier this month expressed “serious concern” and welcomed the speed of the coalition’s investigation into the school bus airstrike. That is too soft. We need a strong, clear and firm condemnation by our Government of these attacks.

I am grateful to my hon. Friend for securing this debate. I, too, was deeply troubled by the lack of a firm condemnation from the Government. Does he agree that simply asking the coalition to investigate its own misconduct is not enough, and does he understand the concern felt by many of our constituents about our complicity in these actions given our association with a coalition that has shown callous disregard for human life and human rights and dignity?

I concur entirely with everything my hon. Friend has just said. On an independent investigation into these atrocities, time and again in debates on this issue in the House, the point has been made that we need a fully independent UN-led process that looks at all allegations by all sides—the Saudi-led coalition, the Houthis and others in this multifaceted conflict.

On callous disregard, would the hon. Gentleman refer to the fact that the Houthis are launching drone boats against commercial shipping, recruiting child soldiers and killing those who will not join the military, and have sown 500,000 land mines, posing a mortal danger to innocent civilians? It is important in this debate to get the balance right.

The hon. Gentleman is absolutely right, and I similarly concur with everything he has just said. I have already spoken about a number of the Houthi atrocities—the attack on Riyadh that Human Rights Watch described as almost certainly a war crime, and the siege of Taiz—and in a moment I will come on to the specific issue he has rightly drawn to the House’s attention, which is the engagement of child soldiers in the conflict by a number of different parties, but particularly, as he says, the Houthis.

I completely concur with the points my hon. Friend has just made about the indiscriminate attacks by the Houthis, including the rocket attacks, the indiscriminate artillery shelling and many of the other issues. Does he share my frustration that, despite the Saudi Foreign Minister and the Saudi Government repeatedly promising to provide the results of the investigations of the Joint Incidents Assessment Team into these attacks over the past few years, we have not seen reports into all those incidents? That is why we need an independent UN investigation.

I thank my hon. Friend, who has done fantastic work on this issue over a long time, and agree absolutely with his comments. Others in the debate may wish to enter into that aspect of the discussion.

In opening this debate, the hon. Gentleman has, to a degree, drawn an equivalence between the behaviour of the Houthis and that of the coalition. The truth is that we are actually on the side of the coalition, which is unanimously endorsed by the UN Security Council. It is trying to suppress the Houthi rebellion, which is against the legally constituted Government of Yemen, and while we will rightly have serious criticisms of how the coalition is carrying out its operations, in the end it is our coalition, endorsed by the United Nations. It is important that it is held to account, but it is also important that we understand that it is trying to do the job of the international community.

Let me make two points. First, international humanitarian law applies, whether the alleged violations are committed by a recognised Government or by a rebel force. In fact, surely we have a greater responsibility to condemn the actions of those whom the hon. Gentleman has described as our allies if they are acting—as has been widely alleged—in violation of international humanitarian law.

Does my hon. Friend agree that it is unfortunate that we have not had a proper debate about our involvement in the coalition of which, as we have just heard, we are apparently part? It is particularly concerning that we continue to sell arms to the coalition, but do not investigate some of the atrocious issues that my hon. Friend and others have raised.

My hon. Friend, who is a new Member, has already made his mark on both the International Development Committee—which I chair—and the Committees on Arms Export Controls, which is especially relevant to this debate. In a moment, I shall deal with the issue of our arms sales to members of the coalition, particularly Saudi Arabia.

The hon. Gentleman is making an eloquent speech and is already presenting a very balanced argument about who is to blame. For me, however, the biggest cause for concern is the support for a Saudi-led coalition that has imposed an embargo—basically a siege—on the port of Hodeidah. Millions of civilians will be affected in respect of food and resources, which could lead to the largest famine that we have ever seen in the middle east.

The hon. Gentleman, who is an active member of the International Development Committee, has anticipated the next part of my speech. In the light of that, I shall plough on.

I am most grateful to the hon. Gentleman.

We have heard that we are supporting the “legitimate” regime in Yemen. Does the hon. Gentleman agree that President Hadi’s regime was elected on a ballot paper with only one name on it, that his term of office has long since expired and that he spends most of his time either in Riyadh or offshore, on an Emirati warship? He is one of the few Presidents who have to make a state visit to their own countries.

The right hon. Gentleman has expressed that very well indeed, and I pay tribute to his sterling efforts on this issue. Unlike me, he has visited Yemen during the conflict. I think that what is really important—and I shall return to it in a moment—is for us to enable all the different parties to come together to undertake a peace process. That is surely something on which all of us can agree.

Should not the answer to the right hon. Member for Sutton Coldfield (Mr Mitchell) have been that President Hadi’s is the legitimate Government because it is the Government recognised by the United Nations Security Council? Were that not the case, the position would be entirely different, but is that not the clear position, which is being flouted not only by the Houthis but, very deliberately—and I hope that my hon. Friend will come on to this—by the theocracy in Tehran?

Clearly, the United Nations Security Council recognises that Government, but I think that the right hon. Member for Sutton Coldfield (Mr Mitchell) made a very fair point in assessing the level of support that President Hadi actually has now in Yemen. I think that if we are to secure a meaningful peace process for Yemen, that will be determined on the streets of Yemen, not in the corridors of New York and votes in the Security Council. My right hon. Friend was right in saying—as did the hon. Member for Reigate (Crispin Blunt)—that the Security Council’s position is to recognise the Hadi Government, but what he said does not contradict the powerful point made by the right hon. Gentleman that the level of popular support for that Government in Yemen is at least open to question, to put it very mildly.

Let me now deal with the position on Hodeidah, which was raised earlier. When the Minister responds, will he tell us what is the British Government’s view of the coalition strategy there? Does he agree with me that in the light of the attempts to restore a peace process, to which I shall return in a moment, the coalition should halt its military offensive in Hodeidah so that peace can be given a chance in Yemen?

The American Congress has taken a strong line on recent events, and I encourage the British Government to reflect on that. Lawmakers in Congress have signed amendments which would provide for greater scrutiny of US arms sales and would make it a condition of ongoing US support for the Saudi coalition that the Secretary of State should certify that the coalition is supporting peace talks, improving humanitarian access and reducing the number of innocent casualties. Todd Young, a Republican senator from Indiana, has said:

“The actions of the Saudis in Yemen undercut our


“national security interests and our moral values—exacerbating the world’s largest humanitarian crisis.”

May I invite the Minister, when he responds, to agree with Senator Young in that regard?

Does my hon. Friend also share my concern about the fact that the head of the Export Control Organisation, which controls arms sales here in Britain, advised the Minister in 2017 that he thought it would be “prudent and cautious” to suspend licences,

“given the gaps in knowledge”

that the British have about the humanitarian results of use of our weapons? It is concerning, is it not, that the Minister overturned that official advice and continues to allow sales?

I do share my hon. Friend’s concern. I hope that he will catch your eye later, Mr Speaker, so that he can elaborate on that important aspect.

I am pleased to see that the Chair of the Foreign Affairs Committee, the hon. Member for Tonbridge and Malling (Tom Tugendhat), is with us. Yesterday his Committee published an excellent report entitled “Global Britain: The Responsibility to Protect and Humanitarian Intervention”. It recommended that

“The Government should update its protection of civilians in armed conflict strategy to include a focus on the use of explosive weapons in populated areas. As part of that strategy the Government should set out the measures it is taking to reduce the impact of these weapons on civilians and on the essential services that civilians rely on, such as healthcare facilities.”

I urge the Minister to respond positively to that recommendation when the Government consider their response to it, and, in particular, its central relevance to the situation in Yemen.

The sharp increase in the civilian death toll must surely act as a reminder to us all that this conflict is far from over. August also saw the release of the report on the conflict by a United Nations panel of experts on Yemen. It is a damning report, and it is damning of all sides, saying that all the parties are

“responsible for a violation of human rights”,

including rape, torture, disappearances, and the

“deprivation of the right to life”.

As we heard earlier from the hon. Member for Kettering (Mr Hollobone), children as young as eight are being conscripted into the conflict, in a clear violation of the convention on the rights of the child. It is estimated that in 2017 alone, 800 children were conscripted, mostly—as the hon. Gentleman rightly said—by the Houthis.

The experts’ report says that some of these horrendous atrocities could amount to war crimes and that the international community should

“refrain from providing arms that could be used in the conflict”.

Spain recently cancelled an arms deal with Saudi Arabia over concerns that such weapons were being used in the war in Yemen. As I said earlier, there is also a live debate in the United States about American arms sales to the coalition. May I once again urge the Government to consider suspending the sale by the United Kingdom of arms that could be used in Yemen?

Does the hon. Gentleman agree that this debate is happening not just in Parliament, but throughout these islands? According to the findings of a YouGov poll, released this week, just one in 10 of the British public supports UK arms sales to Saudi Arabia, and one in six believes that they promote British values and interests. This is a dead duck, and almost no one in these islands believes in it. I hope that the Minister will say a bit more about that when he responds to the debate.

In supporting my hon. Friend’s call for a suspension of arms sales pending an investigation, which the Leader of the Opposition—who is in the Chamber—and I in my previous capacity jointly made a couple of years ago, does my hon. Friend not agree that this is a matter of the law? I know that there has been a legal case, but criterion 2c says very clearly that a licence should not be granted

“if there is a clear risk that the items might be used in the commission of a serious violation of international humanitarian law”.

Are not the incidents in August merely further proof that breaches of international humanitarian law are being committed by the coalition?

I pay tribute to my right hon. Friend for the role he has played on this issue over a significant period of time, and I absolutely share his view. I know there are different views about this in the House, and we had a fundamental difference of view on this in the Committees on Arms Export Controls in the previous Parliament, but I share his view, and I fear that our approach to this as a country undermines our credibility as a force for good in the control of arms around the world.

In my hon. Friend’s considerations in coming to that conclusion, does he give any weight to the tens of thousands of skilled aerospace workers, and their families and their communities, who depend on the military aircraft, let alone the whole aerospace supply chain which is vitally important for our industry? Should we not be thinking about them as well?

My right hon. Friend is of course right to say that one of our considerations in having a policy on the defence industries must be the work for those who are in those industries, but we have not only signed up to a set of laws in our own country, in Europe and internationally on arms control. We have taken the lead in international forums, and those laws and rules have very little meaning if we are not prepared to enforce them, and enforce them consistently.

As the hon. Gentleman said so graphically, we have heard different views from different sides in this difficult issue. Does he agree that we operate one of the most robust arms control regimes in the world at the moment, and would it not be sensible to wait for the conclusion of the judicial process in the UK? The matter is being very carefully considered by the courts, and it was in the divisional court last year, which found for the Government.