My principal focus is to ensure the continued resilience of the UK economy and public finances at this time of uncertainty. Thanks to the hard work of the British people, our national debt is now falling sustainably for the first time in a generation, but it is still too high and it is vital that the Government continue to get debt down to ensure that the economy is resilient against future shocks, to prevent the wasting of billions of pounds more on debt interest payments, and to avoid burdening the next generation.
Since 2013 this Government have given tax handouts worth £4.1 billion to the big alcohol corporations at a time when the NHS is short of 40,000 nurses. Would it not be a sensible choice to invest in the nurses, doctors and police officers who have to deal with the problems caused by cheap alcohol?
Yes, it is a vital cornerstone of our institutional structure that the Bank of England remains independent, and those who have suggested that they would seek to politicise appointments to the Bank of England would be doing a great disservice to this country and our economy.
The Chancellor, like most of us, has been watching the accumulation of spending promises by the Tory leadership candidates. They amount now—[Interruption.] They amount now to nearly £100 billion, and one of the Chancellor’s colleagues commented yesterday that they make me look like a fiscal moderate. May I ask the Chancellor what impact this level of unfunded commitments would have on his economic strategy, or can he tell us how they could possibly be funded?
Let me try this one. Both Tory leadership candidates are threatening no deal. This morning, the Chancellor has eloquently set out the consequences of no deal. Bearing in mind what he said, may I ask him very straightforwardly whether he will join us and commit himself to doing everything he possibly can to oppose the Prorogation of Parliament to try to sneak no deal through, and also to voting against no deal?
With your permission, Mr Speaker, if I may: this might be the Chancellor’s last Treasury questions and I just want to thank him for the civility with which he has always maintained our relationship. I also admit that there have been times when we have enjoyed his dry sense of humour. I gave his predecessor a little red book as a present. We have another red book today, but this is a guide to London’s rebel walks and we hope that he will enjoy it in his leisure periods.
That is very kind of the right hon. Gentleman; I much prefer this little red book to the one he gave my predecessor, although I have to say that I have not read this one and I have read the other one.
On the broader question, I have been consistently clear that I believe that a no-deal exit would be bad for the UK, bad for the British economy and bad for the British people. We cannot rule out that happening, because it is not entirely in our hands, but I agree with him that it would be wrong for a British Government to seek to pursue no deal as a policy. I believe that it will be for the House of Commons, of which I will continue proudly to be a Member, to ensure that that does not happen.
Borrowers who believe that they have been mis-sold a shared appreciation mortgage are able to take their complaint to the Financial Ombudsman Service. The Government are unable to comment on group action cases relating to this issue as we have no role in deciding whether cases may be heard in court. I note that the annual review of the Financial Ombudsman Service in 2003-04 said that in most cases it had not upheld complaints of shared appreciation mortgage mis-selling due to the information being satisfactory. That is the situation at the moment.
The hon. Gentleman is right to point to storm clouds over the global economy. We tend to focus on Brexit-related issues and the domestic agenda, but I have just come back from the G20 in Osaka, and looking more widely, we can see that global growth is slowing and that global trade growth is slowing even more dramatically. A great deal hinges on finding a solution to the disputes between China and the United States. It is hugely in our interests that that dispute is resolved and that normal trading relations are resumed between the world’s two economic superpowers. As a middle-sized open economy, we are bound to be adversely affected if global trade slows down.
I am delighted to hear the news of new investment in my hon. Friend’s constituency, and I take my hat off to Dean’s shortbread. As he knows, the two-year increase in the annual investment allowance, which the Chancellor announced in the Budget, is helping firms right across the country to invest in new plant and machinery. It gives 100% first-year tax relief on the first £1 million of eligible investments and helps small and medium-sized firms such as Dean’s shortbread to continue to grow.
I reassure the hon. Lady that we have already put additional funding into the police grant, and we have raised spending power such that it increases in real terms. Additional surge funding has been put into the west midlands to acknowledge the specific issues in that area.
We made an announcement this morning about our plans for green finance. Over the coming months and years, it will be essential to demonstrate how we are able to mobilise our capital markets and the instruments of a market economy to deliver on this huge enterprise. If we do not demonstrate how the market economy can provide solutions to decarbonising our economy, there are others with alternative solutions to present.
We have worked hard to build a stronger, fairer economy, dealing with the deficit that we inherited, helping people into work and cutting taxes for people, families and businesses, and the result is that the economy has grown continuously for the past nine years. Employment is currently at record high levels, unemployment is currently at the joint lowest rate since 1975, and real wages are rising again. We have created 3.5 million new jobs, but the next stage must be about increasing real wages by raising productivity, because that is the only sustainable way to raise the living standards of working people in this country.
The reality is that that we have got a record number of people into work. Universal credit has been shown to help more families get into work, and it has made work pay. We have also made adjustments to universal credit to shorten the wait time, and we have put in an extra £630 a week for families.
I thank my hon. Friend for his question. The UK’s digital economy is thriving and is growing 10 times as fast as the wider economy. We are pursuing a range of measures to reinforce that leading position, and that involves implementing a 10-year action plan to unlock over £20 billion in finance growth in innovative firms and a further £7 billion for research and development since 2016, with internationally competitive research and development tax reliefs to support investment.
As my right hon. Friend the shadow Chancellor has just pointed out, the right hon. Member for Uxbridge and South Ruislip (Boris Johnson) has made £30 billion-worth of spending pledges and the right hon. Member for South West Surrey (Mr Hunt) has made £13 billion-worth of pledges. The Chancellor has said it will not happen on his watch, but that seems to suggest that a magic money tree has been found in the barren soil of the no deal for which we seem to be heading.
I want to ask the Chancellor about the pledges announced by the current Prime Minister in the past few weeks, which unfortunately have not included any compensation for the infected blood community. How have the Chancellor and the Treasury prioritised and costed those announcements?
My hon. Friend makes a very good point about dementia care, which is one of the issues that will be looked at as part of the long-term plan for health. Due to the fiscal responsibility exercised by this Government, we are able to put extra money into health services to deal with issues such as dementia.
I welcome the Chancellor’s remarks about a no-deal Brexit and the disaster it would be for our country, costing jobs and livelihoods. Does he agree that both Conservative leadership candidates, who support a no-deal Brexit, should stop selling out the country to serve their own political ambitions? Will he commit to joining us in voting against a no deal when and if he returns to the Back Benches, and to voting with us on a no-confidence motion, if it comes to that, to stop a no deal?
At this stage of my career, I will not speculate on my future actions. What I will say is that the Government’s analysis shows that a no-deal exit would mean that all the regions, nations and sectors of the UK economy have lower economic output compared with today’s arrangements and compared with the White Paper scenario that the Government set out. It is important we all understand that preparing for a no deal, which is a perfectly sensible thing to do because it might happen to us without our volition, is not the same as avoiding the effects of a no deal.
Yes. This is a huge commitment, but it is the right commitment to make. The Committee on Climate Change recommended that the Treasury should undertake a review of the funding and financing mechanisms to ensure that this huge undertaking can be funded, and that it will be funded in a way that is fair to families, households and businesses across the UK, which is exactly what we will do.
The “All Kids Count” report, on the impact of the two-child limit after two years, was published last week by the Church of England, the Child Poverty Action Group, Women’s Aid, Turn2us and the Refugee Council. The report illustrates the devastating impact of the two-child policy, particularly on working families who are unable to compensate for the £2,780 a year cut by working longer hours. Before the Chancellor leaves office, will he scrap the two-child policy and its devastating impact on families?
The decision by the European Union to suspend the equivalence agreement with Switzerland seems to be very damaging. My right hon. Friend the Chancellor has done a fantastic job over the past few years. Will he confirm whether the United Kingdom was consulted on whether the decision should go ahead?
We have been closely involved in this issue, discussing it both in the EU and with the Swiss. I can tell the House that although on the face of it the withdrawal of equivalence had a very significant effect on the ability of UK shareholders to trade Swiss shares on the Swiss stock exchange, the measures that the European Securities and Markets Authority announced on Friday significantly mitigate the impact. So we very much hope that the European Union and Switzerland will be able to reach agreement, and of course there is a very direct relevance to the UK’s own negotiations with the European Union.
Will the Chancellor commit to enabling the 120,000 families on very low incomes who find out about a tax credit overpayment when they claim universal credit to have a fair chance to appeal against those deductions averaging £1,500 being made and to giving them a chance to raise themselves out of poverty?
My hon. Friend knows that I do share his concerns on this matter. The Public Works Loan Board is there to support local authorities’ capital spending. Some of the development activities of local authorities are perfectly legitimate: for example, the regeneration of urban areas. What is not legitimate is local authorities arbitraging the low interest rates of the PWLB to buy commercial property for yield, in order to develop income-yielding property portfolios. The Treasury is looking at how we can manage that situation.
Order. We have now had 20 topical questions. Whether this is the Chancellor’s last appearance at the Dispatch Box as Chancellor remains to be seen, but whether it is or not, he will always be able to tell his children that demand for him exceeded supply of him. He can say to them proudly, “I always left them wanting more of me.”