House of Commons

Wednesday 26th November 2014 Commons Chamber

Wednesday 26 November 2014

The House met at half-past Eleven o’clock

Prayers

Wednesday 26th November 2014 Commons Chamber

[Mr Speaker in the Chair]

Business before Questions

Spoliation Advisory Panel

Resolved,

That an humble Address be presented to Her Majesty, That she will be graciously pleased to give directions that there be laid before this House a Return of the Report from Sir Donnell Deeny, Chairman of the Spoliation Advisory Panel, dated 26 November 2014, in respect of a tapestry fragment in the possession of Glasgow City Council as part of The Burrell Collection.—(Alun Cairns.)

Oral Answers to Questions

Wednesday 26th November 2014 Commons Chamber

The Secretary of State was asked—

[Guy Opperman (Hexham) (Con)]

1. If he will give guidance to the Smith commission on ensuring that its proposals do not hamper cross-border trade with the north of England.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

At the outset of this process, Lord Smith set out a number of guiding principles underpinning cross-party talks. They included the principle that the proposals should strengthen Scottish devolution and the Scottish Parliament within the United Kingdom, and that they should not cause detriment to the UK as a whole or to any of its constituent parts.

[Guy Opperman]

My constituents campaigned very strongly so that we remained “better together”, and whether that related to farmers, business, trade or joint air passenger duty, it continues. Does the Minister welcome the borderlands initiative between local authorities on either side of the border?

[David Mundell]

I very much welcome the borderlands initiative, which is an excellent example of cross-border working. Councils are working together across the Scottish and English borders to maximise economic and cultural opportunities.

[Mr Brian H. Donohoe (Central Ayrshire) (Lab)]

I understand that the Smith commission has written to a number of companies asking for their views on the question of what should be devolved. Companies in my constituency are telling me that if Scotland were to be given some of the powers that are being considered, they would leave Scotland. Is that good or bad?

[David Mundell]

The Smith commission has engaged in a widespread consultation with all aspects of Scottish society. I understand that there were some 14,000 submissions, and the commission will obviously look closely at all of them.

[Sheila Gilmore (Edinburgh East) (Lab)]

What everyone wants, in Scotland and in England, is the certainty of knowing how we are to move forward. My party is committed to including a Scotland Bill in the Queen’s Speech when we win the general election next May. Will the Minister’s party make the same commitment?

[David Mundell]

I do not share the hon. Lady’s arrogance, but what I do share is the commitment to delivering the Smith commission’s proposals. We have made it absolutely clear that draft legislation will be produced by 25 January next year, and there will be a commitment to enact that legislation in the next Parliament.

[Angus Robertson (Moray) (SNP)]

A wide range of proposals have been submitted to the Smith commission which would foster economic growth, job-creating powers, and the ability to tackle social inequality. Is the Minister confident that the commission will recommend the devolution of corporation tax, job-creating powers and the setting of a minimum wage?

[David Mundell]

I am not going to prejudge the Smith commission. All that I know in relation to the hon. Gentleman’s proposals is that his party had an opportunity to select him as one of its commissioners so that he could argue for those measures, and, as far as I am aware, it did not do so.

[Angus Robertson]

Following the independence referendum, survey evidence in Scotland showed that 71% of Scottish respondents wanted the Scottish Parliament to control all taxation raised in Scotland, 66% wanted devo-max—that is, the devolution of all areas of Government policy except defence and foreign affairs—and 75% wanted control of the welfare and benefits system to be devolved. Is the Minister confident that the Smith commission will recommend the devolution of those powers?

[David Mundell]

The Smith commission includes two representatives of the Scottish National party, and is seeking to reach cross-party agreement. What we all know is that 55% of people in Scotland—more than 2 million—voted to remain part of the United Kingdom.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

The Smith commission will report tomorrow. Its report will lay the foundations for greater devolution for Scotland and, hopefully, the devolution of powers from Edinburgh, at the centre, to a more local level. The Minister referred to a closer working relationship between the borderland areas in the north of England and the south of Scotland. Will he guarantee that whatever the Smith commission delivers will add up fiscally, to ensure that it does not work to the detriment of the people of Scotland?

[David Mundell]

That is one of the principles guiding the Smith commission’s work. However, the hon. Gentleman is right to emphasise that, notwithstanding the commission’s recommendations on powers for the Scottish Parliament and more devolution in Scotland, in the south of Scotland we need to continue to work with our friends and neighbours in the north of England.

[Mrs Anne McGuire (Stirling) (Lab)]

2. What recent discussions he has had with his ministerial colleagues on shipbuilding on the Clyde.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

First, I would like to place on record my congratulations to Nicola Sturgeon on her recent election as Scotland’s First Minister. I spoke to her on the evening of her election and made the point that Her Majesty’s Government here look forward to working with her and her colleagues in the way I believe the people of Scotland would want.

I have regular discussions with ministerial colleagues on a range of issues affecting Scotland, including shipbuilding on the Clyde, most recently last week with my right hon. colleague the Secretary of State for Defence, during which he reiterated his recent public statement underlining that complex UK warships are built only in UK shipyards. He plans to visit the Clyde again shortly.

[Mrs McGuire]

I am sure many on the Opposition Benches would echo the comments about the new First Minister and wish her well.

The Secretary of State gave a slightly nuanced answer. I wonder if he will state categorically that the Type 26 frigates will be built, and perhaps he could throw some light on why the First Sea Lord felt he could make the comments that threw into doubt the proposals for those frigates.

[Mr Carmichael]

I congratulate the right hon. Lady on finding nuance where absolutely none was intended. The First Sea Lord will, of course, speak for himself, but she will be aware that questions of contract are down to Ministers in the Ministry of Defence, and she will no doubt have seen, as other Members did, the comments of my right hon. Friend the Secretary of State for Defence on Monday making it very clear that that is where the orders will go.

[Sir Gerald Howarth (Aldershot) (Con)]

Does my right hon. Friend agree that the decision by the people of Scotland to remain part of the United Kingdom has been exceptionally good news for defence shipbuilding on the Clyde, that defence is an extremely important component of the United Kingdom and that the prospect of more jobs arising out of the Type 26 global combat ship, for which I had some responsibility in the Ministry of Defence, should mean that there will be a really good assurance of jobs on the Clyde in Scotland?

[Mr Carmichael]

Indeed, the efforts of the MOD—and I pay tribute to the work of my hon. Friend during his time as a Defence Minister—are exceptionally good news for jobs in shipbuilding on the Clyde. It is also good news for the Royal Navy, because that is where the expertise and the body of skills lie, so that is the best place for these ships to be built.

[Mr Ian Davidson (Glasgow South West) (Lab/Co-op)]

Are admirals self-employed? Whatever possessed the First Sea Lord to suggest that these ships would not be built on the Clyde? It is clear that separation shuts shipyards, not Scotland being part of the United Kingdom. Has the Admiral been keel-hauled or walked the plank, or would it be better if he was invited to meet the Scottish Affairs Committee?

[Mr Carmichael]

Having appeared before the hon. Gentleman’s Committee on a number of occasions, I have a small suspicion that of the various options he outlined the last one is the least attractive. As I have said, the First Sea Lord will speak for himself. I have no doubt that in making his comments he felt he was speaking in the best interests of the Navy, but as I have said, the question of contracts is to be determined by Ministers, and the Secretary of State for Defence could not be clearer in his comments in this regard.

[Sir Menzies Campbell (North East Fife) (LD)]

My right hon. Friend will understand that, as someone who lived close to Yarrows shipyard for quite a long part of my life, I have a particular attachment, and indeed affection, for the notion of shipbuilding on the Clyde. Will he accept that in the event that orders from the MOD are no longer placed, the impact will be not just on jobs directly associated with the construction of ships, but on all those companies on both banks of the Clyde that supply goods and services to BAE Systems?

[Mr Carmichael]

Indeed, that is the case. Like my right hon. and learned Friend, I have my own family associations with shipbuilding on the Clyde, and I think we are probably typical of many in Scotland today. The truth of the matter is that if that business had been lost, which of course would have been a consequence of a yes vote, the implications would have been profound not just for those who are directly employed in the shipyards, but for the supply chain right across Scotland.

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

Will the right hon. Gentleman go back to the Defence Secretary to discuss concerns about slippage in the programme, in order to allay fears about exactly when the work is likely to come to the Clyde and to the work force whose livelihoods depend on it?

[Mr Carmichael]

I can assure the hon. Lady that I have regular contact with the shipbuilding unions on the Clyde. I listen to their concerns and I hope that I can give them some assurance of the Government’s intentions. However, there must be commercial rigour in the laying of those contracts, and it would be inappropriate for the Government to make any announcements before that point has been reached. I do hope that we have all, on both sides of the House, learned the lessons of the past in that regard.

[John Robertson (Glasgow North West) (Lab)]

I am the MP for the Scotstoun yard on the Clyde, in which it has been said that £200 million is to be invested to turn it into a state-of-the-art facility. Given that thousands of jobs are at risk there, is it not time that the First Sea Lord was sacked for causing my constituents, the people who work in my yard, such worry? This is ridiculous and he should stand down immediately.

[Mr Carmichael]

Perhaps I could just caution the House against getting too excited about the comments—or, indeed, the future—of the First Sea Lord. I cannot over-emphasise the fact that the decisions on those contracts are made by Ministers, and that those Ministers are quite clear that our complex warships are built only in the United Kingdom. The hon. Gentleman should be able to give that assurance to his constituents.

[Dr Eilidh Whiteford (Banff and Buchan) (SNP)]

The Scottish Government took action in the summer to secure the future of the Ferguson shipyard, the last remaining commercial shipyard on the Clyde. Given the doubts that have been cast over the UK Government’s commitment to bringing the Type 26 frigate contracts to the Clyde, will the Government publish the commercial principles agreement with BAE Systems, so that there can be transparency in the process?

[Mr Carmichael]

Let us reflect for a second on what the hon. Lady has just said. There is no doubt about the commitment to bring the T26 ships to the Clyde. That is an absolute commitment—[Interruption.]

[Mr Speaker]

Order. The parliamentary leader of the Scottish National party is behaving as though he were a kind of pre-programmed computer with a monotonous yell. He should stick to sucking his glasses. We do not need to hear that. He wants to be a statesman, but that is not statesmanlike.

[Mr Carmichael]

Thank you, Mr Speaker. I am afraid that the hon. Member for Moray (Angus Robertson) behaves exactly as we all expect him to. We have come to expect no more of him than that. The hon. Member for Banff and Buchan (Dr Whiteford) asked about the publication of the agreement. She should raise that matter with the appropriate Department.

[Jim McGovern (Dundee West) (Lab)]

3. What steps he is taking to encourage firms in Scotland to pay the living wage.

[Ian Murray (Edinburgh South) (Lab)]

9. What steps he is taking to encourage firms in Scotland to pay the living wage.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

The Government support businesses that choose to pay the living wage, where it is affordable and does not cost jobs. Decisions on what wages to set, above the national minimum wage, are for employers and workers. However, we encourage employers to pay the living wage where possible.

[Jim McGovern]

Last week, Glasgow Celtic, the football club that I support—indeed, I am a season ticket holder—announced that anyone working there who was not on the living wage would be put on to it. That will mean a major increase for many of the club’s employees. Where Celtic leads, many others follow. We have only to look back to 1967 when Celtic became the first British club to win the European cup. They were followed, famously, by Manchester United in 1968—

[Mr Speaker]

Order. It is time for the hon. Gentleman to take his penalty, for goodness’ sake!

[Jim McGovern]

What can the Minister do to ensure that more organisations and major employers in Scotland pay the living wage?

[David Mundell]

On this occasion, I share the hon. Gentleman’s view that where Celtic football club has led, others should follow. We want to encourage all employers who are in a position to do so to pay the living wage.

[Ian Murray]

Pay is one of the most important tools in helping to fight poverty, but it also makes perfect business sense. The Government appear to have absolutely no plans to encourage employers to pay the living wage. The Minister will also be aware that the Scottish National party Government have just refused to put the living wage into Government contracts. Should not the Government be supporting Labour’s “make work pay” contracts, which would share tax benefits with employers, thereby encouraging them to pay the living wage?

[David Mundell]

I completely refute the hon. Gentleman’s suggestion that the Government are not encouraging employers to pay the minimum wage where they are in a position to do so and it does not cost jobs. This Government’s commitment to those on low pay is clear from the way in which we have raised the personal allowance. His party’s position is far from clear—Labour claimed that it would reduce the national minimum wage to a level that is actually lower than it is projected to be in 2020.

[Margaret Curran (Glasgow East) (Lab)]

As we approach the first anniversary of the tragedy, I am sure the whole House will join me in remembering the victims of the Clutha helicopter crash that happened in my own city. Our thoughts will be with the victims and their families this Saturday.

Does the Minister agree that the living wage is a means of addressing the scandal of low pay in Scotland, and that tackling low pay should be a higher priority for this Government? In the light of that, can he tell the House how many people in Scotland were paid below the minimum wage in the past year?

[David Mundell]

I join the hon. Lady in highlighting the first anniversary of the terrible Clutha tragedy. It is a credit to all Members of this House and particularly to the people of Glasgow that not just at the time but throughout the past year they have responded to that.

The hon. Lady will know that unlike the Labour Government, this Government have been keen to ease the procedures whereby those who pay below the minimum wage are named and shamed. Earlier this year 25 employers that had not paid the minimum wage were named, three of which were in Scotland.

[Margaret Curran]

That is a most disappointing answer. In fact, 11,000 people in Scotland are paid below the minimum wage, and it is shameful that neither the Minister nor the Government know that figure. In the past two years there has not been a single prosecution, and only two companies in Scotland have been named and shamed. Eleven thousand people in Scotland are not paid what they are entitled to. Given the gross failure of this Government properly to enforce the national minimum wage, should not the Minister apologise to those 11,000 people who have been failed by this Government? He does not even know who they are.

[David Mundell]

It is the hon. Lady who needs to apologise. Anyone watching this exchange would think that there had been were prosecutions under the previous Government. There were absolutely none. If she wants to get her facts right, I can tell her that three companies have been named and shamed in Scotland. They are Sun Shack Ltd in Hamilton, Cargilfield School Ltd in Edinburgh and Perth Hotels Ltd in Perth. If she has the details of additional people who are not receiving the minimum wage, rather than political point-scoring in this House, she should take their details to Her Majesty’s Revenue and Customs so that their employers can be dealt with.

[John Stevenson (Carlisle) (Con)]

4. When he expects the Smith commission to publish its report; and what steps are planned to implement its findings.

[Mark Menzies (Fylde) (Con)]

6. When he expects the Smith commission to publish its report; and what steps are planned to implement its findings.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

Lord Smith is expected to publish his heads of agreement soon. In accordance with the timetable, this Government will produce draft clauses by 25 January. I shall, of course, with your assistance, Mr Speaker, endeavour to keep the House informed of all developments.

[John Stevenson]

I was delighted that the people of Scotland voted to keep Carlisle at the centre of the United Kingdom. Does the Minister agree that it is vital that we fulfil the commitments made to Scotland and ensure that there is a tight but sensible timetable to bring these commitments to law?

[Mr Carmichael]

I could not agree more. The commitment was made in all good faith and solemnity by the party leaders during the referendum campaign. It will be kept according to the timetable previously outlined.

[Mark Menzies]

Is the Secretary of State confident that the Scottish Government will support the proposals, or will they begrudge what is offered to them?

[Mr Carmichael]

The Scottish Government—or at least the Scottish National party—are taking part in the Smith process. I believe that John Swinney, their nomination as one of their commissioners, is an honourable man who would not do that in anything other than good faith. I very much hope he and his party will not prove me wrong on that.

[Mr Graham Allen (Nottingham North) (Lab)]

10. Is the Secretary of State aware that devolution, like Union, is a principle and not an expedient, so it should apply to all the nations of the United Kingdom, Scotland included? Is he also aware of a letter signed by Mayor Boris Johnson, Councillor Sir Richard Leese and all the senior local government officers and leaders asking for the same package to be applied—or for consideration to be given to its application—to England as Lord Smith wishes to apply to Scotland?

[Mr Carmichael]

I share the hon. Gentleman’s analysis of what devolution is actually about. I say to him, however, that in Scotland we have debated our constitutional future over decades. Change can be achieved only by building the broadest possible consensus from the lowest possible level up, taking in parties outside the political process. The people of England will need to do that if they are to have a better constitutional future.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

13. Does the Secretary of State accept that the issue of fracking and exploring for minerals in Scotland is one legitimately looked at by the Smith commission? If it recommends that that goes to Scotland, it will stop the clock on using reserve powers and will let Scotland decide about fracking.

[Mr Carmichael]

Like everybody else, the hon. Gentleman will have to wait to see what recommendations come from the Smith commission. The Government were responsible for setting it up and we will deliver on the heads of agreement when they are published, but it would not be appropriate for me, standing at this Dispatch Box now, to second-guess what Lord Smith is going to say.

[Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)]

5. What assessment he has made of the adequacy of provision of superfast broadband services in Scotland.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

The Government’s superfast broadband roll-out programme has invested £120 million, provided to the Scottish Government to deliver rural broadband services across Scotland. More than 150,000 Scottish homes and businesses now have access to broadband from the work done so far.

[Tom Greatrex]

The Secretary of State will be aware that 69% of UK premises have access to broadband whereas the figure for Scotland is only 48%. Does he agree that the situation for my constituents in Torhead Farm is unacceptable? That housing scheme is served by two cabinets, one in the commercial scheme and the other in the community scheme, so one person has access to commercial broadband whereas their neighbour does not, because of the Scottish Government’s failing scheme. Can he help the Scottish Government to get a grip of this, so that everyone gets access to broadband services?

[Mr Carmichael]

As the hon. Gentleman says, the responsibility for the delivery of this money and the improvements that can come from it has been given to the Scottish Government. I hear similar stories to the one he mentioned as I go across Scotland; it is clear that there are problems. If he wishes to furnish me with the details, I will be more than happy to take up the matter with the Scottish Government.

[Several hon. Members]

rose—

[Mr Speaker]

Order . There is far too much noise in the Chamber. Let us hear Mr John Thurso.

[John Thurso (Caithness, Sutherland and Easter Ross) (LD)]

Thank you, Mr Speaker. My right hon. Friend will be aware of the excellent project to roll out fibre and broadband in Caithness, Sutherland and Ross-shire, with welcome funding from this Government. Is he as surprised as I am to learn that neither Openreach, nor the Highlands and Islands Enterprise is either capable or willing to say who will benefit? What can we do to get transparency into this process, so that these communities know what they are getting?

[Mr Carmichael]

I am indeed aware of the projects to which my right hon. Friend refers, and I share his disappointment that, apparently, information as fundamental as that has not been given to his constituents. It is difficult to see why people would want to keep it a secret.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

8. Superfast broadband could be assisted by the high data speeds given by 4G mobile. What will the Secretary of State do to ensure that high data speed 4G comes to rural and island areas sooner rather than later?

[Mr Carmichael]

The hon. Gentleman rightly identifies 4G as an opportunity for communities of the sort that he and I represent. He will be aware of the money that has been put into the mobile infrastructure project by this Government. That work is going on and will ultimately assist in reaching 4G.

[Ann McKechin (Glasgow North) (Lab)]

7. What progress has been made on the implementation of a Scottish rate of income tax; and if he will make a statement.

[The Secretary of State for Scotland (Mr Alistair Carmichael)]

Implementation of the Scottish rate of income tax is being led by Her Majesty’s Revenue and Customs, and the Work programme includes representatives from HM Treasury, the Scotland Office and Scottish Government. The project is handling the detail of the implementation and operation of the Scottish rate and is on track to make the necessary changes in readiness for April 2016.

[Ann McKechin]

The Secretary of State will be aware that the Office for Budget Responsibility has consistently reported that the Scottish tax share of income tax is reducing, which is largely due to the fact that we have a higher proportion of basic rate taxpayers. Will he tell us what discussions he has held on how that will be reflected in the final transitional settlement when the Scottish Government take control of the share of Scottish tax?

[Mr Carmichael]

That is exactly the sort of detail that informs the ongoing discussions between the Treasury and the Scottish Government in relation to the necessary adjustments to the block grant.

[Mr Peter Bone (Wellingborough) (Con)]

So that the Scottish National party can get its views on income tax heard, does the Secretary of State think that it, and not the Liberal Democrats, should be in the leaders’ debate as it is polling more than the Liberal Democrats?

[Mr Carmichael]

No.

The Prime Minister was asked—

[Albert Owen (Ynys Môn) (Lab)]

Q1. If he will list his official engagements for Wednesday 26 November.

[The Prime Minister (Mr David Cameron)]

This morning, I had meetings with ministerial colleagues and others, and, in addition to my duties in this House, I shall have further such meetings later today.

[Albert Owen]

In April 2010, I agreed with the Prime Minister and Nick that VAT was a regressive tax. Indeed the Prime Minister went further and said that it was far more regressive than income tax. He then went on to break his pledge to the British people and hiked up VAT to 20%. May I give him an opportunity to restore his credibility on VAT and ask him to rule it out completely to pay for any future income tax cuts?

[The Prime Minister]

Our plans involve not putting up taxes, but continuing to grow our economy and create jobs. With regard to the long-term economic plan, the hon. Gentleman will be pleased to know that a new statistic has come out today. We used to say that there were 400,000 new businesses in Britain. I can now tell the House that, since 2010, there are 760,000 new businesses.

[Mrs Anne Main (St Albans) (Con)]

Does my right hon. Friend share my concern that the one topic that is not being discussed today in the Opposition day debate is the Welsh health service? Sadly, my mother died under the Welsh health service. At her inquest, it was revealed that ambulances routinely had kit that had not been checked and things that had been left out. Does he share my concern that it has taken the death of another person in Wales to get a change to this service?

[The Prime Minister]

My hon. Friend makes an important point, which is that there is a debate on Wales in the House today, but not a debate about the health service in Wales. We should have such a debate because the health service in Wales made the decision to cut the NHS budget rather than to increase it, as we have done in England. It has not met an NHS target on cancer or waiting times since 2008. The NHS in Wales is in trouble and that is not because of hard-working doctors and nurses, but because of a Labour Administration who cut the NHS and failed to reform it.

[Edward Miliband (Doncaster North) (Lab)]

Everyone was appalled by the abuse of people with learning disabilities at Winterbourne View. It is a basic obligation of a civilised society to treat everyone, especially the most vulnerable, with respect and dignity. A couple of years ago, the Government set the aim of moving people into the community and out of these assessment and treatment units. Today’s report shows that that has not happened. Can we today, across the House, reaffirm that aim?

[The Prime Minister]

We should absolutely reaffirm that aim. Anyone who, like me, watched the television programme on Winterbourne View would have been absolutely shocked at the way in which people with learning disabilities are treated. Everybody knows that that has been a problem for years and decades—not for a few months—and that we have to do more to get people out of hospitals and into loving and caring homes in the community. The reason why we commissioned this report from Sir Stephen Bubb, and it is an excellent report, is that the commitment to get all the people out of the hospitals had not been met. Sir Stephen has come up with good ideas for how we bring together the health service and local authorities to ensure that people with learning disabilities are treated with respect.

[Edward Miliband]

I am grateful for that answer, but there are still more people with learning disabilities moving into institutional care than there are moving out of it, which is taking them away from their families and friends. Will the Prime Minister promise today that there will be a clear timetable so that the promises made to people with learning disabilities and their families are kept?

[The Prime Minister]

I do not want to set out a timetable that it is not possible to meet. We have just received the report from Stephen Bubb. He says clearly:

“it’s…unfair to blame the Government, I think it’s been a system failing, and I am very keen not to put blame anywhere, I am very keen that we move on.”

Indeed, we should move on and plan properly how we commission care and places in the community, using local authorities as well as the NHS, so that we respond to the report in good time, because otherwise we will make the same mistake again.

[Edward Miliband]

I hope that the Prime Minister will take the report away and consider setting out a timetable, because a promise was made, and this is about the future and doing right by people with learning disabilities and their families.

I want to turn to the wider issue of the NHS. We saw a report this week of a patient waiting 35 hours in A and E. Across England, A and Es including Scunthorpe, Middlesbrough and King’s Lynn are telling patients not to turn up. We have seen report after report of patients waiting hours for ambulances. Does this represent more than some isolated incidents, and actually show an NHS in England at breaking point?

[The Prime Minister]

The figures show that, yes, the NHS is under pressure. Last week, 429,000 people presented at accident and emergency units across England, which is 3,000 more patients every day than under the previous Government. What has happened is a big increase in accident and emergency admissions. As the right hon. Gentleman knows, the target is to see 95% of people within four hours. The running total for this year is 94.7%, so the figure is 0.3% below what we are meant to achieve. The key thing is what we are going to do to respond to these problems in A and E. We are putting £700 million more into the NHS this year, and we are able to do that only because we have a strong and growing economy. That is the key: you can have a strong NHS only if you have a strong economy.

[Edward Miliband]

The truth is that the crisis in A and E is a symptom of the crisis in elderly care and in relation to getting to see a GP. One of the biggest problems is that one in four people is unable to see a GP within a week, and we even heard yesterday from the Health Secretary that that is a problem. What does it say about the NHS when the Health Secretary says that he goes to A and E because he cannot get a GP appointment?

[The Prime Minister]

Yet again, the right hon. Gentleman comes to the House to raise a problem that he created. Following the Labour party’s GP contract, 90% of doctors opted out of out-of-hours care. That is why we are putting in place arrangements for seven-day opening for GPs, and 7 million people already have access to that. I repeat: if you cannot run the economy, you cannot run the NHS—and he could not run either.

[Edward Miliband]

The truth is that we introduced evening and weekend opening; the Prime Minister cut it. We opened walk-in centres; he shut them. He promised to improve GP access, but he has not delivered it, and this is happening on his watch. Today, the King’s Fund says that without an emergency injection of resources, the NHS will face financial meltdown. This is exactly the same pattern that we saw under the previous Tory Government: winter crisis followed by emergency bail-outs. Is it not a damning indictment of the Prime Minister’s record on the NHS that we are back to those days?

[The Prime Minister]

What we have is this Government putting £12.7 billion more into the NHS, and that is why we have 1,200 more nurses, 8,000 more doctors and patients being treated with greater care. The real point is this: the right hon. Gentleman famously forgot to mention the deficit, and we know what happens when you forget about the deficit. Look what happened to health care spending in Portugal: cut by 17%. Look what happened to health care spending in Greece: cut by 14%. He cannot run the economy and he cannot run the NHS—he has no plan for either.

[Edward Miliband]

I will tell the right hon. Gentleman what is happening. Deficits are rising right across the NHS because of his mismanagement—his top-down reorganisation that nobody wanted and nobody voted for. He has turned the NHS from a service that was succeeding to a service in crisis, and it is a crisis of his making. He closed the walk-in centres. He introduced the top-down reorganisation. He cancelled the GP target so that people could get in to see their general practitioner. He has broken his promises. Only a Labour Government can save the national health service.

[The Prime Minister]

What the right hon. Gentleman forgets is that when we put £12.7 billion into the NHS, his shadow Health Secretary said it was irresponsible. It is only because we have safeguarded the economy that we can safeguard the NHS. The fact is, he forgets the deficit, his shadow Health Secretary forgets Mid Staffs, and both of them have forgotten that we only get a strong health service with a strong economy.

[John Pugh (Southport) (LD)]

Inciner8, a manufacturing company in my constituency, provides portable incinerators to the United Nations that are crucial and vital in addressing the issue of Ebola. It is now offering to donate a further £200,000-worth of equipment if the Government will match it. Will the Government consider this proposal?

[The Prime Minister]

I will certainly look at the proposal. After all, we backed the Ebola fundraising that was very effective in that excellent England-Scotland international, which raised a serious amount of money for Ebola, and we also acted on the Band Aid single, so we will have a close look at what the hon. Gentleman says.

[Ian Murray (Edinburgh South) (Lab)]

Q2. A recent report by the respected charity, the Joseph Rowntree Foundation, found that the Government’s unfair tax and benefit changes had resulted in the poorest half of households losing out, while the top 1% had seen their incomes rocket. That makes me feel extremely angry. What does it make the Prime Minister feel?

[The Prime Minister]

I have studied the report carefully, and it says that the rise in adult poverty outlined by the report occurred on Labour’s watch. Since the election, we have seen 600,000 fewer people in relative poverty, 670,000 fewer workless households, and 300,000 fewer children in poverty. The other point about the report—I am sure the House will want to hear this—is that it covers only the income figures up to April 2013. It says:

“since the middle of last year, there have been huge increases in employment, which will surely impact on incomes and risks of poverty.”

That is absolutely right.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

Q3. In my constituency, we are very proud of local boy, Lewis Hamilton. Will the Prime Minister join me in congratulating Lewis, Ross Brawn, who helped to design the car, and Mercedes? Does he agree that the British motor racing industry not only gives us a lot of entertainment, it also gives us jobs, engineering skills and British business success?

[The Prime Minister]

I certainly join my hon. and learned Friend in praising Lewis Hamilton. He is a young man with nerves of steel and huge ability, and he made everyone in our country proud. But my hon. and learned Friend is right: we should not just be proud of the drivers; we should be proud of the industry. All 19 of the Formula 1 races last year were won by British-built cars. This is an enormous industry for our country. There are 43,000 people employed in Oxfordshire alone in this industry. It is also worth remembering that it is not just Formula 1. I had a reception at No. 10 Downing street for the whole motorsport industry, and it is important to remember that that goes all the way from go-karting up to Formula 1, and Lewis Hamilton started off in a go-kart.

[Roberta Blackman-Woods (City of Durham) (Lab)]

Q4. Recent figures from the Office for National Statistics showed that real wages have fallen by up to 9% in recent years, with two thirds of those who got work last year earning less than the living wage. This is leading to extensive in-work poverty, especially in areas such as the north-east that already have lower incomes. How can the Prime Minister say that we are all in this together, and what will he do to tackle the issue?

[The Prime Minister]

First of all, we will go on growing the economy, creating jobs, and, crucially, cutting people’s taxes. Because the best way to help with this issue is to do what we have done, which is to lift 3 million of the lowest paid people out of poverty altogether and to cut taxes for 26 million more. The figures show that two thirds of the jobs we have created have been full-time jobs, not part-time jobs. The long-term economic plan is working.

[Sir Edward Garnier (Harborough) (Con)]

A few weeks ago a 92-bed hospital in Kerry Town in Sierra Leone was completed, at a cost of £2 million to the British taxpayer. That is a good thing. As of last night, it was looking after five patients. It is run by Save the Children. Will my right hon. Friend have a word with the Secretary of State for International Development and others in the Government to ensure that proper use is made of the hospital?

[The Prime Minister]

My hon. and learned Friend is absolutely right. It is good that the hospital has been built, and roughly on time, but there is an issue with its operation. We are working intensively with Save the Children to ensure that it reaches its full capacity and full use. We are building other facilities across Sierra Leone, as well as community centres, of course, because we need all those facilities to bring Ebola under control.

[Pete Wishart (Perth and North Perthshire) (SNP)]

Q5. Prime Minister, we are living in the early days of a UKIP UK in which Farage and company pull all the strings in this House. Pandering to UKIP has been a disaster for the Prime Minister and for the Tory party, as even a cursory look at the opinion polls shows. Is it not time to stand up to its pernicious agenda and take it on? My country might be dragged out of Europe against its will because of this UKIP-ification. How could that possibly be right?

[The Prime Minister]

There is something that the hon. Gentleman’s party and UKIP have in common: they seek to divide people. We stand for the United Kingdom and bringing people together.

[Annette Brooke (Mid Dorset and North Poole) (LD)]

Q6. I welcome the Prime Minister’s strong support for protecting funding for the NHS and the drive towards efficiency in Dorset, but the needs are great, particularly for children’s mental health services, for adults in crisis and for social care. Will he please support additional resources for the NHS and social care in the forthcoming autumn statement?

[The Prime Minister]

My right hon. Friend will obviously have to wait for the Chancellor to make his autumn statement but, as I said a moment ago, we have been able to put more money into the NHS and to ensure that the NHS and social care are working better together, for instance with our Better Care fund, because we have a strong economy that can deliver those resources. I am absolutely committed to ensuring that we safeguard and improve our NHS, and that means everything to do with our NHS, including the mental health services she mentioned.

[Sir Gerald Kaufman (Manchester, Gorton) (Lab)]

Will the Prime Minister condemn the new Israeli Government Bill that removes what are defined as national rights from all Israeli citizens who are not Jews, makes Hebrew the only national language and has been denounced by the Israeli Attorney-General as causing a

“deterioration of the democratic characteristic of the state”?

Will he make it clear that the statutory, repressive removal of citizenship rights on the basis of religion will turn Israel into an apartheid state?

[The Prime Minister]

One of the reasons I am such a strong supporter of Israel is that it is a country that has given rights and democracy to its people, and it is very important that that continues. When we look across the region and at the indexes of freedom, we see that Israel is one of the few countries that tick the boxes for freedom, and it is very important that it continues to do so.

[Norman Baker (Lewes) (LD)]

Q7. I am sure that the Prime Minister will share my enthusiasm for E.ON’s confirmation this week that 300 jobs are to be created for the construction and maintenance of a new offshore wind farm, many of which will be in Newhaven in my constituency. Does that not prove that doing the right thing for the environment is also doing the right thing for the economy, and will he condemn those people, in UKIP and elsewhere, whose anti-green rhetoric would destroy green jobs?

[The Prime Minister]

What we have seen under this Government, of whom until recently the hon. Gentleman was a part, is consistent levels of investment in green energy, which is producing jobs in our country. Obviously what is happening in Newhaven is welcome, but so too is what is happening on the Humber estuary and in Hull, with the large Siemens investment, which is not just about making wind turbines, but will involve a huge supply industry around it.

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

On Saturday, I attended the service at Birmingham cathedral along with the families of those who lost loved ones in the 1974 pub bombings. They are all agreed, after a 40-year-long wait, that there is still no action to bring to justice the perpetrators of that action. Will the Prime Minister confirm what action he is going to take?

[The Prime Minister]

First of all, our sympathies and condolences should still go to those people who lost their relatives 40 years ago. When you lose a relative, that stays with you, and the grief and the pain stays with you, for ever. It is important that we continue to work to try to make sure that we address all the issues that happened in the past, find those who are responsible, and try to help people to come to terms with what has happened. That needs to happen in Northern Ireland as well as on the mainland.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

Q8. When I see a white van, I think of the small business owner who works long hours to put food on the family table. When I see the cross of St George, I think of the words of my constituent, William Shakespeare:“This blessed plot, this earth, this realm, this England”.Does my right hon. Friend agree that we should not sneer at people who work hard, who are patriotic, and who love their country?

[The Prime Minister]

I agree with every word my hon. Friend has said. In fact, I was wondering why the Labour Benches were so quiet, and now I realise, of course, that the former shadow Attorney-General, who normally makes so much noise, is presumably not here today. She is probably out taking pictures of people’s homes, I expect. We know what that meant about the modern Labour party—sneering at people who work hard and love their country.

[Mr Jim Cunningham (Coventry South) (Lab)]

Q9. Can the Prime Minister tell the House how much taxpayers’ money his Government spent on challenging the EU cap on bankers’ bonuses before it was abandoned last week? Has he learned nothing from Rochester and Clacton, and is not UKIP right, because even UKIP was against increases in the bankers’ bonuses?

[The Prime Minister]

We were taking the same approach as that advised by the Governor of the Bank of England and by all the experts who advised us on that position. I think it is important to stand up to Brussels and to challenge them when we think it has got it wrong.

[Andrew Rosindell (Romford) (Con)]

Q10. Is the Prime Minister aware that areas, such as Romford in the London borough of Havering, with a high concentration of older people will be substantially hit by the financial implications of the Care Act 2014? Will he meet me, and a delegation, to look at a more equitable funding arrangement for older people?

[The Prime Minister]

I will make sure that my hon. Friend has a meeting either with me or with the Health Secretary to discuss this issue. The Care Act makes some very important breakthroughs in terms of providing care for people and making sure there is quality care for people. I would add that if he does have a high concentration of older people in his constituency, they will obviously welcome the fact that by next year the basic state pension will be £950 higher than it was when we came into government in 2010.

[Karl Turner (Kingston upon Hull East) (Lab)]

Q11. Does the Prime Minister think it is right to give Serco a £70 million contract when there are questions about its handling of Yarl’s Wood and allegations of serious abuse and sexual violence? Does he not agree that a full, independent inquiry into these allegations should have been carried out before his Home Secretary signed off on that contract?

[The Prime Minister]

It is very important that when these contracts have gone wrong—the hon. Gentleman is right that in some cases they have gone wrong—it is properly looked at and investigated and lessons are learned. On occasion, we have made sure that serious amounts of money have been recovered from the companies concerned. What we should not do is use one or two bad contracts to fulfil the trade unions’ dream of ending all contracts altogether.

[Mark Menzies (Fylde) (Con)]

Q12. I thank the Prime Minister for his Government having designated Warton in my constituency as an enterprise zone, but may I ask what steps they are taking to ensure that Warton is the most attractive zone for advanced manufacturing inward investment?

[The Prime Minister]

I am grateful to my hon. Friend for what he says about Warton. The enterprise zones are now all up and running, and they are all working well. They have created over 12,500 jobs, and 434 different businesses are coming into the enterprise zones. Making sure that they succeed means that we have to market them even better, using UK Trade & Investment and its resources both here and around the world. In terms of advanced manufacturing, if we promote to companies the tax rates we have, the patent box and the catapult institutes up and down the country to support advanced manufacturing, and bring all those things together, it is absolutely clear to me that there is no better place to invest in Europe right now than coming to invest in Britain.

[Mr Jamie Reed (Copeland) (Lab)]

Q13. The first thing I think of when I see a white van is whether or not my father or my brother is driving it.The National Audit Office has revealed that 40% of cuts to councils in England have been made at the expense of adult social care. The consequences of this on the NHS are obvious. This is the Prime Minister’s disaster. Will he tell the House today what the cost of this failure is?

[The Prime Minister]

If the hon. Gentleman values people who work hard and want to get on, he ought to cross the Floor and come over to the Government Benches.

On the issue of social care, we have introduced the Better Care fund, which has taken money and pulled it between the NHS and social services to make sure that they can work together. It is absolutely vital that we do that, and I am sure that the hon. Gentleman is working in his local area to make sure that that happens.

[Sarah Newton (Truro and Falmouth) (Con)]

The Royal Fleet Auxiliary ship Argus is currently off Sierra Leone fighting the war against Ebola, saving lives there and keeping us safe at home. Will my right hon. Friend join me in thanking the crew and their families for their service and their sacrifice now and over Christmas?

[The Prime Minister]

My hon. Friend is absolutely right. RFA Argus is often based in Falmouth. Its crew are doing an amazing job, and they are doing so at some personal risk to themselves. It is absolutely essential that Britain takes this leading role in Sierra Leone and inserts not just the hospital beds and staff, but the training and logistics that are going to be essential in turning around this crisis. Having RFA Argus there with all its expertise and ability is an absolutely key part of that.

[Mr Andy Slaughter (Hammersmith) (Lab)]

Q14. Following the closure of Hammersmith and Central Middlesex A and E departments in September, west London now has some of the worst waiting times for A and E in the country, but last week NHS England told the Evening Standard that Charing Cross A and E would be replaced with an emergency centre run by GPs and nurses. Will the Prime Minister abandon any further cuts to A and E services in west London?

[The Prime Minister]

The hon. Gentleman should know not only that we are recruiting more A and E consultants and nurses in north-west London and that Northwick Park and Ealing hospitals are getting more beds, but that both Hammersmith and Central Middlesex hospitals have GP-led urgent care centres on site that are open 24 hours a day, seven days a week. Instead of trying to frighten his constituents, he should be talking about the investment going into the local health service.

[Simon Kirby (Brighton, Kemptown) (Con)]

The Prime Minister will not be surprised to hear that I will be marking world AIDS day on Monday in Brighton, but will he join me in encouraging people this week—national HIV testing week—to come forward and have regular tests?

[The Prime Minister]

My hon. Friend is absolutely right. Obviously, this Government are pioneering the idea of free tests. We think that is very important. We need to tackle HIV and AIDS not just in our country, but around the world. That is also why we have put so much money into antiretroviral drugs.

[Phil Wilson (Sedgefield) (Lab)]

Can the Prime Minister envisage any circumstances in which he would lead the no campaign in an EU referendum?

[The Prime Minister]

Unlike the Labour party, I have set out what I want to achieve, which is a renegotiation and then a referendum. I think Britain is better off inside a reformed European Union. I have to ask Labour Members, “What are you frightened of?” We say, “Trust the people, and let the people decide.”

[Mr Alan Reid (Argyll and Bute) (LD)]

Royal Mail’s universal service obligation—that is, to deliver mail to every premises in the country and collect mail from every post box six days a week—is vital. Will the Prime Minister give an assurance that he will never allow the universal service obligation to be watered down in any way, and so support red van man?

[The Prime Minister]

I know how important the universal service obligation is, particularly in constituencies such as my hon. Friend’s, which includes so many islands and far-flung communities. It is very important that it is maintained.

[Mark Reckless (Rochester and Strood) (UKIP)]

I am grateful to the Prime Minister—[Interruption.]

[Mr Speaker]

Order. A Parliament, if it believes in anything, believes in free speech. I do not need the heckling: it is tedious and low grade. The hon. Gentleman will be heard, however long it takes—it is as simple as that.

[Mark Reckless]

I am grateful to the Prime Minister for spending so much time in Rochester and Strood. Dr Phillip Barnes, the acting chief executive of Medway Maritime hospital, said this morning that what our hospital needs is a period of patience and stability. Does the Prime Minister agree?

[The Prime Minister]

I agree that the hospital needs those things, but it also needs the attention that will be brought about by the special measures that Medway is in. We have seen extra A and E consultants and nurses going in. There are 112 additional nurses and 61 more doctors, but it will take time to turn around a hospital that had very high rates of mortality and that still has challenges. The only thing that I fail to understand is why the hon. Gentleman decided to join a party that does not believe in the NHS and that wants to break it up.

[Mary Macleod (Brentford and Isleworth) (Con)]

In 1971, the first refuge in the world was set up in Chiswick in my constituency. Yesterday, the Home Secretary announced the much-needed investment of £10 million for refuges across the country. Will my right hon. Friend join me in calling for an end to domestic abuse right across the country?

[The Prime Minister]

My hon. Friend is absolutely right: we need action against domestic abuse on every front. We have passed new legislation and improved training for the police. Refuges are crucial, which is why the announcements that we have made about discrete funding are so important.

[Pamela Nash (Airdrie and Shotts) (Lab)]

I really appreciate what the Prime Minister said about the Government’s investment in antiretrovirals, and I commend them for their investment in the Global Fund to Fight AIDS, Tuberculosis and Malaria. However, I ask the House to remember that 76% of children who are living with HIV around the world do not receive medication, largely because there is no research and development incentive to make such medication available. We have seen at our peril that a lack of investment in neglected diseases, such as Ebola, risks the health of everyone in the world. What will the Prime Minister do to encourage investment in neglected diseases?

[The Prime Minister]

I very much agree with what the hon. Lady said about the global fund. It has been an excellent way of getting countries around the world to make contributions. Britain has been no slouch in doing so and has been a major funder of the global fund.

On how we tackle diseases, pandemics and problems in our world, I think that we need to have a serious look at the World Health Organisation. It is that body, which is under the ambit of the UN, that ought to be able to respond and to do so rapidly, but it is badly in need of reform. As I have said in this House before, we need to look at how we pool resources so that we can act more quickly. Part of that should be reforming, in particular, the regional aspects of the WHO, which is not fit for purpose.

[Mr Andrew Turner (Isle of Wight) (Con)]

Does my right hon. Friend believe that Tony Blair should get a global legacy award from Save the Children for taking us to war unnecessarily in Iraq?

[The Prime Minister]

The remarkable thing about that award is that Tony Blair got it from someone who used to work for Gordon Brown. Obviously the person who gave the award knows about peacemaking and peacekeeping, but it is not for me to get involved.

[Jack Dromey (Birmingham, Erdington) (Lab)]

In 2010, the Prime Minister promised to protect the front line, yet with the biggest police cuts in Europe, our police service is facing the loss of 30,000 officers—more than half of them from the front line—which is threatening, in the words of the Association of Chief Police Officers, their ability to perform their statutory functions and protect the vulnerable. Does the Prime Minister understand the concern that is being expressed in communities all over the country at his Government’s systematic undermining of the bedrock of policing: local policing and neighbourhood policing?

[The Prime Minister]

I do not accept what the hon. Gentleman says. We have made difficult decisions about police budgets. We had to cut those budgets by 20%, but at the same time as doing that we have seen that crime has actually fallen in this country, whether measured by the national crime survey or the figures reported to the police. On both counts, crime has come down. The other thing that has happened is that because the police have done such a magnificent job of reform and improving efficiency, the percentage of officers on the front line has actually gone up.

[Jason McCartney (Colne Valley) (Con)]

Every hour a man dies from prostate cancer in the UK. Testicular cancer is now the most common cancer in men aged 24 to 49 in the UK and, on average, 12 men a day die as a result of suicide. Will the Prime Minister join me in congratulating all the men who have taken part in the Movember campaign to raise these men’s health issues, and will the Government continue to fund and support these vital issues?

[The Prime Minister]

I certainly join my hon. Friend in praising all those who have taken part in Movember—he is sporting a magnificent specimen himself. Next to him, my hon. Friend the Member for Rossendale and Darwen (Jake Berry) looks as though he is about to star in a Cheech and Chong movie—his moustache is remarkable. My protection team has also done incredible work on this and is raising a lot of money. I am only sorry that I do not seem able to join them. The causes are important, especially the cancers for which we need to raise awareness, improve treatments and save lives.

Point of Order

Wednesday 26th November 2014 Commons Chamber

12:35

[Huw Irranca-Davies (Ogmore) (Lab)]

On a point of order, Mr Speaker. I was pleased to give some short notice of this point of order on an issue that goes to the heart of Government transparency, accountability to Parliament and potential inappropriate lobbying of Ministers and a former chief executive of the Food Standards Agency. It relates to a potential announcement on campylobacter tomorrow and it is important that we have the information.

On 12 November I wrote to the Secretary of State for Environment, Food and Rural Affairs, the Cabinet Office and the Secretary of State for Health, asking them to respond to these allegations so that the individual could be cleared of inappropriate lobbying, which would be a breach of his terms of conduct on leaving the FSA—and potentially a breach of the ministerial code as well. To her credit, the Secretary of State for Environment, Food and Rural Affairs responded to me within seven days—on 19 November. The Cabinet Office, after follow-up letters, e-mails and telephone calls, is on the job and tells me it can respond by 8 December. I have received no response whatever from the Health Secretary or Department of Health.

I ask for your help and guidance on how to expedite the responses. It is a critical issue for the individual concerned and the conduct of Departments. Parliament and the public need to know the answer before any statement is made—possibly tomorrow.

[Mr Speaker]

I am grateful to the hon. Gentleman for his point of order. If I heard him correctly, he said that I had had some modest advance notice. I am sorry to inform him that I was not aware of his intended point of order and, therefore, I have not had an opportunity to reflect on its contents. I note that he ascribes considerable urgency to the matter. He is dextrous in his use of parliamentary devices and can no doubt repair to the Table Office to table further questions if he is dissatisfied.

Also, immediately to his left sits no less a figure than the shadow Leader of the House, who might think it appropriate to raise the matter at business questions tomorrow. If she has a miscellany of other matters to raise and does not wish to raise this issue, the hon. Gentleman might seek to catch my eye at business questions himself. Ministers from the Department of Health will certainly be conscious of the matter by now or very soon. The hon. Gentleman is fortunate also in that the Leader of the House is sitting resplendent on the Treasury Bench and will therefore be aware of his angst on this matter. We will leave it there for now.

Bill Presented

Counter-Terrorism and Security Bill

Presentation and First Reading (Standing Order No. 57)

Secretary Theresa May, supported by the Prime Minister, the Deputy Prime Minister, Mr Chancellor of the Exchequer, Secretary Philip Hammond, Secretary Michael Fallon, Danny Alexander and James Brokenshire, presented a Bill to make provision in relation to terrorism; to make provision about retention of communications data, about information, authority to carry and security in relation to air, sea and rail transport and about reviews by the Special Immigration Appeals Commission against refusals to issue certificates of naturalisation; and for connected purposes.

Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 127) with explanatory notes (Bill 127-EN).

Dogs (Registration)

Wednesday 26th November 2014 Commons Chamber

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

12:39

[Julie Hilling (Bolton West) (Lab)]

I beg to move,

That leave be given to bring in a Bill to require the annual registration of dogs; to require that income from registration be used to fund the enforcement of conditions and penalties imposed on those owning and controlling dogs; and for connected purposes.

On 9 March 2013, my Atherton constituent Jade Lomas Anderson was 14 years old. On 26 March, she was savaged to death by four dogs. Jade was a very popular girl. She was full of life and loved to dance. Her friends said that she was beautiful, kind and a very good friend. Her 13-year-old boyfriend Josh said that she was beautiful and would not hurt a fly. Because she had got a glowing end-of-term report from her new school and as a special treat, Jade’s parents gave her permission to stay overnight at her friend’s house. Her mum and stepdad did not know that there were five dogs in that house, or that one of those dogs was so out of control he was kept in a small cage in the kitchen. They did not know that Jade would be left in the house alone when her friend went next door, or that the dog would burst out of his insecure cage and start the attack that ended her life.

Her parents, Michael and Shirley, have been amazingly brave and determined that no other family should suffer in the way that they have done. They have campaigned tirelessly since Jade’s death, but sadly nine other people have been killed by dogs since then, making it 25 people who have been killed by dogs since 2005. As Michael says, dog attacks are at epidemic proportions. There are some 210,000 dog attacks each year and more than 6,000 people are admitted to hospital, often with life-changing injuries. On average, 12 postal workers are attacked each day and the NHS spends more than £3 million on treating the victims of dog attacks.

Progress has been made since Jade’s death. The law has been changed: owners can now be prosecuted for attacks that happen on private property and the Anti-social Behaviour, Crime and Policing Act 2014 introduced a range of measures to deal with dangerous dogs. I personally am not convinced that the Act does enough to tackle the prevention of dog attacks, but as the RSPCA said,

“it’s too early to tell the effectiveness of the new rules so we are sitting back and waiting to see how things develop”.

However, there are still many more things we need to do to tackle the problems associated with dog welfare and dog control.

The all-party group on animal welfare’s sub-group on dogs will launch a report shortly, supported by all the major dog charities, on developing an effective England-wide strategy for dealing with dogs. It points the way forward, including updating and consolidating all relevant dog control legislation. Among other things, it makes recommendations on dog breeding, dealing and trading, and educating people on looking after dogs and staying safe around them. I really hope the report will be adopted and implemented in 2015.

Clearly, if we are to prevent dog attacks we need to tackle the situations that create dangerous dogs. Taking a puppy away from its mother at too young an age, before it is properly socialised, is a major problem, and I know that hon. Friends have previously attempted to introduce legislation to deal with the irresponsible breeding, importing and selling of dogs. Owners need to choose the right dog for their living environment and not have too many dogs in a household. They need to ensure that their pets are properly fed and exercised. The owner of the dogs that killed Jade could not remember when she had last exercised the dogs. The dog that killed Clifford Clark in Liverpool had not been fed for nearly two days and had resorted to eating cigarette butts and plastic bowls. Of course, owners should never leave their dogs unattended with children, no matter how docile they believe the dog to be.

All measures to protect dogs from cruelty and protect the public from dangerous dogs, and preventative measures to stop dog attacks, need to be properly resourced. In 2010, the Royal Society for the Prevention of Cruelty to Animals estimated that there were 10 million dogs in the UK and that the cost of irresponsible ownership to the taxpayer was more than £80 million. The all-party group report states that there is an urgent need to identify a means for ensuring adequate resources to tackle dog-related issues, but there is not a consensus on how that should be achieved. The RSPCA is in favour of dog licences or an annual registration fee, but the Dogs Trust and the Kennel Club are vehemently opposed, preferring some sort of levy on items that dog owners purchase. My Bill is a solution to funding measures for dog welfare and dog control.

All dogs in Wales will have to be microchipped after March next year, and in England from April 2016. A fee for registering a dog on a national microchipping database and a small annual re-registration fee, with the money ring-fenced for dog welfare and control, would not only produce money but promote responsible ownership and ensure that owners are held responsible for their dogs.

Currently, the police often return a chipped dog to the registered address only to be told it was given away months or even years previously. If we sell or pass on our car, we tell the Driver and Vehicle Licensing Agency that we are no longer the owner. Why on earth would we not expect a dog owner to behave responsibly and do the same thing, when they are dealing with a living, breathing animal totally dependent on human beings for its welfare?

One of the first things Michael Anderson called for was dog licences; the coroner at Jade’s inquest called for the introduction of a licensing scheme for all dogs to ensure the traceability of dogs to owners and to address issues of breeding and trafficking; and the Wigan Evening Post has also launched a campaign for dog licences, and it is not alone. Many of the people who signed my petition for stronger legislation called for the reintroduction of licences, and many older people cannot understand why they were abandoned. In 2010, the RSPCA reported that two out of every three dog owners supported a licensing scheme and that 70% of those who supported licensing said they would be prepared to pay £30 or more.

A licence suggests not simply registration, but possibly vetting for suitability and other conditions. I would not be against that, but my Bill simply calls for registration and the ring-fencing of moneys raised. The dog licence in England, Wales and Scotland was abolished in 1988. At that time, the fee cost £3.5 million a year to collect, but the licence only generated £1 million, and only about half of owners had a licence. The fee was 37p and had not increased since its introduction in the 19th century. In fact, it had been reduced from 37.5p when the ha’penny was withdrawn in 1984. Had it kept pace with inflation, it would have been £10 in 1986.

Of course, the licence was not scrapped without a fight. In this place, Lord Rooker, then MP for Birmingham, Perry Barr, argued for the Opposition that the licences should be retained and raised to between £10 and £20, with the money raised helping to fund a network of dog wardens. The late Bob Cryer, then MP for Bradford South, supported this proposal and called for controls giving local authorities the power to draw up a register of dangerous dogs. Baroness Fookes, former Conservative MP for Plymouth Drake and a former president of the RSPCA, said that the money raised from the licence fee could be put towards a package of dog welfare measures, including an efficient warden service. Unfortunately, the vote was lost by 57 votes, meaning that I am here, 28 years later, arguing for much the same thing, but now linked to the compulsory microchipping of dogs.

Those who argue that licensing and registration do not work need to look at other countries. Some 23 European countries, as well as Australia and New Zealand, have systems of dog licensing or registration. In Italy, registration not only has reduced the number of strays, but is reported to be effective in reducing uncontrolled reproduction and dog overpopulation, as well as reducing the human health risk from dog-borne diseases and environmental contamination. It has also improved the control of activities such as dog fighting. Australia reports similar results, with the additional bonus that the number of complaints about dogs has reduced by half.

Doubters argue that it is a tax on good owners and that irresponsible owners will not pay, but we do not accept that argument for good drivers and irresponsible drivers, or responsible workers and irresponsible workers; we ensure that everyone pays, and if they do not, we take enforcement action.

I am sure, in the future, I will argue in this Chamber for further measures to protect dogs and prevent dog attacks, but today I am merely asking for their annual registration. It would be a fitting tribute to Jade Lomas Anderson and her wonderful parents.

Question put and agreed to.

Ordered,

That Julie Hilling, Robert Flello, Jim Fitzpatrick, Mike Kane, Mrs Emma Lewell-Buck, John Pugh, Rosie Cooper, Oliver Colville, Miss Anne McIntosh, Liz McInnes, Andrew Rosindell and Mrs Mary Glindon present the Bill.

Julie Hilling accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 9 January 2015, and to be printed (Bill 126).

Opposition Day

Wednesday 26th November 2014 Commons Chamber

[10th alloted day]

The Economy

Wednesday 26th November 2014 Commons Chamber

12:49

[Chris Leslie (Nottingham East) (Lab/Co-op)]

I beg to move,

That this House believes the Government has failed to deliver rising living standards and a recovery that works for the many, with working people on average £1,600 a year worse off since 2010; notes that the Office for Budget Responsibility has said that stagnant wages and too many low-paid jobs are leading to lower tax revenues and more borrowing, with the Chancellor of the Exchequer’s pledge to balance the books by 2015 set to be broken; calls on the Government to bring forward a plan in the Autumn Statement to deliver a recovery for the many, not just a few at the top, with proposals for a minimum wage rising as a proportion of average earnings, an expansion of free childcare for working parents, a cut in business rates for small firms, an independent infrastructure commission, and the building of 200,000 new homes a year; believes that a tough and fair plan to deliver a current budget surplus and falling national debt as soon as possible in the next Parliament would include reversing the Government’s £3 billion a year tax cut for the top one per cent of earners and introducing tougher measures to tackle tax avoidance; and further believes that the Autumn Statement should use £1 billion of fines from the recent foreign exchange manipulation scandal for an immediate boost to health and care, and announce a £2.5 billion a year fund to help save and transform the NHS, including funding for an extra 20,000 nurses and 8,000 GPs.

The Government deputy Chief Whip will have spotted that, next week, the Chancellor is bringing forward his autumn statement, which gives the Chancellor a chance to reflect on his nearly five years in office and on the impact made over that period on the living standards of millions of our constituents who have, of course, been following so carefully the choices he has made. I have taken the liberty of digging out the 2010 autumn statement of 29 November because it is always worth reflecting on what the Chancellor was saying four years ago, and worth comparing his intentions back then with the reality we and our constituents now face.

Back in 2010, then, when the right hon. Member for Chelsea and Fulham (Greg Hands) was knee-high to a grasshopper in political terms, the Chancellor of the Exchequer said that the Government

“will meet our fiscal mandate to eliminate the structural current budget deficit one year early, in 2014-15.”—[Official Report, 29 November 2010; Vol. 519, c. 531-2.]

He said:

“Britain is on course…to…balance the books, something that some people repeatedly said could not happen.”—[Official Report, 29 November 2010; Vol. 519, c. 530.]

Well, I am afraid to say that it has not happened. In fact, last year the deficit was £102 billion and so far, during the first seven months of this year, it is heading even higher.

[Ben Gummer (Ipswich) (Con)]

The hon. Gentleman has put a motion before the House on the performance of the economy. I have read the motion carefully, and before he starts reflecting on previous speeches, I wonder whether he could explain why unemployment is not included in it and why we now have the lowest unemployment and the highest rate of employment in our history?

[Chris Leslie]

I have only just started my remarks. I shall come on to employment, the levels of under-employment in our economy and the changing nature of the employment market because that is crucial. It links in particular to the health of our public finances and I want to touch on some of those issues, but I wanted to make sure that the House was aware of the Chancellor’s promises made in the autumn statement of 29 November 2010, just so everybody can see the context in which we have to appraise the Chancellor’s performance.

[Charlie Elphicke (Dover) (Con)]

rose—

[Chris Leslie]

I will come to the hon. Gentleman in a moment, but it is not just on the deficit that we have seen difficulties, as there is a second aspect of the Chancellor’s promises back in 2010. He promised that by this financial year, he would

“get debt falling as a percentage of GDP”—[Official Report, 29 November 2010; Vol. 519, c. 532.]

Yet it turns out that he has failed on that, as well. In fact, he is now saying that debt is not going to start falling as a percentage of GDP until some time in the middle of the next Parliament. It is really important to pin down the Chancellor’s promises and the failure to deliver on them.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Will my hon. Friend give way?

[Chris Leslie]

If my hon. Friend does not mind, I said I would give way to the hon. Member for Dover (Charlie Elphicke) first.

[Charlie Elphicke]

This morning, 30.8 million people went to work—a record in our country’s history. That is no mean feat after Labour’s crash. With the storm clouds gathering again in the eurozone, why would we ever want to go back to where we were four and a half short years ago?

[Chris Leslie]

When it comes to the nature of our recovery, the fact is that most people are not feeling the great benefit that the hon. Gentleman espouses. The vast majority of people—confirmed in opinion polls just last week—are reporting that, as far they are concerned, life is getting harder and their living standards are falling, not rising.

[Mr Sheerman]

Did my hon. Friend hear John Humphrys interviewing Jim Rogers, one of the leading American investment gurus? When asked why he would not recommend investing in the UK, he said that it was a country with a Government who keep on borrowing and printing money.

[Chris Leslie]

I listen avidly to the “Today” programme, but I did not hear that interview. It is important that we pin these Tories down on their failure to deal with borrowing and the deficit. This situation is going to continue well into the next Parliament, and we need to address it in a serious way, not with more of the politicking that we have seen from the Chancellor.

[Mr George Mudie (Leeds East) (Lab)]

My hon. Friend the shadow Minister says that the debt has not started dropping. Will he confirm that when we left power, it was £750 billion, whereas today it is in the region of £1.4 trillion?

[Chris Leslie]

The Prime Minister likes to say—the Tories have said it in party political broadcasts and keep repeating it—that the national debt is somehow falling. The national debt has got larger and larger—[Interruption.] No, let me correct the hon. Member for Wyre Forest (Mark Garnier)—there is a difference between the national debt and the deficit. The national debt has got higher and higher and higher. My hon. Friend the Member for Leeds East (Mr Mudie) was right to say that it now stands at more than £1.4 trillion. He knows that the Prime Minister and the Chancellor have added more to the national debt in their four and a half years in power than the previous Administration did in 13 years.

[Mark Garnier (Wyre Forest) (Con)]

The hon. Gentleman is clearly struggling a little with the definitions of how we run the public finances. The reason why the national debt is going up is that in 2010 this Government inherited a deficit, which is the difference between income and outgoings, of £156 billion. That had been set in place some time before. If the hon. Gentleman remembers, the deficit in 2005—fully two or three years before the financial crisis—was already around £50 billion a year. The previous Government, then, were increasing the national debt. It is going up because the only way to account for the deficit is by putting it on the national debt. The hon. Gentleman must understand the most basic facts of fiscal policy.

[Chris Leslie]

We have an admission there—that the national debt is rising and has risen more in the past four and a half years than it did in the 13 years of the previous Administration.

[Several hon. Members]

rose—

[Chris Leslie]

I will give way to hon. Members in a few moments, but there are other facets of the Chancellor’s promise in that 2010 autumn statement we have to nail down and put on the record. In that statement, he also promised that he would cut the interest charges to service the national debt by £19 billion. Do hon. Members know where we are when it comes to the national debt’s servicing costs? This year, debt interest has hit £52 billion and is forecast to be £75 billion by 2018-19—a situation compounded, of course, by the Government’s failure to tackle the deficit. Each year that they add another £100 billion to the deficit, they have to fund and service the debt levies accrued.

[Mr Marcus Jones (Nuneaton) (Con)]

What the hon. Gentleman says is all very sanctimonious, particularly given that his leader could not even mention the word “deficit” in the speech he made at Labour’s party conference. Furthermore, the hon. Gentleman’s party has set out £166 billion more in spending than the Government have, so how will he pay for that?

[Chris Leslie]

The hon. Gentleman is slightly deluded in his understanding of our position. We have made it absolutely clear that we will not have any manifesto commitments funded by additional borrowing, yet we have not heard the same promise from Conservative Ministers, so I invite the Exchequer Secretary to stand up and tell us how the Conservative Front-Bench team are intending to pay for the £7 billion-worth of pledges that the Prime Minister has made. Opposition Members have to conclude that the Government are going to add it to VAT. That is what they have done in the past; it is their track record. Ducks quack, the sun comes up in the morning and Tories increase VAT. It is what they always do.

[Jake Berry (Rossendale and Darwen) (Con)]

rose—

[Chris Leslie]

I shall give way to the hon. Gentleman with his moustache.

[Jake Berry]

I thank the hon. Gentleman for stating his party’s position so clearly. Just to restate it, he did not question the £116 billion-worth of extra commitments, but he did say that Labour has a commitment not to increase borrowing to pay for all these spending commitments. Will he now take the opportunity to clarify that point by saying which taxes he intends to put up to pay for his spending commitments?

[Chris Leslie]

I shall come shortly to the particular changes that we believe need to be made for our economy. For example, we believe that the national health service needs additional support and that we need to increase a levy on ultra-high-value properties to pay for such things. I shall come on to the specific details in a moment, but I want first to finish giving the Chancellor’s record and his promises in that autumn statement.

The Chancellor made other promises, too. He promised that business investment would zoom away over the four years, saying that it would be

“8% for each of the next four years”.—[Official Report, 29 November 2010; Vol. 519, c. 530.]

In reality, it has been barely half that. Back then, in autumn 2010, the Chancellor promised that exports would grow on average by more than 6% a year. In fact, in 2012 he promised that he would more than double annual UK exports to £1 trillion by 2020. The problem is that that would require 10% annual growth in exports and we have had barely 4%, leaving them £330 billion short of their target.

It was not supposed to be like this. The Chancellor set out with a totally different set of ambitions and made a series of promises to the electorate. He set out his pledges and he has failed to deliver on them. What is worse, and what matters to our constituents, is the promise that the Conservatives made on living standards. They said that living standards would rise and that was the solemn pledge in their manifesto:

“We want to see an economy where not just our standard of living, but everyone’s quality of life, rises steadily and sustainably.”

These Tories—by which I also mean the Liberal Democrats—need to be held to account for the neglect they have shown and the distress they have caused, particularly to some of the poorest and most vulnerable people in society. After prices have been taken account of, wages have fallen in real terms by an astonishing £1,600 a year and prices continue to rise.

[Rehman Chishti (Gillingham and Rainham) (Con)]

The shadow Minister talks about the Chancellor’s record, what he has achieved and what he has set out to achieve. One of the key planks of the proposals was a reduction in youth unemployment. In the hon. Gentleman’s constituency, youth unemployment has gone down from 6.1% to 4.2%, and in my own constituency it has gone down considerably. That clearly supports what the Chancellor set out to do by giving young people a chance and opportunity in life through work.

[Chris Leslie]

My constituency has the 10th highest youth unemployment of any in the country and I will not take any lectures from the hon. Gentleman. The Government have no answer for the 700,000 young people who remain long-term unemployed. They have a Work programme that sends more people back to the jobcentre than it puts back into work—[Interruption.]

[Mr Speaker]

Order. I am very uncertain quite what the hon. Member for Wyre Forest (Mark Garnier) had for breakfast this morning. Without wishing to be personal, I would simply observe that a close family relative of his lives in my constituency and he is a person of impeccable manners, as the hon. Gentleman usually is. My constituent would not approve of the hon. Gentleman’s ranting from a sedentary position. If the hon. Gentleman undertakes to behave in a seemly manner from now on, I promise not to report his bad behaviour to my constituent.

[Chris Leslie]

I was about to give way to my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams).

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

My hon. Friend is making a powerful argument about the appalling economic context that the country faces. Does he agree that the reduction in full-time jobs—there are 670,000 fewer full-time jobs in the economy since 2008—is an indictment of the poor health of the economy under this Government?

[Chris Leslie]

My hon. Friend is right: the labour market is changing, and not always for the better. The instability, short-term assignments and zero-hours culture that are now much more prevalent add to the insecurity experienced by so many of our constituents.

[Mr Sheerman]

I do not usually chide my hon. Friend, but I am going to do so today for being too generous and kind to the Chancellor of the Exchequer. My hon. Friend has not mentioned the appalling performance of this country on productivity. We are 20% below our competitors. What is the Chancellor doing about that? My hon. Friend has to be tougher and nastier to the Chancellor.

[Chris Leslie]

All my hon. Friend will get from the Chancellor is the hollow slogan about the Government’s plan, but their plan contains nothing to tackle the productivity crisis in our economy. My hon. Friend hits the nail on the head. We need a plan that deals with those infrastructure challenges and with getting bank lending back on its feet again to help enterprises make the next move into growth and innovation. We must tackle the skills problem. They are all factors that would represent a genuine plan to tackle the productivity issue.

[Several hon. Members]

rose—

[Chris Leslie]

I would like to make a little progress, because I know that a lot of Members want to speak.

The problem with this Chancellor and the promises that he made back in 2010 is that he has failed abysmally to complete the deal and ensure that he delivers on those promises. It is not just about the record on the national health service or even on immigration, where the Government have failed to meet their target of reducing net migration to tens of thousands. They have failed to deliver a recovery shared by all, they have failed to eliminate the deficit, as they promised to do, and they have failed to detoxify their reputation on the NHS. The real question is whether the Chancellor and the Prime Minister, after nearly five years, are prepared to start taking some responsibility for the situation.

[James Morris (Halesowen and Rowley Regis) (Con)]

rose—

[Chris Leslie]

Will they do what I suspect the hon. Gentleman is about to do and blame Europe? They love to blame Europe, in particular, but they have also blamed the weather and even the royal wedding. Who is the hon. Gentleman going to blame?

[James Morris]

Is the hon. Gentleman seriously arguing that the challenges we are addressing through our long-term economic plan have nothing to do with the fact that we had the deepest economic recession since the second world war—a recession over which his Government presided—which led to thousands of people being made unemployed, hundreds of businesses going bust and an absolutely devastating long-term effect on many people’s lives? Does he not take any responsibility for that?

[Chris Leslie]

Government Members want to airbrush the fact that there was a banking crisis, and a global banking crisis—[Interruption.] They do not like the fact that there was a banking crisis. They want to pretend that it was everybody else’s fault—there they go again.

I must tell the hon. Member for Halesowen and Rowley Regis (James Morris) that he has been in government—perhaps he has not been a Minister, but he has supported the Government—for nearly five years. The Government must start taking some responsibility for the state of the economy.

[Ian Lucas (Wrexham) (Lab)]

On living standards, in Wrexham median weekly earnings have fallen by 7.4% in the past year. The Government show a complete lack of comprehension of my constituents’ lives. For as long as they continue to do that, they will not even begin to address this country’s fundamental economic problem.

[Chris Leslie]

It is the complacency from those on the Government Benches that will, I think, shock our constituents most of all.

Only last week, the Deputy Prime Minister said in questions that “the economy is fixed”. How out of touch are Ministers in this Government, whether they are Liberal Democrats or Tories?

[Mr Jim Cunningham (Coventry South) (Lab)]

If we listened to the Government, we would never think that the collapse of Lehman Brothers and the collapse of Fannie Mae in America caused the last economic crisis. They continually blame the previous Labour Government, but they have to face up to the truth, which is that it started in America and no Government could have legislated for it. They have now found out that there is an economic crisis and recession in Europe, so is that the next excuse for a punitive Budget?

[Chris Leslie]

The previous Government did the right thing after that banking crisis by getting growth moving forward—growth that had the rug pulled from under it by the lack of confidence shown by the Chancellor and the measures he took in that autumn statement back in 2010 and in his emergency Budget.

The Government’s long-term plan is little more than trickle-down economics, which has failed in the past and will fail again in the future. The share of national income held by 90% of earners has shrunk since this Government came to power, whereas the share of the cake held by the wealthiest 1% has—surprise, surprise—gone up.

We need a plan that genuinely delivers a recovery for the many, not just for the few. We do not need the slogan-heavy, content-light, trickle-down plan of Treasury Ministers, but we need action on house building, which is at the lowest level since the 1920s, with a goal of building 200,000 new homes each year by 2020. We need a minimum wage rising as a proportion of average earnings and real incentives for the living wage. We need the expansion of free child care for working parents, paid for by the bank levy that the Government failed so spectacularly to collect. We need a cut in business rates for small firms, rather than a reliance and a focus only on corporation tax cuts for big businesses. We need an independent infrastructure commission to deliver the transport networks that our economy needs, rather than what suits the Government’s short-term political needs. We need to tackle the abuse of zero-hours contracts, we need to hear the Government argue for Britain to play a leading role in a reformed European Union, and we need a real economic plan that can enable us to earn our way towards rising living standards for all, not just for the few. Those are the priorities for next week’s autumn statement.

[Stephen Hammond (Wimbledon) (Con)]

rose—

[Chris Leslie]

I will give way one last time.

[Stephen Hammond]

I am interested to hear the hon. Gentleman’s words, but let us write some facts into the debate about living standards. Will he deny the statistic from the House of Commons Library which shows that real average weekly earnings were falling faster between 2008 and 2010 than they were after 2010? Will he deny the statistic which shows that the average earnings of those who had been in a job for over a year have risen by more than 4% in the last year? Will he deny the fact—this, too, is a statistic from the House of Commons Library—that 71% of all the jobs created in the last year have been full-time jobs?

[Chris Leslie]

I do not know where the hon. Gentleman has been, but did he not see the headlines in all the newspapers about the results of the annual survey on hourly earnings that the Office for National Statistics published last week? According to the ONS, the average weekly pay of full-time workers went up by just £1 between 2012 and 2013. That is a rise of just 0.1%, far below the rate of inflation. Prices continue to rise, but pay, wages and earnings do not keep pace with them. Government Members may not realise that. In the world that they inhabit, life is sweet—everything is fine in the world that they inhabit—but for most of our constituents, times are tough and life is getting harder.

[Ian Lucas]

Will my hon. Friend confirm that this is the first Government since the 1920s who will preside over a real-terms fall in the salaries of the people who elect us?

[Chris Leslie]

This may even be the worst situation since the 1870s. Perhaps we should ask the House of Commons Library to go back in history, and tell us how bad things were in the 19th century.

I have set out our priorities for the autumn statement. However, we do not just need a strong economy to ensure that everyone gets a piece of the action; we need a strong and sustained economy to deliver strong and sustained public finances, which is why the autumn statement also needs a plan to balance the nation’s books in a fair way.

When will Ministers realise that the health of our economy shapes the health of our public finances? During the first seven months of this year, borrowing has been £3.7 billion higher than it was during the same period last year. Why? The Office for Budget Responsibility itself says that stagnant wages and all those low-paid jobs are keeping tax revenues down. The Chancellor has to realise that a low-wage, low-productivity economy will not deliver the goods. The OBR is predicting that growth will slow down next year, and yesterday the OECD cut its growth forecast for this year and next year.

The deficit has not been tackled effectively, and not just because of falling revenues. The Government like to sound tough on welfare inflation, but they do nothing to tackle the underlying causes of it. The Department for Work and Pensions has overspent by £25 billion since 2010. Let me give the House a few examples of where it has gone awry. It has spent £5 billion more than it planned to spend on tax credits during the current Parliament, because of the failure to tackle rising levels of low pay and insecurity. The number of working people—working people!—who are claiming housing benefit has risen by 50% since 2010 and is set to double by 2018, which will cost nearly £13 billion.

Whether the underlying issue is low pay, rising rents or the 700,000 young people who are in long-term unemployment, the Government have produced no serious, structural response. For them, tackling the deficit means little more than lopping off a fixed percentage from every departmental expenditure limit in each 12-month cycle. We need an economy that delivers higher-quality jobs, decent living standards, and robust and sustained growth, as well as tough decisions on spending and tax.

The Chancellor of the Exchequer caved in too easily to the lobbying of his friends who pushed him for that £3 billion a year tax cut for the top 1% who are earning over £150,000 a year. They must have been pestering him—“Give us that tax cut!”—and he did not have the will power just to say no. Instead, he piled higher VAT and cuts in tax credits on to millions of working people, because he did not mind that so much. I am afraid that a fairer plan for reducing the deficit must mean reversing the huge tax giveaway for millionaires—

[Charlie Elphicke]

rose—

[Chris Leslie]

Which I know the hon. Gentleman, in his heart, recognises is deeply unpopular with his constituents. Or am I wrong?

[Charlie Elphicke]

Let me point out not only that a record number of people went to work this morning, but that both long-term unemployment and worklessness rose under the Labour Government. Thanks to this Government’s welfare reforms and long-term economic plan, long-term unemployment has fallen by 99,000, and worklessness has fallen dramatically. Does the hon. Gentleman not accept that the Government’s long-term economic plan and welfare reforms have worked extremely well?

[Chris Leslie]

How disappointed the hon. Gentleman’s constituents must be to hear his comments, which contained no reflection or recognition of any of the problems that they face, including their cost of living difficulties. No, as far as the hon. Gentleman is concerned, everything is fine and wonderful: it is all working totally as it should be. I must tell him that he will have to face his electorate in a few months’ time, and that he will face their anger and concern about his failure to deal with the living standards that they have been experiencing.

[Gordon Birtwistle (Burnley) (LD)]

rose—

[Chris Leslie]

A Liberal Democrat! I will give way to the hon. Gentleman.

[Gordon Birtwistle]

Will the shadow Minister remind the House what the growth of the economy was in 2009?

[Chris Leslie]

We had a global banking crisis, but, as I recall, growth was 1% in the first quarter of 2010. We had a strong level of growth as we came out of that crisis, because we took up the challenge to stimulate the economy and get it moving again. There was a VAT reduction at that time, and then what happened? What did the Chancellor of the Exchequer do? What did he do, with the help of the hon. Gentleman’s votes? He whacked up VAT to 20%, although the hon. Gentleman had not mentioned that in his election manifesto. He, too, will have to face his electorate and account for the decisions that he has made.

I do not want to take up too much time, because I know that many other Members wish to speak, but it is important for me to say something about the fiscal challenge. There will have to be other difficult decisions, which is why Labour is looking at every single Department and every item of expenditure, line by line, in our zero-based review, and identifying the different choices that can be made to enable us to live within our means. We have already proposed scrapping winter fuel payments for the richest 5% of pensioners, cutting Ministers’ pay by 5%, capping child benefit rises at 1% for two years, reviewing the value for money of assets and non-essential buildings owned by the Government, and making savings of £250 million in the Home Office budget—by, for example, scrapping police and crime commissioners—in order to better protect front-line policing. Over the weeks ahead, we will set out more of our early findings from other Departments.

Our plan is to balance the books and get the national debt falling as soon as possible in the next Parliament. While the Prime Minister and Chancellor think it is okay to make £7 billion of unfunded pledges—the Prime Minister said that again today at Question Time—although even the Secretary of State for Business, Innovation and Skills has described that as a “total fantasy”, our manifesto will not make commitments that would be paid for by additional borrowing. When we make promises, we will say where the money will come from. We would willingly put all our costings before the OBR so that it could check and validate them—but, of course, that would upset the Chancellor’s plan to smear our proposals and run a dirty election campaign based on fear rather than fact. If the Chancellor only had the guts to put his plans, and all our plans, in front of the OBR, perhaps we could let the public form a judgment based on the values and merits of the manifestos and their policy proposals.

[Nick de Bois (Enfield North) (Con)]

Will the hon. Gentleman give way?

[Chris Leslie]

I will give way one last time.

[Nick de Bois]

How can the hon. Gentleman credibly expect the public to buy into Labour’s ability to balance the books? Every year, from 2001 onwards, the Labour Government spent far more than they took in, which is why they were left with one of the biggest deficits in the G7. You cannot spend more than you take in: that is the root cause of the problem, but Labour Members do not get it.

[Chris Leslie]

The hon. Gentleman and the Chancellor of the Exchequer were backing all the spending plans during those years. Moreover, the hon. Gentleman did not even mention the banking crisis. Where was he during that period? Does he really think that his constituents will be tricked by his airbrushing of the situation? The hon. Gentleman’s party has been in office for five years, but the Conservatives have failed on the promises they made to tackle the Budget deficit and get borrowing down. They promised that we would not have a Budget deficit, and they failed and it will be up to the next Government to finish the job.

Whoever wins the next election will have to pick up the pieces of this current mess. We will make sure that resources are channelled towards the issues that matter most to the public, but we should not have to wait until next May: the Chancellor has the opportunity to act now. That is why the third task for this autumn statement is to deliver a costed and funded plan to save and transform our national health service. In my constituency in Nottingham it is getting harder to see a GP; on cancer waiting times we still have a system struggling to meet the two-week target from GP referral to first outpatient appointment; and at the beginning of the month in Nottingham almost one in five patients had to wait more than four hours at our local emergency department. We have excellent staff and diligent management at our local hospital, but the pressures on their shoulders have been getting worse and worse, and Ministers have left the NHS to cope on its own, without finding the new sources of funding to put this situation right.

I therefore put this challenge to the Minister today: when she gets to her feet to respond to this debate, will she accept our suggestion to use £1 billion of banking fines from the recent foreign exchange rigging scandal and earmark this windfall for the NHS? More than that, will the Minister do what is required to tackle tax avoidance, and introduce a levy on tobacco firms and a tax on properties worth over £2 million to raise £2.5 billion a year—on top of the Government’s spending plans—for an extra 20,000 nurses and 8,000 doctors? These are necessary—and some of them are difficult—decisions, which focus relentlessly on supporting the NHS at this time of need.

These are the tests for next week’s autumn statement: a recovery for the many; a fairer approach to balancing the books; and a plan to save our NHS. Britain cannot afford another autumn statement of inactivity, neglect and the same old trickle-down economics. We need a Government who step up and take action to deliver a recovery shared by all. I commend the motion to the House.

13:22

[The Exchequer Secretary to the Treasury (Priti Patel)]

Today the Opposition have reminded us why Labour can never be trusted with the economy again. So appalling is its reputation on all matters economic that even its former Chancellor, and now we hear its former Prime Minister, are seeking to join the exodus from the parliamentary Labour party, belatedly fleeing the scene of the economic carnage they helped to create. The hon. Member for Nottingham East (Chris Leslie) spoke about the 2010 autumn statement. Back then the former shadow Chancellor, the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), forecast that there would be a “jobless recovery”. Since then Labour has become a broken record, and over the past four years it has been proved wrong about the economy and sought to mislead and frighten the public at every opportunity. Instead of presenting a sustainable economic plan to the House today, Labour Members come here and use this very rare debate on the economy to talk down the economy, and sneer at those who want to work hard and to get on in life, which is why I would like to start by bringing the House’s attention to a few basic economic facts about their track record.

With a record peacetime deficit, increased unemployment and a welfare system that was broken, Labour left Britain’s economy in a mess. On top of that they doubled income tax for the poorest, and insulted pensioners with derisory levels of state pensions, not to mention the mean-spirited 75p increase in state pension; that is how the Labour party rewards our pensioners after a lifetime of work. Labour also oversaw a doubling of council tax, increased the rate of fuel duty 12 times, and failed to support parents with child care costs, yet Labour Members have the audacity to come here today and lecture us about child care costs. The Government are reforming child care through tax-free child care and sustainably helping hard-working and hard-pressed families up and down the country.

[Sheila Gilmore (Edinburgh East) (Lab)]

Surely the biggest mistaken forecast was that of the current Chancellor when he came to this House in 2010 and told us the deficit would be eliminated during the course of this Parliament.

[Priti Patel]

This Government have cut the deficit by over a third, so we will not take any lectures from the Opposition or the hon. Lady about that—notwithstanding the fact that when in office Labour failed to prepare our young to compete against the brightest and the best when it came to skills, jobs and education, and that was just the tip of the iceberg.

Since 2010, this Government have worked hard to turn this situation around. By working to our long-term economic plan, we have seen the deficit cut by over a third, income tax cut for over 25 million people, benefits capped to reward work, and 1.7 million more people in employment, while over 2 million more private sector jobs have been created and employment is the highest on record. We have created 1 million apprenticeships. The state pension has increased. More children are in good and outstanding schools. Over 50,000 families now have a home thanks to our Help to Buy policy. This is a good start, but we are the first to recognise that the job is far from finished.

[Kerry McCarthy (Bristol East) (Lab)]

I gather the Minister is visiting my constituency tomorrow, although her office was not prepared to tell us what she will be doing there; perhaps she can tell me now. May I urge her to meet some of my constituents, and go around some of the estates and find out what life is really like for those people, because it bears very little resemblance to what she is telling us now?

[Priti Patel]

I am looking forward to coming to the hon. Lady’s constituency tomorrow.

I have made it perfectly clear that we have made a good start but the job is not yet finished. The UK currently has the highest rate of growth in the G7; it is over twice that of Germany.

[Stephen Hammond]

My hon. Friend is right that we have made a good start. The Opposition spokesman talked about opinion polls, but, interestingly, he did not talk about the opinion poll showing that the public saw we had done a good job, and that we have an economic competence lead of 26% over the Opposition and their plans.

[Priti Patel]

My hon. Friend is absolutely right and this brings us back to the heart of this debate. It is about having a long-term economic plan that is tackling the challenges for our economy left by the former Government, while also looking ahead to the future and making sure we have a plan in place.

[Ian Lucas]

How can a 7.4% fall in median average earnings in Wrexham be a good start?

[Priti Patel]

The hon. Gentleman will recognise that had it not been for Labour’s great recession, living standards in this country would be much higher. Thanks to our economic plan and policies, we are now seeing booming inward investment, often by more than the rest of the EU combined, with all the main sectors of the economy growing. A growing economy, a falling deficit, record numbers in work: those are the economic facts that Opposition Members seem to want to deny. They want to continue to scaremonger and misrepresent the economic reality. We said we would get the deficit down, and the deficit has come down. We said we would recover the economy, and recovery is taking place. The Opposition predicted that 1 million people would lose their jobs, but 1.7 million jobs have been created.

It would not be realistic to pretend that the job is done, however, or that the situation is perfect. We know it is not, and that is a result of Labour’s great recession, but I am sure that all Members will agree that responsible government means being straight with the public about the economic situation we are in.

[Gordon Birtwistle]

My hon. Friend said earlier that 1 million apprenticeships had been created. May I advise her that 2 million apprenticeships have now been created?

[Priti Patel]

My hon. Friend is right: over 1 million apprenticeships have been created.

[Mr Marcus Jones]

While unemployment soared under the last Government, does my hon. Friend welcome the fact that youth unemployment is down 50% in my constituency in the past 12 months, and does she agree we should now work towards full employment, to make sure that none of our young people are out of work?

[Priti Patel]

My hon. Friend is absolutely right, and that is, of course, the objective of this Government: we want to support and give a helping hand to the young in particular, as they start out in their careers and professional lives.

[Nicola Blackwood (Oxford West and Abingdon) (Con)]

Unemployment has fallen by 66% in my constituency since 2010, but the businesses who are creating these jobs tell me that cutting red tape is a priority for them if this growth is to continue. Can my hon. Friend explain why the Opposition will not commit to our one in, two out deregulation target?

[Priti Patel]

The Labour party created even more red tape, regulatory burden and excessive regulation on business, and I commend my hon. Friend and the businesses in her constituency on everything they are doing on job creation.

Britain tumbled down the international league tables under the Labour Government: from 11th to 23rd in the world in terms of our corporate tax regime; out of the top 10 in the global competitiveness league; and out of the top 10 in terms of the ease of starting a business and doing business—we were level pegging with Mongolia on that. Levels of Government spending under Labour were catastrophically higher than we could afford. We had the most over-indebted banks and households, and we were on course for having the biggest budget deficit of any major economy in the world.

The British public are still experiencing the impacts of the Labour Government’s economic policies but, rather than coming to the House to apologise for the economic carnage that they created, Labour Members have the audacity to come here today and ask us why we are not clearing up their mess quickly enough. I think we all know that the past four years have been hard, and we cannot magic up a better standard of living from the economic carnage that we inherited. The only way to deliver for people up and down the country is to put in place a lasting, sustainable and healthy recovery.

[Debbie Abrahams]

Does the Minister count among the Government’s successes the waste of £2.8 billion on welfare reforms that was identified in a National Audit Office report this afternoon?

[Priti Patel]

Our welfare reforms have been focused on ensuring that work pays. The Opposition were fully opposed to our reforms to the welfare system, and they still stand against welfare reform today—

[Chris Leslie]

The welfare bill has gone up.

[Priti Patel]

The Opposition are firmly against the reforms that we have brought in on welfare. We inherited a broken welfare system; let us get that on the record and be categorically clear about it. Our reforms are about making work pay and providing opportunities through work, training and employment.

[Charlie Elphicke]

Our welfare reforms have resulted in a jobs revolution that means that it is morning again in Britain. If we look out from Dover across the channel, we see the sun rising over the white cliffs but we also see the storm clouds over Calais and the rest of the eurozone. Does the Minister agree that the biggest risk to our recovery would be a Labour Government and their crazy spending plans?

[Priti Patel]

My hon. Friend is absolutely right. The public should be terrified of going back to the same old days of more borrowing and spending and higher taxes under Labour.

[Chris Leslie]

The Minister is talking about taxes. She will know that the Prime Minister made pledges at his party conference involving a total of £7 billion. Does she agree that if the Government are making such pledges, they really should say where the money will come from? I should like to give her an opportunity to put on record now specifically how she intends to pay for the £7 billion-worth of promises that the Prime Minister made.

[Priti Patel]

The answer is simple and straightforward: it is through sustainability in our economy. That means making hard choices, tackling the challenges of public spending and encouraging the economy to ensure that it grows more. It is about the creation of more jobs, not about higher taxes that penalise the wealth creators of this country.

[Mr Marcus Jones]

Is not what my hon. Friend saying confirmed by the fact that there are 670,000 fewer workless households in this country under this Government than there were under Labour, as a result of our following our long-term economic plan?

[Priti Patel]

My hon. Friend is absolutely right. The Labour Government consigned people to lifelong dependency, and it is our welfare reforms that have enabled us to ensure that work pays and that people are trained to get back into work. Britain would have been much better off, had we not had the mess of an economy on the brink of collapse, a banking system on its knees and a budget deficit in double figures. The only way to help people in this country is to grow the British economy. When we grow the economy, wages grow and living standards improve. The Governor of the Bank of England said last year that

“ultimately the growth in real wages is going to be determined by recovery in…this economy”.

[Mr Mudie]

My hon. Friend the Member for Nottingham East (Chris Leslie) asked the Minister about the unfunded £7 billion of tax cuts. They have been described by the Business Secretary as a “total fantasy”, and by the Chief Secretary to the Treasury, her colleague, as a “grand deception” of the public. Does she support the Chief Secretary to the Treasury? Will she withdraw her remarks about the Labour Government’s fiscal irresponsibility and accept that the Business Secretary and the Chief Secretary to the Treasury are accusing the Chancellor of fiscal irresponsibility by suggesting that £7 billion of tax cuts?

[Priti Patel]

I say to the hon. Gentleman that, by growing the economy, we will see—[Interruption.] The hon. Member for Nottingham East is gesticulating with his hands, which is something I know the Labour party likes to do. The Prime Minister was very clear in his party conference speech. We are all about economic growth, growing the economy, getting our budget back on track and sorting out the finances, unlike the Labour party, which just wants to spend, borrow and tax more.

[Chris Leslie]

The hon. Lady is being very patient in allowing us to intervene on her. It is important that we pin this down. The Prime Minister has announced £7 billion of unfunded pledges, and she is standing there and saying, “We’ll pay for it through sustainable growth.” If the Opposition said that they were going to put £2.5 billion into the NHS through unfunded growth, what would she really say in response? It is our duty to ask her to be specific and to say what she will cut to fund those pledges or how she will raise the money by raising other taxes such as VAT.

[Priti Patel]

It is our duty to be clear about the fact that we will tackle public spending, as the Chancellor and the Prime Minister highlighted during their conference speeches, in addition to supporting the economy through wider economic growth.

[Justin Tomlinson (North Swindon) (Con)]

Is it not the case that Labour promised to spend the bankers bonus tax no fewer than 10 times over?

[Priti Patel]

My hon. Friend’s point tells us everything we need to know about the economics of the Labour party.

We believe in a recovery that works for the many, and there are three ways of putting that recovery in place. First, we create the right macro-economic conditions. Cutting the deficit, restoring public spending to sustainable levels, ending the culture of Government excess—which the Labour party knows quite a bit about—securing inward investment, building, manufacturing, exporting and securing our place in the world are all key, and we are doing those things.

[Nick de Bois]

The Minister has touched on a crucial point. When this Government came to power, exports to the EU far outweighed those to the rest of the world. Our investment in UK Trade & Investment and the confidence of British investors in the macro-economic conditions that we have created have now turned that situation round. We are no longer as dependent on the struggling EU economy, following a 10% increase in growth outside the EU.

[Priti Patel]

My hon. Friend is absolutely right. This Government made the right decisions. For a start, we do not vilify businesses; we work with them to help them grow, export, and expand overseas. We have also invested heavily in UKTI, which is working in partnership with businesses up and down the country.

[Mr Marcus Jones]

My hon. Friend is talking about exports. Does she agree that this Government have set out the right conditions for exports? That is proven by the fact that we are now exporting more cars than we have imported since the 1970s.

[Priti Patel]

My hon. Friend is absolutely right. In his constituency and his region, the motor manufacturing sector is doing incredibly well and demand is incredibly high. Long may that continue. That is all about creating the right economic conditions to allow that to happen.

[Andrew Gwynne (Denton and Reddish) (Lab)]

I appreciate that we are entering the pantomime season and that this kind of political knockabout over whose spending plans stack up might play well to those in the gallery or to people outside, but the real way for the Minister to give confidence to the electorate that her £7 billion tax giveaway will stack up financially would be to allow her spending plans to be judged by the Office for Budget Responsibility. Labour has said that its spending plans will be put before the OBR; why does she not do the same?

[Priti Patel]

We are confident about our plans; it is the Opposition who should be worried about theirs.

The second way to recovery is by securing jobs and employment, and supporting businesses and the private sector. There is no better route to opportunity and success in our economy than being able to get a job; it is perhaps the closest thing we have to a silver economic bullet. Someone in work brings home money and is contributing to the economy, as we have all seen across our constituencies, and this makes an enormous difference to all our constituents. The 2 million private sector jobs created since 2010 have transformed people’s lives, while offsetting the reduction in public sector jobs many times over. This is what it is about: creating the conditions of growth so that the under-25s at the beginning of their careers get the right start in their working and professional lives, as many hon. Members have said. That is why the number of young people claiming benefits has fallen by more than half.

[Richard Burden (Birmingham, Northfield) (Lab)]

Will the Minister explain why the majority of children growing up in poverty are coming from working households?

[Priti Patel]

The hon. Gentleman will know that child poverty is falling, and it is only by making work pay that we can reward the individuals who choose to go out to work and ensure that they are supported, not only through tax credits, but through the wider system, through child care—[Interruption.] The national minimum wage has gone up. Will Labour Members welcome that, because—[Interruption.] It went up last month. [Interruption.] The Opposition are belittling the fact that we have ensured that the national minimum wage has gone up, and that is part of sustaining families and helping them with the cost of living. This is not just about young people; it is about supporting parents as they return to work through our reforms to child care.

To those, particularly those in the Labour party, who point to some of the measures I have outlined as a sign of economic failure, I say two things. First, they should stop sneering at what this Government have done to give our young a hand up when it comes to employment opportunities. The apprenticeships schemes, training schemes, colleges and starter jobs are not to be sneered at—they are valued and welcome. This Government have rightly put out the helping hand to a generation abandoned by Labour by giving them the chance to train, get a profession and get on in life.

Secondly, job creation and wage increases do not happen simultaneously. If there is an exceptional rate of job creation—we have put one in place—of course that has an impact on average wages. Wage increases happen slightly later. However, as the Resolution Foundation, run by Gavin Kelly, a former special adviser to the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), has stated, when compositional changes in the labour market are accounted for, average wages for the first half of 2014 have grown in real terms. Encouragingly, the most recent monthly Office for National Statistics figures showed wage growth outstripping inflation, particularly so for the 84% of workers who were in continuous employment—those in exactly the same job as they were a year ago—who saw pay rises of 4.1%, which is double the rate of inflation.

The third way to get a recovery that works for the many is by allowing people to take home and keep more of the money they have earned: giving them more disposable income. That measure is conveniently not included in the £1,600 worse-off statistic frequently touted by the Labour party, which also does not take into account the huge increase in employment or a measure of inflation that has any credibility. Over the course of this Parliament, we will have cut the income tax of a typical taxpayer by £805, boosting the amount of money that 25 million people take home, and taken more than 3.2 million of our lower earners out of income tax altogether. These are the biggest reforms of income tax in generations.

We are cutting the cost of living, helping to make families more financially secure. We are freezing fuel duty—the Labour party was happy to increase that at every opportunity; freezing council tax; and reducing the costs of child care. Those measures are helping with the standard of living of people up and down this country.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

I do not know how much more the Minister has got to say, but I did not want to let the chance go by for her to address the discourtesy pointed out by my hon. Friend the Member for Bristol East (Kerry McCarthy). My hon. Friend does not know where the Minister is going tomorrow, and I am sure that such discourtesies do not please you, Mr Speaker. The Prime Minister came to my constituency and did not bother to tell me about it. An opportunity has been offered to the Minister and I wonder whether she will tell us before she finishes speaking whether she is going to take that opportunity to be clear about where she is going tomorrow.

[Priti Patel]

Of course, Mr Speaker. No discourtesy is meant. I know that those in my office have been in touch with the hon. Member for Bristol East (Kerry McCarthy) and she has been notified of my visit tomorrow. After I have finished in the Chamber today, I will ensure that she is given full details of the location of the site that I am visiting.

We have heard quite a lot from the Opposition today, and I take issue with the implication that the recovery helps only the well-off. In every Budget since 2010 revenues from the most well-off have been raised. The increases in capital gains tax in 2010, the increase in stamp duty on high-value homes and limiting income tax reliefs are all measures that we have taken. We have been able to use those extra revenues to help the most vulnerable in our society wherever we can. We have done so through the introduction of the triple lock on the state pension, making pensioners £440 per year better off; through the pupil premium in our schools; and by supporting those on disability benefits by exempting them from the annual benefit cap. It is right that we safeguard those in need through such measures. It is not right, no matter what the Labour party says, to have a tax system in place that turns talented growth-creators away from the UK. The Opposition’s dogmatic stance on the 50p rate shows that they are willing to drive wealth creators out of this country and to risk our economic security. That is no way to help the poorest in our country.

Next week, the Chancellor will present the autumn statement to the House. As this motion notes several areas where the Government have taken action, and will continue to do so, I would like briefly to touch on some of those items. As I said, we are the Government who increased the national minimum wage in October, leading to a pay increase for more than 1 million people. That was the largest cash increase since 2008. We are also the Government who are introducing tax-free child care, which will provide working families with 20% support for child care costs of up to £10,000 per year for each child. On tax avoidance, we have taken the lead on the international stage through the base erosion and profit shifting projects. Domestically, we have made 42 changes to tax law to close down loopholes and reform the system. After 13 years of Labour inaction on tax evasion, we are leading the world on tackling the issue.

We will take no lectures from the Labour party on small and medium-sized enterprises. It regulated, taxed and placed endless excessive burdens on SMEs when it was in government. This time last year we announced the largest package of business rates support for 20 years. More than half a million small businesses are benefiting from small business rate relief, with 360,000 paying no business rates at all. This Government back SMEs. We understand them and we pay tribute to them for their enormous contribution to our economy.

For the first time in a generation we have a Government who are committed to investing in our infrastructure. The national infrastructure plan has ended the corrosive stop-start cycle of infrastructure investment and enabled us to have some of the most ambitious infrastructure projects in generations, so that Britain can once again stand tall in the world. [Interruption.] No, we have enabled many infrastructure projects to take place across the country, and we are proud of the investment this Government are making in infrastructure. Housing has been mentioned, and we are investing £7.8 billion to deliver the most ambitious affordable housing programme for more than 20 years. The Conservative party is the one that has supported and championed the property-owning democracy, so we will take no lectures from Labour on home ownership and supporting the aspiration of those who want to own a home.

We live in a global economy and, as we have seen, not every country has had our laser-sharp focus on growth and economic competitiveness. In the 21st century no country is 100% master of its own economic destiny, and it would be naive to pretend otherwise. But the reforms we have carried out are making our long-term sustainable plan and our economy—this leads to the increase in living standards—so viable. Regaining the lost ground can be achieved only by backing growth in our economy, supporting those who back business and support job creation, and underpinning it with sound public finances and strong business investment. We have a plan in place and it is delivering. [Interruption.] It is interesting at this stage of the debate to see Opposition Members sneering and sniggering. We will carry on working through our long-term economic plan, which is securing a resilient economy and a better future for all.

[Several hon. Members]

rose—

[Mr Speaker]

Order. On account of the level of interest in the debate, I am afraid that there must be a time limit on Back-Bench speeches. We will start with an eight-minute limit, although it is not mandatory for Members to consume all of the available time. We will see how we get on.

13:49

[Mr Jim Cunningham (Coventry South) (Lab)]

I will try to be as quick as I can, because I appreciate that Members on both sides of the House take this debate very seriously and wish to participate in it.

Government Members should be reminded that they should not try to rewrite history. I listened to the tirade by the Exchequer Secretary to the Treasury over who did what in the lead-up to the current economic situation. It is worth reminding the Government that in 2008 we saw the collapse both of the Lehman Brothers in America—it is always good to remind them of that—and of Fannie Mae. The conservative US President then pumped $260 billion into the American economy and introduced quantitative easing, which shows that the economic situation was international, because many countries depend on America for trade. We should start to set the record straight. Running alongside that is the fact that in the first two years after taking office in 1997, Labour paid off large chunks of our national debt. That is conveniently forgotten by those on the Government Benches. We should also remember that the current US President had to bail out the motor car industry in America. The Conservatives tend to forget that little one as well.

It is also worth reminding the House of what we achieved. We introduced quantitative easing and low interest rates, which facilitated growth and helped mortgage payers. We capitalised the banks for the dead simple reason that people were in danger of losing their savings. The Opposition had only one answer to that matter which was to cut red tape. How many Members of the House remember the Conservatives saying that?

When we left office, the economy had grown by about 1.8%, and we had managed to retain our three star credit rating, which is why we could borrow money to try to rejuvenate the economy and keep people in jobs. The Government must be reminded of those things, because sometimes, rather than giving us the reality of the situation, they sound more like an Administration from North Korea. People often say that politicians do not reflect what is happening to them on the ground. Anybody listening to the Government today would certainly have had that impression.

No matter what the Government say, no one can dispute the fact that people are worse off by £1,600 a year. It is worth saying that the purchasing power of wages has also been reduced by between 5% and 6%. In the public sector, pay increases have been kept at 1%, which means that workers have had a wage cut of something like 5%.

In one of the most astonishing episodes of this Government, the Chancellor of the Exchequer, last week or the week before, rushed off to Europe to get the cap on bankers bonuses lifted—unbelievable! That is how out of touch the Government are with public opinion. The public want us to hold bankers to account for causing the previous recession with their prolific spending. People want something done about the bankers, and we have the Chancellor running around trying to get the cap lifted on their bonuses to reward failure. It is astonishing.

[Mr Mudie]

Was it not made more unacceptable by the fact that this week midwives were here lobbying for a 1% wage increase that the Government had turned down? That same Government were taking Europe to court because the cap limited bankers’ bonuses to 100% of their pay. At the same time as taking Europe to court for stopping bankers getting bonuses above 100% of their pay, the Government were not allowing midwives a 1% rise, which was recommended by their pay review body. In other words, midwives were considered to be worth nothing.

[Mr Cunningham]

My hon. Friend confirms what I have just said about the Government being out of touch. That is why the public think that politicians in general are out of touch with their constituents.

Before I reflect on some of my constituents’ concerns, let me talk about food banks, the number of which is at an all-time high under this Government. They were introduced to help asylum seekers; they were never intended to be used in the way that this Government are now using them. We should remind the Government of that, because it shows what is happening outside this House to people in this country.

Let me touch on the issues that affect the people of Coventry. Local government cuts are a concern. Coventry has to find £65 million over the next three years. We will have to lose 1,000 jobs. Services such as libraries and those relating to care could be cut. That is the reality of this Government’s policies; we cannot blame anybody else for the problems. Even the education service in Coventry, which backs up teachers and head teachers and gives advice, will be cut. Care for the elderly is also under threat. At a regional level—I am talking about the west midlands—we have seen cuts to the police force. The fire services have a big problem with pensions. A couple of days ago, we had a dispute in the west midlands in which people withdrew their labour. The whole of our public services has been under attack by this Government. The Government have also squandered between £3 billion and £5 billion on the reorganisation of the national health service—that is how out of touch these people really are.

When we look at the public sector in general, pay increases have been kept at 1% for three or four years, which has reduced the public purchasing power by between 5% and 6%. We have seen large-scale redundancies in the public sector. The Government call it rebalancing the economy, which shows just out of touch they are.

The last figure that I have seen suggests that 75,000 people are waiting to be assessed for the employment and support allowance, which is astonishing. The citizens advice bureau in Coventry has dealt with something like 1,300 inquiries in the past 12 months, with the ESA accounting for about 25% of its inquiries. Some of the time spent on those inquiries could be better spent helping people. There are unacceptable delays in appeals, with 40% having negative decisions overturned. People who wait more than a year to be assessed suffer financial difficulty and stress. Terminally ill people are also facing long delays, and the Government are doing nothing about it. That is how out of touch they are.

Employment tribunal fees range from £160 to £250, and a tribunal hearing costs £950, which makes a total of £1,200. That has to be paid by people who cannot afford it. I have constituency cases in which people cannot get proper legal advice because of the cost. The TUC report shows that there has been a fall of 79% in overall claims, which includes an 80% fall in the number of women pursuing sex discrimination cases. That is what is going on under this Government. The CAB has reported that seven out of 10 potentially winnable cases are not being pursued. Then we have the issue of zero-hours contracts. I will not go into any of the details on those now as they have been well and truly rehearsed over the years. I welcome increases in employment, but what we have are jobs that do not even pay a minimum wage. With zero-hour contracts, people cannot plan for a holiday or get a mortgage. That is the reality.

More and more people in this country are in work but on very low wages. What good is work if a person is still in poverty? People should earn enough in their job to be able to live a decent life, and more should be done to make firms pay a living wage.

13:58

[Stephen Hammond (Wimbledon) (Con)]

I am grateful for the opportunity to contribute to this debate this afternoon. It is a pleasure to follow the hon. Member for Coventry South (Mr Cunningham). I listened carefully to his remarks, and feel sure that he would have wanted to put it on the record that unemployment in his constituency has fallen by 32% over the past year and youth unemployment by 48%. That fact goes to the heart of what we are talking about today.

I read the Opposition motion extraordinarily carefully last night. I do not want to use unparliamentary language, so I will speak in economic terms. When we talk about being economical with the truth, we should look at the great speech from the Opposition Front Bench. We had not only deficit denial but fact denial. This motion shrinks away from reality. It is economically and historically inaccurate and, as those on the Opposition Front Bench know, economically inept. I am pleased that the motion has at least one virtue: it gives us the chance to remind everyone in this country that Labour left the largest ever budget deficit in peacetime. It caused the mess that this Government are clearing up. Of course, it is historically the job of Conservative Governments to clear up the mess that Labour Governments leave behind.

It was extraordinary that the speech made by hon. Member for Nottingham East (Chris Leslie) included not only deficit denial, but a denial of facts set out by the Office for National Statistics about the rise in living standards that is beginning due to this Government’s long-term economic policy. We heard no apology from him for the economic mess. No one says that there was not a financial crisis and a banking crisis, but had he listened to my hon. Friend the Member for Enfield North (Nick de Bois)—and responded to my hon. Friend’s point, rather than trying to deny the facts—he would have recognised that the previous Labour Government created a structural budget deficit over a full 10 years, which was why this country had a significantly worse budget deficit than any other European country.

[Chris Leslie]

indicated dissent.

[Stephen Hammond]

The hon. Gentleman shakes his head again. This is not only deficit denial, but fact denial.

[Mr Robert Syms (Poole) (Con)]

My hon. Friend will, like me, remember sitting on the Opposition Benches and hearing the former Chancellor, the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown), saying that the previous Government had abolished boom and bust.

[Stephen Hammond]

The former Chancellor certainly abolished boom for much of the time, and he also created busts.

If the hon. Member for Nottingham East reads the ONS statistics, he will see that productivity fell so dramatically while Labour was in government that we had to redefine it. The Labour Government had to redefine long-term unemployment because the numbers were becoming so large. They put people on a course—any course; it did not matter whether it was relevant to a job—and did not create any apprenticeships.

One of the messages that will ring out from the Chamber is Labour’s failure to apologise. Until the Opposition accept that they were responsible for the economic mess, no one in the country will think that they have any credibility. The motion refers to

“a recovery for the many, not just a few”.

I know that the Labour party does not like to discriminate because while it was in power, it was not a question of the many or the few at the top, because we all undoubtedly suffered economic hardship. Labour Members do not want to face the fact that living standards were falling faster between 2008 and 2010 than they have since.

The wording of the motion is simply wrong. While it cites a “recovery for the many”, the many are recovering at the moment. More than 1.5 million people have been taken out of tax, while 26 million are paying less tax. People’s mortgage payments are underpinned by low interest rates. Some 1.3 million people are in new jobs, and although shadow Ministers do not like to accept this, in the past year, 71% of those jobs were full time. Unemployment among to 16 to 24-year-olds is falling faster than ever before. I do not think that the families who are experiencing such things would regard the economic recovery as something that does not benefit them.

I assume that the words “few at the top” in the motion refer to the cut in the 50% tax rate. Labour Members may wish to address that, but I suspect that, like with measures on bankers bonuses, they would spend the money raised many times over to fund a number of things. However, let us examine the supposed injustice about which they make so much noise. Does the hon. Member for Nottingham East wish to intervene to tell us for how long there was a 50% tax rate under the previous Government? It was 36 days in the whole 13 years when Labour was in government.

[Ian Austin (Dudley North) (Lab)]

Would the 50p tax rate be so necessary if people such as the hon. Gentleman did not exploit complex offshore tax arrangements to minimise their tax bills? How can he lecture the rest of us in the House about ordinary families who are not able to afford accountants and offshore tax arrangements?

[Stephen Hammond]

I say clearly to the hon. Gentleman that I pay every piece of tax that is due. I have never exploited anything. The Daily Telegraph wrote a story that was a lie, and he ought to be very careful about making such a remark outside the Chamber. I have made clear statements, which are on the internet, that show clearly that I pay every piece of tax that I am supposed to pay. I have never avoided tax and I pay it entirely. He should be very careful about making those accusations. He is using parliamentary privilege to do so, but that is cheap. He should be very careful because that is unfair. It is wrong, and he should apologise.

[Ian Austin]

I would have no hesitation whatsoever in apologising to the hon. Gentleman, but the story in The Daily Telegraph has not been amended or withdrawn—

[Stephen Hammond]

It has.

[Ian Austin]

I have just read it now. If I have said something about the hon. Gentleman’s personal affairs that is not correct, of course I apologise without hesitation.

[Stephen Hammond]

At the end of the article, quite rightly, The Daily Telegraph points out all the facts that my lawyers have made available, and it now recognises those facts. If the hon. Gentleman wants to make an apology, I shall happily accept it.

The motion refers to a

“tough and fair plan to deliver a current budget surplus and falling national debt”,

yet the Opposition’s spending plans involve £166 billion of extra spending. The hon. Member for Nottingham East talks about Labour’s tough and fair plan and its zero-based review of every pound spent, yet the shadow Chancellor’s article in last night’s Evening Standard said that Labour had so far identified £250 million of savings against that £166 billion of unfunded promises. We hear about unfunded spending promises from the hon. Member for Nottingham East, so will he clarify whether the zero-based review has identified any more savings than that £250 million?

[Chris Leslie]

Our zero-based review of all Government Departments is an ongoing process, but I want to ask the hon. Gentleman about the £7 billion promised by the Prime Minister. The hon. Gentleman is a man of integrity—he has been debating this with my hon. Friend the Member for Dudley North (Ian Austin)—so surely he does not think that the Prime Minister can get away with saying that future growth will pay for that £7 billion. How should that £7 billion be paid for?

[Stephen Hammond]

I am delighted to accept the hon. Gentleman’s word that I am a man of integrity and I hope that the hon. Member for Dudley North (Ian Austin) will also make that clear in the Chamber. It is perfectly reasonable to say that we will implement the policy when the economy allows. That was exactly what the Prime Minister said, as the hon. Member for Nottingham East knows.

The hon. Gentleman also knows that growth in our economy is at 0.7%, in line with data from the past eight or nine quarters, and that the OECD forecasts that the UK will be the fastest-growing economy in the G8 this year and the second fastest next year. He also knows that the deficit has been cut and that our interest rates mean that mortgage rates remain low for many. There is long-term economic progress in an economy that is now 3.4% larger than when we went into recession. Under Labour, borrowing steadily rose throughout the period of economic activity, but this Government are starting to cut the deficit, which is benefiting the many. People have been taken out of tax and business investment is rising. It is clear that our long-term economic plan is delivering for the people of this country, and the only thing that would put that plan in danger would be the election of a Labour Government. The public see through Labour’s plans, as an opinion poll shows that on economic competence, the Conservative party’s rate is, understandably, 26% higher than Labour’s.

14:08

[Kerry McCarthy (Bristol East) (Lab)]

We could spend a lot of time trading statistics about the economic recovery, the debt, the deficit and how much more the Chancellor is borrowing at this point in the economic cycle than he said he would. Those things are important but, frankly, they mean little to my constituents, who are tired of the blame game and of hearing the Government constantly saying that everything is the previous Government’s fault, given that they have been in charge for four and a half years. What matters to my constituents is their own jobs and living standards, and economic security for them and their families. It is about whether they can heat their homes, put food on the table, keep their cars running or afford the bus into the town centre to get to work, and keep a roof over their heads. The limited recovery that we have seen, which is barely bouncing along the bottom, is not being felt in east Bristol. That is why I asked the Minister, when she is in east Bristol tomorrow, whether she would be prepared to come and see some of that reality on the ground.

The unemployment figures seem to be moving in the right direction, which is good news. Labour has always had the ambition to move people from welfare into work as a route out of poverty. The right is fond of trying to caricature and misrepresent Labour and our voters as being wedded to welfare dependency. That is simply not the case. Labour has always been the party for workers; welfare for those who need it as an essential safety net and a support for those making the transition to work, and work for those who can and who, despite the misrepresentation, in 99% of cases desperately want to work. But under this Government we have seen a rising phenomenon of in-work poverty; a problem that is masked by the superficially encouraging trend in employment figures, but is undeniably there and is a feature of many people’s lives.

The Joseph Rowntree Foundation has just published a report on this year’s statistics. It says that it

“shows a real change in UK society over a relatively short period of time. We are concerned that the economic recovery we face will still have so many people living in poverty.”

It is estimated that about 13 million people in the UK are in poverty. Poverty among working age adults without children is at a record high, but about 40% of working age adults in poverty are working. So it is not simply an issue about moving people from welfare to work; it is about making work pay. Among children in poverty, most—more than 2 million—are in a working family.

[Andrew Gwynne]

My hon. Friend makes a powerful point. Is not this why we need a more concerted effort on the living wage? She will know that during this Government’s lifespan, the number of people paid less than the living wage has increased by 1.5 million, and that puts enormous pressure not just on those families and individuals but on the social security system.

[Kerry McCarthy]

I agree entirely with my hon. Friend. Nearly 20% of working people in Bristol East earn less than the living wage. According to the Joseph Rowntree Trust, two thirds of people who moved from employment into work in the last year are paid below the living wage. That is why in Bristol we have been running a living wage campaign. We have finally managed to persuade the mayor of Bristol to introduce that at the council level, and we want to encourage the organisations that do business with the council, with procurement contracts and so on, also to do that, and for the private sector to follow suit. That is incredibly important.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

My hon. Friend is making an important speech about Bristol, and I was interested in her comments on the living wage. Will she accept that the living wage is equally important for seats such as mine in outer London, where those who travel into central London have recently been hit by a 38% increase in the cost of the tube as a result of the Mayor of London’s recent decision?

[Kerry McCarthy]

I entirely agree with my hon. Friend. I will come in a moment to some of the living costs that are hitting people’s pockets hard. In Bristol, First Bus announced this month that the price of a day rider ticket would increase by 10%. That may not seem a huge amount, but when people are squeezed to the last penny and are struggling to afford to go to work and for work to pay rather than being on benefits, such transport fare rises make a huge difference to their weekly outgoings. That is another part of the jigsaw puzzle of how people are struggling to make ends meet.

My hon. Friend the Member for Coventry South (Mr Cunningham) mentioned zero-hours contracts, and constituents have come to see me recently about the uncertainty in which those place them. Usually people would be added to the payroll in the middle of the month and paid at the end of the month, but if people do not know until the end of the month how many hours will have been worked, they end up being paid a month in arrears. I had a woman come to see me the other day who had started work in September just too late to get on the payroll for that month. She could not be paid for the full month in October because she would not know until the end of the month how much she had worked, so she would not be paid until the end of November. Not only did she have to cover the period without an income, but it was impossible to plan ahead. It was impossible to claim in-work housing benefit and difficult to asses what she was entitled to in child care tax credits and other tax credits. It meant that she had to employ a childminder without knowing whether she needed that or could look after her child herself.

My hon. Friend mentioned season tickets. How does someone know whether it is worth buying a monthly season ticket to travel into work without knowing how many hours they will be working? All these things add up to make life incredibly difficult for people on zero-hours contracts. It is exploitation and it has to stop. Workers are being underpaid and underemployed. They are being treated as just another inanimate resource rather than the human beings that they are.

Some 1.4 million contracts do not guarantee a minimum number of hours and 1.4 million adults are in part-time work because they cannot find full-time work. In the last year, not a single employer has been prosecuted for paying below the minimum wage. The last successful prosecution was in February 2013, which was only the second prosecution under the coalition Government. Last year, the TUC estimated that 350,000 workers were paid less than the minimum wage. Again, that has to stop. These laws are there to protect workers and to ensure that work pays, and they are simply not being enforced.

The Joseph Rowntree report

“highlights the way the housing market has had a negative impact on people in poverty. There is not enough social housing”—

as we all know—

“which means more people in poverty are living with insecure tenancies in the private rented sector. The number of private landlord repossessions is now higher than the number of mortgage repossessions.”

The number of working people claiming housing benefit is rising and the amount that they need to claim is increasing too. Last year, the south-west of England saw the biggest increases in rent, with a rise of nearly 5%. Bristol is second only to London in yearly house price growth, with average prices in our city increasing by more than 13% last year. On top of that are the increases in transport costs. Between 2010 and 2013 energy prices for households rose by 37%.

Finally, there is food poverty, which Madam Deputy Speaker will know is an issue dear to my heart. In the UK, more than 4 million people are affected by food poverty. UK food prices increased by 43% in the eight years to July 2013. We all know that more people are having to use food banks. According to the Oxfam and Church Action on Poverty report “Below the breadline”, the three main food aid providers gave more than 20 million meals in 2013-14, a 54% increase on the year before. Problems with the social security system, such as delays and sanctions, continue to be the biggest overall trigger for food bank use. About 45% of people who use the service do so because of problems with the benefit system. Despite repeated questioning of various Ministers, including even the Prime Minister, the Government refuse to accept that it is the failings of their own welfare system that are driving people to the food banks in poverty.

Another emerging trend is the 22% of Trussell Trust food bank users referred because of low income—compared with last year 51,000 more people were referred owing to low income. Again, this is in-work poverty. These are not people who are playing the system, who, as one Minister said, are making use of the food banks simply because they are there so that they can spend their money on beer and bingo. These people are doing their best to try to get by in work but simply cannot afford to feed their families without resorting to food banks.

My hon. Friend the Member for Nottingham East (Chris Leslie) has outlined some of the measures that Labour would take in terms of taxation and trying to raise incomes to address some of these problems, but above all it is a question of priorities. The Government have completely the wrong priorities—giving tax cuts to millionaires rather than tax cuts and support for people at the lower end of the income scale who are the ones who really need it. Cutting the 50p tax rate did nothing to help the people in my constituency who are struggling to get by. I urge the Government to rethink this because their priorities at this time are simply wrong.

14:19

[Richard Harrington (Watford) (Con)]

It is a pleasure to speak in this debate. I want to concentrate on a few things that the shadow Minister, the hon. Member for Nottingham East (Chris Leslie), said. I hope that one day, while driving from London to Nottingham, he will decide to turn off the M1 and head towards Watford, because then I could show him that, in reality, many of the claims made in this lengthy Opposition motion are not quite correct.

[Mr Thomas]

If my hon. Friend the Member for Nottingham East (Chris Leslie) accepts the hon. Gentleman’s invitation, perhaps he will take him to Watford tube station, where they could discuss the impact of the increase of up to 38% in the cost of fares for outer-London commuters that the Mayor has recently imposed.

[Richard Harrington]

Just to correct the hon. Gentleman, some of the tube fares for areas outside London are set by the owner of the stations, London Midland, rather than by Transport for London. I know that he did not mean to mislead us on that point.

The shadow Minister claimed that working people are worse off today than they were under the magical mystery tour of the previous Labour Government. I am not sure where that claim comes from, but I imagine that he, like the shadow Chancellor, bases his statistics on the retail prices index, comparing it to wages, which most credible economic sources no longer use as an indicator because it does not include the huge increase in the personal allowance and tax cuts of £700 per person.

To get back to reality, when somebody who has been unemployed for a long time, or indeed who has never worked, gets a job, it will not necessarily be a highly paid one. If the hon. Gentleman accepted my invitation to come to Watford, he could visit the local jobcentre—he might be hoping that I will be enrolling there next May—and see that long-term unemployment has fallen by 44% and youth unemployment has halved. Nobody could say that those working people are worse off than they were before 2010.

[Richard Graham (Gloucester) (Con)]

My hon. Friend makes a powerful point about getting people back into work and about youth unemployment, which has also been halved in Gloucester. Does he agree that the rise of apprenticeships provides an important opportunity for young people to develop skills sets that will enable them to have a bright future? There are 5,000 new apprentices in Gloucester, and I have no doubt there are many more in Watford.

[Richard Harrington]

Indeed there are. I totally agree with my hon. Friend and am fully aware of all the work he has done on apprenticeships in his constituency.

When I started running jobs fairs in Watford in 2010—I hope that the shadow Minister is listening—70% of the 2,500 people who came were unemployed and were looking for a job; the others were already employed but were looking for a better job. Last year, 70% of the 4,000 people who came were already in employment and were looking for a better job. To take a Watfordian lesson from that, those people’s real wages will go up in the normal progress of things, now that, as a result of the long-term economic plan, the economy is beginning to move and people are getting back into employment.

The Opposition have set a national minimum wage target of £8 an hour by 2020. Perhaps I have misunderstood —I hope the shadow Minister will explain when he winds up the debate—but on current trends the national minimum wage will be more than £8.10 by 2020 anyway. I do not think he is pledging to cut the national minimum wage in 2020 if he is in government. I recently met Julia Unwin of the Joseph Rowntree Foundation and John Cridland, a former member of the Low Pay Commission, and in fact, they seemed to think that Governments planning to set a minimum wage target is exactly against what the Low Pay Commission does. When they explained to me how they calculate what the minimum wage should be, after negotiations with employers and all the different interested parties, they said that they really wanted the calculation to be taken outside of politics and that they were quite worried about the shadow ministerial team’s proposal.

I wish I had time to go through each point in this rather lengthy motion, but as my time will be up in five minutes—and, indeed, as there is an election in five months—I do not think that I have time to do the task justice. I will instead focus the rest of my remarks on some key points. The real raising people’s wages is not done directly by the Government. Governments do not set wages in quite the way the Opposition imply. What really matters is making available the types of jobs that people are trained to do.

One Government policy that has not been mentioned today, but which I think is directly relevant to the debate, is the founding of the university technical colleges, one of which was recently opened in Watford. The good thing about the UTCs is that half the curriculum is set and designed by local employers, so jobs are available in those fields. Hopefully, the children graduating from those schools—it is early days yet—in addition to getting the more formal academic qualifications, will be halfway into a job and not on the ground floor, because they will already have had years of training. In Watford’s case it would be in tourism and events management—Hilton Hotels is very much behind this—or in IT. They will not just be leaving school, looking for a job and getting in at the bottom.

I hope we all accept that the real problem is the skills shortage, which has been a problem since the second world war, if not before, so it has not been caused by a particular Government. The Education Act 1944 tried to do something about that, but it never seemed to happen. The UTCs might seem a small step, but they are an important way in which more children can get into the right kind of employment from an early age. I realise, of course, that on its own, that really is not enough.

The real way to raise living standards is by having long-term stability and confidence in the economy. It might seem strange to hear me quote Bill Clinton. I do not think he has been to Watford, but if he happens to pick up Hansard and see my offer to the shadow Minister, I would be happy to make exactly the same offer to him—it is just off the M1. [Interruption.] Indeed, Mr Clinton probably has not been to Nottingham either. His speech to the Democratic party’s 2012 national convention in Chicago is one of the best political speeches I have ever heard, apart from the Minister’s response to the shadow Minister today. He said—you will be delighted to hear that I will not attempt an American accent, Madam Deputy Speaker—something along these lines: “So let me get this clear. You all agree that the last guys screwed it up. You may think that the current guys have made slower progress than you had hoped and have not done all the things they said they would do. It hasn’t happened as quickly as they wanted it to. So the answer is to bring back the guys who screwed it up, right?” That thought, for me and my constituents, is a very important one.

We go from Bill Clinton in Chicago to the shadow Minister in Nottingham. If both of them had been to Watford and seen the reduction in long-term unemployment, the doubling of apprenticeships and the 400 new businesses that have been created since 2010, they might both have cause to pause for thought. I hope that will be borne in mind when the Opposition wind up the debate.

14:29

[Mr Michael Meacher (Oldham West and Royton) (Lab)]

On 3 December, the Chancellor will be confronted with a whole array of facts and statistics that he never intended or expected to see. Like an echolaliac obsessive, he has constantly repeated on every available occasion—it has been the same today—that the Government have a long-term economic plan.

So was it the Government’s long-term economic plan that average wages should fall by an average of 9% in real terms—the biggest fall since the depression of Victorian times in the 1870s—and that in the past year the rise in the average wage should be a pitiful £1 a year, which, after adjusting for inflation, is a chunky fall of 1.6%? Was it the Government’s long-term economic plan that UK productivity should now be the worst in the G7 leading high-income countries, and that while output per hour between 2007 and 2013 rose by 8% in the United States, by 5% in Japan, by 3% in Canada, by 2% in Germany, and by 1% in France, in the UK, uniquely, it fell by 3% and shows no sign of improving in the future?

Was it the Government’s long-term economic plan—this really is important—that six years after the crash, business investment should still be flat, at a level 10% below pre-crash, or that the FTSE 100 companies should still now be sitting on cash stockpiles of over £500 billion and not investing because they do not believe the Chancellor’s so-called recovery is sustainable? Was it the Government’s long-term economic plan that net exports in traded goods—that is, manufactured imports less exports—should now be chalking up the biggest deficit in British history, perhaps as much as £110 billion this year? To cap it all, was it the Government’s long-term economic plan that after nearly five years of austerity, the budget deficit should not be falling at all but rising again this year, when it is still a whopping £100 billion?

That then leads to the central question in this debate: what is the rationale for continuing with austerity when the consequences of austerity—the draining of demand out of the economy, as I have explained—are actually increasing the deficit, not reducing it? What is the answer to that central question? The Minister, in an exceedingly shrill, partisan and strident speech, made no attempt at all to answer it.

Nor is the situation just a glitch this year. With economic growth now slipping from 0.9% in the second quarter to 0.7% in the third quarter, and predicted to be 0.5% in the current quarter, and with household incomes continuing to fall—indeed, the 1.6% real-terms fall in the past year is the largest since records began—the Government’s tax take, which is crucial to the deficit, is likely to drop still further in future years. The only way the Chancellor can then start to get the budget deficit down again is by even more draconian cuts in public expenditure and benefits than in his first five years—perhaps by even double the £25 billion that he has already announced, as the Financial Times is predicting. Even if that were politically possible—that is highly doubtful, as polling evidence is clearly showing a public rapidly cooling towards any further austerity ravaging their livelihoods—it would only worsen the basic problem for the Government of making even deeper inroads into their tax income. The Government are finally ending up eating their own tail.

The truth is that the Government have only ever been able to point to two positive elements in their economic policy. One is the much-vaunted recovery, but that has always been over-dependent on a housing asset bubble. It has never rebalanced the economy from finance to manufacturing. It has never gained any legs because, as I have explained, all the potential sources of demand are now pointing firmly south and all the economic indicators show that it is beginning to fizzle out. The other is the unexpected increase in employment, which has been regularly mentioned in this debate, but there too the surface picture is very deceptive. Overwhelmingly, the jobs have come from self-employment, where the average wage has fallen by a massive 13%, or from part-time work.

But those are the details: what really matters about this awful episode of the past five years is that the Government have been pursuing a slash-and-burn policy that is ultimately self-destructive, as we are now seeing all too clearly. They are doing this because their primary motive is not to eliminate the structural deficit but to use the deficit as once-in-a-lifetime leverage to overthrow the post-war social democratic settlement and to shrink the state so that the public sector is transformed into a fully privatised market system.

It need not be like this. The Chancellor has handled the deficit appallingly badly, with maximum pain and minimum benefit, and it could have been so different. By comparison, the previous Labour Chancellor brought in two expansionary Budgets in 2009 and 2010 to counter the monetary collapse caused by the bankers. That cut the deficit from the peak of £157 billion to £118 billion—a reduction of nearly £40 billion in two years. The current Chancellor’s austerity Budgets then kicked in, and the rate of deficit reduction halved over the next three years. He had said that by this year the deficit would be £40 billion, yet it is actually about £100 billion.

What does the record show is the best way to cut the deficit? Is it by stimulating the economy to produce real jobs and boost incomes, as Labour did, or by slashing expenditure, degrading the foundations of our society, and delivering the biggest fall in average real incomes since Victorian times, as this Government have done? Frankly, it is a no-brainer. Continuing with austerity when it has ravaged the livelihoods of millions, destroyed so much of the social fabric of our society and is not now even cutting the deficit, which is supposed to be the whole object of the exercise, can only be described as a certifiable condition.

There is a better way of doing this. It can be funded, with no increase at all in public borrowing, by instructing the publicly owned banks—the Royal Bank of Scotland and Lloyds—to prioritise lending to British industry rather than financial speculation overseas, by having a modest further tranche of quantitative easing targeted directly on key industrial projects rather than wasted on the banks as hitherto, or by taxing the ultra-rich. That is the way we should go.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order. I have to tell the House that it is necessary to reduce the speaking time limit to six minutes. Unfortunately, interventions are taking us well over the eight-minute time limit, so that will not enable us to get every Member in. Therefore, with effect from the next speaker, who is Brooks Newmark, the time limit will be six minutes.

14:29

[Mr Brooks Newmark (Braintree) (Con)]

Thank you, Madam Deputy Speaker. I am delighted to follow the right hon. Member for Oldham West and Royton (Mr Meacher).

Notwithstanding the opening remarks of the hon. Member for Nottingham East (Chris Leslie), the Government have made huge strides in cleaning up the economic mess they inherited in 2010. As the Governor of the Bank of England, Mark Carney, said on 9 September,

“There are now over one million more people in work in the UK than at the start of the crisis. Total hours worked are some 4% above their pre-crisis level. The recovery has exceeded all expectations. It has momentum. The Bank’s latest forecast expects real wage growth to resume around the middle of next year and then to accelerate as the unemployment rate continues to fall to around 5.5% over the next three years.”

[Mr Syms]

Does the higher employment not mean that the economy is healing as people’s wages start to rise?

[Mr Newmark]

Yes, my hon. Friend is absolutely right. I will get on to that a bit later on.

This Government have cut the budget deficit by a third. The International Monetary Fund says that the UK is achieving the largest reduction in the headline and structural deficits of any major advanced economy in the world. Furthermore, it is forecasting growth of 3.2% for 2014—the fastest-growing economy this year. Moreover, the Office for Budget Responsibility forecasts growth this year of 2.7%—the biggest upward revision between Budgets for at least 30 years. Employment is up by 1.7 million since the election. In the past year alone, long-term unemployment has fallen by 206,000 and youth unemployment has fallen by 244,000. I was especially delighted that, in the 2013 Budget, the Chancellor adopted the Million Jobs campaign manifesto idea of cutting national insurance contributions for under-21s, which will help young people get into work and open up opportunities for school leavers.

A record number of women are in work. In addition, the annual fall in female unemployment is the biggest on record. This Government have ensured that the UK now has more men and more women in work than ever, and the number of people claiming unemployment benefits has fallen at the fastest rate since 1997.

It is worth noting that the number claiming jobseeker’s allowance has declined. In relation to the previous speakers, it has fallen by 20% in the constituency of the hon. Member for Nottingham East, by 32% in the constituency of the hon. Member for Coventry South (Mr Cunningham) and by 34% in the constituency of the hon. Member for Bristol East (Kerry McCarthy). The right hon. Member for Oldham West and Royton will want to know that the number of JSA claimants has dropped by a whopping 50% in his constituency.

The Government have ensured a fall in borrowing costs to record lows, which has saved money for taxpayers, businesses, home owners and families alike. Inflation was down to 1.3% in October, helping to bring down the cost of living. By almost every benchmark, the UK has made huge strides in turning the UK economy around, and the Chancellor and his team at the Treasury should be congratulated on sticking with plan A and ensuring that the UK is on the path to recovery.

The Government have much to be proud of on the cost of living. I welcome the significant increases in the personal income tax allowance, which rose to £10,000 from April this year. As has been mentioned, that has ensured a tax cut for 25 million people, with individuals paying an average of £705 less in income tax than they did in 2010. Indeed, 2.7 million people have been taken out of tax altogether, thereby reducing their cost of living.

The Government have already reduced energy bills by £193 by removing the green levies originally imposed by the Leader of the Opposition. They are ensuring that energy companies offer the lowest tariffs to customers, thereby reducing the cost of living. The Government have frozen fuel duty for the longest time in more than 20 years, with pump prices 20p per litre lower than if Labour were in power, thereby reducing the cost of living. Indeed, the average motorist will save £11 each time they fill up their tank, as a result of the Government’s actions.

Councils are getting help to fund council tax freezes for a fourth consecutive year, through a grant for local authorities that could be worth more than £700 for average bill payers. The Government’s new tax-free child care scheme will provide 20% support on child care costs of up to £10,000 per child per year, meaning that parents will receive support of up to £2,000 per child per year.

The Government have introduced the triple lock, which means that pensions increase each and every year by the highest out of price inflation, earnings growth or 2.5%. Over the course of their retirement, the average pensioner is about £12,000 better off under the triple lock guarantee, thereby helping with the cost of living. The Government have introduced the warm home discount scheme, which gives pensioners a £135 rebate on their electricity bills, thereby reducing the cost of living. They have permanently increased the cold weather payment from £8.50 to £25, thereby reducing the cost of living.

In conclusion, the Government have much to be proud of. The Chancellor had to make some difficult decisions back in 2010 to ensure that the country could have a long-term sustainable economic recovery. Although we inherited an unemployment rate of 3.4% in Braintree, I am delighted to say that it has now fallen to 1.5%. There has been a marked improvement in youth unemployment too, with the figure falling from 6.3% in May 2010 to 2.6% last month.

As the Governor of the Bank of England said in September, the economic recovery “has exceeded all expectations.” We should not jeopardise all this by returning to Labour’s tax and spend policies which created the financial mess that we have finally begun to clean up. The Government must stick with their long-term economic plan as it is the only sustainable way to raise living standards, help families to manage the cost of living, and offer a better and brighter economic future for our constituents and for our country.

14:39

[Sammy Wilson (East Antrim) (DUP)]

May I welcome some of the news from the Minister today? The statistics show that there has indeed been an improvement in the economy. It is in the interests of none of our constituents to have an economy that is doing badly simply so that we can score political points. The fact that growth is higher than in the rest of the G7, unemployment has fallen, employment is up and productivity is up, which therefore helps competiveness, is good news and should be welcomed. I have no difficulty welcoming it.

The point of the motion, however, is that that news is not sufficient for smugness or complacency; for a simple acceptance that the plan is working, and that therefore we do not need to do anything more or make any improvements; or for somehow or other rubbishing suggestions just because they come from Opposition Members. The Minister and other Government Members who have spoken should look at some of the statistics.

I do not want to do the economy down. I have seen it happen in Northern Ireland, but people who do that simply talk themselves into a recession anyway, because if confidence goes down, businesses do not want to invest and consumers do not want to spend. Nevertheless, if there are warning signs, we ought to recognise them.

Despite what the Opposition have said, growth over the past few years has been predicated on Government spending. When we look at the figures for the composition of GDP, we see that the biggest increase has been in Government consumption. That is now shifting to consumer consumption, but the figures again show that that is predicated on increased consumer borrowing. Especially when wages are being squeezed in the economy, we ought to be worried about that. It will of course increase household debt, and if consumer spending is carrying economic growth, we should be worried. The Government have made much of wanting export-led growth. Again, the figures for this year show that exports are under pressure: they are not growing where they were growing in the past. There are therefore some warning signs.

Another warning sign is inequality. As has been highlighted, even those in work do not feel any better off. Rather than Government Members saying that it is good to have people in work, they ought to be concerned that even the benefits of their policy are not felt universally, and they ought to accept that something needs to be done about that.

[Mr Gregory Campbell (East Londonderry) (DUP)]

On that issue, does my hon. Friend agree that the nation of the United Kingdom as a whole should prosper, and that wealth needs to increase—with greater inward investment and greater support for small and medium-sized enterprises—right across the regions of the United Kingdom, rather than disproportionately in the south-east of England?

[Sammy Wilson]

Of course, one of the other inequalities is inequality between the regions. The economy in Northern Ireland has done better in this recession than we expected—we are increasing inward investment through some of the Executive’s micro-economic policies—but there are regional inequalities, as well as inequalities between economic sectors and individuals.

For that reason, we need to look at two issues in the motion. The first is that as the economy grows and the percentage of GDP that is attributed to profits rises, there is no reason why—through increasing the minimum wage or, indeed, through greater application of the living wage—we cannot start some degree of redistribution from those who hold capital to the work force. That would not be a bad thing; indeed, it would be good for the Government finances, because it would of course release an awful lot of the spending on tax credits. In a growing economy, we can afford to do that. It is not only those of us on the Opposition Benches who espouse that policy: the Mayor of London has been an advocate of it. He has argued that it is a Tory policy, and that it should not be captured by the Opposition. We need to look at doing that. Not only would it release some of the Government spending on tax credits, but it has been shown that it tends to increase productivity and leads to a lower turnover of staff, saving expense for employers.

The second issue is borrowing. I understand that we cannot simply borrow, borrow, borrow. However, as I have indicated, the Government are happy for some of the growth in GDP to be carried by household borrowing. Of course, businesses borrow for capital expenditure. Borrowing can provide a return and perform a social function. The motion highlights expenditure for a house building programme. That would have a big multiplier effect on the economy—a multiplier effect that would probably be greater than that of borrowing to pay for people to be on the dole. It therefore makes absolute sense.

Government Members are presenting the motion as one that simply says, “Oh, let’s borrow more money regardless,” rather than one that says, “Let’s borrow money to use where it will actually help the infrastructure of the economy; where it will provide a return; where it will pay for itself over a period of time; where it will deal with a social problem; and where it will perhaps increase the mobility of labour because, of course, more housing enables that to happen across the country.” That, to me, is a sensible policy.

For that reason, I am disappointed that the motion, or at least the ideas in the motion, has not been accepted. If there are warning signs that growth may falter, here are ways in which we can put money into the hands of those who spend most of their income—that is, the low paid—and into capital investments that will have a return, which may, in turn, have an effect on economic growth. For that reason, I will support the motion this evening.

14:52

[Steve Brine (Winchester) (Con)]

It is a pleasure to follow the hon. Member for East Antrim (Sammy Wilson), who spoke passionately, as always.

I do not pretend to be one of the great economists of the House, but in my four and a half years as a constituency Member of Parliament, I have seen at first hand what a healing economy means in practice on the ground. Interestingly, the motion is all but silent on jobs, as other Members have mentioned. The shadow Chief Secretary referenced the 2010 autumn statement in his opening remarks. Strangely, he did not touch on the response that was given by the then shadow Chancellor, the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), which predicted a “jobless recovery” in this country.

My constituency of Winchester has seen a 50% drop in the youth claimant count in the last 12 months and an overall fall of 64% in the number of people looking for work since April 2010, so when the Chancellor talks about hard-working families and people who do the right thing—the Prime Minister repeated those words today—I firmly recognise my constituents in what he says. Yes, Winchester is a wealthy place in relative terms: house prices are well above the national average and we have some high earners working in law, medicine and financial services. That is fuelled partly by our proximity to London and the City. However, there is another Winchester where the average wage is £26,000 per year and where every penny counts.

My constituents are not fooled by political rhetoric. They know what they have seen with their own eyes over recent years. They know that being in work, not so that they can enjoy an extravagant lifestyle where it is a disappointment if they do not ski at least twice a year, but so that they can live their lives and provide for their families, is what actually matters.

The fact that the Government have made it possible for Eastleigh borough council, Winchester city council and Hampshire county council, working together, to freeze council tax over the five-year period is a big deal to my constituents. It has saved about £1,000 for a family living in an average band D property in my constituency. The fact that the Government have frozen fuel duty has not gone unnoticed, either. That move has hit the bottom line of family finances, in a positive way, to the tune of some £570 for those who fill up an average family car once a week. My constituents also know what security in retirement means. Again, it does not mean having the means to spend half the year cruising the world, perhaps from nearby Southampton; it means being able to enjoy good health and to help their grandchildren with their swimming or ballet classes on a Saturday morning. They know that it is those things that really matter.

The working families I represent remember the last Government. They see that it is a Conservative Prime Minister, a Conservative Chancellor and a coalition Government who have raised the personal income tax allowance to £10,000. In my constituency, that means that about 40,000 people on lower and middle incomes are keeping more of their money in their pocket each month. As we know, a typical taxpayer saves about £800 a year under that policy.

The decent retired folk I represent in places such as Chandler’s Ford remember the last Government, with the 75p increase in pensions and the £5 billion a year raid on their pension pots, which was one of their first acts in office. More than ever, those constituents are not tricked by the sleight of hand of politicians in Westminster. They have seen this Government introduce the triple lock pension guarantee, they have seen the largest ever rise in the state pension and they have seen that those important universal pensioner benefits have been protected throughout the lifetime of the Parliament, exactly as we promised.

I spent a year working at the Department for Work and Pensions with my right hon. Friend the Secretary of State for Work and Pensions and our superb Lib Dem Pensions Minister. I know, as do the people I represent, that this is a Government of work and pensions. That is very important. The employment figures that I read out earlier represent real people’s lives. The youth claimant count is especially pleasing because, as well as representing many people with families who are at the same age and stage in life as me, I represent many young people. There is a thriving university in my constituency and there are thousands of young people who need a bit of help.

The “dinkys”—dual income, no kids yet—are benefiting big-time from a growing economy that is creating jobs for them to find and settle into. They have the most to lose if this country goes backwards again next year. They have aspirations, such as owning their own home, driving a nice car and being able to afford a season ticket down at Southampton—although that would not be my choice—and I do not resent them for that. I do not scoff or sneer at their ambition just because that is not what everyone can afford.

Those people, whom I represent, are well educated, global in their outlook and highly mobile. They love the fact that Winchester is now the self-employment capital of England, according to a recent study. It is a vibrant place, where start-ups are at a record high. Centres such as Basepoint in Winnall, which I opened early in my time as an MP, are full of new businesses that are bursting with energy. People commute to London when they have to, but they recognise that the city council has an ambition to reduce outward migration each day for work by keeping big companies, such as Denplan, in the city. They do not dismiss out of hand the redevelopment of Station approach in Winchester because they know that it will provide new commercial space so that employers can come to the city and provide new jobs.

[Richard Graham]

Does my hon. Friend agree, as a fellow cathedral city MP, that there is a huge amount that can be done on the ground to help the growth in his city? He has done a lot to make the cathedral city of Winchester come alive with markets and skating rinks around the cathedral. Similarly, there were 200,000 people at Gloucester Quays last weekend for the Victorian market. Those are all ways in which growth can appear in our constituencies, but they are not recognised by speakers such as the right hon. Member for Oldham West and Royton (Mr Meacher).

[Steve Brine]

Absolutely. We have such a positive go-ahead outlook in the Christmas city, which is how Winchester has branded itself. Judging by the number of people skating and shopping at the Christmas market, it is the Christmas city. I urge Members to come.

We might have had some fun with the Opposition motion, but I applaud them for putting the economy at the head of an Opposition day. I would argue that every Opposition day that they have called during this Parliament has been about the economy. In my constituency, Help to Buy has helped 65 families to buy a home and get themselves on the housing ladder, which is fantastic. School places were the biggest issue in my constituency when I became the Member of Parliament. Some £10.2 million of investment later, we have Hampshire’s first all-through school and new primary places. The local NHS in my constituency has an investment of £25 million coming down the line, which will bring world-class, 24-hour consultant cover for my constituents.

None of that, as the Prime Minister said today at Prime Minister’s Question Time, would be possible without a growing economy. That is what is at stake in our country next year. There is a pledge of much more to come because we will further raise the personal income tax allowance and change the 40p tax threshold if we are re-elected next year. Finally, Bill Clinton has been mentioned once today and here is something else that he said. When he was seeking re-election, he said, “What is our opponents’ case against us? It is that we’ve only cleared up half the mess they left behind.” We know how he felt.

15:00

[Sheila Gilmore (Edinburgh East) (Lab)]

I rather suspect that the few people who may be listening to this debate will feel that it is running a similar course to previous debates. Sometimes it feels as if we are talking about different countries and different experiences, but I genuinely think that we all want and support many of the same things. I take exception to some of the portrayals of Labour party policy and politicians as not wanting to see people in work or not supporting people in employment. That is simply not the case and never has been.

Some 350,000 single parents alone were enabled to work as a result of the introduction of tax credits in the early part of this century. All were grateful to a Government who enabled them to take jobs that they had previously been unable to do.

[Nick de Bois]

Notwithstanding the good intentions behind tax credits, is not the reality that that Labour party policy is encouraging and funding corporations to pay less in the full knowledge that the state will pick up their employment bill?

[Sheila Gilmore]

If I have time I will come back to some of those important issues.

The point I was making was that the policy of the last Labour Government focused on getting people into employment and making work pay, not on encouraging people not to work as is so often alleged. We do not get the chance to challenge some of the statements and generalisations that have been made as much as we want. Earlier in this debate, the hon. Member for Ipswich (Ben Gummer) said—and perhaps he misspoke—that unemployment is now the lowest in our history. That is slightly astonishing, given that unemployment was lower than it is now, by some considerable margin, in all years between 1998 and 2008, when the recession struck, and of course the 1950s and 1960s saw considerably lower unemployment rates. There is no need to exaggerate the position.

Nor is it true that long-term unemployment was much worse during the years of the Labour Government. I am glad to hear that in 2013-14, the last financial year, long-term unemployment—people unemployed for more than two years—fell for the first time since 2003. But in 2008, as the recession was striking, that level of long-term unemployment was 200,000. It peaked at 460,000 in 2013, and this is the first fall since then. That is a considerable increase in the number of people unemployed long-term for many years during the period of this Government.

We hear a lot about the fall in jobseeker’s allowance payments in various constituencies, and coalition Members are happy to throw those figures back at every Opposition Member who speaks. But not every reduction in jobseeker’s allowance translates into someone being back in employment—and certainly not back in full-time employment. Many people cease to be entitled to jobseeker’s allowance because they come to the end of their entitlement, not necessarily because they are in a job or eligible for any other benefit.

The Minister suggested that the last Government did not do much for older people, but pensioner poverty was slashed during that time. During this welcome—although slow—recovery, we are seeing some alarming issues for people attempting to work. The number of people who are self-employed is much higher than it has ever been—it was 15% in 2014—and indeed two thirds of the increase in the total number of workers between 2008 and 2014 has been among the self-employed. The problem is that a lot of that self-employment is not generating a high level of income. We have to ask what is happening. When those figures for the high level of self-employment are given, the assumption is that we are talking about thrusting entrepreneurs who are doing very well, but the average earnings of the self-employed have fallen. They are now getting £200 and some a week, which is less than half that of employees.

A lot of self-employed people are struggling, either because their businesses are very new or, possibly, because they have been encouraged to become self-employed as an alternative to unemployment, but find that their earnings and family income are very low. That is an important point to consider, as is much other low-paid employment, when we look at the tax take. The deficit will rise this year—having come down by one third, which was not the total reduction we were promised—and that has a lot to do with reduced tax take. We argue that that has a lot to do with the underemployment that people are suffering and self-employment on very low earnings.

People are in self-employment of a very dubious kind. I met a constituent last Friday. He is in his 50s and he has always been a construction worker. He cannot get permanent employment in that area, even in a city such as Edinburgh where unemployment is relatively low. He has signed up with an agency. Periodically, it phones up to offer him work—four days here or five days there, with gaps in between. Recently, he was phoned up at about lunchtime and asked if he could get down to a building site that afternoon. “How long will the job be?” he asked. “Oh, just today and tomorrow.” So that was one afternoon and one day’s work for someone who is a skilled tradesman and has worked all his life. That is having a devastating effect on his ability to pay his rent, remain in his home and hold his head up as a valued worker. If that is the kind of employment we are encouraging, we must do something about it.

15:07

[Gordon Birtwistle (Burnley) (LD)]

The performance of the economy is a great debate for today. As a brief history of the problems that we face, we all accept that in 2009 the country suffered a catastrophic heart attack in its economy. We can blame the collapse of the banks or the incompetence of the previous Government—I think that both were responsible for the problem. But that is past. What we have to do now is repair the economy.

My belief is that the economy can be repaired only by prosperity. We have to create prosperity, but Governments do not create prosperity—they create the environment for prosperity. Prosperity is created by the thousands of companies that are creating jobs and the millions of people working in those jobs. There has been more prosperity created in a nanosecond outside than there has been in the Chamber since this debate started. Prosperity needs investment by companies. The Government do not invest, but they do provide the environment and the confidence for companies to invest. That is what has been happening over the last four and a half years.

Four and a half years ago, the country was basically bankrupt. We cannot turn that round in four and half years—it will take longer. As long as we create the environment to ensure that the turnaround takes place, I am confident that it will happen. Look at my constituency. When I became the MP in Burnley—[Interruption.] The shadow Minister may think this is funny, but I think it is very serious. I really hope that the Government create the environment for the prosperity that we all need.

Four and a half years ago, unemployment in Burnley was approaching 9%. It is now 3.5%. There has been massive investment by the Government and the private sector. Almost £100 million has been invested in the small town of Burnley. The hon. Ladies in the Chamber might know Boohoo, an online ladies fashion company. Boohoo came to Burnley in 2009 with 46 people. It now employs more than 700 people and is investing £20 million in a brand-new factory. Hopefully, it will have 1,500 people by this time next year. It is so confident in the Government’s economic plan that it realises it can afford to invest £20 million of its own money, while giving the whole work force a 15% increase. It is investing for the future. [Interruption.] It may well not be happening in the shadow Minister’s constituency, but I can only say what is happening in Burnley.

The Government, thanks to the Business Secretary, are managing to rebalance the economy. It was way of out of sync when the coalition came to power, relying on the banking and service sectors while forgetting about manufacturing. What have we done? We have backed the aerospace industry with vast sums of money. It is the most successful industry in the country, creating hundreds of thousands of jobs.

[Sheila Gilmore]

Earlier, the hon. Gentleman said that in his view Governments do not create jobs, but he has just given an example of where Government investment has enabled jobs to be created.

[Gordon Birtwistle]

I did not say that Governments do not create jobs; I said that Governments do not create prosperity. Prosperity is delivered by the people who are working outside this building.

We have rebalanced the economy. We have backed aerospace and there are now hundreds of thousands of people working in the aerospace industry. In Burnley, we have invested more than £20 million in the old Michelin tyre factory, which is now serving an advanced aerospace supply chain. Lots of new American and British companies have come in and created high skills jobs with higher salaries. We backed the automotive industry. As was said earlier, we now export more cars than ever before. In fact, we are plus on exports—we used to import more cars than we exported, but we now export more than we import.

[Jason McCartney (Colne Valley) (Con)]

I would like to thank my hon. Friend for highlighting the success of manufacturing in the north of England. If shadow Ministers actually came out of their London mansions and went up north, they would see that manufacturing is flourishing not only in his Burnley constituency but in Colne Valley and Huddersfield. The textile industry in Huddersfield has produced the green jacket for the Augusta national and the red carpet for the royal wedding of the Duke and Duchess and Cambridge. It is also producing the soft furnishings for the White House and the upholstery on Boris’s Routemaster London buses. They are all made in Huddersfield.

[Gordon Birtwistle]

I am very grateful for that intervention. I am delighted that my hon. Friend’s area is doing so well. [Interruption.] The comments about “five months” really do not do this debate justice. We are talking about real people doing real things and creating the wealth for this country. That is what I want to talk about. I do not want to talk about who might lose a seat in five months. Provided I have done what I can do by then, that is fine.

The problem with the prosperity coming along through the aerospace, automotive, textile and chemical industries is that we have a desperate lack of skills. There has been no investment in skills for the past 25 years under various Governments. The previous Government were culprits as were the Tory Government before that. However, this Government have recognised the problem; we are working on it and are approaching 2 million apprenticeships. I am proud to be the apprenticeship ambassador for the Government. I travel to all sorts of different companies including Starbucks, Next and Rolls Royce—every aspect of business—to talk to young people who believe that they can create prosperity for themselves, the companies they work for and the country they live in. They are proud and pleased to be doing that. The Government have done a major thing in recognising the shortage of skills and giving those young people a chance.

University technical colleges were mentioned earlier. The new UTCs are fantastic. In secondary schools in my constituency the teacher used to say, “If you don’t work hard and pass your exams you won’t be able to go to university and you’ll have to go to the factory.” Let me tell hon. Members, if pupils do not work hard and pass their exams, they will not get a job in the factory. They will have to go to university. The skills we now need, particularly in my constituency and across manufacturing, are very high tech. I hope that the prosperity being created by the people of this country will deliver a future that I want—I am getting on a bit—my children want, and my grandchildren want. They do not want to be saddled with debt. They want to work their way out of our debt by delivering prosperity across the country. The young people of the future will be the ones to deliver that prosperity. We have to train them to be able to do that.

15:15

[Mr William Bain (Glasgow North East) (Lab)]

It is very important to have this debate today, a week before the autumn statement. It is very important that this House can show, through the debate, that we get it. We understand that offering people hope and having an economy where more ordinary people have more opportunities to get work, to progress in work and to get better wages, where there is more prosperity and more shared prosperity, is the only way we will have an economy that will work in this century.

This has been a very interesting debate. I was particularly struck by a couple of counter-intuitive contributions from the hon. Member for Watford (Richard Harrington), who is no longer in his place, and the hon. Member for Winchester (Steve Brine), who quoted Bill Clinton. I am going to do something counter-intuitive as well, which is to quote Ronald Reagan. [Interruption.] I am not sure there will be cheering by the end of the quote, which I think goes to the heart of the problem that will face the Government when they go to the electorate next May. In the famous debate of 1980, Ronald Reagan said:

“Ask yourself, are you better off now than you were four years ago? Is it easier for you to go and buy things in the stores than it was four years ago?”

We know that in every constituency in the land the answer to both those questions is a resounding no. That is the heart of the economic problems our constituents face on a weekly basis. Those problems are faced by the young man whose mother spoke to me in Springburn two weeks ago. She said that he had been offered insecure, part-time work that paid even less than the national minimum wage—he was being offered work at just over £2 an hour. They are the problems faced by the man I met in April on the doorstep in Blackhill in my constituency, who told me that despite working for 15 months with the same employer he had no guaranteed hours at work. An economy that fails those people is one that fails the entire country.

The Exchequer Secretary offered support for a particular industry: revisionist historians. She said that poverty was falling. I am not sure whether she has had time to look at the latest research produced this week by the Institute for Fiscal Studies on behalf of the Northern Ireland Executive. It states that in the years between 2012 and 2015-16 child poverty will have risen. It will rise in Northern Ireland and across the UK, so we are not seeing falling poverty occur with the economic policies followed by this Government. She appeared to indicate that the previous Government had made no difference at all on these matters. The truth is that we saw a massive fall in child poverty under the previous Government. As my hon. Friend the Member for Edinburgh East (Sheila Gilmore) alluded to in her speech, pensioner poverty was halved under the policies of the previous Government. So we have done it before, and next May I hope we will show again that a change of Government can change many people’s circumstances.

The recent ONS data on public borrowing released last week showed that a Government without a proper industrial policy for creating sufficient high-skilled, high-paying jobs are a Government without a policy to decrease public borrowing on the scale required. It remains a great deficiency of the Government that they have not yet responded properly to last year’s damning report from the OECD on the skills deficiency and crisis across the country. Only when we have a Government prepared to reform the banks; set up institutions such as a British investment bank; boost our infrastructure planning; and tackle other such fundamental problems in the economy will we see the greater prosperity and equality that is so crucial.

In Scotland, there are some welcome signs—52,000 jobs have been created in the past year—but manufacturing is still 5.6% below its pre-recession peak, and there is a worrying surge in insecure, self-employed work that is simply not meeting people’s needs or paying the bills. We are also a seeing a worrying rise in household debt because people are coping with declining wages by running down savings or running up more debt. The debt ratio has risen to 170% in the last year. These are worrying statistics.

The upcoming autumn statement is the Chancellor’s last chance to show that he is listening and capable of change. If he is not—if we need to change our policies on living standards—it is becoming clearer that we need a change of Government.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order. I am reducing the time limit to four minutes. I ask each speaker to bear it in mind that the winding-up speeches have to start at 20 minutes to 4. That means that interventions should not be taken, except at the risk of talking out other colleagues.

15:22

[Neil Carmichael (Stroud) (Con)]

This debate has been fascinating, because there seems to be a parallel universe—Labour’s imagined panacea of brilliance when they were last in power, which they have failed to connect to reality. We are filling the gap by dealing with the deficit, the skills deficit and the infrastructure challenges. I want to concentrate on the last two points.

First and most importantly, it is only through skills that we will deal with the cost of living crisis; it is only by empowering people to better themselves that they will generate the necessary additional productivity and earn the higher wages and salaries they need and want, and that is most likely to happen through manufacturing and engineering, as is proved by the facts. While the economy is growing by about 3%, manufacturing is growing by 1.3% or more per quarter, so we should be focusing our skills on that sector.

If we do not rise to the challenge of advancing our manufacturing, turning ideas into deliverable products and always being at the cutting edge of technology, we will fall back. To ensure that we move forward, we need to encourage the Aerospace Technology Institute, for example, which has invested millions of pounds in Airbus, prompting Airbus itself to invest millions more, yielding 791 new orders for aircraft. This Government have encouraged such developments, and I salute them for that.

The other element of the skills strategy concerns schools and colleges. We have heard about university technical colleges already. I say yes to them because they are exactly what we need in our communities: young people continuing with academic study while spending two days a week doing something really useful and learning about engineering. I have been to a few and I want one in my constituency, because I know they will deliver.

The second point concerns infrastructure. In 13 years, Labour only managed to electrify nine miles of rail track, whereas we will have accomplished 880 miles. It is a fabulous achievement and a boost to the economy in terms of activity and investment, and the movement of people and resources. With such projects, the Government have found a way to invest in infrastructure and in doing so have signalled that we are ready for business and investment—and that investment is coming—and that we are upskilling and creating areas of expertise where there were previously none. That is happening not only in the north of England, but in my constituency, where £5 million has converted a decommissioned power station into a centre of excellence for energy and engineering training. That is great, and it is what we need to do.

I want to finish by mentioning the festival of manufacturing and engineering that I run in my constituency. I run it over a week because I know that people need to be clear about the opportunities that engineering and manufacturing provide. There are many firms in my constituency, such as Renishaw, Delphi, Airbus, Lister Shearing—I cannot name them all because I am running out of time—and they understand that message; we must as well.

15:26

[Jim Shannon (Strangford) (DUP)]

It is a pleasure to say a few words in this debate, which I thank the Opposition for initiating.

There are many good things to say about the economy and job creation, but as the motion points out, there remain issues with living standards and living costs, and despite the many job opportunities, which are good news, we need to see more money in people’s pockets. The Northern Ireland Assembly and the Department of Enterprise, Trade and Investment are responsible for the economy in Northern Ireland. We have seen growth in the agri-food, pharmaceutical and aerospace industries —in my constituency, Shorts Bombardier provides continual job opportunities—and in the software and medical device industries. The pharmaceuticals company T.G. Eakin, in Comber, has created more jobs in my constituency and has bought factories on the mainland as well.

In addition, the 2014 knowledge economic index has grown by 33% in the past three years, so there are lots of good things happening. However, we have not seen the money in people’s pockets, and that is what the motion is about. Although lots of progress has been made, certain things still need to be done. Here, I am thinking of Arlene Foster’s Department of Enterprise, Trade and Investment. Citibank has announced 600 new jobs in its Belfast office. PriceWaterhouseCoopers has announced 807 new jobs. Concentrix has announced 1,000 new jobs. Youth unemployment across the UK and in my constituency has continued to fall. These are all good points, and the Government deserve credit for what they have done.

Young graduates are gaining employment in places where they previously might not have. Indeed, that is happening just this week—the number of people claiming jobseeker’s allowance in my constituency fell by 260. It is all good news. However, that money is not getting to those on the minimum wage or restricted hours.

Child care is important to the performance of the economy. The motion before us refers to child care for working parents. It is an issue that affects every working parent, and one we must try to address.

We had a housing and building boom in Northern Ireland. It went extremely well at first, but when the crash came, we felt the pain dramatically. Things are returning to some normality, however, with job opportunities coming through, particularly in the construction industry, which has helped those who lost jobs over the years. At long last, the banks are starting to lend a wee bit of money again, and perhaps an indicator of an economy on the turn is the number of houses coming up for sale. We have competitive prices—the average house price in Northern Ireland is £141,000. Young people in my constituency can buy a house—a good three-bedroom house, too—for between £105,000 and £189,000. The opportunities are there, but people need job security and a decent wage. In most cases, families need two wages coming in.

When we fly, the aircraft seats on which we sit are often made by a firm in Kilkeel; and people driving within or around the outskirts of London are likely to be doing so on stone from Ballystockart and Carryduff, in my constituency. That is a fact. We have 100 international investors in Northern Ireland in the ICT sector. This is all good news, as are the creative industries that have highlighted Northern Ireland on the world stage over the last year.

What we need to see is more money going into people’s pockets to ensure that they have enough to live on and can gain higher living standards. We want people to be given the opportunity to work more hours, the minimum wage to go up, and greater confidence to be created in the economy. We welcome what has been done, but we want more to be done to help our young people.

15:30

[Nick de Bois (Enfield North) (Con)]

I listened with interest to the opening speech by the hon. Member for Nottingham East (Chris Leslie), who relied a good deal on the forecasts made by the Chancellor in 2010. I shall not dwell on them, but the response to that autumn statement was made by the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), whose own forecast then was that this would be a jobless recovery. When it comes to examining forecasts, we should perhaps recognise that as well.

I share something else in common with the right hon. Gentleman, who by his own admission is not an economist: I am not one either. Looking broadly at the key issues, it strikes me that we have a little bit of “Dad’s Army” from the Opposition Front-Bench team, in that they are trying to create a panic and harm confidence. I would take the advice of Corporal Jones: “Don’t panic, Member for Nottingham East!” Public sector net borrowing fell by £200 million to £7.7 billion compared with the previous year. Although there has been a slight increase in the current budget deficit in the year to date, let us be clear that this coincided with a £3.2 billion increase in net public investment. Income tax revenues on the margins may be 0.4%, but, on the question of being confident about collecting revenue, Labour Members have talked at length about the increase in the self-employed and made some disparaging remarks, the idea being that self-employment is a last resort. It is not. There will probably be a boost in tax revenues as the taxes of the self-employed are collected in January. I would proceed with caution before reading too much significance into a statistically not too significant adjustment in the figures. Forecasts will be important. Even if the tax estimates were slightly down on the revenues, that would be a sign that a growing number of young people are going into jobs at lower salaries, which bodes well for the future—and we are here for the long-term, not for the short-term, recovery. That is important.

What most troubles me about this debate and the Captain Mainwaring approach to economics is simply this: we have set about focusing not just on the pure statistics of economic recovery because we believe it is crucial to create the environment for the entrepreneur to thrive and succeed, and for people to go back to work. That is what will drive the economy, given that more than 95% of our businesses are in the small to medium-sized sector.

Government intervention has driven change on the ground. In my constituency, for example, the employment allowance has reached 930 employers, the enterprise allowance has reached 200 people and, above all, since their inception, start-up loans of £500,000 have helped 100 new businesses. That is a return to the economics of the entrepreneur, making this a country to do business in. It is the growth of the SMEs on which we are focusing our policies that will drive the recovery, reduce unemployment and create employment opportunities. That is the key fact. We have more people in work than ever before. The situation in my constituency matches that across the country: youth unemployment is down 40%, and 38% down on the 2010 statistics. That is what counts for most people: delivering a regular pay packet and the security that comes with it.

15:34

[Mr Robert Syms (Poole) (Con)]

I thank the Opposition for affording us the opportunity to laud the success of the Government’s economic policy. I do not think we debate economics and how the economy is doing enough, and this is a useful opportunity.

The trick in running an economy is to ensure, as the world economy goes up and down, that the downs are small and the ups are large. We had the biggest downturn in our history at the end of the Labour Government, some of it down to the facts of world economics but some of it down to the fact that you spent rather more than you should have done and did not regulate the banks as well as they should have been regulated—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I do not think I was responsible. Others might wish to take the blame, but I certainly do not.

[Mr Syms]

I am sorry, Mr Deputy Speaker. I have not been in the Chamber for a while, as I have been on a Bill Committee.

We have a coalition that has set out a firm framework for managing the economy and a long-term economic plan. The result is that we have pretty good employment figures, but we all know that many of those jobs are low paid. That is the start of a recovery. The main benefit of people getting jobs is that they are afforded the opportunity to upskill and move into better-paid jobs as the recovery takes hold.

The economy is healing, but it is a long-term project and it will take a while before we get back to what most of us would consider normal economics. Indeed, interest rates will have to go up at some point so that my retired constituents can also get some benefit from the economic recovery. Good progress has been made and the Government have taken a sensible point of view.

The reality is that it is difficult to export if one’s main export markets in the eurozone have trashed their economies by running stupid economic policies, and if the far east is going into recession as well. If we compare Britain and the United States with most of the world, we can see that we are doing better. We have created more jobs in the past four and a half years than the rest of the 27 European Union states combined. Clearly, there is more to do, but Britain has proved that it has an open and resilient economy. We still have some excellent companies. The car industry is reviving and we still have extremely good educational establishments. Ours is an open economy and the City of London is one of the major financial centres. So long as we provide the framework for a decent economy, I am sure the British public will rise to the challenge by producing jobs, wealth and prosperity.

We have all seen an improvement, but there is more to do. We appreciate that many people are struggling on low pay and having a difficult time of it. We do not deny that, but we must set out that we need to stick with the economic policy, and people’s living standards will start to rise. Wage increases are picking up over and above inflation, which is the start of a slow march towards improving living standards.

We should stick to what we are doing, have confidence in our economic policy—

[David Rutley (Macclesfield) (Con)]

Will my hon. Friend give way?

[Mr Syms]

I had better not, because time is limited.

The British economy will benefit from that confidence. I look forward to hearing the Minister’s reply. There is a good story to tell, but we are only part of the way there. There is more to do, and certainly more to do for the many of our constituents who have been hurting over recent years. That is the consequence of a pretty big downturn and a big adjustment. The British people have gone through the period of adjustment pretty well and have accepted the realities. Now, they are looking forward to a sunny upland, and I hope the Government can provide that as the economy strengthens over the next year or two.

15:38

[Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)]

As always, we have had an interesting debate this afternoon. I remind the House of what my hon. Friend the Member for Nottingham East (Chris Leslie), the shadow Chief Secretary to the Treasury, said when he opened the debate. He suggested that the autumn statement would give the Chancellor some time to pause for reflection, giving him the opportunity to think about his nearly five years in office and the impact his decisions and choices have had on the living standards of millions of our constituents. It did not strike me during the Exchequer Secretary’s opening speech that she was in particularly reflective mode, but perhaps the Chancellor will be by the time we reach the autumn statement. I am sure that the Economic Secretary, who is going to respond to the debate, will have carefully considered all the points that we have made this afternoon.

We have heard about the glaring disparity between what the Chancellor promised in the autumn statement nearly four years ago and what has been delivered. As my hon. Friend the Member for Nottingham East pointed out, the Chancellor said that he would

“meet our fiscal mandate to eliminate the structural current budget deficit one year early, in 2014-15.”

In reality, deficit reduction has stalled and borrowing is rising. He said that by this financial year he would

“get debt falling as a percentage of GDP.” —[Official Report, 29 November 2010; Vol. 519, c. 531-32.]

In reality—as he has admitted—debt will not start falling as a percentage of GDP until the middle of the next Parliament. He said that

“business investment…is set to grow by more than 8% for each of the next four years”.

In reality, he has delivered barely half that. He also said that

“exports are set to grow by an average of more than 6% a year.”—[Official Report, 29 November 2010; Vol. 519, c. 542.]

In reality, they grew by an average of 4.2% in 2011, 2012 and 2013. Moreover, he is set to miss his 2020 target by £330 million. That illustrates the chasm between the rhetoric and the reality—between what the Chancellor promised and what he has actually delivered.

Today’s debate could be described as a game of two halves. Speaker after speaker on the Opposition Benches talked about the impact of the Government’s programme on the real lives of our constituents, while a number of Government Members—although not all of them; we heard considered speeches from some—seemed to be living in a parallel universe that Labour Members may not recognise, in which things were now so much better.

Some of the speeches that we heard did reflect the reality of life for ordinary people. My hon. Friend the Member for Coventry South (Mr Cunningham) reminded us of the nature of the global financial crisis, and described the impact that it would have had if the last Government had not taken action to protect banks and savers. My hon. Friend the Member for Bristol East (Kerry McCarthy) spoke about the impact on jobs and living standards of the Government’s programme. She said that her constituents were finding it difficult to put food on the table, and referred to the costs of transport and energy. She talked about the issues that mattered to her constituents, which they brought to her every day. She also talked about food poverty and the importance of the living wage.

My right hon. Friend the Member for Oldham West and Royton (Mr Meacher) spoke about the impact of the fall in average wages, the problems caused by the fact that UK productivity is worse than that of other countries, and the lack of deficit reduction. My hon. Friend the Member for Edinburgh East (Sheila Gilmore) spoke of the importance of the tax credit scheme, which had caused many people to take employment. Lone parents in particular had obtained work and were making work pay—in some instances, for the very first time—owing to initiatives introduced by the last Government.

My hon. Friend also referred to the plight of the self-employed, as did the hon. Member for Enfield North (Nick de Bois). I do not think any Opposition Member suggested that self-employment was not worthy, and could not provide a good standard of living. However, the harsh reality for many of those who are self-employed is that they, too, may be under-employed. Because disposable incomes are lower now, they may find it difficult to sell their services and to earn enough to make ends meet. As we know, that can mean difficulties and long working hours for self-employed people and their families.

I was pleased to hear the hon. Member for East Antrim (Sammy Wilson)—who made a very good speech—point out that, although some developments had benefited his constituents and he did not want to talk down the economy, we should recognise the warning signs. Not all his constituents had experienced a recovery. I am glad that the hon. Gentleman supports the motion. The hon. Member for Strangford (Jim Shannon) said that new jobs had come to his constituency, but more money needed to be put into people’s pockets.

My hon. Friend the Member for Glasgow North East (Mr Bain) spoke passionately about the experience of both young and older people in his constituency who were trying to get back into work, and about the impact of child poverty. Interestingly, he also talked about the need to boost Scotland’s manufacturing sector—which has not always seen the benefit of the growth that the Government are talking about—and the need to boost infrastructure spending.

As I said at the outset, we heard some considered and carefully thought out comments from those on the Opposition Benches, and I am glad Members were able to express their constituents’ points of views. The thread running through all of them was very clear: we need a genuine economic plan that can deliver that recovery for the many, not just the few at the top. It must be a coherent and credible plan; it cannot be something that is just full of slogans but with no content, supposedly trickling down—like, indeed, the so-called long-term economic plan Treasury Ministers continue to boast about.

We need action on house building, currently at its lowest level since the 1920s, and we need to set the goal of having 200,000 new homes each year by 2020. We need the minimum wage to rise as a proportion of average earnings, and we need real incentives for a living wage. We need the expansion of free child care for working parents, paid for by collecting the bank levy in full. We need the cut in business rates for small firms, rather than focusing only on corporation tax cuts for big business. We need an independent infrastructure commission to deliver the transport networks our economy needs, rather than simply something that suits the Government’s short-term political needs. We have to tackle the abuse of zero-hours contracts, too. Speaker after speaker talked about the jobs that have been created, but the reality is—we heard this time and again from my hon. Friends on the Opposition Benches—that many people are under-employed, many people cannot get the hours they need to make a living, and many people are suffering from not knowing how many hours they are going to work each week. We need a real Labour economic plan that can earn our way to rising living standards not just for the few, but for all.

I am disappointed that we did not have an opportunity to speak a little more about some of the issues in the motion, and in particular about our proposal that the fines arising from the forex scandal should be put towards national health service funding. I was surprised that more Members did not pick up on that issue. I do not want it to be forgotten in this whole debate, so it would be helpful if the Minister in her summing up could be very clear about the following points. She has considerable experience in the banking sector and likes to listen and give careful consideration to any points made, and she is not afraid to act when she has to. Does she share my concern about the appalling situation in respect of the rigging of forex? Is she pleased to see that those record fines have been imposed, and will she give the commitment that that money ought to be used for our NHS? If she is able to do that today, it will at least give some indication that the Government understand the issues affecting ordinary people, and listeners will not leave this debate thinking that there is a parallel universe where the Government think everything is absolutely perfect, while we on this side of the House keep having to raise issues brought to us by constituents who are not feeling that recovery in any shape or form.

I want to conclude on the following point. I do not know how many times I heard the term “long-term economic plan” used during the course of the debate. The test for next week’s autumn statement—and, to an extent, the Government’s own long-term economic plan—will be whether the autumn statement delivers a plan that brings a recovery for the many, a fairer approach to balancing the books and a plan to save our NHS. I have to say, however, that I suspect it is only going to be a Labour economic plan that delivers that, because the Government only have until the end of March and that is not long term.

15:49

[The Economic Secretary to the Treasury (Andrea Leadsom)]

During this debate we have heard some extraordinary assertions. We have heard that the economic crash of 2008 did not really happen, that we can simply spend, spend, spend our way out of a recession, and that we can somehow be insulated from the global economic outlook. However, British voters are pretty savvy. We cannot pull the wool over their eyes or fool them into thinking that we can go on borrowing and spending for ever. We have to be up front about the facts, so I should like to inject some clarity into the debate. I shall go through the motion point by point.

First, I completely agree with the many Members who said that living standards and fairness were critical to our economic recovery. Labour’s great recession has been tough. Many people have genuinely suffered as a result of the disastrous 5% drop in our nation’s GDP, which was brought about by far too much borrowing in the years before the financial crisis. It is too simplistic to say that working people are, on average, £1,600 a year worse off than they were in 2010. That figure ignores changes in employment. It ignores the big change we have made to cut income tax and duty on household goods. It also ignores the increase in household disposable income.

There is another story to tell, a positive story about how the economy is offering hope and opportunity as it recovers under our reforms. It is a story that involves more people being in work than ever before, and 2 million private sector jobs being created since 2010. It is a story that involves the number of young people on unemployment benefits halving since 2012, and a story that encourages work by ensuring that a typical taxpayer has had their income tax cut by £805 a year, boosting the money that 25 million people take home from work and taking more than 3.2 million of our lower earners out of income tax altogether.

It is this Government, through our long-term economic plan—for which I make no apology—who are creating the right environment for opportunity and aspiration for more people than ever before. Opposition Members have pointed out that many of those jobs are starter jobs for young people, part-time jobs for people getting back into work or self-employed jobs. Well, we on this side of the House applaud those entrepreneurs who are starting a business, who are taking on apprentices and who are offering flexible and part-time jobs to those who need them.

The latest figures show that regular pay rose by 1.8% in September, which is 0.6% above inflation. Workers who are in continuous employment—that is, those who are in the same job that they were in a year ago—saw their average earnings rise by 4.1%, which is more than double the rate of inflation. This is

“the start of real pay growth”,

as Mark Carney put it. Our long-term economic plan is delivering the highest growth in the G7. It was confirmed just yesterday at 3%. It is delivering more business investment than in the peak before the recession and creating a record number of private sector businesses. It has cut the deficit by over a third, and it stands to deliver the first surplus in 18 years by 2018-19.

[Angie Bray (Ealing Central and Acton) (Con)]

My hon. Friend is absolutely right to say that the public will not allow the wool to be pulled over their eyes. Does she agree that every survey imaginable shows that this Government have a very high rating for economic competence, whereas Labour is absolutely nowhere?

[Andrea Leadsom]

My hon. Friend is absolutely right. In particular, our achievements must be seen against the backdrop of our inheriting the toughest economic conditions in living memory.

I do not accept that we have broken our pledge to balance the books; nor do I accept that the recovery has somehow insulated the richest. What total nonsense! The richest are contributing more in income tax than they ever did under Labour, with over 28% of income tax revenue coming from the top 1%. In every single Budget, we have raised revenues from the most well off, and we have used those extra revenues to help the most vulnerable in our society. It is a sad fact that many have been hit hard by this recession, and I know how genuinely difficult many people have found it. We owe it to them not just to improve their living standards through an economic recovery, but to make sure we never get into this mess again. That is why it is all about finding the right balance: between ensuring that those with the broadest shoulders take the biggest burden and ensuring the UK remains internationally competitive and open for business.

This Government have looked to strike the right balance. That is why our above-inflation increase of the adult national minimum wage came into force on 1 October: more than 1 million people benefited from the largest cash increase since 2008 and the first real-terms increase since 2007. On child care for working parents, we are introducing comprehensive support. Under our tax-free child care plans, 20% support for child care costs of up to £10,000 per year for each child will be available. We have also doubled small business rate relief for a further year, helping more than 500,000 small businesses and giving 300,000 local shops, pubs and restaurants a £1,000 discount. We have made infrastructure a top priority—we are setting out a long-term pipeline of infrastructure investment of £383 billion to 2020 and beyond. Housing is a major part of this, and we are investing £7.8 billion to deliver 335,000 new affordable homes.

However, it is not our plan to reinstate the 50p tax rate. That rate was crudely thought out, distortive and economically inefficient. It failed to raise the £2.5 billion Labour claimed it would and it gave a damaging signal that the UK was not open for business. We have instead raised far more from tax changes targeting the richest, including the bank levy, which will raise £8 billion during this Parliament. We have also taken tough measures against tax avoidance: we have closed loopholes; we have clamped down on stamp duty avoidance; we have given Her Majesty’s Revenue and Customs new powers to collect disputed tax; and we have led international tax reforms through the G20.

The motion's final point related to creating new funds for health and care. Since 2010, the Government have increased the NHS budget in real terms every year. Health funding will continue to grow in real terms in 2015-16, which means an additional £2.1 billion for the NHS next year. But a strong NHS needs a strong economy, and our long-term economic plan is designed to provide both.

[Chris Leslie]

The £1 billion from the foreign exchange-rigging scandal is coming in as a windfall. Will the Minister do the right thing and allocate it for the NHS?

[Andrea Leadsom]

As the hon. Gentleman will appreciate, a strong NHS needs a strong economy. In answer to the point raised by the hon. Member for Kilmarnock and Loudoun (Cathy Jamieson) about foreign exchange fines, she is absolutely right to say that we are talking about disgusting, appalling behaviour, which represented extreme arrogance on the part of the bankers who thought they could rig foreign exchange. Our Chancellor decided that those fines for misdoing would no longer go back to reducing the levy for the industry’s own regulation, but would instead be used for the public good. This is a big sum and we intend to think carefully about how we use it, but it will be used for the public good.

Whatever happens, we cannot go back to the bad old days. What a shocking mess we were left with—total economic carnage. The Opposition’s motion, calling for a current budget surplus and falling national debt as soon as possible, shows complete economic illiteracy. They want to keep on borrowing, hiding behind so-called “capital spending”, as if, somehow, one type of borrowing does not count. I do not see how voters can be fooled by that; it is the equivalent of saying, “I will spend my wages on food, clothes and petrol, but if I buy a car or a house, that’s investment and so borrowing to fund it doesn’t count.” It is this Government’s plan that will get our debts under control; eliminate borrowing over time to ensure that our debts fall as a share of GDP; and allow future Governments to respond much more quickly to any economic shocks, while continuing to support individuals and businesses across the country.

We know that the job is far from finished. As storm clouds gather once again over the world’s economies, we need to be clear about the scale of the task that we face. When a country loses control of its finances, it loses control of everything, and it is the poorest who are hit the hardest. Labour’s recession proved that only too clearly. This Government have taken the tough decisions to pull our economy back from the brink and, through our long-term economic plan, to put an economic recovery in place, so now, more than ever, it is a plan that nobody can afford to abandon.

Question put.

16:00

Division 96

Ayes: 239

---

Labour: 224
Scottish National Party: 5
Democratic Unionist Party: 4
Plaid Cymru: 3
Independent: 1
Green Party: 1

Noes: 313

---

Conservative: 264
Liberal Democrat: 47
Independent: 1

Government Policies (Wales)

Wednesday 26th November 2014 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I advise the House that the amendment has not been selected.

16:13

[Owen Smith (Pontypridd) (Lab)]

I beg to move,

That this House expresses deep concern at the impact of the Government’s policies on Wales; notes the Government’s real-terms reduction of the Welsh budget by £1.5 billion; notes that Wales currently suffers from the lowest average rates of pay in Britain and has the highest proportion of individuals affected by cuts to social security including the bedroom tax; further notes that Wales suffers the highest energy bills in the UK and that these, along with low pay, have compounded the cost of living crisis in Wales; and calls on the Government to immediately scrap the bedroom tax, freeze energy bills and undertake measures to increase pay rates in Wales.

When devolution was created in 1997-98 by the last Labour Government, it was very much intended as a measure to make Wales more accountable, to give us a greater level of self-determination, and to see autonomy for the Welsh people and bespoke Welsh solutions for Welsh problems. The unspoken motivation behind that, especially in Wales where the miners strike was so fresh in our memories, was to protect the Welsh people from the prospects of a future Tory Government. Pit closures, steel closures, the legacy of de-industrialisation and people shunted on to incapacity benefit to languish there for so many years, were fresh in our minds, and they were absolutely behind the idea that we would, with devolution, have an additional bulwark against the destructive economic philosophy of the Tory party.

[David T. C. Davies (Monmouth) (Con)]

Is the hon. Gentleman admitting here in this Chamber that one of the reasons Labour supported devolution was not because it wanted to change the constitution, but because it thought that it could control the Welsh Assembly at all times?

[Owen Smith]

No. We had campaigned for devolution for 100 years, and it was absolutely about changing the accountability to the Welsh people, making all the obvious constitutional changes. However, for many of us on the left in Wales it was also about guaranteeing a Government who would to a greater extent reflect our values and defend Welsh people against the values of the hon. Gentleman’s party and this Government. Four and a half years on from the return of a Tory Government, we now have an opportunity to measure exactly what the impact of that Government has been and, six months from the next election, think hard about how effective those defences have been.

[Chris Ruane (Vale of Clwyd) (Lab)]

I thank my hon. Friend for giving way—

[Ian Lucas (Wrexham) (Lab)]

Your right hon. Friend.

[Chris Ruane]

I thank my right hon. Friend. [Interruption.] If Labour had truly wanted to dominate Wales in 1997, when we had a majority of 180, would we not have introduced first past the post, rather than proportional representation?

[Owen Smith]

We would have done, as my hon. Friend knows—he promotes me unduly and unfairly—and perhaps we should have done, but we are always fair-minded and therefore did not do so. However, I think we are convinced that what we did do was afford Wales some extra protection against the ravages of a Tory Government, about which we are about to hear more.

[Jonathan Evans (Cardiff North) (Con)]

I just want to give the hon. Gentleman an opportunity to correct his statement that the Labour party had campaigned for devolution in Wales for 100 years. I know that he is a great admirer of Aneurin Bevan. I come from the same town as Aneurin Bevan, and I am sure that he did not campaign for devolution.

[Owen Smith]

I hate to say it, but the hon. Gentleman really ought to study his history a little harder, because Kier Hardie, even when elected in 1895—not as a Welsh MP, but in West Ham—spoke in this House about devolution, and when elected to Merthyr as a Labour MP in 1905 he was absolutely a campaigner for home rule and devolution for Wales. The hon. Gentleman’s history is wrong; mine is perfectly accurate.

Recent history—the past four and a half years—shows that the Labour party is still campaigning for rights for Welsh people and standing up for Welsh Labour valleys. Thus we have seen Jobs Growth Wales, the most effective youth employment programme anywhere in Britain, 1,000 jobs created only last week, and massive increases in inward investment, all positives that have come as a result of devolution and the protection of the Welsh people.

[The Secretary of State for Wales (Stephen Crabb)]

The shadow Secretary of State mentions Jobs Growth Wales. Of course we applaud any initiative that gets people into work and helps increase opportunities for young people, particularly in Wales, but he must be aware that the independent study of Jobs Growth Wales commissioned by the Welsh Government showed that around 75% of all the young people on the programme would have found work anyway. He needs to answer this question: is that a good use of taxpayers’ money?

[Owen Smith]

I think that the evidence for Jobs Growth Wales is absolutely clear to us all. It has proven to be the most effective youth employment programme anywhere in Europe. It is succeeding in creating 16,000 opportunities for young people, and it is succeeding in keeping those young people in work beyond the six months. It is widely supported by the business community right across Wales. I cannot imagine for a minute that the Secretary of State should wish to undermine it, especially when it stands in such stark and promising contrast to his Government’s Work programme.

[Mark Tami (Alyn and Deeside) (Lab)]

Is my hon. Friend as amazed as I am by what the Secretary of State has just said? He has effectively said, “Well, we shouldn’t do anything for young people, because most of them will probably get jobs anyway.”

[Owen Smith]

Around 750,000 young people in Britain are still unemployed. Although that is fewer than the 1 million who were unemployed just a couple of years into this Government’s time in office, and we welcome that fall, I suggest that 750,000 is an enormous number of people to be left languishing on the dole, but that is what we have come to expect from a Tory Government.

[Stephen Crabb]

In response to the hon. Member for Alyn and Deeside (Mark Tami), those are not my words, but those of an independent inquiry into the matter. Of course the business community supports Jobs Growth Wales, which has made good inroads into giving opportunities to young people. However, when about 75% of young people are considered to be able to get work anyway without the need for a support programme, we should bear in mind the question of whether it is a good use of taxpayers’ money.

In comparing Jobs Growth Wales with the Work programme, the shadow Secretary of State is comparing apples and pears. The Work programme does not work with bright young graduates who are fresh out of university but with people who face the biggest hurdles in getting back into work—the 200,000 people in Wales who never worked a day in their life under Labour.

[Owen Smith]

I do not want to belabour the point, but the Secretary of State needs to consider carefully whether he wants to denigrate Jobs Growth Wales, which does not, by and large, work with undergraduates but with youngsters aged 16 to 24, most of whom will not be undergraduates. It has been demonstrably successful in Wales, and he should be welcoming and supporting it, not seeking to undermine it.

[David Wright (Telford) (Lab)]

As someone who represents a constituency in a border county on the Welsh Marches, let me say that we would like to see more support and help for young people to get them into work, and to follow some of the examples in Wales that have been getting people into work. It is important for the economies of the Welsh Marches and the border counties that Wales has a strong economy. That is why this debate is so important for us all.

[Owen Smith]

I am grateful to my hon. Friend, who is absolutely right. That is why Labour has said that, unlike the Tory Government, we will learn from Jobs Growth Wales and transplant it to the rest of the UK. Under the next Labour Government, we will see similar success, I am sure, as a result of the measures we will undertake.

[Mrs Madeleine Moon (Bridgend) (Lab)]

The Secretary of State talked about the people who are not able to get into work. Will he comment on a fantastic course that is being run in Bridgend at The Zone, which is helping people who find it difficult to promote themselves and to deal with going for job interviews? It covers the body language, listening and time management skills that will help them to get into work through Jobs Growth Wales.

[Owen Smith]

The Secretary of State cannot comment on it yet, but perhaps he can later. I would happily come and see that project in Bridgend, which sounds excellent.

My fundamental point is that devolution has already proved to be something of a protection against the Tory Government. Workers’ rights have been stood up for on blacklisting and on the Agricultural Wages Board, and jobs and services have been protected in Wales in a way that they have not been in England.

[Several hon. Members]

rose—

[Owen Smith]

I will make a little more progress and then give way.

However, devolution does not show that, of itself, even with a Labour Government in Wales, it can fully inoculate Wales against the virus of Tory economics. Unfortunately, the “trickle-down” belief of Tory economics that wealth will be spread by favouring the people who already have the most and punishing those with the least is demonstrably leading to lower living standards in Wales. In a moment, I will enumerate some of the symptoms of that virus that we can see right across Wales.

[Wayne David (Caerphilly) (Lab)]

My hon. Friend knows that today the Welsh Government have published their latest index of multiple deprivation, which shows that Lansbury Park estate in Caerphilly is now the most deprived community in Wales. Does he share my anger at that fact? Does he agree that nothing shows more clearly the real impact of central Government policies on poor communities in the south Wales valleys?

[Owen Smith]

I do share my hon. Friend’s anger, and I will express it here today. I also express my anger that Government Front Benchers laugh when we hear of the scale of the poverty that is still being visited on people right across the country.

[Stephen Crabb]

indicated dissent.

[Owen Smith]

You were laughing a moment ago.

[Stephen Crabb]

On a point of order, Mr Deputy Speaker. The shadow Secretary of State has just claimed from the Dispatch Box that I was laughing at the news that the ward in Caerphilly is now the most deprived—[Interruption.] Not at all—it is a complete untruth, and I ask him to withdraw it.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I am sure that the shadow Secretary of State has taken your comments on board.

[Owen Smith]

Let us look at some of the symptoms in Wales of the disease of Tory economics, starting with food banks, because they are a useful barometer of this Tory Government’s impact. The volume of food banks in Wales has grown at a faster rate than anywhere else in Britain. In the first six months of this year, 40,000 people in Wales were forced to use them. That is a tenfold increase since 2010, when just 4,000 people used them. By the end of this year, it will have been a twentyfold increase, which is an extraordinary statistic.

[Mrs Siân C. James (Swansea East) (Lab)]

I am sure that, while congratulating the city and county of Swansea, my hon. Friend will greet with some concern its decision to introduce food collection points across my constituency. It is a sad state of affairs when people have to be encouraged to go along to a council property to drop off food for less fortunate citizens, but they are to be applauded, and I urge everybody to support the food banks.

[Owen Smith]

The food banks are to be applauded, but the fact that they are required should shame us all, particularly the Government who are presiding over the explosion in their usage. It is very clear why they are required: the Trussell Trust has made it plain that the vast majority of people who use them do so because their benefits have been changed or stopped.

The emerging trend—at 22%, up from 15% last year—is for the recipients of food parcels to be in work. They are earning a living, but it is insufficient to pay for something as fundamental as food. That should surprise none of us, because we now know that, under this Tory Government, 13 million people in Britain are in poverty while in work. They are earning their poverty in this country, and that scandal and disgrace should shame us all.

[Ian Lucas]

Is my hon. Friend aware that mean average earnings in Wrexham have declined by 7.4% in the past year? That is imposing a huge financial burden on my constituents, and driving the local economy down in a spiral.

[Owen Smith]

I am aware of that, but I am grateful to my hon. Friend for reminding the House about it. Right across Wales, wage inflation last year was just 0.6%, while price inflation was 2.2%. That real-terms fall in people’s wages comes on top of the fact that wages in Wales are already the lowest in Britain. Average weekly earnings in Wales are now just £473.40, compared with the UK average of £518. One in four workers in Wales earns below the living wage, which should shock the House in the 21st century.

[Jessica Morden (Newport East) (Lab)]

Does my hon. Friend agree that we have not only some of the lowest wages in the UK, but the lowest disposable income, the highest energy bills and the highest levels of energy debt, which are also contributory factors?

[Owen Smith]

Yes. All those things contribute enormously: they are all symptoms of the widespread, systemic problem in our society and economy, which this Tory Government’s current policies are unfortunately making worse. In fact, the Welsh Government have calculated that by next year, £1 billion will have been taken out of the Welsh economy directly as a result of the welfare changes made by this Tory Government. It is estimated that the average annual loss per working-age adult in Wales will be £500 by 2015-16. The bedroom tax, the most pernicious and cruel example of this Government’s welfare policies, hits Wales harder than anywhere else in the UK. The Department for Work and Pensions statistics confirm as much—more than 40,000 Welsh men and women hit by the bedroom tax, 26,000 of those, disabled.

[Chris Ruane]

My hon. Friend talks about averages in Wales being about £540. Is he aware that in Rhyl West—until this morning the poorest ward in Wales, but it has been overtaken by a Caerphilly ward—the actual hit for those people, the poorest in Wales, was £1,450, as opposed to the richer ward of Efenechtyd in the south of the county, where it was only £270, so the impact on those poorest people in Wales has been five times greater?

[Owen Smith]

I am grateful to my hon. Friend for his intervention. Yes, of course that is right. The evidence is right before our eyes: over 50% of Welsh local authorities have had to use top-up discretionary housing payments to deal with the volume of problems created by the changes to welfare in Wales, versus just 27% in England. That is more evidence that Wales is being hit harder on the watch of the Secretary of State and the Minister than anywhere else in the UK.

[The Parliamentary Under-Secretary of State for Wales (Alun Cairns)]

Will the shadow Secretary of State explain, therefore, why only three of the 22 local authorities have applied for additional discretionary housing payment to help with hardship as a result of the spare room subsidy changes?

[Owen Smith]

Some 54% of local authorities in Wales have used up most of their discretionary housing spending. The figure for England is 27%. Wales is harder hit than anywhere else and we are having to spend more money. If the Minister seriously suggests that the DWP figures are wrong, and that Wales does not have a greater volume of people hit by the bedroom tax than anywhere else, he can tell us, but I am sure that he will not disagree with the DWP. I am sure that he will agree with me that 40,000-odd people in Wales are affected, 25,000 of whom are disabled.

[Alun Cairns]

I will happily clarify that Cardiff, Caerphilly and Conwy are the only three local authorities, of the 22 in Wales, that have asked for an uplift in discretionary housing payment to help with hardship. Why did other local authorities around Wales not do so if the situation is as bad as the hon. Gentleman suggests?

[Owen Smith]

Let me tell the hon. Gentleman something very simple that he could do to stop this back and forth about numbers: he could think about the impact on people in his constituency and mine, and those of all other hon. Members, and he could scrap the bedroom tax tomorrow. That is what Labour will do if we are elected. We will get rid of it in a heartbeat. Frankly, the nonsense about who has applied for which grant demeans this debate, which is a serious debate about the impact on real people.

[Chris Bryant (Rhondda) (Lab)]

Does not this argument miss the fundamental point, which is that if the Government have to create a system in which there is a discretionary housing payment, which means that some local authorities will be mean at the beginning of the year and generous towards the end of the year, and that some local authorities will be meaner than others, they have completely lost the plot? That is why we have to get rid of the bedroom tax in its entirety.

[Owen Smith]

Introducing a tax that is reliant on people being able to move to smaller properties was, in and of itself, barmy, because there are not the properties for people to move into. That is why 60% of social housing associations in Wales are struggling to rehouse people.

Of course, it is not just the people who are hit by the cuts to welfare payments that are affected, but the wider population. Sheffield Hallam university produced a report just a few weeks ago that said that the welfare cuts will result in a £1,000 reduction in the incomes of all people across the south Wales valleys eventually, as reductions in aggregate demand, reductions in spending and further job losses—it suggested that 3,000 jobs might be lost across south Wales—result in a less dynamic and resilient economy. It is not just the people who are directly impacted by the welfare cuts who are affected, but the wider economy.

On top of the welfare cuts, ordinary workers who are not in receipt of benefits are losing £1,600 a year. That is why Labour will do something about low wages in Wales. We have made it very clear that we will set the national minimum wage at 58% of median earnings by 2020. That will mean a minimum wage of £8 in Wales and will put an extra £2.50 per week in the pockets of working people. It will mean 60 quid a week or £3,000 a year for hard-working families. [Interruption.] The Secretary of State laughs and giggles once more, as I discuss low wages.

[Stephen Crabb]

rose—

[Owen Smith]

He is laughing even as he comes to the Dispatch Box. I am talking about low wages in Wales and the Secretary of State is giggling. I do not know what he wants to tell us, but he can have another go.

[Stephen Crabb]

There is no laughing or giggling, but we can smile because the hon. Gentleman trumpets, in his usual proud, puffed-up way, the idea that the Opposition would increase the minimum wage to £8 an hour. Under the proposals that the Government have put in place, the minimum wage would be higher than that. Why is he proposing a cut in the minimum wage?

[Owen Smith]

It is nonsense to suggest that we are proposing a cut in the minimum wage. We will increase the minimum wage to £8, which will bring massive benefits for hard-pressed workers in Wales.

[Geraint Davies (Swansea West) (Lab/Co-op)]

On the income of the poorest workers, should we not bear in mind the impact of the bedroom tax? There simply is not smaller council housing for people to move into. In the event that people move into private housing, their rent goes up and the housing benefit goes up. In other words, it is simply a tax on the poorest for the sake of it. We will take it away when we get in, which will raise their incomes.

[Owen Smith]

My hon. Friend is of course right. That is why it looks increasingly as though the bedroom tax will cost the Exchequer money, not save it money. It is voodoo economics of the worst kind, because it penalises the most vulnerable people in our society. It is having an even greater impact in Wales, and the Secretary of State should acknowledge that.

[Paul Murphy (Torfaen) (Lab)]

On the bedroom tax and the discretionary grant, the Secretary of State will know that the grant is given to local authorities, and most of it is made up of local authorities’ own money, not a direct extra grant from central Government.

[Owen Smith]

My right hon. Friend is entirely right. Of course, it is not only the changes to welfare that are having an impact on people in Wales. A culture of fear and insecurity is increasingly becoming the norm in the workplace, with between 50,000 and 70,000 Welsh workers now employed on zero-hours contracts. Some 200,000 Welsh workers are self-employed. I note that the Secretary of State has said in the press today that those people are effectively entrepreneurs, but the reality is that they are people who are increasingly being forced into bogus self-employed status and counted as entrepreneurs by the Office for National Statistics.

[Huw Irranca-Davies (Ogmore) (Lab)]

My hon. Friend will know that there has been a rally today of UCATT, Unite and other unions—and I will take no jeering at union members by coalition Members on this issue—on behalf of construction workers. They are now working for bogus, so-called umbrella companies who sanction—take out of—their pay the employer’s national insurance contributions to annual pay, so they go home with a far smaller wage at the end of the week. That is despicable, but I remind coalition Members that it is a function of the sort of economy and the hands-off Government that we have.

[Owen Smith]

Yes, it is an economy of maximum insecurity for the work force and maximum security and flexibility for employers. Invariably these days the employers are umbrella companies, supply agencies or contract companies, and often people do not even know who is employing them. We do know that the number of self-employed workers in Wales has gone up by 17,000 since the Government came to power, but their incomes have crashed by more than a fifth. Similarly, in Wales there are now 71,000 part-time workers who wish they were working full time. That is up from 54,000—an increase of almost one third under this Government. Those are the hallmarks of the culture of insecurity—the culture of fear—in the workplace that is now affecting Wales and the rest of the country.

[Mrs Anne Main (St Albans) (Con)]

Is the hon. Gentleman suggesting that Labour would scrap all zero-hours contracts? If so, I would like to know how the NHS and education in Wales would cope without the flexibility of bank nurses and bank teachers.

[Owen Smith]

No, we have been clear that we will tackle all abuses and exploitation of zero-hours contracts. We will introduce rules to give new rights to employees on zero-hours contracts. We will ban employers from requiring zero-hours workers to be available on the off-chance that there might be work for them. We will stop employees being required to work exclusively for one firm if they are on a zero-hours contract. We will ensure that zero-hours workers who have their shifts cancelled at short notice are recompensed. That is what the next Labour Government will do; that is what this Government could and should be doing.

[Mrs Main]

Will the hon. Gentleman give way?

[Owen Smith]

I will not give way any more, because I have gone on for quite long enough. I need to wind up my remarks because other hon. Members wish to contribute to the debate—at least on this side of the House.

The reality is that workers’ rights have been eroded under this Government. It is not just wages that have crashed—employees’ rights have crashed. The Government have made it more difficult for workers to take employers to court. They have watered down health and safety legislation and they have bribed workers to sell their rights for shares. They have talked up anti-strike laws, they have halved the consultation period for redundancies in large employers, they have allowed blacklisting to flourish and they have tried to silence campaigning activities by trade unions and others. It is the antithesis of what the Government need to be doing to increase security and loyalty, to increase receipts in our work force and to increase productivity. Fear has become the norm in the workplace. The minimum wage is no longer the minimum: all too often, it is the going rate. Rights have been diminished and wages have fallen.

The next Labour Government will do things radically differently. We will right those wrongs, ban zero-hours contracts, freeze energy bills, fix the rip-off market, increase the minimum wage, and stand up for the Welsh NHS, investing in new doctors and nurses through a mansion tax. We will scrap the bedroom tax and liberate the 26,000 disabled Welsh people from the fear of it. We will cut taxes for the lowest-paid. We will increase taxes for the richest. We will rebuild Wales and Britain on the foundations of fairness, not fear. We will build an economy that works for working people once more, for the many and not the few.

16:40

[The Secretary of State for Wales (Stephen Crabb)]

I am delighted to follow the shadow Secretary of State for Wales and to have the opportunity to talk about the record of the UK Government in Wales. I notice that the Opposition changed their minds on the original motion that they sought to table. I believe it was originally entitled “The disastrous effect of Government policies on Wales”. It seems that they no longer believe that to be the case, and quite right too. We are winning the argument and we have not even begun our speeches yet.

We have to ask ourselves why, at this precise moment, the Opposition have tabled such a ludicrous motion and are trying to talk down the Welsh economy and present a black caricature of what is happening inside the Welsh economy when last week was such a successful week for Wales. On Friday, the Prime Minister, Labour’s own First Minister of Wales, business leaders and journalists stood together at Celtic Manor for the UK Investment Summit, rallying together to bang the drum for the huge strides made in the Welsh economy in recent years. Why would Labour choose to have such a debate at this time to talk down the efforts we are all making to secure new investment and new job creation in Wales?

[Huw Irranca-Davies]

I would applaud any jobs created in my constituency, but I will tell the Secretary of State why we are having this debate today. A guy came into my surgery two weeks ago and showed me his payslip. It was disgraceful. An umbrella company was taking more than £50 from him to contribute to its—the company’s—employer’s national insurance contribution, and deducting £35 as a contribution to his own annual leave. According to HMRC he was employed by the company. Does the Secretary of State condone or condemn such companies?

[Stephen Crabb]

I condone companies that invest in Wales and create jobs, which is the most important thing in driving up wages. Let us be clear about this on both sides of the House: we acknowledge and recognise that wages are not where we would like them to be in Wales. We want to see real wages going up in Wales. The best hope for workers in Wales to see real increases in wages is more job competition: the creation of more and higher quality jobs. That was exactly the purpose of last week’s investment summit. Welsh Labour Members really need to make up their minds. They say one thing at this end of the M4, but back down the road in Cardiff they say another thing about what is going on inside the Welsh economy. They need to make up their minds on whether they back Welsh business or not.

[Huw Irranca-Davies]

The Secretary of State is making a strong and forceful case. Will he argue as strongly and as forcefully for the groups of construction workers in my constituency who are now up to £100 worse off, for the youngsters who are at the beck and call of employers on zero-hours contracts with no continuity and no certainty of employment, and the people working in two part-time jobs because they cannot get one full-time job? Would he say that they are benefiting from the economy in the same way?

[Stephen Crabb]

We feel equally offended by the abuses in the workplace that the hon. Gentleman describes. The record of the coalition Government is actually very positive: increasing penalties for companies that do not pay the minimum wage properly, and consulting on the abuse of zero-hours contracts and taking action.

[Mrs Moon]

The Secretary of State will be aware that I have raised several times in the Chamber the case of a person in my constituency who had money deducted from his salary. He spotted that it had been deducted and went to his employer, who said that it was because he was taking too long in the toilet. Will the Secretary of State condemn employers who do not tell employees that they are deducting money from their wages, or those who are making false deductions from salaries on an ad hoc basis when it is not clear that the money has been taken or what it has been taken for?

[Stephen Crabb]

I am not aware of that specific case, but clearly it does not sound right; it does not sound like an employer that values its employees. However, we should be wary of painting a caricature of the Welsh economy. There are specific abuses, which we will crack down on, and examples of bad practice, which we must not tolerate, but overall the picture is of an improving economy. Wales is getting stronger and its economy is improving, and if Labour Members really value their constituents and want to see opportunities extended to them, which I genuinely believe they do, they should back the general thrust of our policies.

[Mrs Moon]

The company would not talk to me, so I asked HMRC to investigate—let it look at the payslips, let it see what is happening—and what did I get? I got a response saying, “We’ll get back to you some time in December.” That is not good enough. I need an assurance that the company will be investigated.

[Stephen Crabb]

If the hon. Lady sends a copy of that correspondence to my office, I promise we will respond quicker than that.

[Guto Bebb (Aberconwy) (Con)]

Instead of the doom and gloom being portrayed by Labour, will my right hon. Friend join me in celebrating the 42% fall in the unemployment rate in my constituency since the coalition came to power?

[Stephen Crabb]

Absolutely, I welcome the fall in unemployment in my hon. Friend’s constituency. During the shadow Secretary of State’s speech, I was looking through Labour Members’ constituencies. Many of them saw increases of 60%, 70% and 80% in unemployment under the last Labour Government, whereas unemployment in those constituencies is now falling.

[Wayne David]

What would the Secretary of State say to my constituents in Lansbury Park, who, because of the policies of his Government, now find themselves living in the poorest ward in Wales?

[Stephen Crabb]

I have been to the hon. Gentleman’s constituency: I had a fruitful set of meetings with people working at the coal face in terms of supporting people in long-term unemployment and helping them back into work. I realise that there are challenges in the Welsh economy and that sections of Welsh society are still not seeing the full benefits of economic recovery, which is why there is no complacency on the Government Benches, but I must point out that his local authority is working very well with the Department for Work and Pensions, in preparing for the roll-out of universal credit, which will make a difference to the lives of people in his constituency.

[Jonathan Evans]

Is not the answer to the hon. Member for Caerphilly (Wayne David) that the Lansbury Park estate did not become poor in the last four years, and that throughout all the years he has represented the area, it has been one of the poorest in Wales? It is only since the coalition came to office that unemployment has started falling, whereas when Labour was in office, it went upwards.

[Wayne David]

On a point of order, Mr Deputy Speaker. Today, the Welsh Government have published figures showing that for the first time Lansbury Park is now the poorest ward in Wales. I ask the hon. Gentleman to retract his remark.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

That was not a point of order, but I am certain that the hon. Gentleman has clarified his position.

[Stephen Crabb]

Not until every section and geographical part of Wales is sharing in the benefits of recovery will we talk meaningfully about a full economic recovery in Wales. There is no complacency on the Government Benches about that.

To round off the debate about Caerphilly, I must point out that under the last Labour Government, of which the hon. Gentleman was a member, unemployment in his constituency rose by 92%, whereas it has fallen by 31% under this coalition Government. I say with all humility that he should be trumpeting that and welcoming the fact that today there are more men, women, lads and girls going out to work in his constituency than there were under Labour.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

The Secretary of State made great play just now about measures being taken to tackle non-payment of the minimum wage. Exactly how many prosecutions have there been for non-payment in Wales, and does he think it an acceptable level, given the experiences of many people, including in my own constituency?

[Stephen Crabb]

I will get back to the hon. Gentleman with the—[Interruption.] Rather than come up with a specific number, I will write to the hon. Gentleman and provide him with a factual answer.

[Jenny Willott (Cardiff Central) (LD)]

As I am sure the Secretary of State is aware, I was previously the Minister responsible for the national minimum wage. There have not been prosecutions in many cases, but what has been done is far more important—I am sure my right hon. Friend will agree. This Government have ensured that employees who have not received the minimum wage when they should have done have had their money paid back, so they have not lost out as a result. It is far more important that employees get recompense and get their minimum wage.

[Stephen Crabb]

My hon. Friend brings some helpful information to this debate, and I commend her for her work as Minister in driving up and improving employment practices for workers in Wales and throughout the United Kingdom.

[Several hon. Members]

rose—

[Stephen Crabb]

I will give way a bit later.

Let us remind ourselves that when we formed this coalition Government back in 2010, the coffers were empty, and the previous Chief Secretary to the Treasury was joking that the money had all gone. Wales was in an employment slump, and the Labour party was far too relaxed about the tragedy that 200,000 people in Wales had never worked a day in their lives. What a tragedy that was for Welsh communities and for the individuals who had never worked a day in their lives. This Government are not content to be relaxed about that and we are not shying away from the responsibility for trying to put that right. That is why hard-working people are at the very heart of our long-term economic plan. It is why we have cut income tax for more than a million people in Wales so that people can keep more of what they earn. It is why we have cut national insurance contributions to allow businesses to grow so that they can keep and take on more staff, and why we have introduced the Work programme to provide the best possible support for long-term unemployed people, so that they do not get left behind as they did under the last Labour Government.

We have cancelled Labour’s planned fuel duty increases so that petrol will be 20p cheaper than it would have been under the last Government, saving money for the owners of 1.7 million vehicles in Wales, and we are also taking action to help the relatively high proportion of pensioners we have in Wales. Last year, we increased pensions above inflation by £2.70 a week, on top of the record cash rise of £5.30 in the state pension the year before. In April this year, we increased it again by £2.95, in line with our triple lock. This was the biggest cash increase since the state pension was first introduced. That should be compared with the tiny 75p increase offered by Labour when they were in government. It is not hard to tell which party is on the side of pensioners in Wales.

[Mr David Hanson (Delyn) (Lab)]

This debate is about the economy, but it should also be about values. Will the Secretary of State explain to us what values drive him to cut the taxes for the richest people in Wales while putting up VAT, which is paid by everybody, no matter what their income? What values drive him to make benefit cuts such as we have seen with the bedroom tax and to hit the poorest people hardest? As I say, this debate is about values.

[Stephen Crabb]

I agree with the right hon. Gentleman that it is about values. It is about our values as a Government who are not content to see 200,000 people in Wales who have never worked a day in their lives. That is why I celebrate the fact that there are 38,000 more people in work in Wales since the election and 47,000 fewer households where nobody works. What does that mean in real terms? It means more kids in Wales growing up seeing a mum or dad going out to work. Opposition Members, who go under the name of “Labour”, should be championing that.

[David T. C. Davies]

Is my right hon. Friend aware that this debate is not about the economy, but about the effect of Government policies on Wales. Does it surprise him that the hon. Member for Pontypridd (Owen Smith), who spoke very entertainingly—I look forward to coming back to it—for nearly 40 minutes did not once mention the national health service or the effect of Government policies on health?

[Stephen Crabb]

My hon. Friend makes an important intervention and we look forward to hearing more from him later in this important debate. It is about values, but over the last week, the mask has finally slipped—yet another example of Labour’s mask slipping. We saw it last week when a member of the Opposition Front-Bench team saw fit to ridicule someone’s home just because they had a white van parked outside it and were displaying the flag of St George. The Labour party can no longer with any credibility claim to be the workers party. It is the party of the liberal metropolitan elite, that sneers at hard-working people. Today Labour Members should be on their feet championing workers in their constituencies —[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I am struggling to hear the Secretary of State. I am sure that we all want to hear him.

[Stephen Crabb]

Time and again we see that the Labour party simply does not believe in the people of Wales. It thinks it knows best, it does not believe that people can manage their benefits, it does not believe that businesses are strong enough to play their part in rebalancing the economy and it certainly does not believe that Wales is an ambitious country hungry for success.

I believe those things and so do this Government, from the Prime Minister down. We reject the negativity of the Labour party, which is using this debate to talk Wales down at the very time that it should be backing Welsh businesses and backing the people of Wales who are working so hard to drive the economic recovery forward. Since the election, 46,000 fewer people in Wales are claiming out of work benefits, there are 90,000 more private sector jobs in Wales and 26,000 more small businesses are driving the economy forward. That is all down to the difficult decisions taken by the coalition Government back in 2010 to get the economy moving again. Each one of those decisions was challenged and rejected by Labour.

[Jenny Willott]

The Secretary of State mentioned the growth in the small business sector and he also mentioned the employment allowance, which gives a national insurance contribution rebate to businesses. Will he welcome with me the fact that more than 1,000 small businesses in my constituency alone and tens of thousands across Wales have already taken that up, enabling them to invest in their staff through training or higher salaries and even to create new jobs and take on more people?

[Stephen Crabb]

That is a message I hear consistently from small businesses up and down Wales. Wherever I go, they welcome the efforts the Government have made to give them confidence to hire more workers and to keep staff. The last thing that businesses want to be doing is shedding staff at this time. They know how hard things have been for many families out there in the economy and they are doing everything possible to hold on to staff and grow their work forces. We have been supporting them in that.

[Chris Bryant]

The single thing that every business man or woman in Wales has said to me is that they want economic security and certainty about the future if they are going to see investment or to make further investment themselves. What is really worrying them is that the Government are playing fast and loose with our membership of the European Union, hanging the sword of Damocles over the Welsh economy and the UK economy. The uncertainty about whether we will be in or out is surely bad for the Welsh economy.

[Stephen Crabb]

The uncertainty about the European Union and the doubts and concerns about it are out there anyway. If the hon. Gentleman talks to people in Wales and looks at the public opinion polls, he will see that opinion in Wales is almost equally divided between those who are saying they want to come out of the European Union and those who are saying that they want to stay in. The Prime Minister’s strategy of getting a better deal from Europe as regards our membership and putting it to the people of Wales and the UK, arguing for Britain to stay in on that renegotiated membership, is the best strategy for dealing with this and addressing it head-on. That has to be the best way.

[Chris Bryant]

I disagree. I would have a referendum tomorrow. If that is the Secretary of State’s real argument, let us have a referendum tomorrow. The idea of holding off for two years and having some nebulous renegotiation when we have not even set the terms of what we want and are constantly saying to businesses in Wales that we do not know whether will be in or whether the Prime Minister would support staying in the European Union in two years’ time can only be bad not only for big businesses, such as Airbus and General Electric, but for the small and medium-sized businesses that rely on investment through the public funds that come from the EU.

[Stephen Crabb]

I have a great deal of time and respect for the hon. Gentleman, who knows his stuff on this issue, but I suggest that he look at what the business organisations are saying. They support what the Prime Minister is saying about renegotiating. Businesses themselves in the UK and Wales want a less intrusive, less costly and less burdensome membership of the European Union.

[Mr Mark Williams (Ceredigion) (LD)]

I want to reiterate the point made by the Opposition, but from a farming perspective. Has the Secretary of State listened to the president of the Farmers Union of Wales, who talked about the great uncertainty that this will cause many hundreds of small businesses—that is, the farms of Wales?

[Stephen Crabb]

I meet regularly the Farmers Union of Wales and NFU Cymru and I am aware of what they say. I also speak to a lot of individual farmers and, again, I point out that there is a split. There are some strongly held views on both sides, so the Prime Minister's strategy of trying to settle the debate for the long term and get it out of the way is absolutely right.

Time and again over the past four and a half years, the Labour party has got the big calls about the economy wrong. Their dire predictions about increasing unemployment have not materialised. Their prediction that the Welsh private sector was too thin or weak to support the rebalancing of the economy has been proved wrong.

There is, however, one thing about which the shadow Secretary of State has been right, not wrong, and on which we absolutely agree with him. He was recorded saying to activists—at his own party conference, I think—that his leader was not quite up to the job, and that his party had lost touch with its core voters. We entirely agree with his analysis in that instance.

[Owen Smith]

If the Secretary of State is going to repeat what is frankly nonsense—if he is going to come out with unsourced gibberish like that—he really needs to come up with some corroboration. Otherwise, he can withdraw what he said right now.

[Stephen Crabb]

Well, I do not know. I read the press, and I see what the press report.

[Owen Smith]

On a point of order, Madam Deputy Speaker. The Secretary of State has just uttered an untruth in this Chamber. I do not know where he has come up with that untruth, but I ask him to rescind it immediately, and apologise.

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order. The Secretary of State will not have deliberately misled the House. If it has been pointed out that he is incorrect, I am sure that he is capable of making the correct entry in the record now.

[Stephen Crabb]

Well, Madam Deputy Speaker, I merely pick up what has been reported and discussed in the media.

While the Labour party is busy tearing itself apart, we are cracking on with creating the right conditions to get the economy moving. We are investing in Wales because we believe in Wales. I am particularly delighted to be able to tell the House that the rail electrification projects in south Wales will go ahead. I am sure that the hon. Member for Pontypridd would have preferred us not to meet that challenge, so he would have one more reason to be negative and talk down the economy in Wales, but I am proud of the deal that the Wales Office brokered between the Department for Transport and the Welsh Government, putting Welsh interests right at the heart of the Government’s agenda.

[Chris Bryant]

rose—

[Stephen Crabb]

I give way to the hon. Member for Rhondda, who is very excited today.

[Chris Bryant]

No, I am quite calm, actually. This is calm.

Will the Secretary of State tell me precisely when we shall see the electrification of the valleys lines? I have heard successive Ministers make promises about it, but absolutely nothing has happened.

[Stephen Crabb]

We are delivering this project. We have worked very constructively with the Welsh Government to put the deal in place. We will see trains running on the electrified service to Swansea in 2018, and on the valleys lines in 2022. Obviously, those timetables are subject to how quickly the Welsh Government move in managing the project, but they understand its strategic importance and urgency for people and businesses in south Wales.

[Geraint Davies]

I welcome the news of the financial deal and the certainty of the timetable, with a date of 2018 for the Swansea service. However, the economics of austerity and low wages have meant that instead of increasing by 7% this year, income tax receipts are flatlining, and the projected income from national insurance and income tax is £13 billion down, so the Chancellor will not now be able to reduce the deficit by £11 billion. Does the Secretary of State not accept that the politics and economics of low wages and hitting the poor hardest simply are not working, and debt is being driven up?

[Stephen Crabb]

I am not sure that I follow the hon. Gentleman’s argument. If he is expressing concern about the deficit, let me ask him why, for the last four and a half years, he and his colleagues have pursued policies with the exact objective of increasing the deficit and increasing the debt, and have argued and voted against every measure we have tried to introduce to restore stability and sanity to our national finances.

Effective transport links are a vital part of any modern economy, and few areas in the United Kingdom are more in need of the improved commuter costs, reduced travel times and more frequent train services that electrification will bring than the valleys communities. Yet again, investment has Welsh people at its heart. The Government’s programme of investment in rail infrastructure in Wales and throughout the UK is one of the most ambitious since the development of the rail network in the 19th century. By 2019, we shall have put in place more than 870 miles of electrification, whereas Labour Governments have managed less than eight miles.

Rail electrification is only one example of the constructive and co-operative relationship that we have struck with the Welsh Government to help deliver for the people of Wales. In contrast to the Labour party in Westminster, we do not posture and play silly games; we roll up our sleeves, put partisan interest aside and do our very best to help get Wales moving again.

Opposition Members may recall the NATO summit in Newport just two months ago, which was a stunning success for Wales—a great example of two Governments working in co-operation to deliver for the people of Wales. We hosted the largest gathering of world leaders in Britain’s history, putting Wales on the world stage. We worked with local business, local councils—I pay particular tribute to Newport city and Cardiff city councils—the Welsh Government and the local people, and they all delivered superbly. NATO showcased the excellent hospitality Wales has to offer and created jobs for local people, and this success paved the way for last week’s investment summit—another example of this Government working positively with the Welsh Government in the interests of Wales.

It could not be any clearer: the UK Government are putting business at the forefront of the recovery and they are delivering. I refuse to accept the Opposition’s argument that the private sector in Wales is too weak for the rebalancing of the economy to work, and I certainly refuse to accept the constant bashing the shadow Secretary of State delivers in respect of Welsh businesses.

These two historic events—the NATO summit in September and the investment summit last week—should convince the shadow Secretary of State that Wales can deliver on a scale matching any other nation in the world. Joint working on this scale demonstrates how the Welsh and UK Governments can co-operate and collaborate in the interests of the people of Wales.

Securing good quality jobs for people in Wales is a priority shared by both the UK and Welsh Administrations. Airbus in north Wales continues to be a shining example of the quality of jobs and the skills sets Wales has on offer. I was therefore delighted that investment from both Governments last week has secured 6,000 jobs in the long term at the firm’s factory in Flintshire, in the constituency of the hon. Member for Alyn and Deeside (Mark Tami).

[Chris Ruane]

Does the right hon. Gentleman agree that the rise of Airbus, out of the ashes of the closure of Shotton steel works, was down to actions taken by the Labour Government in 1998, when we gave Airbus £500 million in launch aid? That was an example of private and public co-operation.

[Stephen Crabb]

Airbus is deeply appreciative of the efforts of Governments of all party shades, and is particularly appreciative at the moment of the way the Governments in London and Cardiff are working together to strengthen it and see it secure for the long term.

[Mark Tami]

rose—

[Stephen Crabb]

I give way to the Member in whose constituency Airbus is located.

[Mark Tami]

Does the right hon. Gentleman accept that Airbus is a European partnership and it works because we are in Europe, and if we were not in Europe that relationship would be endangered, along with thousands of jobs?

[Stephen Crabb]

There is truth in what the hon. Gentleman says. It is an excellent example of European industrial co-operation, but he knows better than anyone else here that at the heart of the success of Airbus in his north Wales constituency are the excellent skills and motivation of the workers, many of whom are in his constituency, but also in other constituencies.

North Wales is at the heart of Wales’s economic growth, and I look forward to seeing more excellent examples of enterprise in Wales’s very own northern powerhouse tomorrow, when I embark on a two-day business tour there. The Labour party here in London at times seems to resist these developments.

[Ian Lucas]

If the right hon. Gentleman is visiting north Wales, perhaps he will visit the Wrexham area. I hope he will accept that many of our exporting giants in north-east Wales, such as Kellogg’s and Toyota, export to European markets, and that the international investors who decide where to invest and create new jobs are frightened off by his Prime Minister’s indecision and this Government’s lack of clarity.

[Stephen Crabb]

Business is not being scared off: quite the opposite. We recognise that the single European market is an enormous strategic prize for the UK, but in fact a greater proportion of Welsh exports go to countries outside the EU than to those inside it, and our trade with countries outside the EU is growing at a faster rate, so the hon. Gentleman should not be so insular and should look at the worldwide dimension, rather than just the European one.

[Mr Hanson]

When the Secretary of State is travelling to north Wales, will he stop off in Chester or go to Vauxhall in Ellesmere Port and ask my constituents there how much they value having a voice in this House to represent their interests on matters that are dealt with by the English Government?

[Stephen Crabb]

I will take the opportunity to have exactly those conversations, and I expect that all those people will tell me resoundingly just how important the right hon. Gentleman’s voice is in representing their interests.

[Guto Bebb]

The Opposition are very keen to express their concern that our policy on Europe is dangerous for business investment, but does my right hon. Friend agree that that is contradicted by the investment that was made in north Wales last week?

[Stephen Crabb]

Exactly. There is a faint whiff of scaremongering coming from Labour on those issues.

I want the Government to bang the drum for investment into Wales, whether it be the UK Government or the Welsh Government, and I am delighted to be able to say that inward investment into Wales is on the rise. In the past year in Wales alone, 79 projects have got under way—the highest number for almost 25 years. The 13 years of the last Labour Government did nothing for boosting inward investment in Wales, but I have seen for myself what this Government’s policies have done for inward investment—[Interruption.] The hon. Member for Vale of Clwyd (Chris Ruane) says that that is all down to the Welsh Government, but almost all the inward investment projects that we secured for Wales last year involved the active support of UK Trade & Investment and the UK Government.

Just last month I visited Hydro, a company that specialises in water purification using electro-based technology. While I was there, Hydro announced a new £20 million joint venture deal in the United Arab Emirates to assist that country to achieve more effective water treatment solutions. I look forward to hearing the hon. Member for Llanelli (Nia Griffith) congratulating that company and championing the business interests in her constituency when she speaks later in the debate.

[Stephen Doughty]

The Secretary of State is talking about the contribution of major businesses to the Welsh economy. Does he agree that the steel industry in Wales is facing significant challenges, with Celsa and Tata in particular being affected? It is crucial that the Government act quickly and robustly to deal with the concerns that those companies have raised about energy, dumping from markets in China and Turkey, and the many other matters that he and I have had correspondence on. Does he acknowledge that the Government need to get their act together and move a lot faster on those issues to support the steel industry in Wales?

[Stephen Crabb]

My ministerial colleagues and I are working hard on those issues, and we have also had correspondence and meetings with Ministers in the Department for Business, Innovation and Skills. We are certainly alive to the concerns of the steel industry and we want to do everything possible to secure the future of that strategic industry in the hon. Gentleman’s constituency and elsewhere in south Wales.

The road network in Wales is another vital element of its infrastructure connections that businesses and communities rely on. That is why we are providing the Welsh Government with increased borrowing powers via the Wales Bill to boost investment in Welsh infrastructure, including work on the M4 upgrade. Congestion on the M4 has long been a concern for south Wales businesses, and an upgrade is grossly overdue. That is another vital infrastructure decision enabled by this Government.

[Hywel Williams (Arfon) (PC)]

Does the Secretary of State agree that successful exporting businesses such as Siemens in my constituency would be even more successful if the A55 were upgraded from its present woeful state?

[Stephen Crabb]

I have a huge amount of sympathy for the hon. Gentleman’s point. Businesses in north Wales make that point to me consistently, and I expect to hear more on that while I am in Wales over the next 48 hours. The Under-Secretary of State for Wales, my hon. Friend the Member for Vale of Glamorgan (Alun Cairns) will shortly be hosting a transport summit in north Wales in order to identify the strategic infrastructure projects that we need to focus on if we are to secure the long-term economic success of the area.

I will bring my remarks to a close shortly. I could have gone on to talk about investment in digital infrastructure and the support that we are giving the Welsh Government for the broadband project. I could also have mentioned the investment in the new prison in Wrexham, which is a really strategic investment for north Wales, along with the many other examples of how this Government are doing everything possible to create the right framework and conditions for Welsh business to succeed, and to create the jobs and wages that we all want to see for all our constituents.

I am very proud of the transformative projects that this Government have achieved in Wales. I am also proud of the people in Wales who are making those policies work to their full effect. I am proud that we have a growing private sector with more people in work and more businesses. I am just dismayed at times that the Opposition cannot bring themselves to welcome that, bang the drum and support it. We have no problem with rolling up our sleeves and working with the Welsh Government in the interests of Wales. Why does the Welsh Labour party at this end of the M4 have a mental and political block that prevents it from being a constructive Opposition in the interests of Wales?

[Ian Lucas]

As someone who has run a small business in Wales, I ask the right hon. Gentleman whether he understands that his Government’s policies are doing the economy down. His Government are suppressing demand in the local economy by cutting wages, increasing taxes such as VAT, and preventing people from having enough money to spend to help local business. Does he not understand basic economics?

[Stephen Crabb]

What I do understand is the way unemployment has been falling in the hon. Gentleman’s constituency. He should be championing the fact that youth unemployment has fallen by 49% in the past four and a half years. That is more lads and more girls in his constituency getting their first jobs and a foot on the jobs ladder. That is what it is all about.

Last Friday, when Opposition Members were working out what clever things they were going to say in this debate and trying to find new ways to talk down the Welsh economy, what were we doing? I will tell them where I was last Friday: I was down in Newport, standing shoulder to shoulder with the UK Prime Minister and the Welsh Labour First Minister. We were all banging the drum for more investment in Wales, banging the drum for more jobs for Wales, together sending a united, strong, positive message from Wales that Wales is coming back. We all need to work together to see that continue.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order. Given the short amount of time that we have left for this debate, it is necessary to put a time limit on Back-Bench speeches. We are starting with seven minutes. It depends on how many interventions there are whether that limit will be reduced further. So there will be a seven-minute limit on all Back-Bench contributions to this debate, from the next speaker.

17:16

[Paul Murphy (Torfaen) (Lab)]

I have been called some things over the years in politics, but I have never been called a metropolitan liberal before. I rather fancy that most of my colleagues in the Welsh parliamentary Labour party would never be called metropolitan liberals.

I believe the Secretary of State is genuine and sincere about wanting to work with the Welsh First Minister, and I believe that his attendance at various events is, as I said, something that we can admire, but I fear that his boss is not of the same mind. He might have been standing next to him last week in Newport, but since the last general election, when the Prime Minister said that there would be a respect agenda in Wales and in Scotland, that has effectively collapsed. It collapsed when the Government tried to ensure that the number of Welsh parliamentary constituencies would be unfairly reduced. It collapsed at the time of the Scottish referendum, when the Union itself was under threat, when the Prime Minister came out and said that all that mattered to him now was not to keep the Union going but to diminish and downgrade the presence of Welsh and Scottish Members of Parliament and their responsibilities in this House of Commons.

The Secretary of State went on to talk about us all wanting to talk down Wales and the Welsh economy. For the past 18 months the Government have not stopped talking down the Welsh national health service. What is the difference? Does the right hon. Gentleman not understand that talking down the Welsh health service means that he is demeaning consultants, GPs, nurses and everybody else who works in the Welsh national health service? We cannot have it both ways. Either he says that there is devolution, Wales must go its own way and the Government will accept what happens there, or he intervenes for party political purposes and talks down, in this case, the health service.

The Secretary of State referred to a point made by my hon. Friend the Member for Alyn and Deeside (Mark Tami) about the jobs growth policy of the Welsh Government, and more or less said that that does not matter and that people would have jobs anyway. That is a preposterous thing to say, because the Jobs Growth Wales programme has been a magnificent success, with 16,000 new job opportunities over two years. Only last week, there was an announcement of 350 new jobs in my constituency —good jobs, too. What my colleagues have been saying here in this Chamber is that of course we welcome the reduction in unemployment, but the jobs that people are going into are not of the sort we particularly want them to go into. The new jobs that have come to Cwmbran are precisely the sort of jobs I want my constituents to work in.

The Minister also talked about Europe, responding to a point made by my hon. Friend the Member for Rhondda (Chris Bryant). A great Tory grandee once said that the secret weapon of the Conservative party is loyalty. Over the past few months, the Conservative Back Benchers have erupted over Europe, with the loss of two Members to the United Kingdom Independence party and possibly more to come. What sort of signal does that give to businesses that want to invest in Wales? What sort of signal does it give to firms in my constituency which rely overwhelmingly on our membership of the EU? Component car manufacturers in my constituency would go to continental Europe literally on the day we left the EU.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

As always, the right hon. Gentleman is making very considered points. However, will he explain why the Welsh Government have decided to cut the budget for Jobs Growth Wales if it is such a great success?

[Paul Murphy]

I fancy it is because of the money that has been cut from the budget generally, because of what the Government here are doing by reducing the amount of money that is coming through the block grant. The Secretary of State actually said somewhere in his speech—he is getting a bit like his boss now, making things up from time to time—that there was no inward investment in Wales in 13 years of the Labour Government. That is rubbish—of course there was inward investment in Wales during those 13 years. As Secretary of State, I went around talking to firms that had benefited from inward investment and so on.

[Stephen Crabb]

I did not actually say that, and I apologise if I did give that impression. The point I was making was that there was a collapse in the inward investment: compared with what we had seen in the ’80s and ’90s, there was a huge decline over that 13-year period in the amount of inward investment coming to Wales. Thankfully, with the Welsh Government and UK Government working together, we are seeing that go back up.

[Paul Murphy]

The Welsh Government are certainly doing it, because foreign investment in Wales has increased by 30% whereas the figure for England is 10%—I rather suspect the work of the Welsh Government has made the difference.

The other issue the Secretary of State has to take into account is the welfare policies of the Government. In effect, those changes in Wales are doing two things that are detrimental to the people of Wales. I agree with reforming the welfare agenda and I agree that we should not have workless families in Wales—we all agree on that—but the great brunt of the cost of these welfare reforms often falls not on those who are out of work but on those who are in work. Those people in work are suffering sometimes more than anybody else.

Last week’s report by Sheffield Hallam university showed graphically how the south Wales valleys have been hit harder by welfare reform than any other part of the United Kingdom. We can talk about the impact on individuals, which is catastrophic, but we can also talk about the sucking out of the local economies the money that would have gone in had these people still been receiving these benefits. The reforms will cost £34 million a year in my constituency alone, and the average loss of income per working age adult in Torfaen is nearly £600 a year—in one ward, Trevethin, the figure is £850. Some 3,000 jobs in the south Wales valleys could have been created but for the impact of these so-called welfare reforms put in place over the past few months and years, which have been pretty botched.

Finally, I wish to refer to the bedroom tax and make no apology for doing so. One of the first things the new Labour Government will do is abolish it, and everybody in Wales will cheer. Not only is it cruel and wicked, but it is not working. Some 20% of housing benefit claimants in my constituency are affected. In the first year of the policy Bron Afon, which runs social housing, had 268 tenants fall into arrears; we are talking about some £63,000 of arrears that people never had before until this came about. That is not helping anybody. It does not help the tenants, the local authority or the social landlords, and it again takes out of the local economy vital money that could be used to boost local businesses, particularly small and medium-sized enterprises. Ultimately, that is why we have seen an enormous increase in the number of people using food banks in both my constituency and the rest of Wales. Until two or three years ago, I never saw a food bank. Now, we visit them time and again. Our churches and our chapels collect for them every Sunday. That increase is a direct result of the Government’s policies in Wales, which will undoubtedly be rejected by the people of Wales next year. We will then have a Government in Cardiff and a Government in Westminster working together for the benefit of the people of Wales.

17:25

[Guto Bebb (Aberconwy) (Con)]

It is a pleasure to follow the right hon. Member for Torfaen (Paul Murphy). I congratulate the Secretary of State for Wales on his positive and upbeat view of the situation in Wales, which can be contrasted with the doom and gloom from the Opposition. Indeed, I shudder at the possibility of the hon. Member for Pontypridd (Owen Smith) becoming the Secretary of State for Wales. He would be our own version of Private Frazer, going around saying, “We’re all doomed.”

In effect, what is happening in Wales is a success story, and that is hurting the Opposition because that is not what they want to hear. They want to claim that it is only the Government who can make a difference to the people of Wales, but the truth is that it is this Government who are showing quite clearly that it is the people of Wales who can make the difference. It is the people who are willing to take responsibility for themselves and to make a success of their lives. Effectively, this Government are giving the people of Wales that opportunity; they are not saying that they can depend on the Government for hand-outs.

The Opposition should be truly ashamed that they are highlighting figures in relation to poverty levels in Wales. Labour has been in government at a local or national level in Wales for the past 100 years. Where the Labour party is strongest, poverty is at its greatest. It should look at the valleys of south Wales and feel truly ashamed of what it has done to our proud nation. Labour in Wales has failed, failed and failed again. This coalition is giving people a sense of honour and integrity and a belief in their ability to make a difference once more.

[Huw Irranca-Davies]

rose—

[Guto Bebb]

I will not take an intervention from the hon. Gentleman. It is about time that the Labour party heard some hard truths about the way it has failed Wales time and again. That failure in Wales is replicated in Scotland. The Scots have seen through the failure of Labour; it is about time that the people of Wales did the same.

The people of Wales should turn to the Conservative party and this coalition, as we are showing people that we can make a difference to their situation. We can ensure that we create employment. In my constituency, unemployment has fallen by 42% since the coalition came to power, and we should welcome that fact. I am proud of every single one of those jobs. My constituency had 13 years of a Labour MP, and it is not hard to guess what happened to the unemployment figures—they went up. With this coalition, unemployment is falling. We have an increase in the number of people employed and self-employed in my constituency, and we should be proud of every single one of those individuals.

The Opposition always say that they can make a difference to Wales, but they believe that the difference lies in the hands of Government. We believe that difference can be made by people setting up their own businesses and making a success of those businesses. Last week, the Under-Secretary of State for Wales, my hon. Friend the Member for Vale of Glamorgan (Alun Cairns), visited two businesses in my constituency. We failed to visit a third because the owner was in London winning an award. That owner is not just the UK butcher of the year but a man who started a business that now employs 60 members of staff—[Interruption.] The Labour party is laughing at entrepreneurial job creation in my constituency. My hon. Friend then visited the Welsh food centre, which was established two years ago and now employs 60 members of staff. It is the largest privately led project in north Wales and has been receiving funding from the European Union. It is a fantastic success story—somebody had a vision; they were willing to implement it and take a risk with their own money. [Interruption.] The hon. Member for Rhondda (Chris Bryant) is chuntering from a sedentary position. He does not understand what running a business means, let alone appreciate the difficulties. It is that type of success story that is changing lives in my constituency.

The success of small businesses in my constituency has been helped by the fuel duty freeze and the cuts implemented by this Government. The Labour party, by contrast, has bled our rural communities dry with its fuel duty escalator. My constituency also has a significant number of people of above-average age, including a lot of pensioners. Despite the economic inheritance that the Labour party gave us, those pensioners have been protected by the triple lock. The degree of respect that they have been shown by the coalition contrasts with the insult of the 75p pension increase provided by the Labour party. Labour Members say that their party looks after the poorest in society, but it was willing to forget our pensioners. In difficult economic times, the coalition has not forgotten our pensioners, and those people will remember that at the general election.

A key point to remember is the way we have tried to be reformist in difficult times. The Government’s introduction of the single-tier pension is immensely important to a constituency such as mine, which has a significant number of self-employed people. In such times, the coalition Government are not scared of taking long-term decisions that will make a real difference to my constituents’ lives. We hear complaints from Labour Members about changes to the welfare state, but we know why: they like a compliant, complicit population. The truth of the matter is that the welfare state in Wales was not working and we needed to ensure that changes were made.

One of the key successes of welfare reform throughout the United Kingdom, although perhaps not so much in Wales, is the Work programme. Its huge success will grow, as National Audit Office reports clearly show. Labour Members often talk about the Work programme supporting the lowest hanging fruit, but no one—not a single individual—accesses the Work programme unless they have been unemployed for at least 12 months. Compare and contrast that with the situation under Jobs Growth Wales which, by the way, I have supported and publicised to my business community. Under that programme, a person can be a graduate today and on Jobs Growth Wales tomorrow, but someone cannot get on the Work programme until they have been unemployed for 12 months, so it genuinely helps the hardest to reach. Jobs Growth Wales has done a good job, but it is not an attempt to support such individuals. We have a success on our hands—

[Madam Deputy Speaker (Dame Dawn Primarolo)]

Order.

17:32

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

I shall speak about not only the motion, but the effects on Wales of the Treasury’s economic policy. The Chancellor himself said that the UK Government’s austerity policy should be judged against two key benchmarks: eliminating the deficit by the end of this Parliament and preserving the triple A credit rating. He has failed on both terms. The Treasury now plans to eliminate the deficit by 2019, while two of the three credit rating agencies have downgraded the UK’s status.

Plaid Cymru has consistently advocated an alternative fiscal strategy based on increasing infrastructure investment. Indeed, we find ourselves in the slightly uncustomary position of being supported by the International Monetary Fund and the CBI, both of which have advocated a sharp increase in infrastructure investment to boost economic development. That is why securing Barnett consequentials from projects such as High Speed 2 is a key priority for Plaid Cymru. Given that the Institute for Economic Affairs estimates that that project will cost £80 billion, a fair share for Wales would be about £4 billion. Such an investment would revolutionise transport in Wales.

Following a freedom of information request by “Newsnight”, we saw in a KPMG report a full insight into the impact of HS2 on the south Wales economy. It suggested that Wales would be hit hard, with an annual economic loss to south Wales of more than £220 million. However, when we considered the paving Bill, all the Wales-based MPs of the London parties voted in favour, despite there being no promises of a fair share for Wales.

A range of transport infrastructure projects is being promoted, including HS3 at an initial cost of £7 billion and Crossrail 2 at £15 billion. There are plans to extend Crossrail 1 into the home counties and for an underground inner orbital road for London at a cost of £30 billion. Boris Johnson has called for £1 trillion of future infrastructure investment in London by 2050, mainly to cope with the extra demands of HS2. It should be enshrined in law that England-only infrastructure projects that are financed through the public purse result in automatic consequential payments that Wales can invest in its own infrastructure.

As we debate the impact of Government policy on Wales, events in Scotland loom large. The infamous vow made to the people of Scotland on the eve of the independence referendum has implications for Wales. With all three unionist parties now pledged to preserving public funding in Scotland at its current level, they have, for themselves, defined fair funding. If it is good enough for Scotland, it should also be good enough for Wales. Public funding on a Scottish level would provide an extra £1.2 billion to invest in Welsh public services. When challenged on this yesterday in the National Assembly, the Labour First Minister said it was England’s money. This shows how clueless he is. He was more than happy to back the vow for Scotland yet refuses to make the case for Wales.

We also await the Smith commission, which will publish its announcements tomorrow. If the Financial Times and The Guardian are to be believed, the signature recommendation agreed by all the parties will be the full devolution of income tax to Scotland, to be enacted in a Bill early in the next Parliament. Yet the Wales Bill, which completed its passage on Monday, would merely give the Welsh Government control of 10% of income tax receipts, and then only after a referendum. Once again, Westminster is treating Wales like a second-class nation.

I was astounded to read Labour’s attempt to rewrite history regarding the bedroom tax in its motion before the House today. The Tory and Lib Dem Government undoubtedly brought in one of the most ill-thought-out and pernicious attacks on the vulnerable with the bedroom tax. Sixty per cent. of those affected are disabled. Where was the Labour party when it was needed to stand up for the weak? It was nowhere to be seen. It failed to vote against the Welfare Reform Bill on Second Reading, which brought in many of the current damaging cuts to social protection, including the bedroom tax. It was Plaid Cymru, along with the Scottish National party and the Greens, who led the first Opposition Day debate on the bedroom tax here in this House and voted against it. We now find out after the resignation of the former head of the Labour party in Scotland that she wanted to oppose the bedroom tax in public, but was restrained from doing so by the London bosses who wanted to see which way the wind was blowing.

A recent report by Sheffield Hallam university, entitled “The impact of welfare reform in the Valleys”, has been mentioned many times today. It noted that more than £1 billion a year is being lost from the Welsh economy owing to welfare cuts. In some communities it is a loss of up to £1,000 per adult of working age in places such as Maerdy in the Rhondda and Gurnos in Merthyr Tydfil, and £790 in my own constituency in Ammanford. To put it in context, despite west Wales and the valleys qualifying for the highest level of EU funding, welfare reform will remove almost four times as much a year as is received from the EU for regional development, which the Labour party voted to cut when it teamed up with Tory Eurosceptics on the Government Benches.

The Sheffield Hallam study notes that reforms to incapacity benefits are the largest single element in terms of savings the Treasury is seeking to make. These reforms, most notably the changes to work capability assessments, were brought in by the Labour Government in 2008, but are only now taking full effect. One measure that would undoubtedly help remedy the situation is an economic fairness Act that would level up individual and geographical wealth across the UK by prioritising foreign direct investment and infrastructure investment to poorer areas.

Another key measure would be to raise the minimum wage to the level of the living wage. In Wales, which is badly affected by low pay, this would result in a pay rise for 250,000 people. The Labour party should be ashamed of its policy to increase the minimum wage to only £8 an hour by 2020, described as “not at all ambitious” by its own guru, Alan Milburn. Meanwhile, Plaid Cymru is committed to raising the minimum wage to the level of the living wage, a move that is socially just and will leave the Treasury £1.5 billion a year better off, according to Landman Economics.

I see that Labour’s motion talks about its energy price freeze policy, which will unfortunately not affect off-grid consumers, some of the worst affected in many Welsh communities, including my own in rural Carmarthenshire. Again, its policy is a little rich given that it presided over the creation of the big six fix energy market at the beginning of the century. That is why Plaid Cymru has argued for the full devolution of energy policy and the setting up of a publicly owned, not-for-distributable-profit energy generation company in order to deliver lower prices to consumers.

17:38

[David T. C. Davies (Monmouth) (Con)]

Once again, we have listened for about 40 minutes to the hon. Member for Pontypridd (Owen Smith) treat us to his tales of economic doom and gloom and woe. It must be getter harder and harder for him to maintain that in the light of the ever-better financial news. I had an interesting morning in the run-up to this debate: I decided to read through a few of his previous speeches. I went back to 2010, when he quoted an Oxford Economics report, saying that the coalition Government would be able to create only 4,000 private sector jobs. I wonder whether he remembers saying that. The reality is that so far, over the course of this Parliament, we have created 100,000 private sector jobs in Wales alone. In the same speech he talked about net increases in unemployment continuing until 2025. The reality, of course, is that unemployment is now at its lowest level since 2008.

In a subsequent speech on 11 November 2011, the hon. Gentleman spoke of a 4% contraction in GDP over the course of the Parliament. The reality is that so far over the course of this Parliament we have had a GDP of 7.8%, and I got that figure from the House of Commons Library earlier today. We have the fastest-growing economy in the developed world. I am so proud to be standing here supporting the Prime Minister and the excellent Secretary of State for Wales he has just appointed.

[Chris Bryant]

If we are going to talk about speeches that other Members have made, I remember the Prime Minister saying that the deficit would be cut completely by the end of this Parliament. I remember him saying that the debt would be falling. I remember him saying that net migration to this country would fall below 100,000. None of those things has come to pass, so let us talk about the Government’s failures.

[David T. C. Davies]

rose—

[Chris Bryant]

The Prime Minister even said that no disabled people would be affected by the bedroom tax, but two thirds of those affected by it in Wales are disabled.

[David T. C. Davies]

If the hon. Gentleman would be kind enough to give way, I will talk about those things. First I will leave him to think about this headline: “UK unemployment rate falls to lowest level since 2008”. That is from The Guardian just a few weeks ago. But let us talk about the debt, because after all, we inherited a debt of around £800 billion.

[Chris Bryant]

It has gone up.

[David T. C. Davies]

Yes, it has gone up. We also had a deficit of £160 billion, and we have not managed to do as much as we wanted to do with that. I would have liked to see us do more with it. But the reality is that there has been no coherence from Labour Members, because every time we have suggested ways to cut the deficit further, they have opposed them. They sit there trying to convince the world that they have a coherent economic policy, when they have condemned us for borrowing money while at the same time demanding that we borrow more. That is why people will not trust them with the economy.

The hon. Member for Rhondda (Chris Bryant) talked about immigration. Again, I would have liked to see us go further, but immigration from outside the European Union has been reduced significantly, and we cannot do anything about immigration from within the European Union—he should know, because he is the biggest Europhile in this place. We cannot do anything about freedom of movement, but we are going to offer a referendum on it.

[Several hon. Members]

rose—

[David T. C. Davies]

I will give way in a moment.

The motion mentions energy. The hon. Member for Cardiff South and Penarth (Stephen Doughty) made a good point about the impact of carbon taxes on steel production and other manufacturing. What he did not want to say, of course, is that those policies were brought about by the previous Labour Government, who swallowed hook, line and sinker the environmentalist line that carbon dioxide is causing runaway global warming and began imposing billions and billions of pounds in carbon taxes on manufacturing and on home owners. That is one of the reasons why energy bills are so high for home owners and manufacturers. That is why I welcome the fact that the Government have said that they will start rolling them back. I would like to see them rolled back even further, to be honest, but that in no way undermines the enormous support I feel for the Government at the moment or the anger I feel towards those in the UK Independence party—although not those in this House at the moment—who put forward simplistic solutions to very complicated problems. That is why it is important that we have a moderate, centre-right party proposing sensible policies for the people of this country.

Interestingly, even though this debate is about the effect of Government policies in Wales, not once during his 40-minute speech did the hon. Member for Pontypridd mention the effect of Government health policies on Wales. They have had a pretty significant effect, because large numbers of patients in Wales are now trying to get out of the Labour-run Welsh NHS and get their treatment in England, where they will be looked after by the coalition-run NHS.

[Mark Tami]

The hon. Gentleman makes that statement as if there was just a Welsh health service and an English health service; it is a cross-border health service, and that is particularly true in constituencies such as mine. Indeed, the Countess of Chester hospital exists only on the basis that it covers Deeside and Chester, so the whole idea that people are somehow fleeing across the border is based on spurious figures and is totally wrong.

[David T. C. Davies]

I am not using figures that are totally wrong, because since 2012, in my own area, the Aneurin Bevan university health board has been doing everything possible to treat people in Wales and prevent people who were previously being treated in England from continuing to get treatment there. People are aware of moves such as the cancer drugs fund, which has allowed patients in England to enjoy the benefits of life-extending drugs such as Avastin. That is denied to patients in Wales by the Labour-run NHS. I met some of those patients outside No. 10 Downing street last week when they presented a petition to the Prime Minister about the problems being caused to them by the Labour-run Welsh NHS service. They have had to move—to sell up their houses or move into friends’ houses in England—to get access to the higher standards, lower waiting lists, fewer cuts and better ambulance service response times that are being delivered by this coalition Government.

[Mark Tami]

Does the hon. Gentleman accept that for a lot of us in north Wales our children’s hospital is on the English side of the border? [Interruption.] Our heart hospital.

[Chris Ruane]

And Gobowen.

[Mark Tami]

And Gobowen, as my hon. Friend says. Will the hon. Gentleman accept that these people are not flying across the border to get better health care—it is our health service, and that is why we should have the right to vote on it?

[David T. C. Davies]

It is actually not the hon. Gentleman’s health service. There is a health service in England and there is a separate health service in Scotland, in Wales and in Northern Ireland, as a result of devolution. He should be aware of that because his party destroyed the truly national UK health service and brought in regional health services. Of course there are hospitals that serve people in Wales on the English side and hospitals on the English side that serve people coming the other way, and that is a good thing. However, many people’s access is now being prevented, and they certainly do not have the automatic right of access that they would enjoy in England.

[Owen Smith]

Will the hon. Gentleman give way?

[David T. C. Davies]

Of course I give way to the shadow Secretary of State.

[Owen Smith]

I am grateful, because we have to correct these facts. He knows that the volume of people coming from England to Wales has increased over the past few years, whereas the volume of people going from Wales to England has decreased. He also knows that on cancer, for example, the health board he mentions, Aneurin Bevan, performs better than the one over the border, so quite why people would cross the border for worse care, I do not know.

[David T. C. Davies]

The hon. Gentleman will know that most people on the English side of the border who have been treated in Wales have no choice about that. They are registered with GPs connected with the Aneurin Bevan health board, so they have absolutely no choice in the matter. Many of them have formed action groups of English patients who are treated in Wales and do not want to be because they know they will get a better standard of health care in England. One of those is called Action For Our Health; if the hon. Gentleman has a smartphone, he can look it up. He ought to know about these facts. He talks about cancer. The figures for urgent cases are pretty similar, within a percentage point of each other, but he did not mention diagnostic times, which are significantly worse in Wales than in England, or the cancer drugs fund. It is a pity that he did not want to talk about the NHS in his 40-minute speech.

The hon. Gentleman did not want to talk about education, either. One of the few advantages of the Welsh Assembly is that it has allowed us to make simple comparisons. We can now see the difference between what a Conservative-led coalition Government can offer and what can be delivered by a Labour Government. We know that Wales now has the worst educational rankings in the whole of the United Kingdom after 16 years of Labour domination.

The Labour Government have a terrible record on the economy—that is pretty well known—but they also have a shameful record on public services. I am looking forward to the next general election, so that we can remind people that tax-and-spend Labour cannot be trusted with the economy and cannot be trusted with public services, either. As somebody who used to drive a van—I am glad to say that it was a blue one as well—we will never, ever sneer at hard-working people who want to go out and better themselves, work hard, and pay taxes. We are the true party of working people. At that election, I look forward to fighting alongside the Prime Minister and the Secretary of State for Wales to make sure that next time round we have a truly Conservative Government who can deliver even better policies for the people of Wales.

17:48

[Chris Ruane (Vale of Clwyd) (Lab)]

I wish to talk about the impact of £1.5 billion of cuts on my constituents. There are the social security cuts and the bedroom tax, but the national cuts by the UK Government to the police, the Department for Work and Pensions and taxation are also having a terrible impact on the communities that I represent. The way that that has been translated into local government cuts is now becoming properly known in Vale of Clwyd. The Welsh Government have tried to protect local authorities from the worst impacts of central Government cuts over the past two or three years, but the hatchet has now fallen. I want to give some graphic illustrations of how that is affecting my constituents.

The cuts that Denbighshire county council will discuss next week fall into two categories. The first cuts relate to the quality of life. The cuts include removing subsidies to the Prestatyn Scala cinema and arts centre, the Rhyl Pavilion theatre—a cut of £350,000—and the Ruthin Craft centre. The cuts involve library services, such as free access to books and audio tapes; bus routes that are being reduced or closed so people living in rural isolation cannot access the minimal local services on offer; and flower beds that will be grassed or concreted over. People may say that those are little frivolous things in life that we do not need, but for me life is about allowing such things to flourish, and the cuts to be implemented in Denbighshire will diminish them.

Let us come on to the really meaty cuts that are being discussed in Denbighshire, such as the reduction in street lighting and the stopping of CCTV. Proper lighting and CCTV are two of the most effective anti-crime measures, but they will be dramatically reduced or abolished. There will be a £200,000 cut to the welfare rights unit in Denbighshire county council, despite the fact that it brought £6 million in to the local authority last year and that £35 million has still not been claimed in Denbighshire. The cuts include reducing equipment for disabled children, and charging their parents for facilities and services. The pest control unit will be closed, so we will not be able to put down the rats, mice and vermin that often infest our poorer wards. Grants for school uniforms will be ended, and those for taking children on trips will be cut. There will be cuts to the young people’s counselling service—for children who are going through turmoil—although 32.3% of those aged 15 to 25 have one or more psychiatric condition, and services in schools to help to counter that will be diminished or curtailed. There are cutbacks to the educational psychology team and to music education; library services will be stopped; and 25% of public toilets will be closed or cut back.

Those are the results of the cuts coming from the Conservative party and their Liberal Democrat friends in the coalition. I do not blame the officers of Denbighshire county council. In fact, the chief executive officer, Mohammed Mehmet, is excellent and has helped to turn around Denbighshire. I do not blame the political leadership, because Hugh Evans OBE is a good political leader. The people I blame are now sitting on the Government Front Bench. They are not listening, just as Ministers are not listening at national level.

Those are the impacts on my community, and they affect the poorest. I want to turn to the benefit cuts in my constituency, and I pay tribute to Steve Fothergill and Christina Beatty from Sheffield Hallam university, who have given me bespoke statistics for my constituency. In Rhyl West, which until this morning was the poorest ward in Wales, the actual cuts for working-age people are £1,420 a year. The figure for the richest ward in Denbighshire, Llanfair Dyffryn Clwyd, is £270, so the cuts are almost five times higher in the poorest ward than in one of the richest. This is about values, which we talked about earlier, because it is about punishing and demonising the poor and the disabled. There are five hate crimes, but the one that has increased in recent years is hate crime towards the disabled, because of the way in which they have been portrayed by the Conservative party and its friends in the media. The cuts are absolutely terrible. In Rhyl South West, the council ward in which I was brought up, the cuts to people of working age amount to £860. How are families supposed to cope with that level of cuts? How? Would a Minister like to intervene on that? No—silence once again.

The bedroom tax was supposed to drive single people out of houses with two bedrooms and into smaller houses. In Denbighshire, 700 people qualified for the bedroom tax, but the number who have moved is minimal. People would prefer to take the hit of up to £25 a week than be shunted out of the community in which they have grown up. Relatives of mine who have lived on a council estate for 54 years and who are embedded in the community have been told to leave—to get out of the home that they were born in. I am proud that on day one of a Labour Government next May, the bedroom tax is one of the first things we will get rid of.

The Ministers on the Treasury Bench should take those messages back to the Cabinet and the Prime Minister. They should let them know that it is not just in the Vale of Clwyd that what I have described is happening, but across the country, and it is destroying our British way of life.

17:55

[Mr Mark Williams (Ceredigion) (LD)]

I am pleased to say a few words in this debate. Like the hon. Member for Vale of Clwyd (Chris Ruane), I will focus on my constituency. In particular, I will look at some of the challenges that face rural communities. My constituency has some of the most rural communities imaginable. I never lose sight of the fact that there are 600 family farms and 147 villages across the Ceredigion constituency. I will look at the three aspects of the motion: energy prices, jobs and growth in the economy, and, of course, the spare room subsidy or bedroom tax.

[Chris Ruane]

Which one?

[Mr Williams]

Those of us who have concerns describe it as the bedroom tax; others call it the spare room subsidy. I will stick to the bedroom tax, for reasons that will become apparent.

First, I want to talk about energy prices. There is no doubt that my constituents are feeling very short changed, quite literally, by the energy providers. They are aggrieved that there are few alternatives, if any, for people who live in communities that are off grid. They are then told remorselessly that it is simply a matter of switching providers. Most of my constituency is off grid, so most of my constituents remain subject to the monopolistic practices of energy companies. There is simply no option to shop around.

Off-grid customers are left out of many initiatives. Analysis undertaken by Calor Gas showed that most people are merrily—or less merrily—paying £40 a year for energy efficiency schemes, but that they get nothing back through reductions in their bills. Energy companies charge levies on household bills to fund insulation and new boilers in the homes of the vulnerable and those who live in low-income communities where buildings are hard to treat. We know about the history of the housing stock in Wales, and particularly in rural Wales, yet only 1,443 homes out of 1.5 million have benefited from price reductions. Off-grid gas customers are missing out on the promises of new efficient boilers for their homes. Although all customers are subjected to the same charges, the research suggests that the benefits are not reaching rural households. Not only are they not seeing the benefits, but the costs of energy have historically been much higher. I have been making this point for nearly 10 years, including under the last Government, but those of us in rural areas are still waiting and anticipating greater action.

We are told that the key is to boost the collective purchasing power of customers and that we should all join oil syndicates. Many of us have done that. Joining oil syndicates and trying to negotiate reductions in the cost of domestic heating oil is one of the few options available to my constituents in Ceredigion. I have lost count of the number of times constituents have come to my surgery to pose the problem, “How on earth can I afford the minimal amount of oil that I need to put in the tank to heat my home?” That is food for thought for all of us. I commend Ceredigion county council and Ymlaen Ceredigion, which is an excellent organisation, for working with the National Assembly on a project called Club Cosy to develop the system of oil syndicates across the county and for overseeing the 10 syndicates that already exist.

Of course, no one would be against the opportunity of a reduction in bills during the freeze period, but my concern about the Labour policy is that in the immediate period before and the immediate aftermath constituents would face—

[Albert Owen (Ynys Môn) (Lab)]

Will the hon. Gentleman give way?

[Mr Williams]

If the hon. Gentleman will forgive me, I will not give way because I want to crack on in the little time I have.

I want to talk about fuel duty as it affects drivers. My constituents have no choice about driving their cars. Some of them live in Lampeter and work in Aberystwyth —a 60-mile round journey every day. They do not have the luxury of public transport and taxis are unaffordable. I commend the Government’s actions on the fuel duty escalator, which have meant a 20p per litre reduction over the last five years. But in the very rural communities in Wales, we were hugely disappointed that the policy of derogation from Europe on fuel duty was not carried out across the whole of the country—in fact, no areas in Wales will benefit. The Government need to continue to work on that so that that policy is not isolated to various parts of the Scottish highlands.

As I have said, Ceredigion has 600 family farms, and the farmers are concerned about falls in commodity prices and about common agricultural policy reform, and many other businesses have other concerns. They are the backbone of our economy, and they have commended the Government on the reduction in corporation tax. Some 35,000 businesses across Wales will also benefit from the scheme that will allow employers to reduce national insurance contributions by £2,000. That is important to local businesses, as is the work that the Government are doing to build the infrastructure for broadband and mobile phone reception, which the Secretary of State mentioned. The Government could do more. For example, next week they could reduce VAT on tourism—

[Roger Williams (Brecon and Radnorshire) (LD)]

My hon. Friend is making a powerful speech about the issues in rural areas. Does he agree that the Welsh Assembly Government do not recognise the expense of delivering services in rural areas? Powys and Ceredigion had the lowest allocation of grant of any of the Welsh local authorities.

[Mr Williams]

My hon. Friend is right. Ceredigion county council has the worst settlement of anywhere in Wales with a reduction of 4.5%, and Powys is not far behind with 4.3%. There is a perception that those of us who work and live in mid-Wales have been penalised in favour of the beneficiaries in the north Wales corridor and the south Wales corridor, although my hon. Friend the Member for Arfon (Hywel Williams) may disagree.

A VAT reduction on tourism would be a huge benefit to many businesses across the UK. It would give a boost to an important sector of the economy in west Wales. I saw an excellent project in Cardigan castle in my constituency a couple of weeks ago. It involved apprenticeships from Cyfle, an organisation that covers Carmarthenshire, Ceredigion and Swansea. It has an innovative scheme in which apprentices are given experiences not just in one company, but in several, so that they can really build up their CVs.

I will not dwell on the issue of Europe, because the Secretary of State had a few exchanges on that subject, other than to say that although west Wales and the valleys are celebrating the fact that many of our communities will benefit from convergence funding, in some ways that is actually a sad indictment of the failure to build our economy.

I voted against the bedroom tax at the start and I am against it in principle now. I am against it because it will never work in rural areas where there is no housing for people to move to, even if it were the role of Government to encourage people to move. That was the wrong principle from which to start, and I agree with the many constituents of mine who have serious anxieties about the application of a policy that could never work. It will cost the country money and cause huge hardship for many of my constituents.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Can I just say that all Members will have six minutes?

18:04

[Dr Hywel Francis (Aberavon) (Lab)]

It is a pleasure to follow the hon. Member for Ceredigion (Mr Williams), who is a very valued member of the Welsh Affairs Committee. When I chaired the Committee, he always thanked me for the impartial way in which I did so. In contrast, I say to the hon. Member for Monmouth (David T. C. Davies) in a comradely way, although he may not understand the word, that I look forward to the time when he makes a statement in this House that is impartial and balanced and reflects the unique role of a Chair of a Select Committee.

[David T. C. Davies]

Will the hon. Gentleman give way?

[Dr Francis]

No, I will not.

I am not afraid to speak on devolved matters, because they are pertinent to issues we are discussing today. I wish to talk about higher education. In doing so, I declare an interest as honorary chair of the college of arts and humanities in Swansea university. I warmly commend my hon. Friend the Member for Pontypridd (Owen Smith) for the way in which he outlined the very difficult circumstances all the people of Wales are suffering as a consequence of the austerity programme. The excellent report by Sheffield Hallam university outlines the severe difficulties that many vulnerable, precarious communities such as Glyncorrwg, Cymmer and Gwynfi in my constituency are now facing, not only as a result of welfare cuts—something the report deals with—but local government cuts being brought forward as a result of UK Government policies.

Despite those difficulties, we have a surviving and prospering steel industry. I am sad that my right hon. Friend the Member for Torfaen (Paul Murphy) is not in his place, because I want to pay him a compliment. The steel industry is prospering in Wales because of the way in which we have developed a partnership. That partnership was pioneered in the immediate post-devolution period by my right hon. Friend when he was Secretary of State for Wales and I was privileged to be his special adviser. He devised a system of partnership between the UK Government and the Welsh Government. People worried about the time when there would be different political parties in power, but we believed genuinely that that partnership would survive different political parties being in power in Cardiff Bay and Westminster. We live in hope that the idea of partnership will be revived and developed.

I want to move on to the subject of higher education without losing the theme of partnership and the respect agenda. Higher education is of course a devolved matter, but decisions taken here in Westminster have a great bearing on macro-economic issues relating to visas, the need for synergy between England and Wales, and research funding. I am pleased to say that, come next September, my old university will be located in my constituency of Aberavon. Members may not know this, but a second Swansea university campus is being built in Aberavon. Perhaps Swansea university ought to be renamed Aberavon university. The major success of this development, which we should be trumpeting, is based on the partnership between the Welsh Government —I commend in particular the role of the First Minister, Carwyn Jones—and the university. I am not sure whether the Secretary of State has visited the campus—his predecessor did—but he should do so in order to see the role of the UK Government and Europe. The European Investment Bank said that this was the best project of its kind it has ever funded in terms of the interface between business and higher education. That is a remarkable compliment to the interface between my local authority—Neath Port Talbot county borough council, led by my friend Councillor Alun Thomas—and the university.

Perhaps most importantly, despite all the difficulties, that development is a Welsh Government achievement. Sir Terry Matthews, a Welsh businessman on the world stage, is now the chair of the Swansea-based city region. He is a Swansea university graduate, a man of considerable experience—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Unfortunately, the hon. Gentleman has run out of time, but not to worry.

18:10

[Glyn Davies (Montgomeryshire) (Con)]

It is a pleasure to follow the measured tones of the hon. Member for Aberavon (Dr Francis). It influences the tone I want to adopt in my contribution. I am not sure that my hon. Friends the Members for Aberconwy (Guto Bebb) and for Monmouth (David T. C. Davies) could have done the same, however, because they both made thunderously good speeches that I think we all enjoyed. I want to make special mention of the Secretary of State’s incredibly positive speech about the future of Wales. It typified what he brings to the role: a willingness to work with the Opposition in Wales, always putting the interests of the people of Wales to the fore. I commend him not just for his speech, but for all the work he does on that front.

Much of the debate has been about the economy, so it is worth pointing out what has happened to the economy in my constituency. I have spent much time working with the hon. Member for Brecon and Radnorshire (Roger Williams) on the mid-Wales economy. We remember it being really depressed. We remember the work we put in. We remember how 20 or 30 years ago, it had to be dragged from the bottom up. The Severn valley is now full of brilliant, buzzing industries, and unemployment has collapsed—I have never seen employment higher. It is a complete transformation, and we have to give credit to the coalition Government over the last four years for transforming the economy of my constituency.

This debate is about the influence of coalition Government policies on Wales. Inevitably, there will be an influence. First, the Welsh Government have no tax-raising powers, so the level of public spending in Wales is influenced by the decisions we take in Westminster. Secondly, because a large percentage of the population lives close to the border, what happens in England has a strong influence in Wales. That is the point I want to make today.

The education system in England is different—it has choice and competition—from that in Wales, and it is attracting sixth-formers to the colleges in Bishop’s Castle and Shrewsbury, which is having a huge impact on sixth forms in Welshpool and Newtown. It might be more obvious in my constituency than elsewhere that English policies are having a significant impact in Wales, and we have to be aware of these policies so that we can deal with them.

The most important issue for my constituents is probably the future of the health service. Most of our services are provided over the border in Shropshire. All Welsh constituencies have specialist services provided in England, which is exactly as it should be, but all our secondary health care services are also provided there. The Shrewsbury and Telford NHS foundation trust serves Shropshire and mid-Wales, so what happens in Shropshire is crucial.

At present—this is incredibly important, but hidden —the Shropshire NHS cannot carry on; it is becoming unsustainable. We are going to see a big change, because there is likely to be an emergency centre surrounded by several urgent care centres—a pattern we might see repeated across much of England. However, any urgent care centre in my constituency would have to be provided by the Welsh Government. Whatever structure is put in place in Shropshire, it will have to be done fairly quickly, because services are already being lost even further away to Wolverhampton, Stoke and Hereford. That is the reality of where we are. It is increasingly difficult to attract consultants to Shropshire, so something has to happen very soon.

There will be a group of urgent care centres, but there is not going to be one in Powys—certainly not at the moment. We must have an urgent care centre in Powys. That is the real message I want to send out today. If we stayed strictly within the structure of the NHS in Wales, as is preferred, that would not happen. My constituents would suffer hugely because of a modern and more responsive service over the border in Shropshire.

There is a small hospital in Bishop’s Castle, a small town right on the border. It would not normally anticipate being given an urgent care centre, but because it seems likely that there will be no such centre in Powys, consideration is being given to putting such a centre in Bishop’s Castle to serve the people of Powys. England will put that centre in place in order to serve us.

My point is that the policies that operate here in England have a big influence and impact on Wales. That may not be the intention but it is often the case, so it is our role and duty as representatives of the affected areas to bring that fact to the attention of this House, so that we always consider how such policies will impact on Wales. That is why I so appreciate and applaud the work of our Secretary of State in developing a close relationship with the Welsh Government, so that these issues can be brought to the attention of both Governments working together for the benefit of Welsh people.

18:16

[Chris Evans (Islwyn) (Lab/Co-op)]

After the earlier fireworks from Government Members, I welcome the measured tone adopted by the hon. Member for Montgomeryshire (Glyn Davies)—one I hope to continue in my contribution.

I welcome this debate because anyone who tuned in to previous Welsh debates might think we were obsessed by constitutional affairs. There seems to be a belief on both sides of the House that constitutional commissions are on the lips of every voter in our country, but that could not be further from the truth. When we talk about Government policy towards Wales, we must look to the future rather than look back.

The world is smaller than it has ever been, and globalisation has brought challenges that would never have been comprehended or conceived of a generation ago. When the children in Islwyn leave school, they will no longer compete only with their contemporaries from Cardiff, London or Manchester, but with those living in Puni, Bangalore and Peking. Equally, the emerging green technologies will lead to those children going into jobs that we cannot currently conceive of. For Government, this presents a challenge: either we embrace globalisation or we turn our backs and hold back the tide. In real terms, it means that we either continue to waste our time tying ourselves up in constitutional knots, which unfortunately we have done for the last 15 years, or we train our people and equip them with the skills to compete in the global economy.

Let us be straight: despite what many people would have us believe, Wales is not some backwater in which people are on the breadline, queuing up in soup kitchens. This view of Wales, and particularly of the valleys I represent, is a distorted picture that is no way helpful to our self-image or self-confidence.

On the site of the last mine to close in Islwyn—Oakdale—stands General Dynamics, a top 100 contractor company, with nearly £20 billion in sales annually. To those who want to paint the Labour party as anti-business, let me point out that it was the last Labour Government and the stable economic conditions that led General Dynamics to choose Wales as its base. It has recently been awarded the contract for the Scout SV vehicle, securing a further 500 jobs. In July this year, I was pleased to open the new Edge centre, which allows it to share its expertise with small and medium-sized businesses—not just in Wales but across the country. It also has partnerships with universities, which means it can access the unique skills and expertise to be found in those universities.

Just down the road, in Newbridge, is Axiom, a large manufacturer whose profits have grown, and which is opening new markets across the world. In an economy still reliant on the public sector, Just Love Food, a nut-free, allergy-free cake manufacturer also based in Oakfield, has contracts with supermarket chains such as Tesco and Sainsbury. Of course, Islwyn is home, too, to the Crumlin Pot Noodle mine and to Brace’s Bakery, known throughout the country not only for its bread, but for its Welsh cakes. I would make a shameless plug to anybody: if they want to relocate or start a business, Islywn is an excellent place to do it. That should be the message from Wales.

[David T. C. Davies]

I am very grateful to the hon. Gentleman for outlining this wonderful economic news. Did he consult his boss, the shadow Secretary of State for Wales, before he began, as his colleague seems to be earning the epithet of the Eeyore of Welsh politics for the doom and gloom he expounds all the time?

[Chris Evans]

I must commend the hon. Gentleman for his command of English. That was one of the best insults I have heard in the Chamber. I always liked Eeyore; he was my favourite character in the Winnie the Pooh stories.

Success can only pay dividends for so long. In the past four years, unfortunately, we have heard Ministers consistently talk down the Welsh economy—[Interruption.] The hon. Member for St Albans (Mrs Main) laughs, but when the NHS is talked down, what is being talked down is not what Members perceive. They are not talking down the Welsh Government, but the consultants, the doctors, the cleaners, the nurses and the other people who work in the NHS. Every one of those is seen as the NHS, so what message does it send out when those people are being talked down?

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

Does the hon. Gentleman agree that every week in Prime Minister’s questions the leader of his own party talks down the NHS in Wales? Is it not right that we should be able to challenge policy matters within the NHS without it always being interpreted as an attack on front-line staff? The hon. Gentleman’s party does it, my party does it, and it is legitimate in highlighting failures.

[Chris Evans]

I did not want to get into this argument because I did not want to be negative, but we must be very clear that when we try to use the NHS as a stick with which to beat people, we must think about those on the front line.

[Mrs Main]

I urge a note of caution. As someone whose mother has just died under the NHS, with an inquiry going on into her treatment, I know there are legitimate concerns and the hon. Gentleman ought to face up to them. That is not to denigrate the nurses; but there are some serious concerns about the health service.

[Chris Evans]

I have full sympathy for the hon. Lady. I lost two people this week who were close to me and I know they were served very well by the NHS.

The challenges we face are greater than they have been for decades. Rising economies in China, Brazil and India and on the African continent are changing the global economy in ways we could not have predicted just 10 years ago. This is a challenge for which we must be prepared. It is vital that businesses are supported and encouraged to grow and that we train our young people for the jobs of the future. Years ago, when my grandfather began working down the mines, it was the muscles in his arms that he had to use. Now, when children leave school and start work they have to use their brains. It is no good standing here and harking back to the past. No politician can reopen a factory or rebuild an industry that has gone. To put it simply, this country has to go back to school.

No one has a job for life any more. In fact, people will change their job seven or eight times throughout their working life. We therefore need a partnership between education and business. Our universities should work with industry to formulate portable skills that can be taken from job to job. Equally, we have to realise that education ultimately produces future employees and employers, yet businesses tell me they have young people who are not equipped for the world of work. For me, business needs to be involved in the educational process from day one, introducing children to the world of work.

I am afraid that the Government are failing Wales. Their policies are sending our communities backwards, not forwards. Where is the business strategy from the UK Government, like that from the previous Labour Government, to encourage more companies such as General Dynamics to locate in Wales? Where is the national infrastructure to ensure that Wales is connected not just to the UK but to the world? We should remember when we talk about electrification of the railways that it was the Ebbw Vale and Maesteg lines that were left out, which are essential transport links to the valleys.

Where is the support and encouragement for entrepreneurs to create new enterprises? Ministers often talk about a long-term economic plan, but I am still not clear what it is. Is it blaming everybody else, talking down the economy and our communities, making people believe that we are all on welfare and failing time and again to work constructively with the Welsh Government to deliver policies that help Wales face new global challenges?

Mr Speaker—I am sorry, I mean Mr Deputy Speaker, but I hope that one day we will refer to you as Mr Speaker. The facts speak for themselves. Youth employment in Wales is down from last year and is 4% lower than in the rest of the UK. The production index has risen by 1.4% less than the rest of the UK, up to the second quarter of 2014. Worst of all, one in three children live in poverty.

The biggest poverty in the Welsh valleys is not a poverty we can measure but a poverty of ambition. It is the belief that university or starting a business is not for us. It permeates generation after generation, and no Government of any colour can change that with one policy. That is why, as I said before, we need to go back to school. We need to introduce children to the types of careers they can enjoy and say to them, to borrow a phrase from across the Atlantic that has fallen into disregard, “Yes we can.” The tragedy is that we know how to solve the problem. According to the Joseph Rowntree Foundation,

“Wales needs job creation to defeat poverty.”

The Labour Administration in Cardiff are pursuing active labour policies, and we need to follow them.

There is no future in a low-skill, low-pay economy. We know that. What we need is a forward-thinking, specialised, high-skilled, connected economy, and, with the political will, we can achieve it.

18:24

[Albert Owen (Ynys Môn) (Lab)]

It is a pleasure to follow the hon. Member for Islwyn (Chris Evans). He was right to defend the NHS in Wales, and he was right to mention a sad loss that was close to him. The wife of his predecessor, Lord Touhig, sadly lost her battle for life a couple of days ago. I am sure that the whole House will join me in sending our condolences to Lord Touhig and his family.

I agree with the Secretary of State about the need for the Government in Cardiff Bay and the Government here at Westminster to work together. It benefits our constituents when we do so. I have worked with this Government, with previous Labour Governments, and with coalition Governments in Cardiff Bay. I have seen marked improvements in my constituency since becoming a Member of Parliament. We have more connectivity—faster, more frequent trains—than we had when I was elected. That is due to investment in the whole railway network. The £9 billion west coast upgrade has benefited my constituents, because when capacity is increased on one side of Offa’s Dyke, the whole of Wales benefits. That is an economic fact in terms of transport.

As the Secretary of State knows, I have been lobbying for more mobile phone coverage in Wales, and I met representatives of the 3 network today. There are too many not spots. There will be improvements, but we must make it clear that the peripheral areas of the United Kingdom, and of Wales, should be treated on the same basis as other parts of Wales. However, there are good projects on the horizon. The Wylfa Newydd development and the new eco park and biomass plant will bring quality jobs to my area.

I welcome the drop in unemployment in my constituency. Before I became a Member of Parliament, I ran a centre for the unemployed. In the 1980s and 1990s, my constituency had the highest level of unemployment in Wales. It was twice the national average in Wales, and much higher than the average in the United Kingdom. I saw a great transformation between 1997 and 2007, but that was followed by the global financial crash, and the recovery has been shaky. Many of the jobs that have been created have been mini-jobs. Many countries, such as Germany, operate a policy of mini-job creation following recessions, but these jobs have involved relatively low pay, and a great many zero-hours contracts that pay below what we now class as the living wage. Many people are finding jobs, but they are under-employed. The economy needs a real stimulus.

The three words that the Prime Minister is frightened to utter in any economic debate are “value added tax”, because VAT is a regressive tax which he promised not to increase but increased at the first opportunity. It is having a huge impact on businesses in my constituency. It is having an impact on consumer spending, which is up by just 2% in my constituency, compared with an average of some 5% in Wales as a whole. Small businesses, whose representatives I meet regularly, have experienced a fall in turnover of some 6%, compared with an increase of 7% in the United Kingdom. Those issues are concerning businesses. According to anecdotal evidence, less secure part-time work and zero-hours contracts are replacing more secure full-time work.

[Roger Williams]

Will the hon. Gentleman give way?

[Albert Owen]

I will give way briefly, although the hon. Gentleman’s colleague the hon. Member for Ceredigion (Mr Williams) was not so gracious to me.

[Roger Williams]

The hon. Gentleman hosted a wonderful Anglesey day when he was able to demonstrate the virtues of his constituency and the pleasures that could be gained from visiting it. Does he agree with my hon. Friend the Member for Ceredigion that a reduction in VAT on tourist attractions and accommodation would be a wonderful thing for rural Wales as a whole?

[Albert Owen]

I do. When the last Government cut VAT temporarily, that boosted the economy, and it could do so again in sectors such as construction and tourism.

I want to talk about a section of society that is very important to us all: younger people. Younger people in Wales and my constituency are finding things extremely difficult because of the zero-hours contracts and because many of them who are self-employed, including members of my family and their friends, are becoming so not out of choice but because their main full-time job has gone. They are taking this step into self-employment, and they are finding it very difficult to get mortgages and to get credit. They are finding it really tough out there.

The Joseph Rowntree Foundation has produced a report on the increase in the young poor in our country. That is a serious issue that we need to tackle. I welcome the growth fund for young people in Wales, getting people into employment, but I want them to go into employment that pays a reasonable living wage so they can spend and contribute to our society in the way we all want.

The hon. Member for Arfon (Hywel Williams) is not here, but he will know that a lot of my constituents work in Gwynedd, and Gwynedd has one of the highest rates of zero-hours contracts in Wales. The number is staggering: some 477 people are on zero-hours contracts. That is the figure for the neighbouring authority. I do not have the figures for my local authority, but some pay on Anglesey is below the living wage. Some adverts in Gwynedd are for pay of £5.87. There is a Plaid Cymru Member present. We hear that party attacking the Labour party and everybody else about the living wage and zero-hours contracts, yet although it only controls two councils in Wales, it has one of the worst records in that regard. These are my near neighbours—in fine fettle.

We want to stimulate the economy, and we can do it through a house building programme that boosts construction by giving companies relief on VAT, so they can build more houses and get more people into the workplace. That is one way forward.

We need greater investment in improved connectivity as well. We can do that by working together, as the Secretary of State said—but working together not just between Wales and the rest of the UK, but between Wales, the UK and Europe. The banging on about Europe that the Prime Minister talked about is having an effect. I know that the Secretary of State is going to my constituency, although I have not been told so officially by his office—the grapevine of Anglesey works much quicker. When he goes there, he will hear from business leaders that the threat of moving towards the exit is having an impact on future investment plans by large companies. I want to see an Anglesey—an Ynys Môn—that is at the heart of the British Isles, and that is a major player in Wales, in the UK and in Europe; the only way we will do that is by being far more positive, and helping our young people in a more positive way than now. I do not want to see the young poor carrying on as they are; I want to see young people with great opportunities for the future.

18:32

[Huw Irranca-Davies (Ogmore) (Lab)]

I am delighted to follow that excellent contribution by my good friend the Member for Ynys Môn (Albert Owen), which struck the right balance between the necessary optimism and the vision we have for a better future and the real challenges.

It has been a passionate debate and I have been as passionate as many with my interventions, but I want to say first that when I speak for my constituents, I speak for all of them. Many of them are in small businesses and micro-businesses—one man or one woman operations that they intend to build up slowly. They drive the economy locally. I also speak, however, for people who work within the set-up of Raspberry Pi down at the old Sony site at Pencoed in my constituency, and who have reinvented a way to take computers forward, so that everybody can pull them apart and put them back together, and use them in schools and for developing nations, and have different applications for them. They are helping our trade balance, and that is a fantastic story, as is the story of Ford Bridgend in the neighbouring constituency represented by my hon. Friend the Member for Bridgend (Mrs Moon). Ford consistently employs and invests in that plant, and takes on many apprentices.

[Stephen Crabb]

I am pleased that the hon. Gentleman has mentioned the case study of Raspberry Pi. Does he agree that this is a great example of what we now call reshoring? It has brought back the manufacturing of this product from China to the UK, helping the trade balance. It is a great example of what we mean by rebalancing the economy.

[Huw Irranca-Davies]

I agree. It is an astonishing story, showing how sometimes the coincidence of business and political networks meeting happens, so that an offhand conversation can lead to a company thinking, “Well, why do we have to be out in the far corners of the world? Why don’t we come back here? We have a skilled work force.” Sony Bridgend, which has had difficult times over the past couple of decades, has re-engineered itself as a national award-winning centre of design in manufacturing and production, and that is what attracted the company back. It has been a huge, rip-roaring success, and there are another 20-odd companies on that site that we hope will build up as well.

That is all good, and I welcome every instance of the claimant count dropping, but we also have to look at the other side of the story. As parliamentarians, no matter what seat we represent, we have to look at the kind of jobs that those individuals are going into. As my hon. Friend the Member for Ynys Môn said, we need to ask whether they can get credit or a mortgage. Can they think seriously about setting up a home for a family and a future? Can they rent somewhere?

I am sure that Members on the Government Benches know in their heart of hearts that behind the claimant count drop there are a lot of people who want to be paid a bit more, who want to work a few more hours and who want the certainty of a permanent contract with the protection that any decent employer would surely want to give to a decent worker. That does not involve loading burdens on an employer. Government Members often tell us that we know nothing about this, but I can tell them that I have managed businesses in the public and private sectors. I understand the challenges of balancing a business plan and bringing in the bottom line, but that has to involve treating the workers decently as well.

We cannot achieve this overnight. This is not just a case of extolling the virtues of business and job creation; let us also talk about the quality of those jobs. Let us take businesses, large and small, by the hand and ask what more we can do to lift people up by giving them skills, education and training, a decent wage and decent terms and conditions. That involves making an investment in the worker as well as in the plant. There are many good companies out there. I am trying to avoid using a soundbite, but this is a reflection of the reality in my constituency: it has an M4 catchment. We can travel down into what is still a very good manufacturing centre along the M4. Thanks to Labour’s investment over the years, people can also get on a train in Maesteg—now at a lower price than a couple of years ago, thank goodness—and travel to work in Cardiff or Newport.

Let us take as an example a youngster who has to get a minimum wage job. Getting to work could mean spending £5 a day on a ticket or driving in a clapped-out car that will cost them 50 or 60 quid a week. When they ask me whether it is worth going out to work, I will say, “Of course it’s worth it. It is always worth going out to work, because of all the good things that come from being a valued member of a work force.” I want those people to be valued. I want them to be paid decently. This debate has sometimes seemed polarised, but this is not a question of me, as the MP for Ogmore, standing here and saying that all businesses are horrible. They are not; they create the jobs. We can put some of the framework in place and make it easier for them to create the jobs, but it is the businesses themselves that create and drive those jobs, and the people in those jobs need to be treated decently.

It is not all doom and gloom in my constituency, but when I first became an MP, there was one food bank there. Now, there is not a single village without a food bank. Last week, I went to the setting up of a Christians Against Poverty debt advice centre. We already have a citizens advice bureau, as well as debt advice being given by Valleys to Coast. We have had a tenfold increase in the number of people in work who are taking out payday loans.

Yes, let us welcome job creation, but let us also be honest about what we want out of those jobs. I do not want anyone to be forced into taking two or even three low-paid jobs. They should be able to find an employer who will pay them decently to do a job with good terms and conditions and who will value their contribution. I do not want youngsters or people close to retirement to be told that their only option is a job in retail with no guaranteed hours. I do not want them to be told, “We may or may not call you but, my God, if we do, you’d better come in because if you don’t, there are half a dozen other people who will do the job instead.” I do not want that. It is not a good way to drive an economy.

Let us have some frankness in the debate. If we can say that we want job creation but we also want them to be good jobs, we will have done a good job for our constituents. That, by the way, means tackling one of the biggest scandals that I have come across recently. There has been a massive change since March or April this year, with HMRC’s new rules and its approach to umbrella companies in construction. Constituents are coming into my office, skilled, long experienced construction workers, who are £100 a week worse off. It is there in their pay slips and it is legal. It is due to subcontracting out beyond the original contractor to umbrella companies, which deduct payments from those workers. If one thing comes out of today’s debate, I hope it is that the Minister will condemn that practice and undertake to destroy it.

18:40

[Nia Griffith (Llanelli) (Lab)]

We have had a wide-ranging debate. I will try to focus my comments on the motion, which is about the UK Government policy and its effect on Wales, but of course I will refer to what many hon. Members have said today.

We are talking about the choice that this Government have made about their tax and welfare policies. That choice means that Ministers have deliberately chosen to place a disproportionate burden on those with the lowest incomes in Wales. As we predicted back in 2011, and as has been shown in a recent study from Sheffield Hallam university, in Wales the Tory-Lib Dem Government’s policies on tax credits and welfare have resulted in £1 billion each year being taken out of the Welsh economy, with the losses falling disproportionately on the poorer areas of our communities.

This Government’s changes to tax credits alone have taken £200 million a year out of the Welsh economy. These cuts have meant a loss of income to some 250,000 households across Wales. These are homes where people are in work, often in thankless tasks, often patching together several jobs to try to make ends meet, and working unsocial hours, yet it is Welsh families like these, the very people least able to afford a drop in income, who are losing income. The average loss of income as a result of the Government’s tax credit and welfare policies amounts to some £550 per working age adult in Wales per year, a greater loss than the average for Britain as a whole, which is £470 per annum.

However, in many of our poorest areas, as we heard from my hon. Friend the Member for Vale of Clwyd (Chris Ruane), the average loss is over £1,000 per working age adult, amounting to some £2,000 for a two-adult family or some £40 a week, which is a huge loss when we consider that these people already have some of the lowest incomes in Wales. That takes into consideration only changes to tax credits and welfare; it does not take into account the effects of, for example, the VAT hike, which further curtails spending power.

Not only is it very unfair to take such a disproportionate amount of money from those with the lowest incomes while at the same time handing tax cuts to millionaires, but it is economic madness. It is not rocket science to perceive that those who earn least spend it most quickly in their local communities. They do this out of sheer necessity, spending the money on everyday essentials, so when they suffer cuts in their household incomes, there is an immediate knock-on effect in the local community. Those with the lowest incomes are the least likely to have the financial means to travel far to spend their money, so it is our very poorest communities that suffer the greatest loss. No prizes for guessing that that means the tops of the valleys, the areas furthest from the wealth-generating opportunities of our cities and our major transport infrastructure.

This loss to the Welsh economy has been quantified by the researchers from Sheffield Hallam university as equivalent to the loss of 7,000 full-time equivalent jobs across Wales, but with the highest concentration of such job losses in the areas of greatest deprivation. In reality, that loss of 7,000 full-time equivalent jobs manifests itself in people having their hours cut and not being able to get as many hours work as they would like, and fewer openings for our young people. There are now 71,000 part-time workers in Wales who would like full-time work, up from 54,000 in 2010, so this Government’s taxation and welfare reform is resulting in the poorer areas of Wales getting poorer. By sucking money out of these areas, the Government are making it ever more difficult for these areas to recover economically, and the gap between these areas and the wealthier parts of the UK is growing.

The hon. Member for Aberconwy (Guto Bebb) rightly pointed out that those with entrepreneurial spirit should be praised and he cited some successful businesses. The problem is that the impact of UK Government policies on the poorest areas makes it doubly hard for small businesses in those areas to succeed. My hon. Friend the Member for Vale of Clwyd explained clearly the impact in real terms of the reduction of the Welsh budget by £1.5 billion and the cuts to services. He also graphically pointed out that his area has one of the highest per working age adult losses—it is some £1,400.

My hon. Friend the Member for Ogmore (Huw Irranca-Davies) gave a good example of the reshoring of jobs, which is much to be welcomed. However, he also pointed out the many problems of insecurity, low pay, unfavourable terms and conditions for workers, and the scandal of umbrella companies where workers are actually paying employer contributions as well as their own contributions, leaving some people as much as £100 a week worse off. He welcomed investment in his local area, but pointed out that it is no good if we are not also looking at what type of jobs are being created.

The hon. Member for Ceredigion (Mr Williams) spoke clearly about off-grid issues, the cost of vehicle fuel and the need for a continued roll-out of broadband. He praised Cyfle, an organisation giving young people apprenticeship opportunities through placements in several different companies, because companies cannot always offer a full-time apprenticeship. That is particularly useful in a rural economy. He also mentioned a VAT reduction for tourism businesses, a campaign which he has pursued vigorously.

My hon. Friend the Member for Ynys Môn (Albert Owen) talked about the success of the economy from 1997 to 2007, mentioning that since the downturn things have become more difficult in terms of the types of jobs being created. He mentioned the many mini jobs, the fact that young people are facing a lot of problems when trying to find work, and self-employment not really being what people want—it is sometimes imposed on them because no other option is available. The hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards) focused on the issue of funding for Wales and possible consequentials on funding for Wales from HS2. He also mentioned that the £1 billion being taken out of the Welsh economy is more than four times the benefit that Wales gets from EU funding.

The hon. Member for Monmouth (David T. C. Davies) gave us a history lesson and his own inimitable view of climate change and green taxes. He also spoke about the dangers of the UK Independence party and about health in Wales.

[Albert Owen]

The hon. Member for Monmouth (David T. C. Davies) would not take an intervention from me at the time, but I wish to correct him on something. He said that the Labour party introduced all these carbon taxes, but I wish to remind the House that this Chancellor introduced carbon floor pricing, the level of which the Government have now had to reduce, and which has had such an impact on manufacturing in Wales.

[Nia Griffith]

My hon. Friend rightly says that it was this Chancellor who set that carbon floor price, causing considerable difficulties for our industries. We are still having to go through hoops with those industries to get the relief they need.

My right hon. Friend the Member for Torfaen (Paul Murphy) stressed the importance to our manufacturers of remaining in the EU and the very real fear that the Conservatives’ shilly-shallying over Europe is driving companies to question whether to make new investment here. Let us make no mistake: if the Government are seen to be rushing for the exit from Europe, we will lose those companies, with the loss of thousands of jobs across Wales.

My hon. Friend the Member for Aberavon (Dr Francis) talked about the second campus of the university of Swansea and the importance of partnership working between the university and the steel industry. My hon. Friend the Member for Islwyn (Chris Evans) praised small businesses in his area, said that we should not be obsessed with constitutional issues and talked about the importance of infrastructure linking Wales to the world.

The question is: what is the Minister going to do to tackle the cost of living crisis? Wages in Wales are simply not keeping up with inflation, with wages up by only 0.6% but prices up by more than 2% this year. People in both north and south Wales pay some of the highest prices for our energy and we have some of the hardest-to-heat homes. In addition, many people live off grid and so have more limited options for heating their homes. So what is he going to do to tackle high energy bills? The market is just not working for consumers in Wales.

Labour Members have made it clear that an incoming Labour Government would freeze energy prices for 17 months for both domestic consumers and businesses, during which time we would reform the energy market so that it works for consumers in Wales. We have also taken on board the policy of paying the winter fuel allowance earlier in the year to those who rely on buying in heating oil or liquefied petroleum gas, so that they can buy their supplies more cheaply. That is a simple move, but Ministers have not even agreed to do that. So when are we going to see some action from this Government to address the concerns of the people of Wales by tackling the high energy prices, job insecurity and the low-wage economy?

Will the Minister tell us now that he will match Labour’s energy price freeze? What will he do about low wages? Will he match our pledge to raise the minimum wage to 58% of median earnings? What will he do to tackle insecurity at work in Wales? Will he sign up to Labour’s pledge to tackle the abusive use of zero-hours contracts? I do not mean just banning exclusivity clauses that force workers to work exclusively for one major employer, important though that is. Will he go further than that, as we will? Will he show some humanity and abolish the bedroom tax in Wales? I guess not. He would rather see the people across Wales working longer for less, the poorest areas in Wales getting poorer, and the people struggling with fuel bills. He is happy to give out tax cuts to millionaires and see a recovery for the few, whereas Labour wants to see a recovery for the many.

18:50

[The Parliamentary Under-Secretary of State for Wales (Alun Cairns)]

I thank all Members for their valuable contributions. It is fair to say that the tone of the debate changed somewhat from the negative one that prevailed at the outset to the more measured contributions by the hon. Members for Islwyn (Chris Evans), for Aberavon (Dr Francis) and for Ogmore (Huw Irranca-Davies).

This coalition Government inherited an economy that was on its knees. Throughout the past decade, we have had an unstable model for the economy. There was an over-reliance on the public sector, the financial services sector and economic growth from London and the south-east. In spite of the crocodile tears and the synthetic anger that we saw from the shadow Secretary of State, the situation was even more perilous in Wales. One of the saddest legacies that we inherited from the previous Administration was that Wales was the poorest part of the United Kingdom, and that was after 13 years of control from Labour Members. Ultimately, their economic model came crashing down.

We have a long-term economic plan that is working and delivering the recovery for Wales. It is based on investment in infrastructure—both digital and traditional —the development of skills, welfare reform, and making Wales and the rest of the UK a more competitive environment for business, which is something that some Labour Members have recognised today. I pay tribute to my hon. Friend the Member for Aberconwy (Guto Bebb) for being a strong and doughty champion for small businesses and the self-employed in his constituency.

[Geraint Davies]

Does the hon. Gentleman not accept that the British economy grew by 40% in the 10 years to 2008, before the banking crisis? Since then it has virtually flatlined, which is why his party has borrowed more in four years than the Labour party did in 13. It is a disaster.

[Alun Cairns]

I will happily repeat that, in 1997, Wales was not the poorest part of the United Kingdom. But between 1997 and 2010, Wales sadly and tragically became so. That was when the hon. Gentleman was a Member for Croydon Central, before he decided to come back home to Wales, so he will have played a part in the policies that led to such a devastating consequence for Wales and the Welsh people, and that is something for which he should apologise. Investing in infrastructure is key to our economic plan, and Wales has rightly received significant sums for some major projects.

I cannot mention railways without paying tribute to my right hon. Friend the Secretary of State for Wales for his hard work and persistence in seeking a solution to secure the electrification of the line all the way to Swansea and of the valley lines as well. That is the largest investment in railways in Wales since Victorian times. Wales was sadly left in the slow lane when it came to railways. After 13 years of a Labour Administration, Wales, Moldova and Albania were the only three countries in Europe that did not have any electrified railways. Wales is now set to benefit from rail investment worth £2 billion. Our north Wales link to Liverpool is being renewed through the Halton Curve, which is welcomed by all businesses in north-east Wales and north-west England. Crewe is becoming a hub station for HS2, which offers new opportunities to the whole of north Wales, ensuring that we all benefit from this major UK strategic investment.

It was 12 months ago that my right hon. Friend the Chancellor announced a funding package to enable the upgrade of the M4 around Newport, which was something for which businesses had been calling across the whole of the south Wales corridor. That project was cancelled by the previous Administration in 1997 after my right hon. Friend, the current Leader of the House, committed to it when he was the Secretary of State for Wales. The project was cancelled by Labour but reinstated by the Conservatives.

I was sorry that the hon. Member for Wrexham (Ian Lucas) did not welcome the £212 million investment for a new prison in Wrexham. Even after it is up and running, its operational activity will involve £23 million being pumped into the economy each year.

Wales is playing its part in our energy infrastructure upgrade after years of neglect that led to the risk of the lights going out throughout the United Kingdom.

[Albert Owen]

The Minister is aware that Wales pays among the highest distribution costs in the whole of the United Kingdom, as is reflected in our bills, so would he support flattening those costs throughout the United Kingdom? Some areas might have to pay a little more, but north-west Wales actually produces energy and we pay too much for it through our bills.

[Alun Cairns]

Of course, that is a matter for Ofgem, as an independent organisation. I know that it has made changes and I look forward to its further deliberations. I am sure that the hon. Gentleman recognises the major investment of £20 billion for Wylfa nuclear power station on Anglesey, which will create 6,000 construction jobs alone.

Of course, such activity does not stop at hard infrastructure, and upgrading our digital networks is central to our plans. Wales is benefiting from £69 million of Government investment for superfast broadband to provide access to more than 275,000 homes and businesses, although I did not hear any welcome for that from Labour Members. By spring 2016, 96% of Wales will have access to superfast broadband connectivity. Further digital projects include Cardiff and Newport being part of the Government’s super-connected cities programme. A pilot programme in Monmouthshire to tackle hard-to-reach areas offers exciting prospects, while the mobile infrastructure project to which the hon. Member for Ynys Môn (Albert Owen) referred is a clear plan to start filling the not spots.

As well as dealing with infrastructure, there was a need to reform the benefits system. The historical problems of worklessness in some communities in Wales were another legacy of the previous Labour Administration, but the Work programme is offering new prospects. It has already supported back into work more than 15,000 of those who were furthest away from employment. Universal credit is simplifying the tax and benefit system and increasing the incentive to work. Some 200,000 households in Wales will have higher entitlements under universal credit—on average, £163 more a month—and the poorest claimants will benefit the most. Shotton in Flintshire is already live and the rest of Wales will be online by April 2016. This is a once-in-a-lifetime opportunity to change the benefits system for the better. The changes offer the opportunity of transforming the fortunes and prospects of families and communities. Alongside the benefits cap and other measures, they will make work pay for everyone.

Supporting business is a key part of the long-term economic plan. More than £100 million has been provided to businesses in Wales through the business bank. More than 600 start-up loans have been awarded to businesses in Wales to release the entrepreneurial spirit mentioned by my hon. Friend the Member for Aberconwy. Some 35,000 businesses in Wales have benefited from the employment allowance to help them to grow and take on new workers. We have a disproportionate dependence on energy-intensive industries, and they will benefit from our energy package of £240 million, which I am sure that the hon. Member for Cardiff South and Penarth (Stephen Doughty) will welcome in the light of his interest in the industry in his constituency. Our enterprise zones on Deeside, and at Ebbw Vale and Haven Waterway, will benefit from enhanced capital allowances until 2020, which will give investors incentives and security.

If I had time, I could highlight so many more policy areas where I can show that Wales is coming back. Outcomes are the most important measures. I have been talking about inputs until now. When we combine the impact of these changes as part of our long-term economic plan, there is little wonder that the number of people claiming jobseeker’s allowance has fallen for 20 consecutive months—

[Ms Rosie Winterton (Doncaster Central) (Lab)]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Main Question accordingly put.

19:00

Division 97

Ayes: 199

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Labour: 195
Plaid Cymru: 3
Democratic Unionist Party: 1

Noes: 299

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Conservative: 256
Liberal Democrat: 41
Independent: 1

Deferred Divisions

Motion made, and Question put forthwith (Standing Order No. 41A(3)),

That, at this day’s sitting, Standing Order No. 41A (Deferred divisions) shall not apply to the Motion in the name of Secretary Theresa May relating to the Prevention and Suppression of Terrorism—(Dr Thérèse Coffey.)

Question agreed to.

Prevention and Suppression of Terrorism

Wednesday 26th November 2014 Commons Chamber

19:15

[The Minister for Security and Immigration (James Brokenshire)]

I beg to move,

That the draft Terrorism Act 2000 (Proscribed Organisations) (Amendment) (No. 3) Order 2014, which was laid before this House on 24 November, be approved.

By way of context for tonight’s debate, the Joint Terrorism Analysis Centre has raised the threat level for international terrorism from substantial to severe, as it assesses a terrorist attack on the United Kingdom to be highly likely. The House will be aware that the Home Secretary stated earlier this week that we believe that more than 500 British nationals have travelled to Syria and Iraq, and that thousands from other European and western countries have joined them.

The threat from ISIL is clear—it is one of the most serious security challenges we face today—but it is not the only threat we face. The House will note that the groups listed in the order operate in Libya and Egypt, as well as in Syria. Currently, instability and violence in Libya has provided an environment for groups such as Ansar al-Sharia-Benghazi to operate. Syria and Iraq have become a crucible of terror and violence in which groups such as Jaysh al-Khalifatu Islamiya, al-Nusrah Front and ISIL operate. Egypt has seen a significant increase in criminal activity and terrorist attacks on police and security forces by groups such as Ajnad Misr and Ansar Bayt al-Maqdis.

We can never entirely eliminate the threat from terrorism, but we are determined to do all we can to minimise the threat from terrorism to the UK and our interests abroad. Additionally, it is important that we demonstrate our support for other members of the international community in their efforts to tackle terrorism wherever it occurs. Proscription is an important part of the Government’s strategy to tackle terrorist activities.

The three groups that we propose to add to the list of terrorist organisations, by amending schedule 2 to the Terrorism Act 2000, are Ansar al-Sharia-Benghazi, also known as the Partisans of Islamic Law; Ajnad Misr, also known as the Soldiers of Egypt; and Jaysh al-Khalifatu Islamiya, also known as the Army of the Islamic Caliphate.

[Keith Vaz (Leicester East) (Lab)]

How many months or years have those particular organisations been on the radar of the Government or the security services? We do not want to know the details of any private operations, but whether the organisations are new or have been around for a while.

[James Brokenshire]

It might help the right hon. Gentleman to know that I will go on to provide a brief summation of the three groups, which I think will answer his question.

Before I do so, I should explain that the effect of proscription is that a listed organisation is outlawed and is unable to operate in the UK. It is a criminal offence for a person to belong to, support or arrange a meeting in support of a proscribed organisation, or to wear clothing or carry articles in public which arouse reasonable suspicion that an individual is a member or supporter of a proscribed organisation.

Given the wide-ranging impact of the power to proscribe, the Home Secretary exercises it only after thoroughly reviewing the available relevant information and evidence about an organisation. Having carefully considered all the evidence, she believes that the three groups listed in the order are all currently concerned in terrorism. Although I am unable to comment on specific intelligence, I can provide a brief summary of each group’s activities.

Ansar al-Sharia-Benghazi is a Sunni Islamist militia group that takes an anti-western stance and advocates the implementation of strict sharia law. It has been involved in terrorist attacks against civilian targets, frequent assassinations and attempted assassinations of security officials and political actors in eastern Libya. On 11 September 2012, its members took part in the attack against the US special mission and annexe in Benghazi, killing the US ambassador and three other Americans. AAS-B continues to pose a threat to Libya and western interests, and is alleged to have links to the proscribed organisations Ansar al-Sharia-Tunisia and al-Qaeda. The US designated AAS-B as a terrorist organisation in January 2014, and the UN listed it in November.

Ajnad Misr is a jihadi group based in Egypt. It is believed to be a splinter group of Ansar Bayt al-Maqdis, which was proscribed by the House on 4 April. Ajnad Misr has stated that it seeks to protect Egyptian Muslims and avenge alleged abuse against them by Egyptian security services. It is believed to have been active since 20 November 2013, when it attacked an Egyptian checkpoint. The group announced its establishment on 23 January this year and has claimed responsibility for a number of attacks on Egyptian security forces since 2013, including the attack in April at Cairo university, which resulted in the death of a policeman and injured three others, and the bomb attack near the Foreign Ministry in Cairo in September, which killed three police officers in September.

Jaysh al-Khalifatu Islamiya is an Islamist jihadist group that is active in Syria. JKI consists predominantly of Chechen fighters and is an opposition group. It has assisted the al-Nusra front and ISIL in conducting attacks. In February 2014, Abdul Waheed Majeed, a British individual who was linked to the group, carried out a suicide attack on a prison in Aleppo, resulting in prisoner escapes.

In conclusion, we believe that it is right that we add AAS-B, Ajnad Misr and JKI to the list of proscribed organisations in schedule 2 to the Terrorism Act 2000.

[Keith Vaz]

I thank the Minister for that very clear account of the three organisations. He has provided the House with a great deal of information. Will he tell the House how many associates of the three organisations are operating in the United Kingdom?

[James Brokenshire]

I am afraid that I cannot comment on matters that may relate to intelligence. I hope that the right hon. Gentleman will understand that we always seek to present as much information as we can about groups that we are seeking to proscribe. The Home Secretary weighs various pieces of intelligence and open-source material in determining whether a group is engaged in terrorism. All I can say to him is that we have considered the tests clearly and believe that they are met in terms of whether the groups threaten our interests overseas or our national security.

With that summation, I hope that the House will agree that the order should be approved. If it is, it will come into force on Friday 28 November.

19:21

[Diana Johnson (Kingston upon Hull North) (Lab)]

I thank the Minister for his statement. There is a long tradition of cross-party co-operation on issues of national security and the Opposition will, of course, support the Government motion this evening.

Under section 3 of the Terrorism Act 2000, a group can be proscribed if the Home Secretary is persuaded that it:

“(a) commits or participates in acts of terrorism,

(b) prepares for terrorism,

(c) promotes or encourages terrorism, or

(d) is otherwise concerned in terrorism.”

It is a largely judicial role in that the Home Secretary has to assess whether the evidence before her meets the test. The Opposition do not have access to that evidence, of course, but on the basis of the statement that has been made by the Minister and the Home Secretary’s letter to my right hon. Friend the shadow Home Secretary, we will support the Government tonight.

I thank the Government for the letter to my right hon. Friend the shadow Home Secretary. May I say how pleased we were to receive that letter before the newspapers were briefed? I am sure that the Minister will recall that the last time we discussed a proscription order, he had to apologise to the House for the contents of the order being given to The Sun newspaper before they were given to the House. Is he able to report back on the investigation that he said would happen to find out how that had occurred?

Moving back to the order before us, we accept that proscription is an important tool to use against terrorism. It enables us to tackle and disrupt terror groups in co-operating around the world. Of course, that makes proscription a serious matter. Proscription makes it illegal to belong to or support in any way a listed organisation. It is a draconian measure, so we should use it only when we know that it is appropriate. The evidence that we heard tonight suggests that the measure is appropriate because all three groups have been involved in terrorism of the highest seriousness, including some directed at our citizens and allies.

The groups that we are discussing are active from Chechnya to Libya and include groups that operate in Syria, Egypt and Libya. They demonstrate the enormous challenge that is posed by the fallout from the Arab spring across the middle east and north Africa. I will start with Syria, where we know a number of organisations that pose security concerns are operating. We support the proscription of JKI, which is an Islamist jihadist group that consists predominantly of Chechen fighters who appear to be part of a web of interrelated organisations. The most prominent of those is the Islamic State of Iraq and the Levant, but there is also the al-Nusra front—both of those have been proscribed recently—and Jaysh al-Muhajireen wal Ansar.

To emphasise the challenge of separating out these groups, JKI was until recently known as the Majahideen of the Caucasus and the Levant or MCL. JKI has been linked to a number of attacks, including—as the Minister pointed out—a suicide attack in Aleppo by a British national, Abdul Waheed Majeed. In Egypt, we have the Soldiers of Egypt, another jihadi group and again a splinter group of a known terror group, in this case Ansar Bayt al-Maqdis, one of the most high-profile terror groups in Egypt. Again, this is a group that was proscribed in the UK this year. This group is also linked to ISIL and shows dramatically the size of ISIL’s sphere of influence that we are trying to combat. Although Soldiers of Egypt is believed to be just a year old, it has already been linked with a series of attacks targeting Cairo airport, border operations, police stations and Cairo university.

Finally, in Libya another Sunni group, Ansar al-Sharia-Benghazi or AAS-B—also known as Partisans of Islamic Law—seeks to use violence to achieve the aim of strict implementation of sharia law in post-Gaddafi Libya. The group is led by Mohammed Ali al-Zahawi, and Ahmed Abu Khattalah is another senior leader. As the Minister explained, since the fall of Gaddafi the AAS-B has been linked with numerous terror attacks against civilian targets, and frequent assassinations and attempted assassinations of security officials and political actors in eastern Libya. Many of these have resulted in the loss of innocent lives, including the attack on the US embassy in Benghazi in September 2012, which led to the death of the US ambassador and three of his colleagues.

While we support the Government’s motion tonight, I want to raise two other issues with the Minister that arise out of yesterday’s Intelligence and Security Committee report on the murder of Fusilier Lee Rigby. The first is about social media. This is an issue I have raised in debates on previous proscription orders. Yesterday, we learnt that messages had been shared on the internet by Michael Adebowale which, because of their content, were picked up and the accounts were closed by the internet companies. But no follow-up action was taken and no referrals made. That raises serious questions about social media companies and the Home Office’s counter terrorism internet referral unit, which clearly is not receiving all the referrals it should be. Will the Minister review the working of this unit in the light of yesterday’s report and see what more can be done? We know that all the groups we are discussing tonight have had a significant online presence, including on Facebook and Twitter. Those companies may operate across the world, but they generate significant revenue in the UK and we need to make it clear that we expect them to do more than they are doing at the moment.

[Keith Vaz]

My hon. Friend is a serial attender of these proscription order debates and she will know that we have raised on several occasions the position of Hizb ut-Tahrir. In 2009, the now Prime Minister said that he wanted that organisation banned. It has still not been banned. Does she share my concern that no progress has been made on that?

[Diana Johnson]

I am grateful to the Chair of the Home Affairs Committee, and he is right that I am—like him—a serial attender of these debates. The issue of Hizb ut-Tahrir has been raised at every proscription order debate in which I have been involved and we have asked the Minister what progress has been made on the promise by the then Leader of the Opposition that he would ban it when he became Prime Minister. It is now several years since the Prime Minister made that promise. It would be interesting to hear from the Minister if any progress has been made on that point.

May I take this opportunity to wish the Chair of the Home Affairs Committee a happy birthday? I understand that it is my right hon. Friend’s birthday today. [Hon. Members: “Hear, hear.”]

Finally, I would like to turn to the issue of prosecutions of members, supporters and facilitators of proscribed organisations. The Intelligence and Security Committee report published yesterday highlighted the low number of prosecutions and the difficulties the police face in obtaining prosecutions in this area. What do the Government intend to do to address this problem? In particular, does the Minister think that the way of defining terror for the purpose of proscription is sufficient to allow a terror group to be clearly identified? All three of the groups we have discussed today have had a series of associate groups; in most cases, groups that have been proscribed this year or in previous years. Those groups are often difficult to separate out. Will the Minister comment on the degree to which the way in which we define groups gives sufficient clarity to enable us to link an individual with a specific proscribed group? What more does he think we can do to ensure more prosecutions, where appropriate, in these types of cases where organisations have been proscribed?

[Madam Deputy Speaker (Mrs Eleanor Laing)]

With the good wishes of the House for a very happy birthday, I call Mr Keith Vaz.

19:31

[Keith Vaz (Leicester East) (Lab)]

Thank you, Madam Deputy Speaker. I can think of no better way to celebrate my birthday than to discuss the proscription of three organisations in Libya, Syria and Egypt. I am therefore delighted that the Minister has brought this order before the House this evening. I promise not to detain the House for too long.

We of course accept it, as we have always done, when Ministers come to Parliament and say from the Dispatch Box that they have important and sensitive information concerning groups that are operating in this country and abroad, and want to use powers to proscribe them. The Minister for Security and Immigration put his case very eloquently as he always does. He is the classic safe pair of hands: when he stands at the Dispatch Box and tells us that he has information he believes is sufficient to allow the Home Secretary to sign off an order proscribing an organisation, I, for one, fully support what he and the Government are doing—as do those on the Opposition Front Bench. I want to raise a number of points, which I hope he will have the opportunity to address.

The first point relates, of course, to Hizb ut-Tahrir, a group we have discussed every time a proscription order has been brought before the House. The Prime Minister made a very important statement on the group when he was Leader of the Opposition. I was in the House at the time and heard what he had to say. He was very firm that this was a terrorist organisation and that it ought to be banned. Five years later, Hizb ut-Tahrir still has not been banned. I think it has been involved in the same kinds of activities as a number of groups mentioned by the Minister in the House today and on previous occasions. It would therefore be good when he replies to hear an update on progress on whether that organisation, which the Prime Minister has rightly turned his face against, is any closer to being proscribed.

In previous debates I have always asked whether the Governments of the countries concerned have been consulted about the three groups the Minister has mentioned today, or whether they have any particular information. I appreciate that it is difficult to do this in the case of Syria, Libya and Egypt at the present time. I am not sure what our relations with Egypt are at the moment, but certainly in respect of the other two countries it may be difficult to get a particular view. However, if the Minister has one, it would be helpful to the House to hear it. If he has consulted those Governments, it would be helpful to hear what they had to say. My concern is that the attack in Benghazi, which he mentioned a few moments ago, occurred in 2012. The American embassy was ransacked, burned to the ground and the ambassador was killed. Will he tell the House whether the organisation responsible has already been proscribed in the United States of America, and whether it has been proscribed in any other European country? Once we pass the order, it would be helpful to know whether, as a result of what we have done—

[James Brokenshire]

The right hon. Gentleman asked whether any other state had taken action against Ansar al-Sharia-Benghazi. It was designated as a terrorist organisation by the United States in January and by the UN this month.

[Keith Vaz]

That is extremely helpful. I am grateful for the Minister’s clarification. When he winds up, will he remind us of the process regarding other EU countries? Once we have taken a decision, does he tell EU colleagues of it, will it automatically be extended to other countries or does it have to go through other Parliaments? I assume that the United States and the UN have also proscribed the other two organisations, in Syria and Egypt, and that we will be urging our European colleagues to do the same.

The final point I want to make concerns de-proscription. I am not suggesting for one moment that, having agreed to proscribe these organisations, we would want to de-proscribe any of them, but I have raised several times, as has the Home Affairs Committee, our concern about the de-proscription process. I have mentioned before the concerns of my constituents regarding the Liberation Tigers of Tamil Eelam, which no longer exists but is a proscribed organisation. Some of my Tamil constituents feel they are put at a disadvantage because the ban on the LTTE remains, even though it no longer exists. Has there been any progress on de-proscription, other than the only method we think exists to get an organisation de-proscribed, which is to take the Government to court? The People’s Mujahedeen Organisation of Iran did that a few years ago, and the last Labour Government were obliged to de-proscribe it.

Aside from asking for those clarifications, I fully support what the Minister has said. He is doing absolutely the right thing, and I am glad he has come here with so much information to share with the House.

19:37

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

I will not detain the House for long.

I wish to add my support to the order and to the comments of my hon. Friends, but I have a few questions for the Minister. First, following on from the comments by my hon. Friend the Member for Kingston upon Hull North (Diana Johnson) about the identification and definition of organisations, the Minister will be aware of my concern—we have discussed this matter before—that such organisations frequently rebrand themselves with similar names. Will he assure us of the process for keeping that under continual review? Some of these organisations are clearly trying to subvert the process of their proscription.

My second, related point concerns the issue of identifying supporters, particularly the wearing of clothing, the distribution of materials, the use of flags and so on. Several organisations are attempting to subvert proscription through slight alterations in those materials. How robust are the measures to ensure that people are not attempting to evade the system of proscription?

Thirdly, I have a specific concern relating to the Libyan organisation. The Minister might not be aware, but constituents of mine had to flee Benghazi earlier this year to escape the activities of the organisation mentioned and allied organisations. It is my understanding that, sadly, several British citizens remain trapped in Benghazi, for a number of reasons, and I would like his assurance that he will do everything in his power, working with colleagues in the Foreign Office, to make a clear assessment of any British citizens remaining in Benghazi and to help those attempting to escape the heinous and barbarous actions of the group being proscribed and its allied organisations, which are causing so much fear and destruction in eastern Libya.

19:39

[James Brokenshire]

I thank those who have contributed to this debate for supporting the Government’s proscription of the three organisations listed in the order. We take our responsibilities seriously when considering each group and coming to the House to seek an order in this way. I am grateful for the comments that have been made and add my best wishes to the right hon. Member for Leicester East (Keith Vaz), whom I hope will celebrate his birthday after the debate has concluded. I am sure we all wish him well on this special occasion.

A number of questions were asked. The hon. Member for Kingston upon Hull North (Diana Johnson) asked whether we could review the definition of terrorism. As part of the review of counter-terrorism powers that we carried out at the start of this Government in 2010, we looked at that but concluded that it would be disproportionate to broaden the definition. Ultimately, pursuing a prosecution comes down to evidence and is not necessarily based on redefining terrorism. The issue has been examined. We are considering the issue of extremism more generally and what further action might be taken against organisations that might not cross the threshold for proscription. We will return with further proposals on extremism, and the Home Secretary has highlighted her intention to lead on such a strategy, drawing across government, that could include taking action against groups—and on extremism in our society more generally—that fall below the threshold of terrorism.

The hon. Lady highlighted the work of the counter terrorism internet referral unit, which I believe has been extremely effective since commencing its work back in 2010. Since that time, some 65,000 pieces of unlawful terrorist-related content have been removed as a consequence of its actions. There is more to be done, however, and the role and responsibilities of social media companies are key here, as the Prime Minister said in his response to the Woolwich report yesterday. We absolutely encourage the public and civil society organisations to refer terrorist and extremist content at scale to social media companies and internet service providers—in some ways amplifying the work of the CTIRU. It has good relations with a number of these companies, some of which have been responsive in dealing with a number of its requests. It comes down to actions taken, knowledge possessed and responsibilities better to share information with the agencies charged with protecting our national security. We want appropriate action taken to interdict, to intercede and to ensure that terrorist attacks do not occur.

[Keith Vaz]

I note that the Minister for Culture and the Digital Economy, who has responsibility for the creative industries, is in his place on the Front Bench. He is rightly held in high regard by those in the creative industries, including by some of the companies that have been mentioned. The issue is this: are we moving from a voluntary arrangement with internet companies and companies such as Facebook to a more compulsory approach? The voluntary arrangement has not worked, so does the Minister think we should be doing more by way of compulsion to make sure that such companies act in this way?

[James Brokenshire]

I do not necessarily want to expand this proscription debate into a broader debate about terrorism. However, there is legislation in place, and when we debate the security measures in the Bill published today, we will find that it deals with the resolution of internet protocol addresses issue, and with the question of the Regulatory and Investigatory Powers Act 2000. David Anderson, the independent reviewer of counter-terrorism legislation, is carrying out an ongoing examination, in the round, of a number of these matters.

There is more that the industry can do in the short term, such as looking at its terms and conditions of service and ensuring that they are properly upheld. Yes, there are legal issues that will continue to challenge, and more needs to be done in that sphere, as the Home Secretary said. Equally, there is work on which the industry itself can continue to focus.

Both the right hon. Gentleman and the hon. Lady raised the issue of Hizb ut-Tahrir. It is not a proscribed organisation—as the House will know, proscription can be considered only when the Home Secretary believes an organisation to be concerned in terrorism, as defined by the Terrorism Act 2000—but it is one about which we have significant concerns, and we will continue to monitor its activities very closely.

That brings me back to the broader issue of extremism, and why it is right that we continue to challenge ourselves in respect of what more can be done about it more generally. We must continue to take on board the points that have been made about social media. The extremism taskforce, which involves Ministers throughout the Government, is working to ensure that we seek to confront extremism in all its forms.

As for enforceability, I have already referred to the need for evidence and investigation, as did the hon. Member for Cardiff South and Penarth (Stephen Doughty). Between 2001 and 2014, 33 people were charged with proscription-related offences. The Terrorism Act covers a broad range of offences, and different offences may well be adopted on the basis of the evidence that is presented. However, I can tell the hon. Gentleman that the police and the Crown Prosecution Service continue to examine these issues carefully.

Both the hon. Gentleman and the right hon. Member for Leicester East raised the issue of name changes, which we keep under close review. When aliases are used for the same organisation, we can impose name change orders, and have done so on a number of occasions. The procedure involves a negative rather than affirmative resolution, which means that we can potentially act more quickly. If there is evidence that the name used by an organisation is a sham or a front, and the original organisation is extant and still operating, the police and the CPS will continue to be able to pursue the matter.

The change that we make tonight will have an impact on other EU member states and on international bodies. We do consult member states that have a direct interest in the relevant groups. We will inform them if parliamentary agreement is secured in this House and in the other place, and we will consider whether to pursue EU listings of the groups concerned. Obviously, those are separate processes. I take the point made by the right hon. Gentleman: we must consider the evidence properly, rather than automatically taking on board what other states may say. We will consult when that is appropriate, but I think it right for us to make our decisions in the House of Commons.

Our advice, and the clear advice of the Foreign and Commonwealth Office, is that British nationals should leave Libya by whatever commercial means are available. Our ability to provide direct support is limited because of the closure of the British embassy in Tripoli, but I know that my colleagues in the Foreign Office are very conscious of the issues raised by the hon. Member for Cardiff South and Penarth, and that they keep them under close review.

I hope that the House will be minded to support the order.

Question put and agreed to.

Business without Debate

Wednesday 26th November 2014 Commons Chamber

Delegated Legislation

Motion made, and Question put forthwith (Standing Order No. 118(6)),

Companies

That the draft Reports on Payments to Governments Regulations 2014, which were laid before this House on 23 October, be approved.—(Mel Stride.)

Question agreed to.

COUNTER-TERRORISM AND SECURITY BILL (AMENDMENTS, ETC.)

Ordered,

That, in respect of the Counter-Terrorism and Security Bill, notices of Amendments, new Clauses and new Schedules to be moved in Committee may be accepted by the Clerks at the Table before the Bill has been read a second time.—(Mel Stride.)

Telecoms Industry (Mis-selling)

Wednesday 26th November 2014 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Mel Stride.)

19:49

[John Healey (Wentworth and Dearne) (Lab)]

I am grateful for the opportunity to secure this debate, as this is a shameful story. Stephen Jones is a vulnerable man who was ripped off by a big telecoms company, Unicom, which refused to admit it had broken the rules or treated him badly. He has said to me, “They’re asking me to pay thousands of pounds for a service I didn’t receive. I wouldn’t want anyone else to go through this. It’s a disgrace.” He is right. I want justice for Stephen Jones, and together we want to help prevent other people from being treated the same by Unicom.

From the very earliest days of this dispute, Stephen Jones has been supported and represented by a remarkable friend, who for nearly two and a half years has battled on his behalf with Unicom and with the ombudsman. He does not want any public recognition for his role, so let us just call him Ray.

Stephen and Ray came to see me in July, and as so many constituents do they came to me, their MP, as a last resort. They had tried everyone else and they had been failed by everyone else. I may not succeed, but I will do everything I can to get these indefensible charges dropped and I will not—will not—give up this fight, and I hope that during this debate the Minister will understand why I am so angry.

Stephen Jones is 70. He is a vulnerable man who is highly susceptible to buying and hoarding things he does not need. He describes himself as trusting and gullible. I describe him as one of the kindest, nicest people I have met. For over 40 years he ran a small salon in Station street, Swinton called Stephen Hairdressing. Earlier this year, he broke his back and stopped working. He is not able to read or understand complex detail of the type found in consumer contracts, and, as his daughter says, “He gets bamboozled with information which is why he always likes to see things in black and white”, so he can then check them with his family or with Ray.

Stephen has not been a well man for many years and now his daughters are getting very worried about the effect this dispute with Unicom is having on his health. They say he is withdrawn, anxious and depressed, and it is even affecting his relationship with his grandkids, and no wonder because out of the blue, and five months after he had the contracts with Unicom cancelled, he was hit with a bill for £3,000, and now he is being threatened with debt collectors, courts and bankruptcy. The detail of his dealings with Unicom is far worse and the experience he has had with the ombudsman is little better.

I have serious criticism of Unicom’s conduct in four respects. The first is mis-selling. Mr Jones was sold two telephone and two broadband packages for his shop and his home, an extortionately expensive service that Mr Jones did not want, had not asked for and could not use. The culprit was Mark Jennings of Unicom. He cold-called on Mr Jones in his salon on 25 May 2012. Mr Jones was on his own, he was busy, he was under pressure and he asked Mark Jennings to put the detail down in writing, but Mark Jennings would not do this.

Stephen Jones was told that Unicom services would be cheaper, yet Mr Jones already had free broadband with Orange and a reasonable telephone rate via XLN. In fact, Mr Jones found that Unicom’s charges for line rental, calls to mobiles and landlines and paper billing were all much higher than XLN’s, especially calls to local or national landlines, which worked out nearly three times more costly for Mr Jones than the call charges he was paying to XLN. Mr Jones was told that the broadband service for the shop would allow clients to book online, yet he had no computer, no website, no knowledge of the technology and no need for the service. His salon is an old-style salon in a traditional ex-mining village with largely elderly clients. The cost was £72 per month, or £2,500 for each of the broadband lines over the three-year contract period.

The second criticism relates to slamming, which Ofcom describes as

“the most extreme form of mis-selling, which occurs when a consumer’s service is switched to another provider without their consent”.

Mr Jones’s internet service was switched to Unicom by obtaining his individual migration authorisation code—known as a MAC code—without his authorisation. That broke Ofcom’s industry rules, which are set out in what it calls its “general conditions” to protect consumers in the communications sector. Crucially, it also sidestepped a further decision point for consumers, and therefore weakened the cooling-off period protection. This might prove to be part of a pattern in Unicom, because in one phone call that Ray made on Mr Jones’s behalf to talk about the way in which his MAC code had been obtained, the manager he was talking to turned to a colleague and said, “They’ve done it again.”

The third criticism relates to cancellation. Ray’s detailed notes confirm that he had a conversation with Unicom’s Sheffield office on 17 July 2012, 15 days after Stephen Jones had received the paperwork. In the call, the company accepted that a mistake had been made, knew that the MAC code had been transferred without reference to Mr Jones and described its contracts with him as “dead in the water”. Yet it was only after 14 chasing e-mails and 83 days that the contracts were indeed cancelled.

To be fair to Unicom, no termination fees were applied at that point, as a good-will gesture to Mr Jones, to allow him to return to XLN. Mr Jones paid the telephone element of his final bill in full, but felt aggrieved that that bill also included the sum of £184.80 for the entirely unused broadband service. Ray then took that matter up with the ombudsman on Stephen Jones’s behalf. Unicom offered to waive the £184.80 charge if the case was not pursued with the ombudsman. However, because Mr Jones felt that the charge was unfair, and because the case had already been lodged with the ombudsman, he did not withdraw his complaint.

I have to say that, from start to finish, it felt as though the ombudsman was almost acting as an agent of Unicom. Given that the ombudsman states that its job is

“to investigate complaints fairly by listening to both sides of the story and looking at the facts”,

Mr Jones certainly felt that it had failed him. It failed to appreciate that it was dealing with Ray rather than with Mr Jones himself, which is likely to have led it to believe that it was dealing with a smart, sophisticated customer rather than with a simple, kindly, elderly man. The ombudsman failed to grasp that Mr Jones was no longer a Unicom customer at the time of the investigation. It failed to show that it had examined fully certain areas that were central to the case: the dealings with Unicom’s Sheffield office; the illegal way in which Mr Jones’s MAC code had been obtained; and what the salesman, Mark Jennings, must have said to Mr Jones in the salon about the cost of the Unicom contracts. The ombudsman failed to uphold any aspect of Mr Jones’s complaint, ruling instead in Unicom’s favour and going further, saying that the company had done nothing wrong and need not make any concessions.

That brings me back to Unicom and the fourth area of serious criticism. Unicom took advantage of the ombudsman’s report to slap termination fees on all four contracts—almost £600 for each one. This was fully five months after the contracts had been cancelled. Interestingly, Amy Tytler, an investigation officer in Unicom’s compliance department, confirmed to me in a letter last month that the termination fees

“were contained within the invoice raised on the 11th February 2013, prior to the issue of the Ombudsman’s Report dated the 15th February 2013.”

So the company knew the content of the ombudsman’s report before it was published. This raises questions. The ombudsman is a body entirely funded by the industry through subscriptions and case fees. For the consumer, it comes across as too toothless to investigate impartially, and too close to the companies to deal properly with complaints against them.

For some reason, for more than a year all went quiet with Unicom, until Ray e-mailed the ombudsman service on 12 May 2014 and happened to mention that the company had not been in touch. The very next day Mr Jones received a call from Unicom. He was in hospital, having just broken his back in three places, and he took a call from the company demanding immediate payment of all four full-scale termination fees totalling more than £3,000. This was 522 days since Unicom had had any contact with Mr Jones.

In July this year Mr Jones and Ray came to see me and I have been on the case with Unicom, Ofcom, the Minister and the ombudsman since. The balance on the account is now over £3,500 and rising by £50 a month. In August Unicom offered to reduce this to £1,399.33. This is totally unacceptable. It is unacceptable after what Mr Jones has been through and after Unicom had said two years ago that it would waive all charges.

Ofcom has launched an official formal investigation into Unicom, which it tells me it expects to complete in February. The excellent BBC radio programme for consumers, “You and Yours”, has done four separate reports on Unicom in recent months. It tells me that Unicom stands out for the number and the type of complaints it gets. The problems come especially from small businesses such as cafés, garages, florists and hairdressers. The Minister told me last month that “the Department take inappropriate sales and marketing very seriously”.

The dreadful and still continuing experience of Stephen Jones at the hands of this predatory company raises serious questions. Is the present system of protection and investigation strong enough? Is the ombudsman too cosy with the companies that fund it? Is Ofcom tough enough to bring into line rogue companies that rip off and bully customers such as Mr Jones? This Unicom investigation will be an important test of Ofcom, and I trust that the Minister is following it closely.

For now, for Mr Jones, I ask the Minister in his important position if he will personally do three things. First, will he ask the ombudsman whether it is satisfied with the way in which the service has handled Mr Jones’s complaint? Secondly, will the Minister ask Ofcom to confirm that Mr Jones’s case will be built into its current investigation of Unicom? Thirdly, and much the most important, will the Minister personally raise this debate with the chief executive officer of Unicom and ask him now to draw a line, drop the charges and apologise in full to Mr Jones?

20:04

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

I congratulate the right hon. Member for Wentworth and Dearne (John Healey) on securing this important debate on behalf of his constituent Stephen Jones. The right hon. Gentleman has put the case extremely forcefully and anyone listening to the events he recounted will be shocked at the way Unicom has behaved. I was astonished when I heard his version of events, which I have no reason to doubt, particularly as it was recounted in this Chamber and given his record as an upstanding constituency MP. It seems astonishing that a telecoms company would pursue a man in his 70s, who has broken his back, for this sum of money and not understand that any right-thinking person would want to make a good-will gesture. Having won its war with Mr Jones through the ombudsman, it should recognise that its corporate social responsibility should dictate that it should waive this bill.

The right hon. Gentleman knows full well that neither my Department, nor the regulator, Ofcom, has a remit to investigate and resolve complaints on behalf of an individual, although given the events as they have been recounted one is sorely tempted. It would not be right for me to overturn the ombudsman’s judgment, and I could not do so in any case, but I will comment on the three points the right hon. Gentleman made at the end of his speech. He rightly wanted not only justice for his constituent, but to raise matters of importance arising from how this case was handled and to question the robustness of consumer protection in the telecoms market. So it is important that I speak a little about the system in place.

There are rules to prevent consumers from being sold the wrong contract, or a contract where the terms are not clear or where complaints to a telecoms operator with whom one has a contract are not handled appropriately. Ofcom takes these complaints and breaches very seriously. As the right hon. Gentleman pointed out, Ofcom has launched an investigation into Unicom’s sales and marketing practices. I can answer one of his questions immediately. He mentioned that Ofcom is hoping to report in February 2015 and that is indeed the case. I can confirm that it will take into account Mr Jones’s experiences, along with the other complaints it has received about Unicom’s sales and marketing practices. Let us be clear: it is not in Ofcom’s remit to take up an individual complaint, but it can take into account the volume of complaints and the nature of complaints. That process will obviously take into account the experience that Mr Jones has gone through.

On the ombudsman and how it works, all communication providers must be members of an alternative dispute resolution scheme approved by Ofcom and they must also make it clear that customers have recourse to such a scheme if they wish. Such a service—the ombudsman service, in this case—is meant to provide an independent, impartial and cost-effective way to resolve disputes outside the courts. The ombudsman is meant to be an expert in dispute resolution. I suspect this will not be taken up in this case, but I have to say that going to an ombudsman does not preclude a customer from going on to take legal action. The remit of the ombudsman is to investigate complaints fairly and decide what action, if any, should be taken when a consumer and a communications company cannot agree.

Providers must also make it straightforward for their customers to make an escalated complaint within that provider, before they go to an ombudsman. Ofcom also looks at that. It looks at compliance with complaints handling rules and it carries out enforcement where it thinks that a telecoms company has not properly set up its own internal complaints procedure.

In most cases, the ombudsman proves to be a powerful and effective piece of consumer protection. It does work, and figures show that it often works to the consumer’s benefit. It allows customers to take unresolved complaints to an independent body and to secure an impartial judgment. The provider has to accept the decision, but the customer does not have to. I understand that, in this case, the constituent did not accept the ombudsman’s final decision. I said that Mr Jones is free to take any other action he considers appropriate although, given the context outlined by the right hon. Gentleman, Mr Jones may not choose to take that route.

There is also a mechanism by which a customer who is dissatisfied with the way in which a case has been conducted by the ombudsman can have the process by which the ombudsman reached its findings independently examined. Under general condition 24, which is part of the general conditions for telecommunications companies, where a customer is transferring a fixed-line telecommunications service between communication providers, the gaining communications provider—in this case Unicom—must not engage in dishonest, misleading or deceptive conduct; engage in aggressive conduct; contact the customer in an inappropriate manner; or engage in slamming. Ofcom is investigating whether Unicom has breached those obligations in many cases.

I would be happy to go back to the ombudsman, but as the right hon. Gentleman is aware from the correspondence that we have had, the ombudsman maintains that, under data protection rules, it cannot share his constituent’s information with me. I suggest that his constituent gives either him or Ray the authorisation to share that information, and that they then come to a meeting with me, and hopefully the ombudsman, to see whether we can get some clarity as to how the ombudsman conducted this particular case.

The same general condition also sets rules for the information to be communicated at the point of sale. That includes information on the identity of the legal entity with which the customer is contracting; their contact details; details of the service provision; the key charges, including minimum contract charges and any early termination charges; payment terms; the existence of any termination right, and so on. As I have said, Ofcom runs a monitoring and enforcement programme to monitor industry compliance with those rules, and it will be looking to Unicom to provide that.

Ofcom also looks at contracts under general condition 9, and compliance with that condition is another aspect of the investigation that Ofcom is undertaking. It is important for companies to have contracts, as they offer certainty, but customers must be completely clear from the start of the contract what they are signing up to.

The general condition also provides consumer protection to ensure that conditions or procedures for contract termination do not act as disincentives for consumers against changing their communications provider. Communications providers are also prohibited under general condition 9.4 from including terms in any contract preventing the consumer from terminating the contract before the end of the agreed contractual period without compensating the communications provider, unless the compensation relates to no more than the initial commitment period.

In the UK, we are lucky that competition delivers a wide choice of competitive tariffs in communications markets. Ofcom has worked to ensure that consumers are able to take advantage of competition and choice. That does include clear and accurate information, so that consumers can compare services appropriately. Ofcom continues to monitor the market, including compliance with regulatory obligations, price trends and complaints handling, and it remains focused on ensuring that consumers are able to exercise choice to access the best deals for them. Consequently, in March 2014, Ofcom opened a formal investigation into Unicom following complaints from consumers, as well as an assessment of evidence submitted by Unicom during Ofcom’s inquiry phase to decide whether to open the investigation. Ofcom is investigating whether Unicom has complied with its obligations under general condition 24, which relates to how telecoms companies should engage in sales and marketing involving landline services. As has been mentioned, Ofcom rules explicitly prohibit companies from engaging in the mis-selling and slamming of landline services.

As the right hon. Gentleman said, Ofcom is seeking to conclude its investigation in February 2015, and we must await the outcome. I would be happy to discuss the handling of the case with the ombudsman, but I need authorisation if I am to access Mr Jones’s data, so he must nominate someone to share that.

[John Healey]

I am grateful to the Minister for the way in which he has responded to the debate and for his offer, which I will discuss with Mr Jones and Ray, to meet them, me and the ombudsman. Will he take up my final request that he draws the attention of the Unicom chief executive to the debate and encourages him, as I do, to consider dropping the charges in their entirety?

[Mr Vaizey]

I was going to sum up by answering the right hon. Gentleman’s three questions—

[John Healey]

I beg your pardon.

[Mr Vaizey]

The right hon. Gentleman has no need to do so.

I clarified earlier that Ofcom will include Mr Jones’s case in its deliberations. However, let me ponder whether I take the step of phoning the chief executive. I am sure that he has been alerted to the debate, so he will have heard my remarks and observed how forcefully the right hon. Gentleman put his case on behalf of his constituent. Any right-thinking company, given the bad publicity that must have arisen from the case, would wish to do the right thing. While I will ponder the right hon. Gentleman’s request, I hope he will forgive me if I do not give a final answer now, as that point was raised only this evening, although I understand where it comes from.

I once again thank the right hon. Gentleman for securing the debate and congratulate him, even though he is my elder and better, on making such a forceful case. He has been a Member for 18 years, and the way in which he set out his argument, given the volume of cases with which he must have dealt over almost two decades, shows that this will be one of those that has made him the most angry. If that does not get across the message loudly and clearly that Mr Jones appears to have been incredibly unfairly treated, I do not know what will.

Question put and agreed to.

20:18

House adjourned.