House of Commons

Monday 23rd March 2015 Commons Chamber

Monday 23 March 2015

The House met at half-past Two o’clock

Prayers

Monday 23rd March 2015 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Monday 23rd March 2015 Commons Chamber

The Secretary of State was asked—

[Alex Cunningham (Stockton North) (Lab)]

1. What her policy is on the net migration target; and if she will make a statement.

[Mr John Spellar (Warley) (Lab)]

9. What her policy is on the net migration target; and if she will make a statement.

[The Secretary of State for the Home Department (Mrs Theresa May)]

Uncontrolled mass immigration increases pressure on public services and can drive down wages for people on low incomes. That is why we are committed to reducing net migration. Where we can control immigration, our policies are working; we have reduced non-EU immigration, raised the standards required to come here and clamped down on abuse. Without our efforts, met migration would have been far higher.

[Alex Cunningham]

But net migration is much higher now than it was when the Conservatives came to power—54,000 higher. It now stands at more than 300,000, which is more than double their target. Is the Home Secretary trying to take the public for fools by suggesting that her party will repeat its broken promise to cut migration drastically?

[Mrs May]

I have been very clear that of course we have not met the net migration target we set, but I have to say to the hon. Gentleman that this Government have clamped down on abuse—860 bogus colleges can no longer bring in overseas students—and tightened every route into the UK from outside the EU, and we have set out clear plans for what a Conservative Government would do to deal with free movement. We on the Government Benches will take no lessons from a Labour party that allowed uncontrolled mass immigration.

[Mr Spellar]

Contrary to that reply, is not the reality that the Home Secretary is leaving office with net migration higher than when she arrived, because it now stands at 298,000? She claims she has cut migration from outside the EU, and that is true: it is down from 196,000 to 190,000. Rather than all this waffle, why will she not finally admit that her record at the Home Office is one of complete failure in that area and a series of broken promises?

[Mrs May]

As I said in response to the hon. Member for Stockton North (Alex Cunningham), I fully accept that we have not met the net migration target that we set, but we have tightened every route into the United Kingdom from outside the European Union, and we have said clearly what a Conservative Government would do to deal with free movement from the European Union. I say once again that it ill behoves the Labour party to make such comments, because in government it presided over uncontrolled mass immigration that had the impact of keeping incomes at the lower end of the scale down and was identified by its own policy guru as a 21st century wages and incomes policy.

[Philip Davies (Shipley) (Con)]

The public certainly want immigration to be properly controlled, and far better controlled than it is at the moment, but they also want some honestly about immigration. Is not the fact of the matter that while we remain in the EU with free movement of people we cannot guarantee how many people will come to this country, so we should not be making promises that we are in no position to keep? Is not the fact of the matter that we cannot control the number of people coming to this country while we remain in the EU?

[Mrs May]

My hon. Friend is right to identify the significant increase in the number of people coming to this country from inside the European Union as the key reason we have failed to meet our net migration target. However, crucially, not only has the coalition already taken steps to tighten up on movement from inside the European Union—for example, by reducing access to benefits—but the Conservative party has clearly set out what we would do in government after the election to deal with free movement and tighten up further to reduce migration from inside the European Union.

[Mr David Nuttall (Bury North) (Con)]

Does the Home Secretary recognise the sense of grievance felt by citizens of Commonwealth countries who for years have abided by the rules when trying to get into this country as immigrants, only to see EU citizens being able simply to walk in and out of the country at will?

[Mrs May]

My hon. Friend makes a point about Commonwealth citizens, many of whom have come to the United Kingdom and contributed greatly. We are clear that we want to tighten the rules on people coming from inside the European Union, particularly in relation to the ability to claim benefits, which I believe will have an impact on the number of people coming here, but in order to do that we need a Conservative Government to be elected on 7 May.

[Mr David Hanson (Delyn) (Lab)]

Could the Home Secretary bring herself to say the words, “Net migration is 54,000 higher than when Labour left office”? Could she stand at the Dispatch Box and say that today—not tens of thousands, as she promised—and could she say to the House with no ifs and no buts that she has broken her promise made at the election?

[Mrs May]

The right hon. Gentleman’s question is the third that I am answering from Labour Members. In response to the first two, I said clearly that the Government have not met their net migration target. I am not trying to claim that we have; I am very clear about the fact that we have not met our net migration target, but this Government have recognised the significance of immigration as an issue, and the impact that it has on public services and wages at the lower end of the income scale, and it is this Government who are doing something about it.

[Justin Tomlinson (North Swindon) (Con)]

2. What assessment she has made of the risks to the UK from gaps in communications data capability.

[The Minister for Security and Immigration (James Brokenshire)]

Our law enforcement and intelligence agencies continue to face a decline in their ability to obtain the communications data they need. This is caused by the use of modern technology and changes in the way in which people communicate. We believe that further changes to the law are needed to maintain capabilities. We cannot let cyberspace become a haven for terrorists and criminals.

[Justin Tomlinson]

Can my hon. Friend assure me that the next Conservative Government will introduce the appropriate legislation to restore our declining communications data capability?

[James Brokenshire]

It is very clear that although this Government have taken some steps to close the gap, significant gaps remain. The Joint Committee on the draft Communications Data Bill identified that, but we have not been able to bring those measures through in this Parliament. We need to remedy that. Given that about 95% of serious crime cases involve the use of communications data, those measures are an essential tool in fighting crime, and we are determined to take further action to close the gap and make sure that our police and security agencies have the powers they need.

[Mr Frank Roy (Motherwell and Wishaw) (Lab)]

What discussions has the Minister had with the Scottish Government in relation to the risk and responsibility for communications data?

[James Brokenshire]

On issues of national security, there are reserved powers. We therefore retain that focus on ensuring that security is assured. Clearly, communications data and other measures play an important part. I am sure that discussions with others, including devolved Administrations, will take place in future, but ultimately this is a matter for the UK Government.

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

The Minister and his boss must be aware that our police, under-resourced as they now are, are still in a mode of fighting traditional crime. Cybercrime, as we all know, has been the great challenge. Throughout the country we are unequipped to deal with it, and it is what most citizens will face in the form of fraud and other criminal activity.

[James Brokenshire]

This Government have invested heavily in capabilities to deal with cybercrime through the establishment of the new cybercrime unit in the National Crime Agency and the work of police forces throughout the country to ensure that we have the digital forensics—the digital information to fight the new crime types. The hon. Gentleman clearly does not recognise the important achievements of this Government in cutting crime, at a time of having to save money to deal with the deficit that we inherited from Labour.

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

3. If she will conduct a review of the effectiveness of anti-radicalisation programmes.

[The Secretary of State for the Home Department (Mrs Theresa May)]

We continually monitor and evaluate the Channel programme to ensure its effectiveness. Through the Counter-Terrorism and Security Act 2015 we have placed the programme on a statutory basis. The duty aims to secure local co-operation and delivery in all areas and we, of course, work closely with international partners to make sure that we are sharing expertise and best practice in tackling extremism and radicalisation. I have today published the latest annual report on our counter-terrorism strategy, Contest, alongside the annual report on the serious and organised crime strategy, and copies of both reports will be made available in the Vote Office.

[Mr Cunningham]

How many people returning from Syria have gone through the deradicalisation programme, and how many people in total have gone through that programme?

[Mrs May]

More than 2,000 people have gone through Channel since it was rolled out nationally in 2012, and hundreds have been offered support. This is dealt with case by case. It is not appropriate for everybody to be put into the Channel programme, but it has been effective and we are seeing significant numbers of people referred to it.

[Crispin Blunt (Reigate) (Con)]

I welcome my right hon. Friend bringing clarity about what is and what is not acceptable in the context of radicalisation and extremism. In an environment where our press and media are prone to hysterics and have the capacity to achieve the objectives of the enemies of our society by sowing fear and anxiety where none need exist, will she continue to proceed calmly and on the basis of the evidence?

[Mrs May]

My hon. Friend makes a very important point about proceeding on the basis of the evidence. I am grateful for his comments about remarks that I made earlier today about the necessity for us to develop a wider partnership to counter extremism across its broadest spectrum so that we can deal with the hateful beliefs that the extremists are propagating.

[Keith Vaz (Leicester East) (Lab)]

I too welcome the Home Secretary’s comments in her speech this morning. Only by working with communities are we able to tackle this problem. I also commend the Metropolitan police and Turkish authorities for bringing back to London the three young men from Brent. It is sad that we missed the opportunity of doing this with the four young girls from Bethnal Green. What is the message to families to get them to report areas of concern so that they do not feel stigmatised if they do so?

[Mrs May]

I am grateful to the right hon. Gentleman for his comments about my speech. He is right. As I made clear in that speech, Government cannot deal with this alone; we need to work with families, communities and civil society. The message that the Government have given to families consistently in relation to those who might be travelling to Syria to get involved in terrorist-related activity, or to be with terrorist groups, is that the sooner they can give information to the authorities, the easier it is to work with them to ensure that their young people are not put into that danger.

[Stuart Andrew (Pudsey) (Con)]

In the all-party group on Islamophobia we have heard countless times of the need to offer more support to the mothers of young Muslims who fear that their children might be in danger of being radicalised. What specific efforts are being made to support the mothers who are tackling this issue?

[Mrs May]

My hon. Friend makes a very important point. I am pleased to have been involved with two civil society organisations that have been working with families—particularly, in one case, with women. FAST—Families Against Stress and Trauma—is giving support to families whose young people may have travelled and helping them to prevent young people from travelling. Inspire’s “Making A Stand” programme is about Muslim women up and down this country saying that radicalisation is not taking place in their name, and working together as Muslim women to ensure that their young people are not radicalised.

[Diana Johnson (Kingston upon Hull North) (Lab)]

The Home Secretary said this morning, and has just reiterated, that she wants a new partnership on Prevent between communities, individuals, civil society and Government. When she came into government, she inherited 93 Prevent areas, which she cut to 23 and then put up to 30. She now says she wants 50, and they might go up to 90, so we are going back to where we started five years ago. Why the rollercoaster in such an important area for this country?

[Mrs May]

No, we are not going back to where we started. First, the hon. Lady has made a fundamental mistake in her question in saying that my speech this morning related to Prevent. It did not; it related to the new counter-extremism strategy that the Government are introducing. Secondly, when we came into government we found that the Labour Government were funding extremist organisations, and members of the Labour party were standing on platforms embracing extremist hate preachers. Government Members take a very different view.

[Mr Andy Slaughter (Hammersmith) (Lab)]

4. What assessment she has made of the effectiveness of the police response to domestic abuse.

[The Minister for Crime Prevention (Lynne Featherstone)]

Domestic abuse is an appalling crime, and this Government are determined that the police response is the best it can be. The Home Secretary commissioned Her Majesty’s inspectorate of constabulary to review the response to domestic abuse across police forces in England and Wales. We are driving change through a national oversight group. All 43 forces have action plans on domestic abuse. In November, HMIC highlighted the commitment of forces to improving their response.

[Mr Slaughter]

This Government have a truly terrible record on tackling domestic abuse, whether it is closing specialist courts, restricting legal aid, or failing to prosecute. There is a rising number of offences, but since they came into office there have been 4,000 fewer prosecutions. What are they going to do about that?

[Lynne Featherstone]

I totally refute the hon. Gentleman’s assertions. This Government have a record to be proud of in the work we have done on domestic abuse, not just the ring-fencing of stable funding of £40 million but the introduction of new laws, protection orders, and measures on stalking abuses. We have done more in the five years we have been here than the Labour Government before us did in all their 13 years. What is more, I seem to recall that Labour Members are not proposing to reverse any of the legal aid cuts, and we have preserved legal aid for cases in which domestic abuse plays a part.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

On legal aid for victims of domestic violence, I and other colleagues have come across women who are victims but who have had to fork out from their own pockets, and some have just given in after spending too much, moving too often and finding that the system does not work. Surely the Minister must acknowledge that there is a problem. What is she going to do about it?

[Lynne Featherstone]

I reiterate that the £2 billion annual cost of legal aid, combined with the economic circumstances left by Labour, meant that hard choices had to be made. Labour was also committed to reducing legal aid. We have retained legal aid in key areas impacting on women, particularly with regard to injunctions to protect victims from domestic abuse and in private family law cases where domestic abuse is a feature.

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

5. What steps her Department is taking to tackle extremism.

[Daniel Kawczynski (Shrewsbury and Atcham) (Con)]

6. What steps her Department is taking to tackle extremism.

[The Secretary of State for the Home Department (Mrs Theresa May)]

Today I delivered a speech on the challenge of extremism in which I set out the need to develop a better understanding of the threat from extremism; to promote more assertively our values and the proposition that everybody living in this country is equal and free to lead their lives as they see fit; to ensure an effective response from the state; and to build up the capacity of civil society to identify, challenge and defeat extremism. I made it clear that the challenge to the extremists must be centred on a new partnership consisting of every single person and organisation in our country that wants to defeat extremism.

[Rehman Chishti]

In the light of recent incidents, including that of the three young London girls who travelled to Syria, does the Secretary of State have any plans to set up a hotline for parents concerned about extremism, so that they can seek professional advice if they believe their children could be at risk, as is the case in Australia?

[Mrs May]

There are a number of opportunities available to families to report concern, including the anti-terrorist hotline. The Metropolitan police also made a further call to families last week to encourage them to report as early as possible, and organisations such as Families Against Stress and Trauma are actively working in communities to help people understand what they need to do when they are concerned about their children.

[Daniel Kawczynski]

Will my right hon. Friend assure me that the next Conservative Government will introduce new powers to tackle extremists and groups that spread hate but do not break existing laws?

[Mrs May]

My hon. Friend raises an important point. We have looked at addressing the issue of those people and groups who act in a way that does not meet the current proscription threshold, and we will, indeed, introduce extremist banning orders and extremist disruption offers, which will do exactly what my hon. Friend says.

[Fiona Mactaggart (Slough) (Lab)]

In her response to the hon. Member for Gillingham and Rainham (Rehman Chishti), the Home Secretary referred to the three girls from Bethnal Green academy. When the first girl left in December, what specific assistance was given to the school by the Home Office?

[Mrs May]

Following the first girl leaving in December, assistance was given to the school by the local Prevent co-ordinator and the local authority’s schools officer, who went into the school to make arrangements for extra training to be given.

[Kate Green (Stretford and Urmston) (Lab)]

What steps is the Home Secretary taking to encourage police forces to record accurately and comprehensively incidences of Islamophobia and hate crimes against Muslim victims, which Greater Manchester police is already doing?

[Mrs May]

The hon. Lady raises a very important point. The approach to recording hate crime has developed over the past five years and I am pleased that we are now able to see much more clearly what is happening. I was very clear in my speech today that this is an issue for a future Government, but a future Conservative Government would require the police to record anti-Muslim incidents as well as anti-Semitic incidents.

[Sir Tony Baldry (Banbury) (Con)]

7. What steps her Department is taking to tackle organised crime.

[The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)]

The Government are committed to tackling the threat of serious and organised crime. In 2013 we launched a comprehensive new strategy and a powerful new crime-fighting organisation—the National Crime Agency—which are already making a difference. We continue to strengthen our response through the Serious Crime Act 2015, the Modern Slavery Bill and strategy, and the anti-corruption plan. We have also forged new collaborative relationships with the private sector to tackle money laundering and to combat online child sexual exploitation.

[Sir Tony Baldry]

The National Crime Agency has clearly had a good start, with 300 convictions in just the first six months. Will my hon. Friend confirm that the Serious Crime Act 2015 will ensure that the National Crime Agency continues to have the resources and powers to address serious and organised crime?

[Karen Bradley]

I thank my right hon. Friend for his question. He is right that the National Crime Agency has made a good start. We have looked carefully at where powers are needed to increase the weapons that it has in its arsenal, and the Serious Crime Act really assists the National Crime Agency and other police forces in making sure that they can tackle particularly criminal finances to stop the Mr Bigs keeping hold of their money.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

One of the most serious forms of organised crime is child sexual exploitation. The National Crime Agency was given information over a year ago about 20,000 people who had downloaded abusive images of children. Twelve months later, only 2% have been fully investigated or charged. What has happened to the other 98%? With that kind of backlog of CSE cases, does the Home Secretary really think that this is the right time to cut thousands more police?

[Karen Bradley]

The hon. Lady disappoints me. We have had this conversation on several occasions. The fact of the matter is that the National Crime Agency, through Operation Notarise and others, has protected more children from abuse than any other agency, and it is ensuring that children at risk of abuse are looked after and protected in a way that has never happened before.

[Damian Green (Ashford) (Con)]

Does my hon. Friend agree that one of the signal successes of the NCA is that it has made more than 600 arrests in dealing with online child sexual exploitation through the operation that she has just mentioned? Will she assure the House that this will continue to be a high priority, not just for the NCA but for each individual local force?

[Karen Bradley]

My right hon. Friend, who has considerable experience in this area, will know full well that the National Crime Agency and local police take this issue incredibly seriously. Bringing the Child Exploitation and Online Protection Centre into the National Crime Agency, as a command within it, has increased both capability and capacity to consider such crime and to make sure that we find those criminals who want to hurt our children and prevent them from doing so.

[Mr Dominic Raab (Esher and Walton) (Con)]

8. What steps she is taking to reduce crime rates.

[The Minister for Crime Prevention (Lynne Featherstone)]

Police reform is working, and crime is down by more than a fifth under this Government, according to the crime survey for England and Wales. We are taking decisive action to cut crime and protect the public, including through working with the National Crime Agency. We are tackling the drivers of crime, including through our drug and alcohol strategies, and we have intensified our focus on issues such as violence against women and girls, gangs and sexual exploitation.

[Mr Raab]

I thank the Minister for that answer. While police funding has been cut by about a fifth, police-recorded crime has fallen by 14%, and by 28% across Elmbridge in my constituency. Will she join me in commending front-line officers in Surrey and across the country for the great job they are doing? Does that fall not demonstrate how vital reform is, and that public services cannot be judged only by the amount of money going in?

[Lynne Featherstone]

I am happy to join my hon. Friend in commending front-line officers in Surrey, and I congratulate all police forces that, with their police and crime commissioners, are rising to the challenge of driving efficiency and cutting crime. Effective policing plays a key part in reducing crime, and PCCs are ensuring that forces focus on the issues that matter most to local people. My hon. Friend is right that money is not the only thing that we need in order to cut crime; dedicated officers are our greatest resource.

[Dan Jarvis (Barnsley Central) (Lab)]

There is no doubt that the huge increase in the use of so-called legal highs has an impact on crime rates. I have seen that in my constituency. The Government have agreed to ban legal highs, but have not yet acted to do so. Will the Government take action in this Parliament, and if not, why not?

[Lynne Featherstone]

Given that this Government have actually banned and outlawed 500 legal highs, I do not think it is accurate to say that we have taken no action. We obviously want to move to a general ban on legal highs—lethal highs, as I call them—and that is on the shelf, ready for the new Government.

[Mr Steve Reed (Croydon North) (Lab)]

There is a glaring difference between the Government’s complacency and the City of London police commissioner’s view that online crime is growing exponentially. Does the Minister agree with the Office for National Statistics that if all bank and credit card fraud were included, the statistics would show that overall crime was up by 50%?

[Lynne Featherstone]

I am having a lot of disagreements with the Labour party today. The ONS is working to incorporate measures of cybercrime in the main crime survey. It looked at this issue specifically and said, when it published the latest crime figures, that it had found that although there may have been some movement by criminals into fraud and cybercrime, it certainly had not been enough to offset the substantial falls in traditional crimes, such as burglary and vehicle theft, over the past 20 years. Action Fraud’s reporting is up. That is a specialist reporting agency. We are acting on fraud.

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

10. What steps she is taking to encourage police and crime commissioners to support early intervention programmes.

[The Minister for Crime Prevention (Lynne Featherstone)]

As part of the work of the Home Office crime prevention panel, the Early Intervention Foundation and the College of Policing recently launched new guidance to help front-line police support early intervention. The police and crime commissioners from Dorset, Lancashire and Staffordshire were involved in the development of the guidance.

[Mr Allen]

May I ask the Minister to do something very practical? We are grateful that she launched the report, but will she ensure that every single police and crime commissioner and every single chief constable gets a copy of it so that they can not only reduce crime by cutting down dysfunction in the population early on in life, but save the taxpayer a lot of money through not having to invest money late on through late intervention?

[Lynne Featherstone]

The early intervention guidance for police will provide invaluable support in stopping potential criminals before they commit crimes, which will save the police a great deal of work in the long term. The guidance is already available online. We encourage all police officers, police community support officers, chief constables and PCCs to read it. I am happy to take up his suggestion if I have time, because the more officers have access to it, the better. I am sure that we can get it done before Thursday.

[Kerry McCarthy (Bristol East) (Lab)]

11. What recent discussions she has had with police unions and associations on the effect of changes to police budgets on frontline staff.

[The Minister for Policing, Criminal Justice and Victims (Mike Penning)]

The Home Secretary and I hold regular bilateral meetings with police work force representatives. I have said since day one as the police Minister that my door is always open to those representatives.

[Kerry McCarthy]

The Minister will know, then, what pressure front-line policing is under. The Government promised to protect and even increase front-line policing numbers, yet 8,000 front-line jobs have gone. Why will the Home Office not look at alternative ways of saving money, such as introducing better procurement practices or scrapping police and crime commissioners, rather than pursuing plans to axe yet another 20,000 officers?

[Mike Penning]

I would have thought that the hon. Lady would have praised the work that is being done by Avon and Somerset police, rather than following the party line. In her constituency there has actually been a 5% increase in front-line officers, who are not doing back-room work, and a 21% cut in crime.

[Mr David Heath (Somerton and Frome) (LD)]

Avon and Somerset police have indeed done very well. However, an understandable operational response to difficult budgets is to withdraw policing from rural areas, which empirically have a lower level of crime. That is understandable, but wrong. Will the Minister reassure me that he will tell all police forces that they have a duty to people who live in rural areas? Those people must not think that they are being exposed to crime or abandoned by the forces of law and order.

[Mike Penning]

I assure my right hon. Friend that each time I go into any force I say to anybody who listens to me not only that it is their duty to address rural crime—my constituency has large rural areas—but that all crime, no matter where it is, needs to be detected and prosecuted.

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

12. What her policy is on the minimum income threshold requirement for people wishing to sponsor their partner’s visa to settle in the UK.

[The Minister for Security and Immigration (James Brokenshire)]

The minimum income threshold of £18,600 for sponsoring a partner under the family immigration rules ensures that couples who wish to establish their family life in the UK can stand on their own feet financially. The requirement prevents burdens on the taxpayer and promotes integration. It has been upheld by the Court of Appeal and is helping to restore public confidence in the immigration system.

[Richard Burden]

The Minister has just asserted that the purpose of the minimum income threshold is to ensure that a spouse from overseas who comes to live here is not a burden on the taxpayer. However, at £18,600, the threshold is more than £3,000 higher than the living wage. Does he not think that it should be reviewed to ensure that the original purpose of the minimum income threshold is what counts and that it does not discriminate against those on the living wage or below, or against people who happen to live in the wrong part of the country?

[James Brokenshire]

As the hon. Gentleman knows, the income threshold was set on the basis of advice given to the Government by the Migration Advisory Committee, which considered this issue in great detail to assess the appropriate level. Perhaps he will find interesting the fact that the 2014 annual survey of hours and earnings for the Office for National Statistics showed that median earnings of those in full-time employment were appreciably higher than £18,600 in all parts of the UK.

[Duncan Hames (Chippenham) (LD)]

In practice, the length of time in which a sponsor is required to demonstrate that they have met the minimum income threshold is driving families apart. Would it be sufficient for a sponsor to demonstrate that they have secured permanent employment on such a salary, and not have a situation where several months have to pass with someone providing bank statements to show their income, during which time their partner is separated from them?

[James Brokenshire]

Migrant partners with an appropriate job offer can apply to come to the UK under tier 2 of the points-based system, and those using the family route to come to the UK must be capable of being independently supported by their sponsor, their joint savings, or non-employment income. We have considered the issue in an appropriate way to ensure that people are not a burden on the taxpayer, and I underline again that the system has been tested and upheld in the courts.

[John Cryer (Leyton and Wanstead) (Lab)]

Has the Minister made any assessment of the minimum age of sponsors as well as minimum income, because the two factors often relate to each other?

[James Brokenshire]

The hon. Gentleman will no doubt be aware that the minimum age for spouse visa applicants and sponsors was increased to 21 in 2008, and the Government defended that position. The Supreme Court found in 2011 that although the Secretary of State was pursuing a legitimate and rational aim in seeking to address the problem of forced marriages —the hon. Gentleman will know that such issues exist—increasing the minimum marriage visa age from 18 to 21 disproportionately interfered with the right to a family life under article 8 of the European convention of human rights. We keep such issues under close review, but they are complex.

[Jeremy Corbyn (Islington North) (Lab)]

Will the Minister think again about this whole policy? It is cruel on children who are denied the right to live with their parents, contrary to the principles of the conventions on human rights, and really not necessary. Its only effect is that of hurting the very people who should not be hurt because of it.

[James Brokenshire]

While ensuring sufficient resources so that those arriving are supported at reasonable levels, the minimum income threshold is also intended to ensure that family migrants can participate sufficiently in every-day life to facilitate their integration into British society. That is one of the fundamental purposes of the policy, and I think that is right.

[Mike Crockart (Edinburgh West) (LD)]

13. What discussions she has had with the Secretary of State for Scotland on the potential introduction of a scheme to allow international students graduating from Scottish further and higher education institutions to remain in Scotland to work for a defined period of time.

[The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)]

My right hon. Friend the Home Secretary meets colleagues regularly for discussions on a range of issues, including how we can continue to attract the brightest and best to study here while bearing down on abuse.

[Mike Crockart]

The recommendation comes as part of the Smith agreement. It recognises that the higher education sector is a multi-billion pound industry, and Edinburgh university is one of the most successful participants in that. More than 10,000 foreign students are now studying at Edinburgh, generating some of the highest quality research in the UK. Does the Minister agree that keeping more of those excellent students in the UK while their research is commercialised would be of enormous benefit, not just to the Scottish economy but to the UK as a whole?

[Karen Bradley]

My hon. Friend will know that the Russell Group of universities, of which Edinburgh is a member, has seen a 30% increase in the number of applications from overseas students since 2010, showing that studying in the United Kingdom is an attractive offer to students. There is no cap on the number of students who can stay in the UK after completing their degree, provided they have a graduate-level job, get an internship or become a graduate entrepreneur.

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

The Minister will have seen the Scottish Government’s post-study work working group, which recommends that a post-work study visa is reinstated for a wide range of people, including businesses, education and student representatives. Will the Minister consider that or will she ignore it again? What can the Scottish people do to progress that agenda and ensure that our economy and higher education institutions benefit?

[Karen Bradley]

What the Scottish people can do is clear: stay part of the Union. I repeat that there is no cap on the number of graduates who can stay on after their studies, provided they have a graduate job, an internship or a graduate entrepreneurship.

[Ann McKechin (Glasgow North) (Lab)]

The Minister will be aware of the reduction in the number of students from the Indian subcontinent. One of the major reasons for that is that they are unable to remain in the United Kingdom for a few years to work and to pay off their fees. This policy, therefore, discriminates against those who come from poorer nations, rather than those from richer families.

[Karen Bradley]

I repeat that since 2010 there has been an increase in the number of visa applications from overseas students. It is difficult to say what the drivers are for our seeing more students from some countries and fewer from others. For example, we are seeing a significant increase in the number of students from China, which indicates that it is not the reforms that are stopping people coming.

[Rosie Cooper (West Lancashire) (Lab)]

14. What assessment she has made of the financial condition of police forces in England and Wales.

[The Minister for Policing, Criminal Justice and Victims (Mike Penning)]

The Home Secretary and I have made it clear that there is no question but that the police will have the resources to do their important work. Her Majesty’s inspectorate of constabulary has reported that forces up and down the country are reducing crime and protecting communities, while balancing their books.

[Rosie Cooper]

Since 2010, Lancashire police has lost 700 posts and 11 police stations have been closed due to £60 million-worth of cuts, with more to come. Offences such as burglary, theft and violence are all on the rise. The Lancashire Police Federation says that the police are at breaking point. Will the Minister please apologise to the people of West Lancashire for failing to honour his promise to protect front-line policing?

[Mike Penning]

I like the hon. Lady—I get on with her really well—but she should apologise to her constituents for not mentioning that crime is down by 9% in her constituency and across Lancashire, something we should all be very proud of.

[Tim Loughton (East Worthing and Shoreham) (Con)]

On Friday night, I went out with the very impressive section 136 team at Worthing police. The initiative, under which community psychiatric nurses go out on patrol with the police, is being piloted in Sussex. Given that up to two thirds of police call-outs are estimated to relate to mental health and substance abuse problems, this has the potential to free up a lot of police time and save a lot of money. These pilots really work, so will they be rolled out across the whole country?

[Mike Penning]

That pilot and other pilots around the country are working. I have seen them myself. It is our intention to continue to roll them out. We are working enormously closely in particular with the mental health team in the Department of Health. I have seen dramatic changes not only in my constituency but around the country. There are people who should not be in cells and should not be arrested. They should be in a place of care, where they need to be. That is what we expect to happen.

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

My Greater Manchester police force has had to make savings of £145 million in the five years to 2015, and has lost more than 1,300 police officers as a result. Across the country, the picture is pretty similar. Will the Minister say whether, as a result of the changes to police forces, response times have improved or got worse on his watch?

[Mike Penning]

What has happened on the Home Secretary’s watch and on my watch is that crime in the hon. Gentleman’s constituency is down by 20%, something that is forgotten every time Labour Members stand up in this House.

[Mr Nigel Evans (Ribble Valley) (Con)]

15. What assessment she has made of the adequacy of the number of police officers in Lancashire.

[The Minister for Policing, Criminal Justice and Victims (Mike Penning)]

Crime has fallen by a fifth across the country and by 9% in my right hon. Friend’s constituency. That is because we have proved that more can be done with less. We should be very proud of police forces across the country, particularly in Lancashire.

[Mr Evans]

Unlike the hon. Member for West Lancashire (Rosie Cooper), I want to praise the work of the Lancashire constabulary in my county, where crime has gone down by 19% since 2011. Antisocial behaviour is down by 35.8% and robbery in the past 12 months is down by 47%, which is a remarkable figure. Will the Minister assure the House that the Lancashire constabulary will, under a Conservative Government, have sufficient resources to carry on doing its great work in the next five years?

[Mike Penning]

Not only will we guarantee that, we will continue to roll out the specialist equipment that is helping the police day in, day out, especially body-worn cameras. They are ensuring that more people in the community are protected, the officers are protected and we get more convictions, something I expect to see in Lancashire, as well as in the rest of the country.

[Stephen Hammond (Wimbledon) (Con)]

16. What recent steps she has taken to tackle sham marriages.

[The Minister for Security and Immigration (James Brokenshire)]

This month, the Government introduced a new scheme to tackle sham marriages and sham civil partnerships allowing the Home Office to investigate suspected sham cases under an extended 70-day notice period. Since April 2014, we have intervened in more than 2,000 suspected sham marriages, and last year 30 organised crime groups involved in arranging sham marriages were disrupted, with many receiving long custodial sentences.

[Stephen Hammond]

Will my hon. Friend update the House on the number of people he expects this country to protect itself against following the introduction of these new powers?

[James Brokenshire]

This has been a priority for me since I took on the immigration responsibilities last year. We will take strong action, including prosecution and seizure of assets. As for an update, this financial year we have undertaken more than 2,000 operations, resulting in 1,200 arrests and more than 430 removals, which compares with 327 sham marriage operations, resulting in 67 arrests in 2010, showing that, unlike the last Government, this Government are committed to this issue.

[Mr Philip Hollobone (Kettering) (Con)]

17. What the level of crime was in Northamptonshire in (a) May 2010 and (b) March 2015.

[The Minister for Crime Prevention (Lynne Featherstone)]

Police reform is working and crime is down by more than one fifth under this Government, according to the independent crime survey for England and Wales. According to the latest figures published by the Office for National Statistics, police recorded crime in Northamptonshire fell by 18% between June 2010 and September 2014.

[Mr Hollobone]

We are blessed in Northamptonshire with excellent and hard-working policemen and women, and it is marvellous that crime has fallen. Given that we were told by Her Majesty’s loyal Opposition that crime would rise because of the police budget cuts, why does my right hon. Friend think it has actually come down?

[Lynne Featherstone]

I congratulate my hon. Friend on his work as a police special constable. He rightly says that the Opposition doubted our ability to bring down crime. However, our police forces have proved that where there is a will there is a way, and they have cut crime by more than 20% this Parliament, according to the crime survey. We should be very proud of them.

[Maria Miller (Basingstoke) (Con)]

T1. If she will make a statement on her departmental responsibilities.

[The Secretary of State for the Home Department (Mrs Theresa May)]

For too long, thousands of people have been on bail for months or even years, with no independent oversight of the police’s investigation. To put a stop to this, I announced to the House in December that I was consulting on the introduction of statutory time limits for pre-charge bail. That consultation closed on 8 February, and I am grateful to the 300 individuals and organisations that responded. I have today placed in the Library of the House and on the gov.uk website a summary of the consultation responses and the Government’s response.

On the key point of independent review, it is apparent from the consultation that the model where all extensions of bail past 28 days would be done in court would not be viable, as there is unlikely to be sufficient capacity in the magistrates courts. I have therefore decided to adopt the model endorsed by the consultation under which pre-charge bail is initially limited to 28 days. In complex cases, an extension of up to three months could be authorised by a senior police officer, and in exceptional circumstances, the police will have to apply to the courts for an extension beyond three months to be approved by a magistrate. This will introduce judicial oversight of the pre-charge bail process for the first time, increasing accountability and scrutiny in a way that is manageable for the courts.

[Mr Speaker]

We are all now very fully informed.

[Maria Miller]

I recently visited Hampshire’s cybercrime unit and spoke to officers detecting online crime, particularly child abuse. I am sure the Home Secretary will want to join me in commending those officers for their dedication. Does she agree that we need to do everything we can to help police in this work and, in particular, to ensure that social media and other websites verify the identity of UK residents using their sites?

[Mrs May]

First, may I take up the point that my right hon. Friend made about the work of police officers in police forces, the Child Exploitation and Online Protection Centre and the National Crime Agency more widely in dealing with child abuse cases? These are not easy issues, and they do a very valuable job. Over the period of this Government, we have invested £86 million in dealing with cybercrime, and the creation of the national cyber crime unit at the NCA is, I believe, an important element in dealing with cybercrime. We expect social media companies to make it easy for users to choose not to receive anonymous posts, to have simple mechanisms for reporting abuse and to take action promptly when abuse is reported.

[Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)]

The Office for Budget Responsibility says that the Chancellor is planning cuts that are much more severe than anything we have seen over the last five years. The Institute for Fiscal Studies has said that the cuts will be twice the size of any year’s cuts over this Parliament. That means a real-terms cut for the Home Office under the right hon. Lady’s plans over the next few years alone of 23% and the loss of 20,000 more police officers on top of those who have already gone. When the terror threat is growing, when more child abuse cases are coming forward, when recorded violent crime is up and when chief constables say that neighbourhood policing cannot be sustained, is she really saying to communities across the country that she and the Tories are prepared to cut 20,000 more police officers?

[Mrs May]

The right hon. Lady knows full well that the funding for counter-terrorism policing has been protected and that this Government are putting more money into dealing with child sexual exploitation. When she comes to deal with this issue, perhaps she could remind people why it is that this Government have had to deal with budget cuts across the public sector: it is because the last Labour Government left us with the worst budget deficit in our peacetime history.

[Yvette Cooper]

But the right hon. Lady has not managed even to meet her deficit plan, and we have already seen the police cut across the country. Her plans mean going further in the scale of police cuts, with 20,000 further police officers going across the country at a time when recorded rapes are up 30%, but fewer rapists are being arrested; when recorded violent crime is up 16%, but fewer violent criminals are being convicted; when online fraud is through the roof, yet fewer fraud proceedings are going ahead; and when recorded child abuse is up 33%, yet 13% fewer paedophiles are being prosecuted. On her watch, 999 waits are up, the police cannot keep up with extremists on the streets and more criminals are walking free. Is she really saying she is going to go around the country, campaigning with all her Back Benchers, saying she is content for 20,000 more police officers to go—because we’re not, and we won’t?

[Mrs May]

The right hon. Lady mentioned that reports of child sexual abuse have increased, and yes they have. In a sense, that is to be welcomed, because more people feel that they can now come forward and report their abuse, which means that those issues can be investigated and the cases looked into. She talked about the figures for rape and domestic abuse, but I have to say that the volume of domestic abuse referrals from the police rose in 2013-14 to the highest level ever: 70% of those referrals were charged, which was the highest volume and proportion ever; there has been a rise in charged defendants from 2012-13; and conviction rates have risen since 2010-11. The figures on which she bases her rant show once again, I am afraid, that she is not paying attention to what is actually happening. What is happening is the exact opposite of what she and her colleagues said five years ago. She said crime would go up, but crime has gone down under this Government.

[Robert Halfon (Harlow) (Con)]

T3. My right hon. Friend will be aware that we in Harlow have had more than 109 illegal and unauthorised encampments over the past 15 months, and there is now a town-wide injunction banning anyone from setting up unauthorised or illegal encampments. Will my right hon. Friend look at how we can strengthen the law, possibly following the Irish example of making trespass a criminal rather than a civil offence?

[The Minister for Policing, Criminal Justice and Victims (Mike Penning)]

I pay tribute to my hon. Friend for the campaigning and work he has done on behalf of his constituents whose lives have been blighted by these illegal camps. When we are back in government after the election, we will look at the law—I can assure you of that, Mr Speaker—but we must also make sure that the police use the powers they have and are not frightened of using them, as appears to have happened in certain parts of the country, including in my hon. Friend’s part of Essex.

[Meg Munn (Sheffield, Heeley) (Lab/Co-op)]

T7. I am concerned about a recommendation in a recent Home Affairs Committee report that those arrested on sexual offences charges should be given anonymity. Does the Home Secretary agree that in these circumstances, these prosecutions are extraordinarily difficult, and that the decision should be made carefully by the police? Will she ask the independent panel inquiry also to look at this issue?

[Mrs May]

The hon. Lady raises an important issue. As she will be aware, there was a significant debate about this very thing early on in this Parliament. The Government have not yet responded to the Home Affairs Committee report—for understandable reasons, given that it has only just come out—but I was asked about the matter when I was in front of the Home Affairs Committee last week. This issue has to be dealt with on a case-by-case basis. I think that an assumption of anonymity on arrest is right in general, but there will be cases when it is right for the police to ensure that the name is put out so that other people can come forward to report crimes by the same perpetrator.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

T4. The use of legal highs is a significant problem all over the country, and it is certainly a problem in Harrogate and Knaresborough. Such drugs can have devastating consequences. The papers covering my area, the Harrogate Advertiser and The Knaresborough Post, have run a very good campaign highlighting the scale of the local problem. What progress has been made in tackling these dangerous drugs?

[The Minister for Crime Prevention (Lynne Featherstone)]

It is very helpful when the local media join the campaign against what I term “lethal highs”. As I said earlier, the Government are drawing up proposals for a general ban on the supply of new psychoactive substances throughout the United Kingdom, with a view to introducing legislation at the earliest opportunity. Obviously there is not enough time left for us to legislate in the current Parliament. However, we have already banned more than 500 new drugs, created a forensic early warning system to identify new psychoactive substances in the UK, and supported law enforcement with the latest intelligence on new substances, and we are taking a number of actions in relation to health, prevention and treatment.

[Kerry McCarthy (Bristol East) (Lab)]

T8. The Minister told me a moment ago that there were more front-line police officers in Avon and Somerset. However, a report by Her Majesty’s inspectorate of constabulary tells me that the number is down by 10%, from 2,937 in March 2010 to 2,651 in March 2015. In what way is that “more”?

[Mike Penning]

I apologise if I misled the hon. Lady, but I am sure I said that we were taking staff out of the back rooms and putting more on the front line. There are more officers serving on the front line today than there were when the Labour Government left office.

[Sarah Teather (Brent Central) (LD)]

T5. I understand that the Home Secretary has asked officials to carry out a detailed piece of work on the future requirements of the immigration detention estate, in conjunction with her decision to halt the expansion of Campsfield. What is the remit for that work, what is the timetable for it, and will it be made public? Will the Home Secretary direct the officials to look at the international evidence that was presented in our cross-party report on the immigration detention system, which suggests that we could substantially reduce our need for detention places?

[The Minister for Security and Immigration (James Brokenshire)]

Let me take this opportunity to wish the hon. Lady well for the future, as that was probably the last Home Office question she will ask before she leaves the House.

We will certainly look at the all-party parliamentary group report, and I intend to write to the hon. Lady about it before the House rises on Thursday. We are examining the issue of the detention estate internally, but our work will be informed by Stephen Shaw’s review of the welfare aspects. It is important to ensure that we are providing a humane environment for people who are being detained.

[Julie Hilling (Bolton West) (Lab)]

Crime rose by 6% in Greater Manchester last year. Will the Minister update us on her improvement plan with Action Fraud, and can she assure me that the defrauding of my constituents will be investigated and they will be kept up to date with the progress of that investigation?

[The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)]

The hon. Lady and I have had several discussions about Action Fraud. Let me bring her up to date with the latest figures from the organisation. As we have established in earlier discussions, fraud is historically an under-reported crime. The number of recorded offences has almost trebled, from 72,000 before the introduction of Action Fraud’s centralised reporting system to 211,000 now. As the hon. Lady knows, Action Fraud is also embarking on an improvement plan. It has resulted in a reduction in the number of complaints, which should be welcomed, but we are still keen to ensure that local police forces in particular treat and correspond with victims in a way that enables them to understand the action that is being taken to deal with these crimes.

[Sir Edward Leigh (Gainsborough) (Con)]

T6. Yesterday huge crowds turned out in our most multicultural city, Leicester, to celebrate English history. Did not that celebration of monarchy and continuity provide a fine example of British values, and should we not learn from that example of history that it is not a good idea to get on politically by bumping off one’s close relations?

[Mrs May]

We could have an interesting debate about my hon. Friend’s last comment, and I am grateful to him for not suggesting that the princes in the tower is an historic case that the police should take up today. The point he made about those in Leicester coming together yesterday from all parts of the community and celebrating British values is an important one. It is exactly what I was speaking about this morning, when I said that we need a partnership of individuals, communities, families and Government, going across Government and including other agencies, to promote our British values and what it is to live here in the United Kingdom and to be part of our British society.

[Paul Blomfield (Sheffield Central) (Lab)]

The Home Secretary will know that one of her former Cabinet colleagues and a former chief inspector of prisons were among those of us from all parties and both Houses on the recent inquiry into immigration detention which recommended that the Government learn from best practice abroad where alternatives to detention not only allow individuals to live in the community, but are more effective in securing compliance, and at a much lower cost to the public purse. Will she respond positively to our recommendations?

[James Brokenshire]

I have already indicated that we are examining the points made in the recent all-party parliamentary group report, but I have to say to the hon. Gentleman that there is a need for detention in managing immigration and ensuring that we can remove people safely and appropriately. It is also worth underlining that we cannot detain people indefinitely. This is about the perspective of ensuring that there is the ability to remove, and that is the way in which the Government operate the rules.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

T9. Does the Home Secretary agree that until such time as front-line resources and targets are set for rural crime, these crimes will not be taken seriously in rural constituencies? Will she give an edict from the Dispatch Box today that Travellers who are on rural land illegally will be removed forthwith?

[Mike Penning]

The police already have powers. As I indicated to my hon. Friend the Member for Harlow (Robert Halfon) earlier, the police often have the powers in respect of illegal Traveller sites. Crime in rural areas is a very serious issue and we should all take it seriously. While crime is down 16% in the part of the world of my hon. Friend the Member for Thirsk and Malton (Miss McIntosh), any crime is bad.

[Barry Gardiner (Brent North) (Lab)]

Yesterday I spoke to community leaders at one of my mosques about the young men who had been educated at schools in Brent North and who have now been returned from Syria. They expressed to me their deep concern about the lack of community facilities for some of the community groups and the way in which this was tending to lead to radicalisation of the young men. Does the Home Secretary regret the cuts to the Prevent programme?

[Mrs May]

The changes we made to the Prevent programme are very simple. We did two things when we came into office: we said Prevent should look at non-violent extremism as well as violent extremism, but we also said that the part of the Prevent programme that was about the integration of communities came better under the Department for Communities and Local Government than under the Home Office, because people were looking at this as people effectively spying on them rather than a proper integration of communities. What we are doing now is standing back and recognising that we need to deal with extremism across a broader spectrum, because Prevent has always been cast in terms of counter-terrorism. That is why in my speech today I talked about the broader partnership with Government, other agencies, communities, families and individuals to deal with extremism and give a very clear message to the extremists that they will not divide us.

Speaker’s Statement

Monday 23rd March 2015 Commons Chamber

15:32

[Mr Speaker]

I have a short statement to make. Under the chairmanship of the right hon. Member for Blackburn (Mr Straw), the Select Committee on the Governance of the House of Commons recommended, and the House agreed on 22 January, that the roles of Clerk of the House and Chief Executive should henceforth be split. It invited the House of Commons Commission to make arrangements to select a new Clerk and thereafter to begin to recruit for a separate role of Director General of the House of Commons. Accordingly, a trawl for the vacant post of Clerk of the House of Commons was held. Four applicants were interviewed by a panel chaired by me and also including the Leader of the House, the shadow Leader of the House, the Chairman of the Finance and Services Committee and Liz McMeikan, an independent assessor. The unanimous recommendation of the panel was that Mr David Natzler, at present acting Clerk of the House, should be recommended for appointment. I am glad to be able to tell the House that Her Majesty the Queen has approved the appointment. I am sure that the House will join me in warmly congratulating David.

I have further to report to the House that the deadline for applications for the separate position of Director General of the House of Commons has passed and that the selection process is under way. In keeping with the recommendation of the Straw Committee, it is expected that this recruitment process will be completed very early in the next Parliament.

European Council

Monday 23rd March 2015 Commons Chamber

15:35

[The Prime Minister (Mr David Cameron)]

I know that the whole House will join me in welcoming David Natzler as the new Clerk of the House. Mr Speaker, you went to the ends of the earth in search of the best candidate, but I am glad that we found the right answer right here in Britain.

Before turning to the main focus of the Council, which was the situation in the eurozone, let me say a word about the discussions on Tunisia and Libya, on the situation in Ukraine and on the nuclear talks with Iran. I am sure the whole House will join me in sending our deepest condolences to the friends and family of Sally Adey, a British holidaymaker who was among at least 20 tourists and two Tunisians brutally murdered in the terrorist attack at the Bardo museum last week. I have written to President Essebsi to assure him that Britain will stand with the people of Tunisia as they seek to defeat the terrorists and build a peaceful and prosperous future. The EU has agreed to offer practical assistance, and Britain will play its part, deploying SO15 and military counter-terrorism experts and continuing to provide assistance in aviation security and tourist resort protection.

The suggestion that some of the terrorists involved had been trained in Libya is the latest evidence of the very difficult situation in that country. The Council agreed on the need for a political solution, supporting UN-led efforts to bring the different parties in Libya together to agree a national unity Government. Britain has provided Libya with aid and military training, and we will continue to do all that we can to assist. I know that some people are looking at this situation and asking whether Britain, France and America were right to act to stop Colonel Gaddafi when we did. We should be clear that the answer is yes. Gaddafi was on the brink of massacring his own people in Benghazi, and we prevented what would have been a wide-scale, brutal, murderous assault. It was the right thing to do, and we should be very proud of the British servicemen and women who carried out that vital task.

Turning to the situation in eastern Ukraine, the Council welcomed the significant reduction in fighting and the progress on the withdrawal of heavy weapons. But as President Obama, President Hollande, Chancellor Merkel and I agreed earlier this month, it is essential to send a clear signal that sanctions will not be eased until Russia delivers on its promises and the Minsk agreements are fully implemented. The European Council did exactly that. The conclusions say that

“the duration of the restrictive measures...should be clearly linked to the complete implementation of the Minsk Agreements.”

The conclusions also underline our readiness to take further measures if required.

One of the best things we can do to help Russia’s neighbours is to help them to fight corruption and strengthen their democracies. Just as the Know-How fund, set up by Margaret Thatcher, did a great job of helping eastern European countries after the fall of the Berlin wall, so we need the same approach today. At the Council, I announced a good governance fund with an initial £20 million to support reforms in countries in the eastern neighbourhood and the western Balkans. This will complement support from other donors, accelerating efforts to fight corruption, strengthening the rule of law, reforming the police and justice systems and supporting free markets by liberalising key sectors such as energy and banking. The fund will be up and running by the summer. As well as covering Ukraine, it will initially cover Georgia, Moldova, Serbia, and Bosnia and Herzegovina.

Turning to Iran, I met Chancellor Merkel and President Hollande in the margins of the Council to discuss progress in the vital talks on Iran’s nuclear programme. We are absolutely clear and united in our purpose. Iran must never be allowed to develop a nuclear weapon. But there is a peaceful path to civil nuclear energy, and we believe that a comprehensive, durable and verifiable deal is possible, but only if Iran shows greater flexibility and takes some tough decisions during the talks this week. We also discussed proposals for co-ordinating Europe’s energy policy, ensuring transparency of gas supply agreements and that Europe’s energy policies are consistent with reaching the vital deal at the climate change summit in Paris this December.

Turning to the eurozone, the Council welcomed the agreement between Greece and the euro area to extend their programme. Let me say again—this is the last of these statements in this Parliament and I have probably uttered this sentence 11 times: Britain is not in the eurozone and we are not going to join the eurozone. But we do need the eurozone to work properly. A disorderly Greek exit from the euro remains a major threat to Europe’s economic stability and it could be very damaging to the British economy. Protecting our economy from these wider risks in the eurozone means sticking to this Government’s long-term economic plan. Five years ago, Britain’s economy was close to the edge. We had the biggest budget deficit in our peacetime history. We had a deficit that was forecast to be bigger than that of Greece or of any other developed country on the planet. Five years on, the deficit has been halved and our national debt is falling as a share of GDP; we have the fastest growth of any major western economy; we have 1.89 million more people in work; and we have more jobs created in Yorkshire than in the whole of France, and more jobs created in the UK than in the rest of the European Union put together. We need to stay on this path, not abandon it just as it is leading our country to prosperity.

Just as we are acting in our national interest at home, so we have acted to protect our national interest in Europe, too: we have cut the EU budget for the first time in its history; we got Britain out of the euro bail-out schemes; we vetoed a treaty that was not in our national interest; we stopped attempts to discriminate against EU countries outside the eurozone, not least with our successful legal challenge last month; we have made vital progress on cutting red tape and completing the single market; at our G8 in Lough Erne, we kick-started the talks on what will be the biggest bilateral trade deal in history, between the EU and the US; we have put power back in the hands of our fishermen so they can sell what they catch; we have negotiated a new single European patent that will reduce cost for entrepreneurs, and part of that patent court will be based right here in London; we have ensured new safeguards to protect our vital financial services industry; we have returned over 100 powers from Brussels to Britain, giving us more control over our borders, policing and security; we have clamped down on benefit tourism; and in foreign policy, we have worked with our European partners to get things done and keep our people safe, on matters ranging from sanctions on Russia and Iran, and practical assistance to help countries in north Africa fight terrorism, to international action to help those in desperate need around the world, including in west Africa, where British aid workers are risking their lives, helping to stop the spread of Ebola.

In the coming two years, we have the opportunity to reform the EU and fundamentally change Britain’s relationship with it. We have the opportunity to build a European Union that is more competitive, more flexible and more accountable to the people, where powers flow back to member states, not just away from them, and where freedom of movement is no longer an unqualified right. And for the first time in 40 years, we have the opportunity to give the British people their say on Britain’s place in Europe with an in-out referendum. If I am Prime Minister, that is what I will do. Those who would refuse to give the British people their say should explain themselves to this House and to the country. I commend this statement to the House.

15:43

[Edward Miliband (Doncaster North) (Lab)]

May I thank the Prime Minister for his statement? He is obviously getting in his preparations for opposition now. Let me also join him in congratulating David Natzler on his very well-deserved appointment.

I also wish to join the Prime Minister in condemning the appalling terrorist attack in Tunisia last week. Our thoughts go out to the family and friends of Sally Adey and all the victims who were involved in the attacks. This despicable act of terrorism once again reinforces our determination to stand united across Europe.

Before turning to other matters, I also want to note that since the last European Council we have had the Israeli elections, although they do not appear to have been discussed at the European Council. Let me say that there is now one overriding priority, which is restarting negotiations towards a two-state solution: a secure Israel alongside a viable Palestinian state. Can the Prime Minister, when he replies, say whether he agrees that we must put pressure on both sides now to restart negotiations? In the light of Prime Minister Netanyahu’s comments in the run-up to the election, has our Prime Minister sought reassurances about his continuing commitment to a two-state solution?

On Iran, we support the talks. We cannot allow an Iran with nuclear weapons. It is vital that we secure a successful outcome and we will support the EU in seeking to bring that about. Let me also echo the Prime Minister’s words on Libya. We supported the military action—it was the right thing to do—and we support the call for an immediate and unconditional ceasefire. However, the Prime Minister needs to tell the country why things have gone so wrong in Libya. Are people not entitled to conclude that the international community did not adequately plan for the aftermath of the conflict, and what does he realistically believe can be done now?

On Greece, rather than recycling his failing election slogans, can the Prime Minister tell us what the prospects are for a long-term agreement with Greece? That agreement is in the interests of Greece, the eurozone, and the United Kingdom.

Turning to the situation in Ukraine, it is vital that the international community stands united in ensuring that the Minsk agreement is implemented in full. We welcome the commitment, which the Prime Minister reiterated, that EU sanctions on Russia should be eased only in the event of the full implementation of that agreement. Given that the current situation on the ground is not showing signs of getting better, will the Prime Minister tell us whether discussions took place during the summit about increasing further the pressure on Russia, particularly on the so-called tier 3 sanctions on specific sectors?

It is clear that the security dimension of the EU is becoming more and more important. That has been particularly apparent over the past year. It demands common action, resolve and a clear commitment to our continuing place in the European Union—a commitment that the Prime Minister is incapable of delivering. As this is his 29th and last European statement, I had hoped that he might do what he has failed to do in the past 28 and spell out his negotiating strategy. All we had was the same empty rhetoric. Perhaps he can now specifically tell us what the non-negotiable reforms are that he is seeking in Europe. Is he seeking treaty change? Would he countenance voting for “out” in a referendum—[Interruption] Oh, the Minister for Europe says no from a sedentary position; he would not countenance supporting “out”. Perhaps, when the Prime Minister replies, he can confirm that the Minister for Europe said from a sedentary position that, under no circumstances, would he countenance an out vote in a referendum—the Minister knows that the national interest lies in staying in. Those are the questions to which the country deserves answers.

Was the Prime Minister disappointed last week when the President of the European Council, who is supposedly an ally of Britain, described his position as “mission impossible”? With the typical modesty that we have come to expect from the Prime Minister, he then compared himself to Tom Cruise. [Interruption.] I am coming to that; he will enjoy it. To be fair, he did admit to one crucial difference. He said, “He’s a little bit smaller than me.” I have to say to the Prime Minister that I am not sure that that is the main difference that comes to mind. One has a consistent and relatively coherent approach to international affairs and the other is the Prime Minister of Britain.

The Prime Minister mentioned his achievements. Let us remind ourselves of them. He talked about his veto of the treaty, but the treaty went ahead. He did not mention the stand he took against President Juncker; he lost that 26 votes to two. He did not mention either the £1.7 billion bill from Brussels. His attitude to that was: can’t pay, won’t pay, oh, all right, we will pay. But let me relay my personal favourite over the past five years. Who can forget his phrase that in this town, you need to

“lock and load and have one up the spout.”

Up the spout is exactly where his European policy is—not so much Tom Cruise, more David Brent. He cannot tell us what he is negotiating for—

[The Prime Minister]

rose—

[Edward Miliband]

No, I have not quite finished. The Prime Minister cannot tell us what he is negotiating for; he has no strategy for achieving change—[Interruption.] I thought that Government Members wanted to talk about Europe—not any more. He cannot tell us what he is negotiating for. He has no strategy for achieving change and he cannot even tell us whether he will vote yes or no in a referendum. A Prime Minister who cannot tell us whether he wants to be in Europe or out of Europe is a weak Prime Minister. He cannot provide the leadership that our country needs. For that, Britain needs a Labour Government.

[The Prime Minister]

I had not been counting, but I think that reporting back to the House 29 times is quite an impressive record—too many. The right hon. Gentleman does have one thing in common with Tom Cruise: every policy he touches self-destructs in five seconds—tuition fees, spending, the deficit, taxes; it is all the same.

Let me deal with the right hon. Gentleman’s questions. On the very important matter of the Israeli elections, I am sure that we will all want to congratulate Prime Minister Netanyahu on his election victory. I agree with the Leader of the Opposition that we must put pressure on both sides to ensure that talks on a two-state solution get going. I will be talking with Prime Minister Netanyahu this evening, and I will make it very clear that I support a two-state solution. I think that is in the long-term interests of not only the Palestinians, but the Israelis, and Britain’s policy on that will not change.

I thank the right hon. Gentleman for what he said in support of the Government’s position on Iran and on Libya. He asked why we have seen the difficulties after the fall of Gaddafi. One of the things that we have to be clear about is that the Libyan people and the Libyan Government did not want some occupying force; they did not want to be remotely controlled by others. They were given opportunities to opt for a more unified future, but so far they have not taken them, so we have to do everything we can to keep putting those options on the table, not least through a national unity Government.

The right hon. Gentleman asked about Greece and the prospects for a long-term agreement. I still think that the prospects are quite worrying, because on one hand we have the creditor nations that want to see Greece fulfil its programme, and on the other hand we have a Greek Government who do not seem at the moment to be coming up with reforms that give their creditors confidence. One of the lessons that needs to be learned—the right hon. Gentleman needs to learn this—is that government involves difficult decisions, and the Greeks still have to make difficult decisions. [Interruption.] Yes, he was in government. I remember, because he completely crashed the economy, as a member of the Government who left this country in hopeless amounts of debt.

The right hon. Gentleman asked a very specific question on the Minsk agreement: will there be more sanctions if there is more destabilisation? The answer is yes. We should be prepared to consider more sanctions if the situation deteriorates. The key point about the Minsk agreement is that the difficult decisions for Russia will come at the end of the process, which is why it is so important to keep the sanctions right to the end.

The right hon. Gentleman wants to know why we want to renegotiate in Europe, and I will tell him why: we want to get out of ever-closer union; we do not want that to apply to Britain; we want control of our welfare system; we want safeguards for the single market; we want powers to flow back to Britain. Let me ask him this: if those are the things that we want, what is it that he wants? The answer, when it comes to Europe, is absolutely nothing. He told us that he does not think that Brussels has too much power. He refuses to rule out joining the euro because, as he said, “It depends how long I’m Prime Minister for”, so that is a hopeful message. He has made it clear that he will never give the British people a say in a referendum.

Frankly, I will compare my record on Europe with his party’s every day of the week. They gave away £7 billion of the rebate; we have protected the rebate. They gave away our ability to veto what is not in our national interest; we vetoed a treaty that was not in our national interest. They signed Britain up to being in the euro bail-out fund; we got Britain out of the euro bail-out fund. The truth is that we on the Government side of the House stand up for Britain in Europe and the Labour party just sells us out.

[Sir William Cash (Stone) (Con)]

I commend my right hon. Friend for what he has just said, and for stating unequivocally in his Bloomberg speech that it is our national Parliament that is the root of our democracy, for which people fought and died, but in what specific respects will he repatriate the powers of the British people to govern themselves and return the powers of sovereignty to this Parliament so that we can govern this country as we wish?

[The Prime Minister]

My hon. Friend makes an important point. We have already returned a power to Britain by getting out of the bail-out fund. We have returned 100 specific powers as a result of the opt-out on justice and home affairs. I have been very specific that when it comes to the free movement of people, and particularly its interaction with our welfare system, we need powers to be returned to this country. Specifically, I have said that people coming from European Union countries to Britain should not be allowed to claim unemployment benefit, that they should have to leave after six months if they do not have a job, that they should have to pay in for four years before getting anything out of the tax credits system and that they should not be able to send child benefit or other child tax payments to families back home. Those things require serious change in Europe, including treaty change, and that is what we will secure, and what a contrast with the Labour party, which will do absolutely zip.

[Mr Jack Straw (Blackburn) (Ind)]

May I add my own congratulations to Mr Natzler as Clerk, and say how pleased I am personally that the cross-party process of the Governance Committee has led to one of many important decisions that have been made following it?

When the Prime Minister speaks to Mr Netanyahu this evening, will he underline two things—first, that in respect of the negotiations with Iran, a deal which is acceptable and honourable on both sides is more likely to help guarantee Israel’s security, as well as that of others, than no deal at all? Secondly, will he emphasise to Mr Netanyahu that what his party and Government have been involved in is trying to change the reality on the ground through settlement building, so that if it goes on, it will be impossible for there to be a separate state of Palestine, and that if he carries on like this, the patience of this House and of Europe will run out?

[The Prime Minister]

First, just in case it is the last time I look at the right hon. Gentleman across the Floor of the House of Commons and he does not catch the Speaker’s eye at the last Prime Minister’s questions on Wednesday, may I pay tribute to him for all the work that he has done in government and in opposition, including in some very senior roles at some very difficult times for this country? The one pledge I make him is that if he continues to live where he does, his constituency MP will always stand up for him in this House of Commons and make sure that he receives a premium service.

The two points that the right hon. Gentleman makes about Israel are right and they are points that I will be happy to make. They are linked: if there is no two-state solution, the situation ends up moving towards a one-state solution, which I think will be disastrous for the Jewish people in Israel, so I really do believe in the two-state solution. We are very much opposed to the settlement building that has taken place. We have been very clear about that and will continue to be clear about that. It makes a two-state solution more difficult and that, in turn, will make Israel less stable, rather than more stable.

[Sir Richard Ottaway (Croydon South) (Con)]

In his Bloomberg speech the Prime Minister set out five core principles for a 21st-century EU. If he has had a chance to look at the current European Commission work programme, he will have seen that, contrary to what the Leader of the Opposition has just said, there has now been significant movement towards these principles, particularly on migration and the single market. Does my right hon. Friend agree that we do not have to demand a renegotiation before a referendum? Europe is already offering us one.

[The Prime Minister]

My right hon. Friend is right. It is because we have been clear about the things that need to change that the European Commission is already looking at the sorts of changes that could be made. This is an organisation that responds not simply to pressure, but to political realities, so we have to make sure that the political reality after the next election is someone walking into the Berlaymont building or the European Council building and demanding change, rather than someone wandering in and just saying, “Relax—there’s nothing you need to do. We don’t have to have a referendum. We don’t need a renegotiation. One day we’ll join the single currency.” All the pressure would be off and, yes, some in Brussels would breathe a sigh of relief, because it would be business as usual with Labour and probably the Scottish National party too.

[Mr Peter Hain (Neath) (Lab)]

I endorse the Prime Minister’s welcome to our excellent new chief Clerk. I also welcome the fact, Mr Speaker, that you are proceeding speedily to the appointment of the post that will carry out the chief executive duties, the director general. That is very important.

On Greece, may I suggest to the Prime Minister that simply repeating the same dose of austerity on the Greek people and their Government will not achieve the objective any more than the last dose did? National debt went up in Greece as a result of the austerity programme. Of course, the Greek Government have to reform to collect their taxes and to get rid of corruption, and the Government have volunteered to do that, but going down the same austerity road is not going to revive the Greek economy or enable it to repay its debts. Those must be rescheduled and the reforms around that must ensure that Greece is capable of repaying its debts, not being strangled with austerity.

[The Prime Minister]

I do not entirely disagree with the right hon. Gentleman. The problem is, though, that the people who have lent the money to Greece want their money back, and they believe that Greece should carry out a series of reforms before they give it any more money. He or I can take a different view and argue as I would, although he would not, that Greece should never have joined the eurozone in the first place. That is not the right hon. Gentleman’s view because he is a fanatic about the eurozone. None the less, as we have not lent money to Greece, we are not in that position. If he had been at the European Council he would have heard, whether from the Germans, the Dutch and the Scandinavian countries, or from the Spanish, the Portuguese and the Irish, who have all been through these painful processes, that there is very little appetite to cut Greece a lot of slack.

[Martin Horwood (Cheltenham) (LD)]

On behalf of the Liberal Democrats, I echo the Prime Minister’s congratulations to Mr Natzler. I welcome the Prime Minister’s remarks on Tunisia and Libya, where we must all still hope that the promise of the Arab awakening will be fulfilled and sympathise about the fact that uniting the Tory party on Europe really is “mission impossible”? On the Transatlantic Trade and Investment Partnership, does he agree that the UK should never ratify a treaty that would undermine the NHS?

[The Prime Minister]

Of course. But I do believe that all of us in this House who support free trade and want to see Britain as a success story in international markets should really get behind TTIP rather than listening to some non-governmental organisations that are raising entirely false fears about it. There is no way that TTIP can in any way undermine our NHS. Our NHS is determined by the policies we pass here in this House. One of the things that was so striking about the European Council was countries worrying about the so-called investor protection mechanisms, even though Britain has 94 of these things and we have never lost a case. There is an awful lot of scaremongering about TTIP. Any of us who want to see a successful British economy should get behind what could be a real jobs boost for our country.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

If the Prime Minister is so certain that TTIP will not undermine the NHS, does he have assurances in the treaty that specifically mention the NHS and therefore make it absolutely clear that what some of us fear might happen will not happen?

[The Prime Minister]

There is this very powerful quote, which I think I have read out in the House of Commons before, where the previous Trade Commissioner said:

“Public services are always exempted—there is no problem about exemption. The argument is abused in your country for political reasons but it has no grounds.”

The point I would make, though, is that it is local NHS commissioners who make decisions about who delivers services. One of the things that is being done with TTIP is that people or countries who want to raise concerns, like over the investor protection mechanisms, are asking for more things to be put in the treaty, which in the end we will have to pay a price for; and if they are not necessary and there is not a problem, why are we creating one? With the investor protection mechanisms, the country that was raising this problem was Austria, which has 60 of these agreements and has never, ever lost a case. Of course let us have the robust negotiation and seek any safeguards we might need, but let us not raise problems that do not really exist.

[Mr James Clappison (Hertsmere) (Con)]

Is my right hon. Friend aware that in contradistinction to the views expressed by the Leader of the Opposition, there are millions of ordinary voters in this country who want their say on whether Britain should remain part of the European Union—a say that is long overdue? Is it not absolutely crystal clear that they will get that say only if my right hon. Friend continues to occupy Downing street after the election and is in a position to deliver on that promise?

[The Prime Minister]

I think there are millions of people in our country who want to have that say. We have not had a referendum since 1975. We cannot remain in these organisations without the full-hearted consent of the British people behind us. So it is time to have the referendum, but let us have it on the basis of a renegotiation. My hon. Friend is absolutely right: there is only one way to get that referendum, and that is to make sure that there is a Conservative majority and a Conservative Prime Minister after the next election.

[Keith Vaz (Leicester East) (Lab)]

The crisis in Libya is having catastrophic consequences. Prime Minister Matteo Renzi has said that of the 170,000 people who entered Italy illegally last year, 92% did so from Libya, and the figures for this year show a 64% increase. Does the Prime Minister agree that it is not enough to give more resources to Frontex—we also have to deal with the source countries to help them stop migrants putting their lives at risk or being profited from by traffickers?

[The Prime Minister]

The right hon. Gentleman is absolutely right. We will not solve the problem simply by more sea patrols—nor, indeed, by returning to the Mare Nostrum policy, which sounded humanitarianly sound, but deaths at sea during the period of its operation increased fourfold. So there is no alternative to trying to stabilise these countries and deal with the problem at source. We are able to use our aid and other budgets, with European partners, to do that, and we should certainly do so.

[Mr Peter Bone (Wellingborough) (Con)]

A few weeks ago I went to No. 10, along with my hon. Friend the Member for Kettering (Mr Hollobone) and Tom Pursglove, the excellent Eurosceptic Conservative candidate for Corby, to deliver the results of the north Northamptonshire referendum, in which 81% of the people of north Northamptonshire voted to come out of the EU. Unfortunately, when we knocked, the Prime Minister was not in, but he kindly wrote to me stating, rather importantly, that, if it was at all possible, he would be delighted to bring forward the EU referendum. I think there is a misunderstanding that it has to be held at the end of 2017, so will the Prime Minister confirm that it could take place earlier?

[The Prime Minister]

First, may I apologise for not being in? It is not that I have an adverse reaction when I see the men in grey suits approaching Downing street, but I obviously was not there on the right day and I am very sorry about that. What I have said is that the referendum must take place by the end of 2017, but if it is possible to complete the renegotiation and hold it earlier, no one would be more delighted than me. I think it would be—[Interruption.] The Leader of the Opposition complains from a sedentary position, but there would be no referendum or choice with Labour. They would literally just turn up in Brussels and say, “Tell me how much to spend. Where do I sign? No renegotiation or referendum.” It is absolutely clear that there is only one way to give the British people a choice, and that is to make sure I am at this Dispatch Box after the next election.

[Kate Hoey (Vauxhall) (Lab)]

Does the Prime Minister accept that thousands of small and medium-sized businesses and companies throughout the United Kingdom would love, and are desperate to see, a different relationship with the European Union? Does he accept that promising a referendum is a better way of getting that ultimate change?

[The Prime Minister]

I agree with the hon. Lady and wish she could talk some sense into her Front-Bench colleagues. She is absolutely right. By holding a —[Interruption.] The Leader of the Opposition says that the hon. Lady does not agree with me, but she just stood up and made the case for a referendum rather better than I did. I will take careful note of what she said. The point is that, by having this pledge and renegotiation, we can get things done for businesses large and small.

[Sir Edward Leigh (Gainsborough) (Con)]

We are all being a bit unfair on the Labour party. After all, 40 years ago it was the Labour party that gave us a referendum and, to be fair to the Liberals, they promised one in the last Parliament, although I do not understand why they have gone wobbly on trusting the people. Perhaps it is because the people may give the wrong answer. Is not the answer to the Leader of the Opposition that every single person in this country, no matter how important they are—whether they are the Prime Minister, the Deputy Prime Minister or the Leader of the Opposition—gets one vote? Will my right hon. Friend therefore give a categorical assurance that any Government of which he is Prime Minister will deliver this choice to the British people?

[The Prime Minister]

I have been absolutely clear: I will not be Prime Minister in a Government that do not hold a referendum. I could not be more clear about it. My hon. Friend makes an important point. I remember Tony Blair standing at this Dispatch Box as Prime Minister —I was sitting somewhere on the Opposition Benches—and saying with respect to the European constitution, “Let battle be joined”, and making a great pledge. He could have held a referendum, but he did not. That is one of the things that has poisoned the well in this country and that makes a referendum even more important today.

[Mr Frank Roy (Motherwell and Wishaw) (Lab)]

During discussions on the middle east with his European counterparts, did the Prime Minister explain why the United Kingdom has allowed only 140 refugees from Syria to come into this country?

[The Prime Minister]

We have spent about £800 million helping refugees in Syria, which makes us the second largest bilateral donor to the programme. We have taken 140 people under the vulnerable persons relocation scheme, and it is right that we have done that, but we have to be frank with ourselves and with the public. In a refugee crisis of this scale, which runs into millions of people, the idea that even a small part of the solution is for our country to take in hundreds or thousands is completely wrong.

[Neil Carmichael (Stroud) (Con)]

Does the Prime Minister agree that inward investment from the European Union, including Sartorius Stedim investing in my constituency, is a sign that Europeans believe in a reformed European Union and that we have a large number of allies in Europe who want to reform the EU in a constructive way, ready for a referendum?

[The Prime Minister]

My hon. Friend makes the important point that Britain is a magnet for inward investment. In fact, we are getting 50% more inward investment than either France or Germany, the next two biggest recipients of such investment. The interesting point is that, since I made my Bloomberg speech and that referendum commitment, there has been no sign of change in the inward investment from countries in the rest of the world coming into the United Kingdom, because they know that it is right to hold that renegotiation and that referendum.

[Mike Gapes (Ilford South) (Lab/Co-op)]

We can all wish for a political solution and a national unity Government in Libya, but the reality is that it is not happening and an al-Qaeda or ISIL-linked state is being established on parts of the coast, which is a serious threat to our country and the rest of Europe. What are we going to do about the situation in Libya, rather than just wishing for a change?

[The Prime Minister]

It is not a question of simply wishing for a change; we are working with our allies to help to bring one about. The aim so far has been to produce a national unity Government by bringing together the different parties that there are in Libya. We have not taken the approach that some in the region have taken of trying to pick sides and creating conflict between the various parties. I accept, however, that as we see the growth of ISIL in Libya, we are going to have to challenge all those who could take part in a national unity Government to oppose ISIL and any formation it is able to achieve in Libya. That will be an important part of the stability that we seek not just for the sake of the Libyan people, but for that of our own.

[Mr Andrew Robathan (South Leicestershire) (Con)]

In my last week as a Member of Parliament, may I commend my right hon. Friend not just for his statement, but for his work over the past five years in re-establishing the United Kingdom as a serious and respected player in international affairs?

Turning specifically to the good governance fund that he mentioned with regard to Ukraine and eastern Europe, will the Prime Minister look at the money that has been transferred to this country, particularly from Russia? Oligarchs and others seem to have thought that here and western Europe were good places to put their money, most of which was looted from the good people of Russia. Part of the reason why there is a problem in Russia is that money has been taken out of Russia and placed here.

[The Prime Minister]

First, may I thank my right hon. Friend for the valuable work that he has done for his constituents in this House, but also as part of the Government both in Northern Ireland and at the Ministry of Defence? He has played an absolutely crucial role, and he will be missed.

On the issue of Russian money, we have some of the toughest controls anywhere in the world in terms of money laundering and other such issues. I would make the point that Britain has very much been in the vanguard of arguing for sanctions on Russia and Russian individuals, even though it could be argued that this might in some way disadvantage investment coming into the United Kingdom. We have put the interests of Europe and the interests of the Ukrainian people first.

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

Is the Prime Minister aware that many of us on the Labour Benches who are pro-European want what our allies want, which is a strong Britain in a strong Europe? Yes, we want a reformed Europe—all of us are in favour of reform in Europe—but we are not in favour of weakness and vacillation, which manufacturers and exporters in my constituency say will damage this country over the next three years while we wait for a referendum.

[The Prime Minister]

The hon. Gentleman says that he is in favour of reform, but I have not heard one single proposal from the Labour party about anything it wants to reform. He is presumably standing on his leader’s ticket, but I do not know whether he has his picture on his leaflets. When I met my Labour opponent in Chipping Norton market square this week, I had a look at his leaflet, and there was not a dicky-bird when it came to the Leader of the Opposition. It could have been from a totally different party. There are plenty of pictures of me. The Leader of the Opposition has said:

“I don’t think Brussels has got too much power”.

That is the official position of the Labour party: it is not for reform, but for the status quo.

[Dr Julian Lewis (New Forest East) (Con)]

As the only major party leader to trust the British people with an in/out referendum on EU membership, my right hon. Friend has certainly reassured the patriotic British electorate. Will he now go the whole way by reassuring them that throughout the next Parliament, when he is Prime Minister, Britain will not fall below the NATO recommended minimum of 2% of GDP on defence?

[The Prime Minister]

I would say to my hon. Friend, who I know cares passionately about this issue, as I do, that we are one of the few countries in Europe to meet 2%. We have met it through this Parliament, and we are meeting it this year and next year. He has very specific guarantees about a full replacement for Trident, a £160 billion equipment programme that will go up in real terms each year and no further reductions in regular personnel in our armed forces. I think those are bankable assurances, which will resonate on the doorsteps as he goes house to house.

[Kelvin Hopkins (Luton North) (Lab)]

Even at this late stage, I think that the Prime Minister might thank my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown) for keeping us out of the euro. As he knows, the euro has been sinking like a stone in recent weeks and there are terrible stresses inside the eurozone, arising from the rigidities of the euro. Is not the only serious solution to dissolve the euro and recreate national currencies? Is he not in a strong position to say that?

[The Prime Minister]

I believe strongly in maintaining our national currency, but it is not a realistic option to tell all other countries in Europe which currency they should use. Many of them are hugely enthusiastic about the euro. However misguided I feel that is, arguing that they should all break up their currency is not a viable option. Obviously, being in the euro and not being able to devalue have damaged Greece’s ability to respond to the problems, but we cannot lay all the problems with the Greek economy at the door of the euro. Greece has a long history of not making structural reforms, having ludicrously early retirement ages—[Interruption.]—having problems with its working practices and all the rest of it. The hon. Member for Bolsover (Mr Skinner) asks what is wrong with ludicrously early retirement ages. He has enjoyed making such comments from a sedentary position for many, many years and I am sure that he will do so for many years to come. There is a slight irony there.

[Robert Halfon (Harlow) (Con)]

Did my right hon. Friend have any discussions at the European Council about the jobs miracle in this country, in that there are more people employed here than at any time in our islands’ history? Did he ask members of the European Council to come and see that miracle at first hand in Harlow, where unemployment has halved, youth unemployment is down by nearly 60% and apprenticeships are up by 116%?

[The Prime Minister]

I am grateful to my hon. Friend for his question. We discussed the employment situation across Europe and I was able to give a very strong report on what is happening in Britain: the 1,000 jobs that are being created every day and the plummeting levels of unemployment and youth unemployment. I said that that is evidence of the combination of long-term structural changes and economic recovery. There are European countries with very high structural rates of unemployment that need to take action to deal with that.

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

My party heartily congratulates David Natzler on his appointment. There could be no one more suitable and appropriate for this role in the House of Commons.

On the Tory European referendum, what will happen if the UK votes to leave the European Union, but Scotland votes to remain within it? Should the Scottish people just put up with being yanked out of Europe against their will? Would it not be better if all the siblings in the Prime Minister’s family of nations agreed individually before they were taken out of Europe?

[The Prime Minister]

What I want to know is, where are the rest of the Scot nats? They are preparing for power and writing Labour’s Budget. They are obviously very busy. What I would say about referendums is that the hon. Gentleman lost the first one and he will lose the next one.

[Chris Heaton-Harris (Daventry) (Con)]

You will have noticed, Mr Speaker, that my hon. Friend the Member for Wellingborough (Mr Bone) no longer talks about his wife, but about the excellent Conservative parliamentary candidate in Corby, Thomas Pursglove. I believe that that is because Mrs Bone is going to become a councillor in my constituency and so has been talking to me. She regrets the fact that the Liberal Democrats have not allowed the Government to negotiate formally on a renegotiation in Europe, but she wonders whether the Prime Minister has taken advantage of his meetings on the sidelines of the European Council to talk about our renegotiation with our European partners.

[The Prime Minister]

I must say, I did not know that those sorts of things happened in Northamptonshire. They are obviously very exciting events. I congratulate Mrs Bone on trying to become a councillor. I am sure that she will make a great contribution, as she did to the film about this place. Of course I have had discussions with our European partners about what Britain wants to see renegotiated and I will continue to do so.

[Valerie Vaz (Walsall South) (Lab)]

The Prime Minister is keen to extol the virtues of a referendum and the benefits of Europe, so will he say whether he would lead the yes camp or the no camp?

[The Prime Minister]

I have been absolutely clear: I want Britain to stay in a reformed European Union. That is the aim I have and I am confident I will achieve it.

[Mr David Nuttall (Bury North) (Con)]

Does the Prime Minister agree that this Government’s great progress in turning round the British economy has been achieved despite the eurozone and not because of it?

[The Prime Minister]

Although my hon. Friend and I do not always see eye to eye on issues European, he is making a strong point. We have not seen much of a boost to the British economy from the eurozone because it has been relatively stagnant. We have had to achieve economic recovery by selling to other parts of the world and getting our own economy moving. If we do see a recovery in the eurozone—which we hope to—that will obviously be very good news for Britain.

[Clive Efford (Eltham) (Lab)]

If we ask a group of lawyers their opinion on whether TTIP would apply to the NHS, we will get as many answers as there are lawyers. The Prime Minister cannot get away with saying that it will not apply, because by opening up the NHS to market tendering and market forces in the way he did with the Health and Social Care Act 2012, he has opened the door to treaties such as TTIP applying to the national health service. That is the problem he needs to protect the NHS against.

[The Prime Minister]

I am baffled by Labour’s position on this as I thought it was a party that believed in free trade and backing Britain’s exporters. There are so many areas where we are disadvantaged in our trade with America and where we could be creating jobs and growth, but instead Labour Members want to read out a script handed to them by the trade unions to oppose the trade deal. It makes you weep for the time when the Labour party was in favour of progress and trade.

[Michael Ellis (Northampton North) (Con)]

At the Council did anyone raise the treatment of journalists? Does my right hon. Friend agree that the witch hunt that has seen several journalists from The Sun, for example, put through three years of hell and cases that juries keep throwing out is un-British, in that the Crown Prosecution Service is seeking to neuter the abilities of journalists to obtain information in the public interest? Should there be a rethink of CPS policies for similar prosecutions, because that reflects across the whole of Europe?

[The Prime Minister]

That issue was not raised with me or at the press conference. Obviously, the CPS is independent in our country, as it should be, but my hon. Friend is right to say that justice delayed is justice denied and these things should always be resolved as speedily as possible.

[Nia Griffith (Llanelli) (Lab)]

Many jobs in my constituency depend on continued investment by leading manufacturing companies that also have companies on mainland Europe. Labour Members can say that a Labour Government would give them a categorical reassurance that the UK will remain in the EU. What would the Prime Minister say to those companies if his shilly-shallying over Europe about some sort of referendum were to drive them to invest elsewhere?

[The Prime Minister]

Interestingly, the conference of the British Chambers of Commerce—probably the biggest business trade body in Britain—supported my approach of a renegotiation and referendum, and did not support the alternative of just meekly going along with whatever the European Union is doing today. Business is on the side of the changes I am putting forward.

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

I am a big fan of the public sector. Does my right hon. Friend agree that Greece teaches us a lesson that we can have a strong public sector only if we have a strong economy?

[The Prime Minister]

My hon. Friend is absolutely right. If we look at what happened in Greece with the economic difficulties it has had, we see that it had to make sweeping cuts to its national health service because it was in so much economic trouble. That underlines the point that we will make every day from now and for the next 45 days, which is that if we want a strong NHS, schools and policing, we must have a strong economy.

[Ian Lucas (Wrexham) (Lab)]

In his statement the Prime Minister said that he wanted a European Union where freedom of movement was not an unqualified right. If he does not secure an exemption from freedom of movement by the time of the referendum in 2017, will he be voting no?

[The Prime Minister]

I am very confident that we will get the changes we need, not least on the operation of our welfare system. Back in European history, there was a time when freedom of movement was about accepting a job that had been offered, rather than simply the freedom to move to look for work. I have been clear, and we will be clear on the doorsteps, including in the hon. Gentleman’s constituency: no unemployment benefit for visiting EU migrants; after six months if someone has no job they have to go home; someone must work for four years before they get in-work benefits; and no sending home of child benefit. Those are things that I suspect each and every one of the hon. Gentleman’s constituents wants put in place.

[Dr Matthew Offord (Hendon) (Con)]

With regard to the Iranian nuclear deal, may I urge great caution on the part of the Prime Minister and, indeed, other members of Europe? The road between a civil nuclear energy Iran and a military nuclear Iran is a very short one. Contrary to what at least one of my right hon. Friend’s constituents has said, it would be better for the middle east to have no deal than a bad deal.

[The Prime Minister]

I absolutely understand and share the concerns that people right across the world, including in Israel, have about the prospect of a nuclear-armed Iran. The deal should keep Iran away from having a nuclear weapon, with proper inspection and verification so that if there were any changes to those circumstances, they could be seen. Obviously, we should not do a deal at any price, but the alternatives to doing a deal are not attractive. Frankly, they are not attractive for Iran. The sanctions we put in place—Britain led the charge in Europe—have done such damage in Iran that it is in its interests to conclude a deal.

[Andrew Stephenson (Pendle) (Con)]

Earlier this month, I met a group of talented young people at John Fisher and Thomas More Roman Catholic high school in Colne, who, through CAFOD, are helping to raise the profile of climate change. They have all made their own climate change pledges, which they presented to me. Will the Prime Minister say more about his discussions on energy policy and the prospects of our reaching a long-term agreement in Paris this December?

[The Prime Minister]

I am very grateful to my hon. Friend for that question. I think the prospects are good, because of the deal Britain helped to broker at the previous EU Council. It shows that the European Union will be making a very serious contribution to reducing carbon emissions. We obviously had to allow some countries, such as Poland, some flexibility, but the overall numbers for Europe are impressive. Now what we need to do, with the movement by the Americans and the Chinese, is discuss the matter with all the countries which might, if we are not careful, put a spoke in the wheel of progress, so that, with others, we will help to ensure that the sort of mitigation that they will need in their countries goes ahead.

[Henry Smith (Crawley) (Con)]

In his statement, the Prime Minister spoke about opportunity. Does my right hon. Friend agree that people will have an opportunity to reform the EU and have an in/out referendum on this country’s membership of the EU only by voting Conservative, and that voting for any other party will kill that opportunity?

[The Prime Minister]

My hon. Friend is right. Voting for another party is really opening the back door to a Labour Government, who would not renegotiate or have a referendum. It would just lead to a sigh of relief in the corridors of Brussels that none of those changes was necessary. If people are serious about wanting reform and a referendum, there is only one box they can put their cross in.

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

On foreign policy, did the European Council look at the coup in Yemen against the legitimate Government of President Hadi? Taking into account the words of the Yemeni Foreign Minister in today asking for Gulf Co-operation Council countries to send in their forces to avoid civil war, the Saudis have asked their ambassador to operate from Aden to show support for the legitimate Government. Will we be doing the same?

[The Prime Minister]

We did not discuss Yemen specifically at the Council because we were very focused on Tunisia, Libya, Ukraine, energy union and the eurozone crisis, but my hon. Friend is absolutely right that what is happening in Yemen is deeply worrying. It is extremely unstable. We still, obviously, support and believe that President Hadi is the legitimate power. Frankly, what is needed in that country is what is needed in so many other troubled countries in the middle east, which is inclusive government that includes representatives of all the people of that country, so there can be some sort of progress.

[Andrew Bridgen (North West Leicestershire) (Con)]

Despite yet another eurozone crisis, the UK economy continues to grow strongly, creating more jobs than the rest of Europe added together. Does the Prime Minister agree that it would have been a huge error of judgment, especially by someone who aspired to be Prime Minister, to have backed Francois Hollande’s failed socialist policies when he should have been backing our long-term economic plan?

[The Prime Minister]

We all remember what the Leader of the Opposition said. He stood on the steps of the Élysée and said he wanted Britain to follow the French course. If we had done that, unemployment would be twice as high as it is and growth would be one seventh of what we have achieved, so I am sure that when it comes to the choice at the election, people will recognise that we should follow not the French course but the British course, which means voting Conservative.

[Mr Speaker]

Before I call the Minister for the Cabinet Office and Paymaster General to make his statement to the House, it might be helpful to colleagues to know that the final day’s debate on the Budget is very heavily subscribed, with no fewer than 38 colleagues seeking to catch the eye of the Chair. As a consequence, it will be important to be very pithy in the statement now, both from the Back Benches and the Front Bench. We will then proceed with the main business of the day.

Government Efficiency and Reform

Monday 23rd March 2015 Commons Chamber

16:30

[The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)]

With permission, I would like to make a statement on Government savings from efficiency and reform.

Since May 2010, my Department has led a cross-Government programme, working closely with the Treasury, to ensure that taxpayers’ money is focused on front-line services. With rising public expectations for high-quality services, coupled with the huge budget deficit we inherited in 2010, the coalition faced a huge challenge to do more—and better—for less. Over this Parliament, we have secured unprecedented levels of savings, delivering for successive years £3.75 billion, £5.5 billion, and £10 billion, compared with spending in Labour’s last year. For 2013-14, we saved £14.3 billion, against a 2009-10 baseline.

That is testament to the hard work of civil servants across Whitehall and the strong support of my right hon. Friends the Chancellor and the Chief Secretary and other Treasury colleagues. Last July, the Comptroller and Auditor General recognised the pace and priority we had injected into the efficiency agenda. We started this with the introduction of tight spending controls just days after we entered government, and these controls have delivered the largest share of savings. Since 2010, we have negotiated billions of pounds off expensive legacy contracts and cut central Government spending on consultants and interim workers by over half. Like for like, the civil service is 21% smaller. I publish today our annual “State of the Estate” report, which shows that we have exited in aggregate more than one building every day since May 2010, reducing the total size of our estate by 20%.

As part of our long-term economic plan, our aim was to save £20 billion from central Government efficiency and reform for the last year of this Parliament, including by reducing losses to the public purse through fraud, error and uncollected debt. I can tell the House that we are on course to meet and indeed exceed this target. Up to January 2015, we have already identified £11 billion of efficiency and reform savings—over a third up on the same point last year—with the largest savings coming in the final quarter every year so far. With fraud, error and debt benefits still to be counted, we are well on the way to the £20 billion target. The full year’s savings will need to be confirmed by independent audit, and, as in previous years, we will invite the National Audit Office to undertake this.

We have made significant progress in transforming government and cutting costs, but this is only the beginning. At the autumn statement, we published, with the Treasury, a document entitled “Efficiency and reform in the next Parliament”, which set out our intention to save a further £10 billion for 2017-18 and £15 billion to £20 billion for 2019-20 compared with the current year. We now set out our next steps. We will implement a new approach to land and property, based on central ownership and management of assets and Departments paying market-level rents. This will provide greater incentives for Departments to rationalise space, as well as releasing land and property for productive use—for example, for up to 150,000 homes. To do this successfully will mean working even more closely with local government, including through our One Public Estate programme, which now operates across 32 local authorities.

The UK is now a world leader in digital government, and we will work with local government to take this transformative approach into the wider public sector. Digital services improve the citizen experience, while being significantly cheaper to provide. We will continue to reduce the cost of technology in government, as extravagantly expensive legacy IT contracts fall in over the coming years. To that end, I have signed an innovative deal to create a joint venture for data hosting that will save up to £100 million.

All of this work has been driven by an increasingly strong corporate centre, supporting and challenging Departments to work together to maximise efficiencies and improve services. We are strengthening central leadership across 10 key cross- departmental functions, including commercial, digital and technology, project management, legal and human resources. Later this week, we will publish our functional leadership model.

The chief executive of the civil service will lead the build-out of this strengthened model, under which the Treasury and the Cabinet Office will work together as the corporate centre to support Departments to continue their programme of reform and to deliver future spending consolidations. Spending controls will remain in place and evolve in time to strong functional standards, while Departments will need to own more of the transformation agenda. As part of this, we are recruiting 25 commercial directors across government and launching a new project leadership programme at Cranfield university. This programme will help to build project management skills in parallel to our successful major projects leadership academy.

I am grateful for the collaborative way in which the shadow Cabinet Office Minister has approached this important programme, which continues that of her predecessor, the hon. Member for Barnsley East (Michael Dugher), and also for the support of the Chair of the Public Accounts Committee and its members, who have seen the point of what we are seeking to do and given significant support to it.

We have made substantial and long-overdue improvements to the way government operates, but much more lies ahead. We have shown that we can drive down the cost of government while improving the quality of services. We have shown that we can get more and better for less, and that we have a long-term plan to deliver it. I commend the statement to the House.

16:37

[Lucy Powell (Manchester Central) (Lab/Co-op)]

I thank the right hon. Gentleman for advance sight of his statement. His statement today has a little bit more content than his empty statement of two weeks ago, but only a little bit more. One has to wonder again why it is that I keep being called to this House for his statements. Is it perhaps because he wants to continue his very long career of public office in the other place after May and is using Hansard to scrub up his CV? Or is it, more seriously, to distract me and this place from the disarray that is now besetting the Conservative party’s election campaign? Perhaps his and his colleagues’ time would have been better spent today deploring the despicable actions of the Tory candidate for Dudley North or by explaining to the public where the axe will fall, following last week’s confirmation of the Chancellor’s extreme spending cuts in the next Parliament.

The Minister has carried out his job in government of identifying efficiency savings with zeal and his work to reduce the cost of government bureaucracy is welcome. While I might disagree with him on occasion, I do not question his motives to reduce costs. I also commend the civil service for its work on the shared agenda.

The Minister for the Cabinet Office thanked the Chancellor for his support on this agenda, but I have to say to the right hon. Gentleman that it really should be the other way around. It is clear from the Office for Budget Responsibility and the Institute for Fiscal Studies that after the Chancellor’s Budget last week, unprotected Departments will face huge and colossal cuts to meet his spending plans and unfunded tax cuts. With all due respect to the Minister, no amount of back-office efficiencies will save front-line police, armed forces or social care services, or working families from the Government’s secret VAT plans. Only so much can be got from efficiency savings and even with his savings in this Parliament, the Government are still only halfway to their own deficit reduction targets. That is why, even with his savings, public services would face even bigger cuts in the next Parliament than they have in this one. Opposition Members have a better plan. We will balance the books in a fair way, ensuring a recovery for the many, not just for the privileged few.

We broadly support the approach to land and property that the Minister has outlined. On digital government, I am pleased to see that he has been reading our independent review on this topic. Just weeks ago, he was saying that the Government Digital Service could not work with councils to improve services and save money. Now he is championing this, and I welcome his conversion today. We agree that stronger functional skills in the civil service are important, and we will examine in detail the Minister’s plans for new commercial directors and a new project leadership programme.

Any new Government will have to think about how we can provide better and more responsive public services with less, but with just a few weeks to go, the country faces a clear choice at the election. No amount of spinning on efficiency savings will hide the Tories’ true agenda of cutting front-line public services and hitting families with a rise in VAT.

[Mr Maude]

I am very sorry that the hon. Lady has been so mean-minded about this. She has cast some unworthy aspersions on the reasons for my statement. The historic purpose of the House is to vote Supply and scrutinise the way in which Governments spend their money. I am astonished that, when I come to the House to explain how this Government have delivered savings running into tens of billions of pounds, and have protected front-line services by taking out the cost of government, the hon. Lady should trivialise something that is at the core of the historic mission of the House of Commons. She has done no honour to her position.

The hon. Lady should reflect on the fact that the Office for National Statistics, which began its series on public sector productivity in 1997, has shown that during the years of the Labour Government, up to 2010, productivity in that sector remained flat, while productivity in the nearest analogue, the private services sector, rose by nearly 30%. She should reflect on the difference that could have been made to the deficit of historic proportions that her party bequeathed to the coalition.

The hon. Lady talked about the future, and about the contribution that could be made by what she described as back-office efficiencies. We are talking about much more than back-office efficiencies; we are talking about the introduction of very different and improved ways of delivering public services. That can be done, and we have shown that it can be done. The public’s expectations in terms of the quality of public services are, properly, rising; the demand in terms of the quantity of public services is also rising as people—happily—live longer; and the amount of money that is available to support those public services is less, thanks to the deficit that we inherited.

We therefore must do more, and do it better, with less money. We have shown over the last five years that that can be done, and we have also shown that it needs to be done again. There should never be an end to efficiencies. The most efficient organisations in the world always look for further efficiency savings every year, and that is what this Government, under a Conservative leadership, will do in the next Parliament.

[Sir Alan Beith (Berwick-upon-Tweed) (LD)]

Why has the rigorous challenge that the coalition Government have had to make to the way in which money is spent in many Departments not been applied to the criminal justice system? Having a larger prison population than nearly all the other European countries is not necessarily the most cost-effective way of keeping people safe. Will the Minister look at the American states that are trying to reverse that trend in order to spend the taxpayer’s dollar in the way that is most likely to keep the taxpayer safe?

[Mr Maude]

Let me say to my right hon. Friend, as we both enter our last week in the House of Commons, that, as he knows, the reason our prison population is so large is the rate of reoffending. I know that he will support, as I do, the rehabilitation revolution, led by our right hon. Friend the Lord Chancellor, which is committed to a radical reduction in the rate of reoffending that is the sole reason why our prison population is so much higher than those of comparable countries.

[Kelvin Hopkins (Luton North) (Lab)]

The Treasury’s problems are, above all, about income, not expenditure. There is a gap of £120 billion a year between the tax that should be paid and the tax that is actually paid. However, the Government have presided over tens of thousands of job cuts in Her Majesty’s Revenue and Customs, where senior staff collect 20 times their own salaries and junior staff 10 times theirs. Are the Government not shooting themselves in the foot?

[Mr Maude]

The hon. Gentleman is completely mistaken if he believes that there is a direct linear relationship between the number of HMRC officials and the amount of tax that is being collected. There is absolutely no evidence of that. The size of HMRC, in terms of headcount, was falling before the 2010 election, and the amount of tax being collected has risen. We can do things differently and we can do things better—we have already shown that that is the case—but if the hon. Gentleman thinks that the only problem with the public finances is that we are not taxing enough and not raising enough taxes, I am afraid that he and I differ. I think that we must cut our costs first, which is what we are doing and will continue to do.

[Nick Herbert (Arundel and South Downs) (Con)]

May I congratulate my right hon. Friend and parliamentary neighbour, who has done a superb job in driving these savings and thereby ensuring front-line services can be protected? He has done a fine job behind the scenes and will be much missed from this place, but I hope he will be able to continue in some way in this important public service. Does he agree that the key part of his statement was that these savings have been achieved as a result of a strong corporate centre—a central drive for efficiency—and is it not the case that that centre will have to be strengthened further if significant additional savings are to be achieved?

[Mr Maude]

I am grateful for my right hon. Friend’s kind comments, and I also hugely appreciate what he and the right hon. Member for Wentworth and Dearne (John Healey) have done in leading the work of GovernUp, which has made the case very powerfully, as indeed has the Public Accounts Committee, for a strong corporate centre in Government that can drive these sorts of changes. When we examined this, we found that, in almost all cross-government functions, the historical position of the British Government is to have an extraordinarily weak centre. That is part of the reason why it has been proved in the past to be so difficult to drive these sorts of efficiency savings, but we are changing that.

[John Healey (Wentworth and Dearne) (Lab)]

This was a swansong statement, if I may say so, which largely looked backwards rather than forwards. Nevertheless, what the Minister has announced today about stronger central leadership within Whitehall, clearer professional standards right across the Departments and more power to the elbow of the new chief executive of the civil service are welcome on all sides. The right hon. Gentleman over five years has made something of a start in ensuring we get better and more for less, but his statement this afternoon is clearly passing the baton for the next five years to this side of the House and my hon. Friend the Member for Manchester Central (Lucy Powell) on our Front Bench.

[Mr Maude]

I agree with every part of what the right hon. Gentleman says except the last part, but I am grateful for what he says and the work he has done on this issue. He is a very experienced former Minister himself and he has seen very vividly how we can do these things better. We have made a start but there is much, much more to be done.

[Andrew Bridgen (North West Leicestershire) (Con)]

As my right hon. Friend has stated, public sector productivity flatlined between 1997 and 2010, but what assessment has he made of improvements in civil service productivity since 2010?

[Mr Maude]

Productivity has improved dramatically. Like for like, the civil service is 21% smaller, yet I do not think anyone would say the civil service is doing less. It is not; if anything, in some places it is doing more. Productivity has markedly improved and I pay a very warm and genuine tribute to those hundreds of thousands of civil servants who do a fantastic job, often in very difficult circumstances. All of us in this House should be warm in our tribute to them.

[Wayne David (Caerphilly) (Lab)]

I agree with what the Minister has said about extending digitisation in government, but what is he doing to ensure millions of people are not excluded from the process of digitisation?

[Mr Maude]

That is a very good point. When the now Baroness Lane-Fox reported to me at the very beginning of this Parliament when she introduced the concept, which we warmly adopted, of digital by default—if a service can be delivered online, it should be delivered only online—she made the point, which again we strongly supported, that there must always be an assisted digital option, which ideally can be used to help people who are currently digitally excluded to become full participants in the online world, so, for example, older people can more easily communicate with distant family members. There is a big programme here that we are strongly promoting.

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

I am so pleased to hear that we are protecting public services while cutting down the cost of government, but does my right hon. Friend share my concern that we have been prevented from delivering one of the bigger cuts—namely, cutting the number of Members of Parliament by delivering our proposed boundary changes? Does he agree that although the Opposition refer to fairer cuts, they give no indication of what those cuts would be, and that the public therefore cannot trust anything they have to say?

[Mr Maude]

Aneurin Bevan once said:

“Why look into the crystal ball when you can read the book?”

The last Government did nothing to drive the sort of efficiency savings that we have achieved, so when it comes to making cuts in public spending, we can only fear that they would cut the services, whereas we are cutting the costs, which is the better way to go.

[Paul Flynn (Newport West) (Lab)]

Why has there been no reform of the continuing parliamentary scandals of cash for access to politicians and cash to buy peerages? Why has there been no brake on the revolving door that allows retiring Ministers to prostitute their insider knowledge to the highest bidder, and why are there no controls over lobbyists who are still free to buy influence and privilege in this House? Is not the Minister ashamed that, after his Government have been in office for five years, the reputation of politics remains firmly in the gutter?

[Mr Maude]

I cannot imagine a greater contribution to that reputation than the hon. Gentleman going on about it all the time. As he above all people ought to know, most people come into this particular form of public service, known as politics, for high reasons and with high motivation, and they do their job in an honourable way. He might just occasionally shrug off that carapace of cynicism and give due credit to the public servants in this House as well as to those outside it.

[Richard Benyon (Newbury) (Con)]

My right hon. Friend can leave the House knowing that he has done an outstanding job in reforming our public services, and it would have been nice to hear a little more humble pie from the hon. Member for Manchester Central (Lucy Powell). On the question of getting better digital coverage across our country, does he agree that the public estate should be made more available for things such as mobile phone masts if we are to have a 21st-century digital economy? What more can be done to encourage the public sector estate to make up for the absence of support from the private sector estate in getting greater digital coverage?

[Mr Maude]

My hon. Friend makes a really good point, and there is much more that we can do. For example, we will make available public sector Government-owned land and buildings for the siting of mobile phone masts, which will be beneficial in lots of ways. It will provide locations for the masts as well as income for the Government. We have now also published the second iteration of our map of the publicly funded digital infrastructure. This includes the many thousands of miles of fibre that have been paid for by the taxpayer but which are massively underused and under-exploited. If that network can be mobilised to support the roll-out of mobile coverage and rural broadband, it could accelerate the programme to which my hon. Friend and I are both deeply committed.

[Duncan Hames (Chippenham) (LD)]

It is three years to the day since the Minister took up my invitation to visit Ark Data Centres in Corsham with me, and I am delighted to hear that the taxpayer stands to benefit to the tune of £100 million from the Crown hosting joint venture with the company. Does he agree, however, that the benefits of digital services extend much further than that, in that they allow a total redesign of the processes that underpin our public services?

[Mr Maude]

My hon. Friend is completely right. The digitisation of services is sometimes seen as just a pretty front end on a website, but this goes much deeper. It is about a fundamental redesign of the way in which services are delivered, with the processes being designed and built around the needs of the citizen instead of around the convenience of the Government, which has far too often been the case in the past.

[Andrew Stephenson (Pendle) (Con)]

As this is probably my right hon. Friend’s last statement in the House, may I thank him for the numerous visits he has made to Pendle over the past few years and for recently meeting Training 2000 in the Cabinet Office to discuss its plans to set up a cyber-security institute in my constituency? Will he say more about public service mutuals, the increase in their number under this Government and how they can benefit productivity?

[Mr Maude]

I am grateful to my hon. Friend. The public service mutuals programme is important. There are now more than 100 of them, whereas there were fewer than 10 when the coalition Government were formed. More than 35,000 members of staff have joined public service mutuals, which are delivering public services to the value of more than £1.5 billion. Most of them choose to be not-for-profit, and have seen an extraordinary improvement in productivity by bringing together: entrepreneurial leadership, of which there is much more in the public sector than is generally thought; staff who are liberated from bureaucratic constraints; hard-edged commercial discipline; and the public service ethos. Those four factors, brought together, are an extraordinarily powerful driver of improved productivity and value.

[Mr Andrew Robathan (South Leicestershire) (Con)]

In my right hon. Friend’s swansong—I commend him for it and for his five years’ work, saving money for the public purse—I wonder whether I might pick up on one specific issue of government efficiency reform, which is the trade unions training fund. It was set up a dozen or so years ago by the previous Government; some £10 million to £12 million was given to trade unions’ training and, lo and behold, £12 million came back as a bung to the Labour party. Will he update the House on what has happened to that?

[Mr Maude]

My right hon. Friend should not assume that this is my swansong. Although it is my last week in the House of Commons, I am answering oral questions on Wednesday and I am looking forward to that—[Interruption.] I am looking forward to engaging with the hon. Member for Manchester Central (Lucy Powell) on that occasion. It is very nice to see my right hon. Friend the Chief Secretary to the Treasury here, as he has been my comrade in arms as we have driven forward these efficiency savings over that period. My right hon. Friend the Member for South Leicestershire (Mr Robathan) will know that I made a statement, either last week or the week before, about the reform of trade unions within central Government. We have cut the cost of the subsidies to trade unions significantly over that time, bringing into these things a proper sense of proportion.

[Mr David Nuttall (Bury North) (Con)]

I thank my right hon. Friend for his statement and for the work he has done, saving taxpayers billions of pounds. Does he agree that by merging Departments even greater efficiencies and savings could be made?

[Mr Maude]

I understand what my hon. Friend says. The studies that have been done on machinery of government changes do not always indicate that they pay for themselves, but there are undoubtedly ways in which we can organise government to yield—in addition to what we have already done—significant improvements.

[Dr Matthew Offord (Hendon) (Con)]

I congratulate my right hon. Friend on his statement. Many of us recall my hon. Friend the Member for Cannock Chase (Mr Burley) making his suggestions to the House at the beginning of this Parliament and being vilified by some Opposition Members. May I say how resolutely and quietly the Minister has gone about this work? Not only has he made the savings, but he has taken the civil service with him to improve the public services of this country.

[Mr Maude]

I am grateful to my hon. Friend. This has been a long process and it is fair to say that the further we have gone, we have discovered a deep appetite for reform and change within the civil service, particularly among its younger members, who often get frustrated. They are the people who complain most about bureaucracy, and they have welcomed the fact that Ministers have taken a real interest in driving out bureaucracy and speeding things up.

Tobacco Manufacturers’ Producer Responsibility

Monday 23rd March 2015 Commons Chamber

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

16:59

[Paul Burstow (Sutton and Cheam) (LD)]

I beg to move,

That leave be given to bring in a Bill to require the Secretary of State to undertake a programme of research into the costs and benefits of introducing an annual levy on sales to be paid by tobacco manufacturers, with the proceeds to be used to support tobacco control measures, to discourage young people from starting to smoke tobacco, to help existing tobacco smokers to stop smoking; and for connected purposes.

This Bill is about establishing the principle that the tobacco industry, which has done so much to harm our society, should pay more than it does now to help reduce the harm that it might do in the future. Like the majority of Members in this House, I warmly welcomed the announcement by the Chancellor last autumn—it was in the autumn statement—that he would consider a levy on tobacco manufacturers and importers. I strongly agreed with him that:

“Smoking imposes costs on society and the Government believe that it is therefore fair to ask the tobacco industry to make a greater contribution.”

I welcomed the announcement by the Leader of the Opposition that his party was also committed to such a levy. It is right in principle that the tobacco industry should pay for the damage that its addictive and lethal products cause. The industry is one of the most profitable on earth. The two largest tobacco firms in the UK market, Imperial and Japan Tobacco International, hold around four fifths of the UK market and achieve joint profits of about £1 billion a year. Charging those firms to help clean up the damage their products cause is a rational and justified extension of the “polluter pays” principle to public health policy.

In the United States, the tobacco industry is required, under the Family Smoking Prevention and Tobacco Control Act 2009, to pay an annual “user fee” to the Food and Drug Administration to fund tobacco regulation and wider tobacco control activity. In effect, that fee is independent of the wider US fiscal regime, and the proceeds are controlled directly by the FDA.

As of 31 March 2014, the US Food and Drug Administration had collected $1.88 billion in manufacturer user fees, of which it spent $1.48 billion. About half a billion dollars went on public education, and another half billion went on scientific research projects to support additional FDA regulations on tobacco products.

In the UK, there is a policy parallel in the energy companies obligation, which places a legal requirement on the energy industry to invest in energy efficiency and related measures, especially for poor and vulnerable households. That leads us to a key problem with both the Chancellor’s and the official Opposition’s approach to the levy. The Treasury consultation on the levy, which was announced in the Budget but is still ongoing, does not include any commitments on how the money raised should be spent. Instead, it seems that the levy will be used simply to go to the Exchequer.

If a tobacco levy is introduced, the tobacco industry will have to decide whether to pass on to consumers some, or all, of the cost in higher prices. That would of course have some public health benefits, as price increases are known to be the single most effective policy lever in reducing smoking prevalence. However, the potential benefits to public health can be fully realised only if the levy is used to fund tobacco control action, which is designed to increase the rate of quitting tobacco use over and above what might otherwise be expected as a result of price rises.

I strongly believe that at least some of the funds raised should be directed towards actions to reduce the harm caused by tobacco consumption. A research paper by the economist Mr Howard Reed suggests that £500 million could be raised without much difficulty every year from a levy based on sales data. If the programme of research proposed in this Bill were carried out, it would show that the recurring cost of tobacco control activity at every level—local, regional and national—could be met from the proceeds of the levy. Indeed, it is likely to generate a fund sufficient to support these activities as well as assisting deficit reduction.

That would include national action through Public Health England and regional strategy through regional offices and any future regional governance structures, and tobacco control work by local authorities and in the third sector. The funding would cover: stop smoking services, mass media and public education campaigns and research, and efforts to tackle illicit trade at local and regional level. It could also fund new initiatives such as a positive retail licensing scheme to help ensure that retailers do not face any new costs. I also note with interest that the Communities and Local Government Committee has recommended that some levy proceeds be used to help clear up the litter and environmental problems caused by discarded cigarettes.

Local stop smoking services play an essential role in helping people to quit. However, following the transfer of the public health function to local authorities, which I support, those services are vulnerable, because of the financial strains placed on local authorities and the difficult choices that they have to make.

There are already grounds for concern about how many people are being reached by stop smoking services. Indeed, the Health and Social Care Information Centre reported in 2013-14 that the number of people quitting had fallen relative to the previous year. Although stop smoking services are demonstrably highly cost-effective and greatly benefit the whole of society, the direct savings they deliver go mainly to the NHS and not to the local authorities that pay for them. That applies also to local action by trading standards officers and others, for example when it comes to reducing the scale of illicit tobacco trade. The Exchequer benefits financially from that action, not the local authorities.

I draw the House’s attention to NHS England’s “Five-Year Forward View”, published in October of last year. This includes a section entitled, “Getting serious about prevention”, which states:

“The future health of millions of children, the sustainability of the NHS, and the economic prosperity of Britain all now depend on a radical upgrade in prevention and public health.”

Those words will remain simply a pious hope if we do not find new ways of financing public health policy and that would in turn mean that the chances of bridging the £30 billion NHS funding gap identified in the forward view forecast will not be achieved.

The Bill also proposes that research should be conducted into how the levy could be assessed and collected. I would favour basing it on sales data made public by manufacturers at a local and regional level as well as a national level. That would allow resources to be focused on the areas with the greatest sales and the greatest prevalence rates, better targeting tobacco control in the future.

Like most of us in this House, I was delighted when the former Health Secretary, the right hon. Member for South Cambridgeshire (Mr Lansley), said that he wanted the tobacco industry to have no business in this country. Smoking still causes hundreds of thousands of premature deaths across the UK every year and for every death caused by smoking, 20 smokers suffer from smoking-related disability. That is a terrible toll of death, disease and disability. It is why we must carry on seeking ways to improve public health measures to tackle smoking. A tobacco levy could provide vital funds for that purpose and I am confident that the programme of research proposed in the Bill would show just that. I therefore commend the Bill to the House and hope that Members will support it.

17:06

[Philip Davies (Shipley) (Con)]

I shall speak only briefly. I should say at the start that I do not intend to divide the House, as I know that many people wish to speak in the forthcoming debate, but I could not allow this Bill to stand without any opposition whatsoever. It takes the typical Lib Dem populist approach, trying to attack the tobacco industry without any evidence whatsoever, probably just because the right hon. Member for Sutton and Cheam (Paul Burstow) thinks that he might be able to extract four extra votes from it in his constituency at the general election.

The right hon. Gentleman made big play of wanting the tobacco industry to pay its fair share. I have never met anyone who would disagree with that sentiment, but he failed to mention one thing. I received a briefing note from Action on Smoking and Health—I see that the right hon. Gentleman is putting himself up as the spokesman for ASH, as it is its campaign that he is advocating—and it estimates that the cost of smoking to the NHS is about £2.7 billion a year. That figure comes from ASH, the deadliest opponent of the tobacco industry, yet tobacco excise and VAT already raise about £12 billion a year in revenue according to Her Majesty’s Revenue and Customs. How on earth the right hon. Gentleman has come to the conclusion that the fair share is not being raised from the tobacco industry is beyond me. The industry is clearly paying well above the cost of smoking to the NHS and even if he wants to add on the cost of cleaning up cigarette butts, fires and all the other things that ASH tries to add on, it comes nowhere near £12 billion.

I particularly wanted to oppose the Bill because the right hon. Gentleman has done us all a great service. He has let the cat out of the bag. Of course, the Government have already accepted ASH’s campaigning on banning smoking in cars where there are children, which is completely unenforceable. They have also accepted the plain packaging of tobacco, which is completely idiotic. Of course, the Government accepted those policies because ASH told them that if they did so the amount of smoking in the country would plummet. We were told that if we introduced plain packaging it would be absolutely fantastic because all of a sudden cigarettes would not appeal to young people and children and that would close the gateway into tobacco use. The whole policy was based on that premise.

That policy has not even been implemented and already the right hon. Gentleman is saying, “Actually, that was all a load of tripe. It won’t make any difference whatsoever. What we need now is a levy on the tobacco industry so that we can do some research to find out why young people smoke and then try to stop them smoking.” Well, what on earth was the plain packaging campaign about, if not that? I am grateful to him for letting the cat out of the bag by telling us that the whole premise behind plain packaging was a complete load of old codswallop. Unfortunately, the Government idiotically accepted that codswallop in a mindless fashion without even thinking it through, because they, too, are in the pocket of ASH and, rather than making up their own policies based on evidence, just want gleefully to accept anything ASH tells them.

If we want to raise more money from the tobacco industry, there is one great way of doing so: by clamping down on the illicit trade in tobacco, which would raise far more than the right hon. Gentleman’s levy ever would. Yet the Government are pursuing policies, such as plain packaging, that will reduce the amount of revenue from the industry and increase the illicit trade. Why he says that he wants to raise more funds from the tobacco industry but supports measures that will do exactly the reverse is absolutely beyond me.

The point is that this is just the latest campaign from ASH. Every time it advocates the introduction of another measure, it tells us that that is what the Government need to do to tackle tobacco, but as soon as it is implemented we are told that actually it was a load of old cobblers and now we need something else. It is like those companies that tell us their washing powder is absolutely magnificent, only to bring out a new one a couple of years later and tell us that the previous one was actually terrible and that really we need to buy the new one. ASH cannot now hand over the keys to the company car; it has to keep going and justifying its role. It will keep coming up with new, innovative solutions to try to keep its jobs, which no doubt the Government will accept, because they do not have a mind of their own and just have to do what ASH tells them to do.

I just hope that we can start thinking these things through, rather than simply accepting all the nonsense that comes from ASH, the Liberal Democrats and other hon. Members on these subjects. The right hon. Gentleman wants the tobacco industry to pay its fair share. I want the tobacco industry to pay its fair share. It is already raising far more in taxes and duties than it ever cost the NHS, according to ASH’s own figures. If we want to get more money, let us stop the illicit trade, and the best way to do that is not by having a levy, but by getting rid of the ridiculous plain packaging policy.

Question put (Standing Order No. 23) and agreed to.

Ordered,

That Paul Burstow, Kevin Barron, Bob Blackman, Dr Julian Huppert, Alex Cunningham, Martin Horwood, Nick Smith, Sheila Gilmore, Sir Alan Beith, John Robertson and Dr Sarah Wollaston present the Bill.

Paul Burstow accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 27 March, and to be printed (Bill 192).

Ways and Means

Monday 23rd March 2015 Commons Chamber

Budget Resolutions and Economic Situation

Monday 23rd March 2015 Commons Chamber

Amendment of the Law

Monday 23rd March 2015 Commons Chamber

Debate resumed (Order, 20 March).

Question again proposed,

That,—

(1) It is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance.

(2) This Resolution does not extend to the making of any amendment with respect to value added tax so as to provide–

(a) for zero-rating or exempting a supply, acquisition or importation;

(b) for refunding an amount of tax;

(c) for any relief, other than a relief that–

(i) so far as it is applicable to goods, applies to goods of every description, and

(ii) so far as it is applicable to services, applies to services of every description.

17:13

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

It is a pleasure to open the debate, possibly for the last time, and to welcome this final Budget—[Hon. Members: “Hear, hear.”] I knew that I would draw support from different parts of the House, and I am pleased to hear that I draw it from the Opposition Front Bench as well. Last week the Chancellor reiterated the Government’s commitment to our long-term economic plan—even the previous Chancellor, the right hon. Member for Edinburgh South West (Mr Darling), slightly smiled at that one—restoring the public finances and supporting businesses while providing security and stability for Britain’s families.

At the start of this Parliament we inherited an economy that had suffered a greater collapse than almost any other country, with £112 billion wiped off our GDP and 750,000 people losing their jobs, contributing to a welfare bill that had risen by 60% in real terms under the previous Government. Over the past year, however, Britain has grown faster than any other major advanced economy, with the Office for Budget Responsibility’s future growth forecast revised up. Britain has had the best performing labour market in the G7, with employment forecasts revised up too, and unemployment revised down. We are on the path, therefore, from austerity to prosperity. The deficit has been cut in half. The fiscal mandate has been met in the target year. National debt is set to fall in the coming year. A surplus of £7 billion is forecast by the end of the next Parliament. Welfare spending is down in real terms for the first time in 16 years and is below its 2010 level as a share of GDP.

Underpinning this recovery is the remarkable performance of our labour market, with the highest employment rate that Britain has ever seen, at 73.3%. The rise in youth employment in the UK over the year is larger than the rest of Europe combined, and there are now more people in private sector jobs than ever before, more women in work than ever before, more lone parents in work than ever before, more older workers than ever before, more disabled entrepreneurs than ever before, and perhaps most importantly, the most households in social housing in work since records began. That is arguably the most important of all the figures.

[Wayne David (Caerphilly) (Lab)]

Will the right hon. Gentleman give way?

[Mr Duncan Smith]

In a moment.

Importantly, and contrary to the myths that the Opposition promulgate, of this rise in employment since 2010—I want to make this clear, as I suspect the hon. Gentleman may ask about this—80% is full-time work and 80% is permanent. Three fifths has come from managerial, professional and associate professional jobs, 70% of private sector jobs have been outside London, and two thirds of jobs have gone to UK nationals, reversing the damaging trend under the previous Government when more than half went to foreign nationals.

[Wayne David]

Will the Secretary of State kindly tell the House how many of those new jobs were on low pay?

[Mr Duncan Smith]

I think I have just told the House. It is always good to ask another question when I have just answered it. The jobs that we are providing are paid well. We have seen a rise of 2.1% in private sector pay against inflation of 0.3% now, and a rise in public sector pay of 0.7%—somewhat over and above inflation.

So we have seen unemployment fall to pre-recession levels. The number of out of work benefits has fallen to its lowest for a generation, and the number of workless households has fallen to the lowest on record.

[Mr Geoffrey Robinson (Coventry North West) (Lab)]

Precisely on employment at record levels and the other boasts that the right hon. Gentleman has made, why then are national insurance and tax receipts way below budget and employment above budget? Does that not reflect the quality and level of the employment that is being offered—1.8 million zero-hours contracts, for example?

[Mr Duncan Smith]

I respect the hon. Gentleman and I am glad he asked me that, because it allows me to point out something that I was going to come to later. We have raised the thresholds on taxation. It is not surprising, therefore, that some of the insurance levels are low. I am proud of that. I am proud that my right hon. Friend the Chief Secretary is also proud of the fact that we are raising the point at which people pay tax for the first time. The real reason behind all these facts and any other issues that the hon. Gentleman raises in this regard is the fact that the previous Government saw the economy go over the edge of a cliff, and we have been picking it up ever since. If the question is why it is not perfect yet, the answer is that we still have some way to go, but we are making progress and going in the right direction.

Through this Government’s employment programme we are ensuring a jobs recovery for all. I want to point out some of the figures: 2 million apprenticeship starts since the beginning of this Government; over 1 million claimant commitments signed—as people go in to sign on to jobseeker’s allowance, setting out and reinforcing people’s obligations; work experience for 250,000 young people; 60,000 start-up businesses through the new enterprise allowance; and the Work programme helping more long-term unemployed people back into work than any other programme before.

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

rose—

[Mr Duncan Smith]

I will come back to the hon. Gentleman. I want to make a little progress, as I know that others want to speak.

The Work programme is continually improving. Nearly 1.1 million people have spent time off benefits, 680,000 have got a job, 400,000 have found lasting work, and job outcomes after 12 months are nearly twice as high as with the early cohorts, including the new employment and support allowance claimants. Compared with the previous back-to-work programmes—the flexible new deal, for example—the Work programme has helped more than twice as many people into work in the first two years as the flexible new deal, with nearly three times as many people in jobs for six months. This is not just getting people into work but ensuring that they stay there—that is the critical element.

I will give way to the hon. Member for Coventry South (Mr Cunningham) and then make some progress.

[Mr Cunningham]

The Secretary of State said that when the present Government took over, the economy was on a knife edge. I remember the previous Conservative Chancellor claiming credit when we were in power for the handling of the economy. More importantly, the Secretary of State has not mentioned the fact that recently the purchasing power of wages has dropped by 6%. Wages might have gone up by 2% in the private sector, but their overall purchasing power has dropped by 6%.

[Mr Duncan Smith]

I am a little bit lost. I am not sure whether the hon. Gentleman is saying that the previous Prime Minister was claiming credit when he was Chancellor in the previous—[Interruption.] If he is referring to my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), it is difficult for the previous Labour Government to claim credit when their Chief Secretary left a letter on the desk saying, “There’s no money left.” If the hon. Gentleman wants to claim credit for that, I will certainly allow him to intervene.

While the Budget proposed new measures to boost growth and support private sector job creation, in turn increasing employment, the Opposition’s only alternative, the jobs guarantee, it now turns out, is more like a no-jobs guarantee—a make-work scheme that the Institute of Directors has said is

“not the source of sustainable jobs”.

It is the kind of scheme that, for the past 20 years, the OECD has demonstrated is expensive and counter-productive in the long term. It says that large deadweight losses, displacement and substitution effects are of little success in helping unemployed people to get permanent jobs in the open labour market. We got rid of the Opposition’s last scheme, which did not work, and this one will fare no better. Labour’s flagship programme is just a rehash of the failed make-work schemes that seem to be its solution almost every time.

The hon. Member for Leeds West (Rachel Reeves) made this comment about Jobs Growth Wales:

“I went to see a scheme very similar to this in Wales last week and...that’s what we would aim to do across the UK”.

If that is what she thinks she is going to do, let us deal with what Jobs Growth Wales actually produces. It has been revealed to be an expensive exercise in cherry-picking the best-quality people who want to go back to work. Far from being a guarantee for all, which I understood was her policy, the hardest to help are not eligible for the programme, and only one in three applicants has got a place on it. A success rate of 80%, at a cost of £6,000 per place, is trumpeted, yet that compares with the 90% success rate of all—not some of—the eligible people in Wales who apply, who move off jobseeker’s allowance within nine months anyway. The reality is that this programme, on top of already successful programmes getting people into work, is less successful than the programme that it seeks to replace. Apparently, this is the programme that the Opposition want to copy and turn into a national programme in government, and it is all a rehash of the future jobs fund.

In the public sector, this Government have achieved the same success as the future jobs fund achieved through work experience in the private sector, but—here is the key—at a twentieth of the cost of what it cost Labour to provide jobs in the public sector. That is the problem with this make-work scheme.

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

While the right hon. Gentleman goes on mudslinging about party policies, he is skimming over the fact that what is wrong with our economy and the jobs being created is that over the past five years we have had a terrible deficiency of highly skilled workers. We are still churning out apprentices from short-term apprenticeships of a year, on average. That is not meeting the real need. When is he going to address that? If he does not do so, he will never solve the problem of low productivity.

[Mr Duncan Smith]

I agree with the hon. Gentleman that that was the situation we inherited. As I said earlier, under this Government there have been 2 million new apprenticeships aimed at getting people the necessary skills. There are also more people going to university and studying science. The reality is that it is not possible to turn around in a few years the problem mentioned by the hon. Gentleman, which followed 13 years of Labour government. We have set in train all of the right measures for the medium and long term to get more skilled people back into work. Before the hon. Gentleman sneers a little too much about people going back to work, I want to say that they are far better off in work and working towards full-time pay than sitting on benefits being depressed and worried.

[Mr Sheerman]

indicated assent.

[Mr Duncan Smith]

The hon. Gentleman agrees with me. The key point is that we want to get people into work, including skilled work, and for them to develop skills not only while they are in work, but as they come through apprenticeships and university.

I want to return to the make-work scheme, because I have a feeling in my bones that the Opposition are beginning to slide away from it. They have failed to answer a number of questions. We have asked them time and again how many private businesses have signed up to the jobs guarantee, but we have never had an answer. We have been told endlessly that there is a lot of interest, but we have never heard any examples.

I heard the shadow Chancellor on, I think, a Radio 4 programme and he seemed rather scared and unusually unable to be coherent. [Interruption.] All right, I will drop the “unusually”. He was unable to list the vast number of private sector companies taking part. When asked how many there were, he seemed to lose his nerve and said:

“But if not, you can do it through the voluntary sector. If not, you have to have a final backstop: a public work scheme.”

The shadow Chancellor has pretty much made it clear that the scheme is going to be about jobs created not in the private sector, but in the public sector. [Interruption.] Oh no, it will not: the right hon. Member for East Ham (Stephen Timms) knows that to be the case. In other words, the Opposition would repeat the mistakes of the past.



I hope that the hon. Member for Leeds West will answer another question we have asked the Opposition time and again: how long will the guarantee last? Back in 2011, we heard about a 12-month guarantee for young people unemployed for one year. By 2013, the proposal had morphed into a six-month guarantee—half the time previously advertised—for those unemployed for two years. Even that is not enough, for as Labour begins to see what a disaster the policy is and the shadow Chancellor begins to wind away from it—there is no interest in it from private sector firms and it has no traction with business—they seem to be beginning to realise that it is not worth all the money they are talking about spending.

I had a look at the Labour website when it launched its tuition fee policy. Interestingly, buried in the relevant document—I would like to say it was in the small print, although the print was pretty small anyway—I found that the scope of the flagship jobs guarantee had been halved again. This announcement was made without fanfare and without anyone taking to the airwaves to tell everybody what a wonderful scheme it was going to be. Labour now proposes “a six-month job”—remember it was for a year originally—

“for any more 18-24 year olds who find themselves claiming Jobseeker’s Allowance for a year”.

It also proposes “a three-month job”—it used to be for six months—

“for the over 25s out of work for two years”,

not one year. In other words, Labour is edging back, killing off its policy bit by bit, and I suspect that eventually it will let it go altogether.

Following a Budget in which the Chancellor once again pledged that no spending commitments would be unfunded, the final and most significant unanswered question—I hope the hon. Lady will answer it, because this is her last opportunity to do so—is: how will the jobs guarantee be paid for? That is a legitimate question, for the Budget punched a hole in Labour’s two proposals with two new measures: the first to levy funding from the banks and the second to restrict pensions tax relief.

Given that the shadow Work and Pensions Secretary has herself declared that

“we need to make sure that the sums add up”,

it is right that we do the maths, starting with the cost of the jobs guarantee, an estimation of which was done by Treasury officials in January. The cost of the jobs guarantee for 2015-16 is forecast to be £1.54 billion for over-25s and £540 million for under-25s. That is £2 billion in total in one year alone, which is far more than the Labour estimate. Taking the small print of the document we found, even if the figure in it is halved, as the Labour U-turn seems to make clear that it will be, it is more than three times the £300 million a year that Labour says it will cost, at close on £1 billion a year.

When the hon. Lady gets up to speak, I hope that she will explain how Labour will fund the jobs guarantee. If she is going to use the bankers’ bonus tax again, I must tell her that it has been spent 11 times over. Here are the things on which it has been spent: reversing the VAT increase—£12.75 billion; reversing the tax credit savings—£5.8 billion; more housing—£1.2 billion; reversing the child benefit savings—£3.1 billion; more capital spending—£5.8 billion; child care—£800 million; and there are more. The last Chancellor, the right hon. Member for Edinburgh South West, said that he did not think it would be feasible to repeat the one-off bankers’ bonus tax, but the reality is that Labour will repeat it to pay again and again for other things.

Another announcement in the Budget was the excellent decision to reduce the tax-free lifetime allowance. It had already been reduced from the £1.8 million inherited from Labour to £1.25 million, and it will now fall to £1 million. The latest change will save about £600 million a year. Importantly, it will affect only 4% of those approaching retirement. That is in stark contrast to Labour’s proposal to reduce the tax-free annual allowance, which would plunder the pension pots of moderately paid, long-serving public servants such as police officers, teachers, nurses and others. With the Government already taking effective steps to curb the size of the very largest pension pots—my right hon. Friend the Minister for Pensions has been involved in that—Labour’s proposed pension tax relief changes will be left null and void. Despite the fact that Labour has committed the money for the purpose of increasing working and child tax credits and, very recently, to pay for the £3.1 billion cost of lower tuition fees, it will apparently be used only to fund the jobs guarantee. As for Labour’s final funding proposal, restricting pension tax relief for those with incomes of more than £150,000, it would not come in for a further three years.

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

Will the Secretary of State give way?

[Mr Duncan Smith]

Not yet. I will finish this particular point before I move on to the rest of the stuff in the Budget.

In this key area, the Opposition have absolutely no idea what they will do. They do not have the money, they are losing interest in the very policy that they said was at the heart of their policies and the rest has just become smoke and mirrors. It is as simple as that. There we have it: the cobbled-together nonsense of Labour’s jobs guarantee is destined to fail as wholly unfunded. Yet we should not be surprised by that from a party which built an entire economy on debt, with policies paid for by more borrowing and higher taxes. Under Labour, Britain accumulated personal debt of a record high, reaching some £1.5 trillion, while the level of household saving fell to a 50-year low.

[Mr Ronnie Campbell (Blyth Valley) (Lab)]

Will the Secretary of State give way?

[Barbara Keeley]

Will the Secretary of State give way?

[Mr Duncan Smith]

In a minute.

This Government are restoring stability in our economy, with no unfunded spending and no extra borrowing; instead, aspiration, responsibility and security will pave the way for a better future. The principle behind the Budget is to restore a Britain built on savings and investment, and that will be done with three new measures. There is a radical, more flexible individual savings account, with the complete freedom to withdraw money from a cash ISA and pay it back later in the year without losing any of the £15,000 tax-free entitlement. There is the brand-new Help to Buy ISA: we are working hand in hand with first-time buyers to help them to save for a home—£3,000 will be provided by the Government for every £12,000 saved—which is an excellent idea. There is a new personal savings allowance, with up to £1,000 interest-free. It will take 17 million taxpayers out of savings tax, not just cutting but abolishing that tax for 95% of people.

On pensions, the Government have already reversed the decade-long decline in pension saving, rolling out automatic enrolment to make saving the norm and introducing the new state pension, while reducing the means test and creating a solid foundation on which to save. We are returning to people who build up their pension pots the freedom to use that money as they see fit. In last year’s Budget, the Chancellor announced radical changes to abolish the prescriptive rules that dictated how and when people could use their pension savings. That means that from April, 320,000 people a year will be able to choose what to do with their pension savings on turning 55. In last week’s Budget, he went further still by allowing 5 million annuity holders to access their existing annuities. He has extended the freedom to give those people greater control over their finances, which is an excellent idea.

[Barbara Keeley]

One group of people who do not have much chance to accumulate pension pots is unpaid family carers, many of whom have to give up work in order to care. Will he say, at the end of this Parliament, whether he regrets forcing 60,000 unpaid family carers to pay the bedroom tax, meaning that not only can they not acquire pensions, but many of them are having to cut back on food and heating to pay it?

[Mr Duncan Smith]

The spare room subsidy policy that we introduced has been assisted by some £380 million that we have given to local government to ensure that anybody in the local community is supported and aided, as necessary. I do not regret that policy. I think it will bring fairness to social housing. Why does the hon. Lady not get up one time and answer this question: does she not feel ashamed about leaving so many people—7 million people—on long waiting lists for accommodation? Why does she not apologise for leaving so many people, when Labour left office, in overcrowded—

[Barbara Keeley]

rose—

[Mr Duncan Smith]

No, she has had her word. Why does she not apologise for leaving so many people in overcrowded accommodation? Labour Members do not apologise for that. The answer is that they have no policy on that. Social house building under the Labour Government fell to the lowest level since the 1920s. She should get up and apologise for that.

[Barbara Keeley]

I thank the Secretary of State for giving way, eventually. Perhaps he would like to look at the case of the couple in Sefton—the disabled person and her carer—who have fought their case through to the Supreme Court. The Prime Minister was unable to give an answer about that couple. It is not a question of such couples giving up their home or their spare room to anybody else. Carers find those rooms essential. That couple found their room essential. The Prime Minister could not answer. Will the Secretary of State answer?

[Mr Duncan Smith]

That is exactly the reason why we gave £380 million to local authorities to deal with individual cases. The courts have supported us in this. Again, the hon. Lady did not get up and apologise for the mess Labour left social housing in: overcrowded accommodation, people who could not find the right houses, people on huge waiting lists for accommodation and the lowest level of house building on record since the 1920s. That is the shame of the 13 years of the last Labour Government.

I spoke a moment ago about the pension freedoms that have been provided. The last pension freedom that has been provided by my right hon. Friend the Chancellor is to allow 5 million annuity holders to access their existing annuities. I pay tribute to my right hon. Friend the Minister for Pensions because that was originally his idea. It shows that the coalition is working at all levels.

It pays to save and, through our welfare changes, this Government have ensured that it pays to work. We have undertaken the most significant reforms in living memory, which span not only pensions but job-seeking benefits, disability benefits, child maintenance and more. They have been opposed at every turn by the Opposition. We are delivering a welfare state fit for the 21st century.

Universal credit is rolling out nationally. It is already in 150 areas and is set to be in every jobcentre by this time next year. The earliest claimants are spending more time looking for work, are moving into work quicker, are working more and are earning more than those on jobseeker’s allowance. It will bring economic benefits of up to £35 billion over 10 years, as the Public Accounts Committee agrees.

The benefit cap has ended the something-for-nothing culture. Capped households are 41% more likely to move into work and 12,500 have done so. Housing benefit is capped too. There has been the first real-terms fall in housing benefit spending in a decade and it is set to carry on falling in real terms up to 2020. Our reforms are restoring fairness and mean that we are making better use of Britain’s housing stock as we build more houses.

Over this Parliament, the increase in welfare spending has been the lowest since the creation of the welfare state at 0.5% a year compared with the 3.5% increase in Labour’s last Parliament in office. Total welfare spending is below what we inherited in 2010 as a proportion of GDP. In the coming year, out-of-work benefit spending will be back to pre-recession levels. Welfare reforms are set to have saved nearly £50 billion cumulatively, all while departmental baseline spending is down—I say this to the Chief Secretary to the Treasury—by some £2 billion a year. He can say “well done” if he likes. We are doing more, and we are doing more efficiently as a result.

As we come to the end of this Parliament, I am proud of the work we have done with my right hon. and hon. Friends in this House. I pay tribute to some of my previous Ministers, including my right hon. Friends the Members for Epsom and Ewell (Chris Grayling), for Basingstoke (Maria Miller) and for Hemel Hempstead (Mike Penning), and my hon. Friend the Member for Fareham (Mr Hoban), as well as to current Ministers, including the Minister for Employment, who has done brilliantly in her job, and the Minister for Disabled People, who is doing brilliantly in his. I pay particular tribute to an hon. Friend who is unsung and unfairly traduced by the Labour party: my good friend Lord Freud. He has worked tirelessly for two different Governments, determined only on one thing, which is to improve the quality of life for people in Britain. I am also proud of my working relationship and what has been achieved with the Minister for Pensions. We have worked well together and achieved good things, and we have also worked closely with the Chief Secretary to the Treasury on many subjects.

The last five years have often been hard and difficult, but always rewarding. We took a system that was bloated and unfair, and which under the previous Government seemed to penalise those who tried and rewarded those who did not. The last Government left us a system that measured only the amount put in and not the results obtained, and it trapped many in dependence. We took that system and changed it for the better, leaving a positive legacy: the deficit down, unemployment down, youth unemployment down, long-term unemployment down, employment up, private sector work up, working households up, growth up. That is a legacy of which any Government of any stripe should be proud. This Budget is key to that legacy, and I commend it to the House.

17:41

[Rachel Reeves (Leeds West) (Lab)]

I thank the Secretary of State for his valedictory address this afternoon, and I hope that this will be my last speech from the Opposition Benches.

The last five years have been a tragic and terrible waste for working people in this country, and a shocking record of Tory welfare waste at the Department for Work and Pensions. What a wasted opportunity this Budget was to put in place the better plan that we need. People in my constituency—and in every constituency around the country—have been let down yet again. People are putting in the hours at work but still falling behind with the rent and the bills; they are desperate to work and earn, but are not getting the support they need to find a job. People who cannot work because they are sick or disabled are forced to turn to food banks because the safety net is being pulled away from them.

The people of our country have been put through five years of hardship by this out-of-touch Government, and they are still waiting to feel the benefits of what has been the weakest recovery in more than 100 years. Five wasted years in which working people have put in the hours, day after day, year after year, only to find themselves £1,600 a year worse off than when the Government took office. Five wasted years in which families have been hit by tax and benefit changes that cost the average household more than £1,100 a year, only to find that the Government have borrowed £200 billion more than they said they would and have totally failed to deliver on their central promise to balance the books. Five wasted years in which people have been told “We are all in this together”, while the Government prioritised tax cuts for millionaires and came back time and again to take money from the poorest. Five wasted years in which a Secretary of State for Work and Pensions has waxed lyrical about his grand scheme for welfare reform, but all he has delivered is delays, backlogs, write-offs and overspends—a record of Tory welfare waste that we cannot stand for another five years.

Let us remind ourselves of the backdrop to this Budget and of the complacent and self-congratulatory speech we have just heard from the Secretary of State. The Chancellor promised in 2010,

“we will bring down the benefits bill.”

Since then we have had five years of cruel and unfair policies: taking money from the pockets of disabled people through the bedroom tax; taking money from working families with restrictions to tax credits; driving hundreds of thousands of people to food banks to feed their families; and increasing the number of children in absolute poverty by 500,000. And yet, at the beginning of this year, the Institute for Fiscal Studies confirmed that

“Real terms benefit spending…is forecast to be almost exactly the same in 2015–16 as it was in 2010–11”.

Why is that, we may ask, after the Government have inflicted so much hardship on so many people who have the least? It is because, the IFS explains, these harsh and unfair policies have been cancelled out by upward pressure on the benefits bill resulting from

“weak wage growth and rising private rents”.

Meanwhile, it says, most of the major structural changes, such as universal credit, have run into problems and are yet to be delivered. This is the reason why, in the past five years, the Government have spent £25 billion more on social security than they said they would in 2010. It is why, yet again, the small print of the Budget reveals another £600 million overspend this year against last year’s forecasts.

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

My hon. Friend is making some incredibly strong points. On low wage growth, does she agree that we have seen particular challenges in very low paid sectors, such as care? Not only are carers struggling to get by on very low wages and struggling with the cost of living, we are seeing the minimum wage being undermined and some companies possibly not even paying it. Allegations have been made this week about MiHomeCare in Penarth in my constituency. The Government are failing to enforce the minimum wage.

[Rachel Reeves]

We know that still too many people are not even paid the minimum wage, and we know that the number of people paid less than the living wage has increased from 3.4 million to 4.9 million in the past few years. It is also true that we need to do more to ensure the minimum wage is always enforced, which is why we have said we would increase fines for non-payment to £50,000 and why we would give more powers to local authorities to ensure that the minimum wage is always paid.

[Mr Robinson]

Will my hon. Friend confirm what the Secretary of State failed to confirm? What she has clearly exposed this afternoon, supported by an earlier intervention, is that there have been 1.8 million zero-hours contracts in the past five years. As a consequence, tax and national insurance receipts are, cumulatively, £100 billion below the Government’s own projections. That is at the heart of the problem.

[Rachel Reeves]

My hon. Friend is right. Income tax and national insurance receipts have fallen short of forecasts by a staggering £97 billion in the life of this Parliament. As he makes clear, too many people are working on zero-hours contracts or in very low-paid jobs where they just cannot make ends meet.

[Mr Sheerman]

As a fellow Yorkshire Member of Parliament, does my hon. Friend share my anger that despite all this bland talk about the success of the economy and the success of the welfare system when it is actually being destroyed, in my town—and probably in hers—30% of people working are on low wages? It is women and families with children who are being particularly hard hit.

[Rachel Reeves]

My hon. Friend is right to talk about the experience of people in his Huddersfield constituency. People in Huddersfield, Yorkshire and around the country will, I think, be slightly shocked by the degree of complacency from the Secretary of State today and from the Chancellor last week, when for them and their families things are very often getting harder, not easier.

The Government have failed to control social security spending, as they promised they would, because they have failed to tackle the true causes of rising welfare spending, such as low pay and the lack of affordable housing, and because they have failed to deliver the flagship reforms the Secretary of State made such great claims for five years ago. What a tragic waste of time, talent and taxpayers’ money: wasting the precious time of sick and disabled people forced to wait for months on end for the support they so desperately need; wasting the talents of people who are not getting the help they need to get into work, or who are stuck in low-paid insecure jobs that my hon. Friends have spoken of that do not make the most of their potential; and wasting money on IT systems that do not work, assessment and appeals procedures that have descended into chaos, and soaring spending on in-work benefits because of this Government’s failure to build an economy that actually rewards hard work.

[Mr Duncan Smith]

The hon. Lady talks about what she calls soaring benefit costs. Does she accept that under her Government not only did in-work benefits rise by more than 50%, but housing benefit for those out of work rose by 70%? In other words, both in-work and out-of-work housing benefit claims rose dramatically under her Government.

[Rachel Reeves]

Under the last two Conservative Governments, unemployment reached 2.5 million. There was a global financial crisis during the period of the last Labour Government, and as a result, unemployment rose, but it has risen even further under this Government, from 1.5 million, when Labour left office, to 1.7 million in February 2012. The OBR’s Budget forecast last week showed a £600 million increase in the forecast for social security spending in just one year, and since 2010, the Government have spent £25 billion more on social security than they set out to spend.

Under the Government, the number of people paid less than the living wage has soared by 44%, while house building has fallen to its lowest levels since the 1920s. It is for those reasons that housing benefit spending—the second-largest area of DWP spending, after pensions—was more than £2 billion higher in 2014-15 than in 2009-10. It was due largely to the rocketing numbers of working people not paid enough to cover their rent. In this Parliament, the Secretary of State has spent £1.8 billion more than he planned on housing benefit for working people and, on current Government forecasts, the cost of working people’s rising reliance on housing benefit to pay their rent will reach £14 billion by the end of the decade, if left unchecked—£488 for every household in the country.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

I think there is some common ground between us, particularly on zero-hours contracts for women who choose to work part time, but could the hon. Lady not congratulate the Government on regulating part-time zero-hours contracts, especially given that the Office for National Statistics has knocked the figures Labour used? This is often something that working mothers choose.

[Rachel Reeves]

According to the ONS, the number of zero-hours contracts has increased from 1.4 million to 1.8 million in the last year. This is a huge challenge for working mothers and others. We want to ban the exploitative use of zero-hours contracts so that if someone does regular hours, they will be offered a regular contract and so that their hours cannot be cancelled at the last minute without compensation. If we make those changes, I hope we can stem the increase in the number of zero-hours contracts, giving more people the security of paid work they know will happen week after week.

[Barbara Keeley]

I want to give an example from the social care sector to add to that given by my hon. Friend the Member for Cardiff South and Penarth (Stephen Doughty). I recently spoke to a constituent working in the care sector whose job decayed over the years after an agency took over the firm she worked for, to the point where, instead of working the 35 to 40 hours a week she wanted, she was lucky if she got 20 hours a week, and the agency constantly cancelled at short notice. She could not manage from week to week with that. Sadly that is the care industry these days.

[Rachel Reeves]

My hon. Friend speaks powerfully about something she knows a lot about. The number of zero-hours contracts in the social care sector, and more widely across the economy, has grown. It is incredibly difficult to plan from week to week if someone does not know how much money they will take home or whether they can afford to pay the rent and bills and put food on the table. That is why more people in work are having to rely on food banks to make ends meet.

I move now to key reforms that have spun out of control under the Government. Universal credit was supposed to cut fraud and make work pay, but after five wasted years of this Government and more than half a billion pounds of taxpayers’ money spent, it is being paid to just 41,000 of the 1 million people who were supposed to be receiving it last April. The National Audit Office has identified a fortress mentality and a “good news” reporting culture in the Department as key factors behind this fiasco. Last summer, the Secretary of State promised an accelerated roll-out plan, but we have yet to see much evidence of it—things could not be going much slower.

The Work programme—another failed programme—was the Government’s belated and inadequate replacement for the future jobs fund they scrapped, but it has failed to tackle long-term unemployment. Indeed, the number of long-term unemployed people has risen by a staggering 49% since 2010. It still sends more people back to sign on at the jobcentre after two years than it places in a job and has made no impact on the disadvantaged and high-risk unemployment faced by over-50s and disabled people. The introduction of personal independence payments has also been a complete and utter shambles, leaving sick and disabled people waiting months on end for support, while total spending has gone over budget by more than £2 billion. The roll-out of employment and support allowance was supposed to deliver big savings by helping more disabled people into work, but just 8% of people on ESA have been helped into work by the Work programme. Furthermore, analysis by the House of Commons Library shows that the Secretary of State has spent £8.6 billion more than he said he would on ESA. What a mess and what a waste—five years of Tory welfare waste we needed this Budget to put an end to.



The Budget was a wasted opportunity. We needed a better plan to make work pay and get social security spending under control, but instead the report of the independent OBR confirmed that all we could expect from the Government in the future was more of the same: more unplanned spending on social security and more failure to deliver promised savings on disability and sickness benefits, with the OBR noting on page 143 that

“projected spending on incapacity benefits, DLA and PIP is up by £0.2 billion a year on average between 2014-15 and 2019-20”;

more failure to deliver promised savings on fraud, with the OBR reporting on page 191 that it had

“revised down the savings associated with tax credits operational measures. These increase spending by £0.2 billion a year between 2015-16 and 2019-20”;

and more of the “good news” culture on welfare reform, with the OBR noting on page 192 that

“we have noted a history of optimism bias relating to reforms to incapacity benefits, disability benefits and universal credit.”

“Optimism bias” is a polite way of saying that we cannot trust a word the Government say.

In a moment of optimism bias, the Secretary of State promised that 1 million people would be on universal credit by April 2014, but one year on, fewer than 41,000 people are claiming it. In another moment of optimism bias, he promised that universal credit would be on time and on budget, but with delay after delay and millions of pounds written off, everyone knows that it is neither on time nor on budget. In yet another case of the Government’s optimism bias, they promised to back carers but then forced 60,000 households with carers to pay the bedroom tax, as my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) mentioned. Was it not optimism bias that led the Chancellor to promise to reduce the benefit bill, only for the Government to spend £25 billion more on social security than they set out to spend? And perhaps optimism bias is why the Chancellor broke his promise to clear the deficit by the end of this Parliament.

[Christopher Pincher (Tamworth) (Con)]

Is the hon. Lady’s muddled jobs guarantee an example of optimism bias?

[Rachel Reeves]

Labour’s jobs guarantee would help 150,000 people get into work in the first year of a Labour Government. I am optimistic that we can transform the lives of young people and the long-term unemployed, unlike this Government, who have left them on benefits. Funded by a repeat of the bank bonus tax they abolished and by restricting pensions tax relief to 20% for people earning more than £150,000 a year, our compulsory jobs guarantee will help young people who have been unemployed for a year and older people out of work for two years. Should that not be our priority, rather than tax cuts for bankers?

The Budget also reforms the rules governing pensions and annuities. The Opposition have long called on the Government to sort out the failing pensions and annuities markets, which result in too many hard-working savers finding their retirement pots eroded by excessive fees and poor-value products. So we welcome more freedom for savers to choose how to access their money and plan their retirement. Just as with last year’s announcement, we find the same failure to ensure that savers and pensioners have the support and protection they need to secure a decent and reliable income and to avoid the rip-offs that are already threatening to create another mis-selling crisis.

Just this weekend, we learned that with fewer than two weeks before the reforms announced in last year’s Budget come into effect, there is still no telephone number for the promised advice service, Pension Wise, leaving hundreds of thousands of savers exposed to scams that could have a devastating effect on their retirement plans. Instead, we have the ridiculous spectacle of the Pensions Minister trying to wash his hands of the responsibility by warning of the rip-offs that will result—without doing a single thing properly to protect people from those risks.

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

Any decisions about annuities are extremely complex decisions to take. Failing to get the advice lines up and running is not just a fault on the part of this Government, it is negligent. It is negligent to allow people this freedom without providing them with any back-up to help them make the right decision. What is more, there is no thought given to the remedies if the decision they take is wrong.

[Rachel Reeves]

When the Chancellor spoke in the 2014 Budget he said that people would be given “advice”, which was then watered down to “guidance”. Now, with two weeks to go, we know that nobody has received this guidance, yet people will be making irreversible decisions about their retirement income.

This Budget has been more of the same from the same old Tories: more overspends, delays and missed targets on social security; and more big promises for savers and pensioners that are not backed up with the support and the protections we need to make these reforms work.

[The Minister for Pensions (Steve Webb)]

The hon. Lady is concerned, as we are, to make sure that consumers get good value. She has proposed a cap on charges for these new pension products. Presumably, she thinks the cap should come in straight away. What should it be?

[Rachel Reeves]

We have said that there should be a cap on fees and charges—not just for the annuities products, but for the new drawdown products. We think it should be at the same level as the Government have set out, but then reduced over time. In that way, we will ensure that savers get value for money. Unless we do that, more people will be ripped off. Unfortunately, despite all the Government’s rhetoric, they have not taken action to protect people’s retirement incomes.

What we have heard from the Secretary of State today is the same complacency and self-congratulation. Yes, of course we welcome any fall in unemployment, but it was this Government who allowed unemployment to soar to record levels in the first place, peaking three years ago in February 2012 at 1.7 million. Under this Government, the number of long-term unemployed, abandoned to a life on the dole, has risen by 49%. That is why Labour will have a compulsory jobs guarantee.

[Richard Graham (Gloucester) (Con)]

The hon. Lady made a number of comments about the prices and charges that should be levied on pensions. Will she confirm that the price cap that has been levied on auto- enrolment pensions is, in fact, half that of the amount levied on stakeholder pensions when her Government were in power?

[Rachel Reeves]

We introduced a cap on charges for stakeholder pensions and the automatic enrolment brought in policies for which Labour had already legislated. We are proud of automatic enrolment, but we disagree with the changes that this Government introduced, which mean fewer people are benefiting from automatic enrolment —1.5 million fewer, two thirds of them women. That is a real lost opportunity to ensure that those people who should be saving are actually saving.

What this Secretary of State and the Government he speaks for simply do not understand is that their failure to make work pay and to deliver a recovery that raises living standards for all is the root cause of their failure to control social security spending and balance the books as they promised. They have spent £25 billion more than they planned and their receipts from income tax and national insurance have, as has been pointed out, fallen short of forecasts by a staggering £97 billion over the life of this Parliament.

It is because of that failure that, in order to deliver his objective of a large surplus in the next Parliament, the Chancellor has now committed to even deeper spending cuts over the next three years than we have seen over the past five years. The Office for Budget Responsibility confirms that these plans will mean

“a much sharper squeeze on real spending in 2016-17 and 2017-18 than anything seen over the past five years”,

and

“a sharp acceleration in the pace of implied real cuts to day-to-day spending on public services”.

My right hon. Friend the Member for Morley and Outwood (Ed Balls)and my hon. Friend the Member for Nottingham East (Chris Leslie) have highlighted the threat this poses to police, defence and social care. Is it not the truth that the Chancellor’s extreme fiscal plan can be delivered only by putting our NHS at risk or imposing yet another Tory rise in VAT? Although it is hard to see how this Government can make the extra £12 billion-worth of cuts to social security spending when they have failed to deliver any savings in social security so far, these cuts could not be delivered without inflicting unimaginable hardship on low-paid workers, children in poverty, disabled people or carers.

So for this Government, this empty Budget will be a fitting epitaph. What of this Secretary of State who wanted to take his place in history as the compassionate Conservative who reformed welfare? His time is up and his record is clear: major reforms undelivered or descending into costly chaos; food banks in every town and child poverty back on the rise; more and more spending on in-work benefits as more and more working people find their wages do not cover the rent. No wonder the OBR says that the Government are guilty of “optimism bias”.

[Mr Jim Cunningham]

One important factor in looking at low pay, child poverty and similar issues is that many people’s employment rights are eroded. We need only to look at City Link in Coventry to see that more than 1,000 people could not even get any redundancy pay because of the erosion of employment laws under this Government. That only adds to the poverty.

[Rachel Reeves]

I thank my hon. Friend for that intervention. Of course, this Government have made it harder for people to access justice, too, through the cuts they have made there.

We have had five years of Tory welfare waste—and it is high time we put it behind us. The Secretary of State wanted universal credit to be his legacy, but it is being paid to less than 4% of those who were supposed to be receiving it a year ago. Instead, this Secretary of State will be remembered for the hundreds of thousands of disabled people hit by the bedroom tax; for the 1 million people forced to resort to a food bank to feed their families last year; for the 3 million low-paid working families who have been hit by this Government’s cuts to tax credits. We cannot afford another five years of this Tory Government.

This could have been a Budget to make work pay, with a plan to raise the national minimum wage to £8 an hour and measures to promote and incentivise the living wage. This could have been a Budget for mums and dads who want to work and earn more, with 25 hours a week of free child care for all working parents of three and four-year-olds and guaranteed wrap-around care for those with children at primary school. This could have been a Budget that gave relief to working families on low incomes, by scrapping the ill-conceived and unfair married couples tax allowance and using the money to introduce a 10p starting rate of income tax instead. This could have been a Budget to create more of the productive, well-paid jobs we need by backing entrepreneurs, small businesses and the growth industries of the future, with a cut to business rates, a proper British investment bank, and new powers devolved to every city and county region across the country.

This could have been a Budget to secure our NHS for the future, with a tax on properties worth more than £2 million to pay for the thousands more doctors, nurses, midwives and home care workers that our health service desperately needs. This could have been a Budget that began to right the wrongs of the past five years, by tackling the tax loopholes and reversing the tax giveaways that have benefited a few and by cancelling the cruel and unfair bedroom tax that is hitting disabled people so hard. All that is not just the Budget that this could have been; it is the Labour Budget that we can have and the Labour Budget that we will have if we elect a Labour Government in just 45 days’ time.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Due to the large number of right hon. and hon. Members who wish to speak, there will be a time-limit for all Back-Bench speeches. There will be 10 minutes for the first two Back Benchers and five minutes for each remaining speech thereafter.

18:09

[Mr Kenneth Clarke (Rushcliffe) (Con)]

I congratulate my right hon. Friend the Chancellor, the Chief Secretary and the rest of the Treasury team on the Budget. I also congratulate them, even more emphatically, on the extraordinary record of the last five years which enabled a Budget of this kind to be presented. I think it must be acknowledged that we took over a worse situation in 2010 than any Chancellor had taken over since the war. It was even worse than the winter of discontent in 1979. I have not looked up the debate on that first Budget, but I believe that our present position would then have been beyond the wildest dreams of most Members on either side of the House. That is why this Budget gives us such a firm foundation for making further progress.

I also congratulate the Treasury team on the type of Budget that we have been given. I am relieved and delighted that it was not a gimmicky Budget, and that we did not see one of those foolish attempts to start buying votes with populist measures. Chancellors who are facing elections are always besieged with requests for them to do unbelievably silly things in the belief that the public will respond by voting for them, but the public are usually far more sensible than most of the journalists and most of the politicians, and have never responded to such measures in the past. Admittedly, both the right hon. Member for Edinburgh South West (Mr Darling) and I eschewed that type of Budget, because we were producing the last Budgets for Governments who on any sensible view were doomed to be defeated at the next election, but we did what has been done on this occasion. It is not a question of the electoral purpose; it is a question of the national interest. A sensible, competent, prudent Budget is in the national interest, and gives us the best opportunity to deliver what we hope to deliver over the next five years.

[Sir Edward Leigh (Gainsborough) (Con)]

In her peroration, the hon. Member for Leeds West (Rachel Reeves) produced a great, long shopping list of things that could have been done in the Budget. “It could have been a Budget” for this, that and the other. Would not the best response to the hon. Lady be “It could have been a Budget to bankrupt Britain if Labour were in charge”?

[Mr Clarke]

I think that it would. Blatantly going around telling people that their pay will go up and that expenditure will be increased in a number of instantly popular ways, along with Labour’s earlier promises to start ordering companies to reduce the prices of sensitive products in highly volatile markets, is totally irresponsible. I hope that, were the population so foolish as to return a Labour Government in six weeks’ time, their policies would be hastily abandoned when they found themselves confronted with the realities of power.

In basic terms, this is a fiscally neutral Budget, which is plainly what was required. During Budget debates, we used to spend more time discussing the Budget judgment, and on this occasion that judgment was “fiscally neutral”, which I think has been widely applauded. That does not mean that the Budget is devoid of significant measures, including measures that will have a considerable impact on the rest of the human race—the ordinary men and women out there who have ordinary, moderate incomes. I am rather surprised that so little attention has been paid to the wider impact of another rise in personal allowances, which will not only have the welcome effect of taking the very low paid out of tax altogether, but will have a big impact on the great bulk of the population who are receiving perfectly ordinary pay. Some 27 million people will benefit, and average taxpayers will be better off by £900 million a year.

However, so that the Budget could remain fiscally neutral, that easing of the problems of the ordinary population has been balanced and financed by a rather eye-watering increase in the bank levy—which I think is a perfectly sensible way of raising money now that the banks are on their way to recovery—and a further reduction in tax relief on the pension contributions of not the very wealthy, but the better off. They can build up a pension pot of £1 million, which is not to be sneezed at; they have secure jobs, are making contributions, and have plans for their retirement. How that measure can be characterised—as the activities of this Government often are—as helping the rich at the expense of the poor and ignoring the demands of the ordinary man, I cannot imagine. It is the banks and the better off whose taxation has been raised, and the ordinary man and woman whose income tax has been lowered. That shows that free-market economics can be combined with a social conscience, which I have always believed is the best guiding principle for the Conservative party when it is running the macro-economic affairs of the country.

There are also further measures—which, again, will not create pleasure among all the rich—to deal with tax avoidance, of which a great deal has been made. On this occasion, they mostly involve corporate tax avoidance. My right hon. Friend the Chancellor has set a very ambitious target for the future—he is aiming to get another £5 billion out of tax avoidance—but he has already introduced a general tax avoidance measure in the Finance Act 2012, which has had an enormous impact on what we can do. We have agreements in the G20 and with Switzerland and Liechtenstein, and it is now impossible to hide money in the way that caused a scandal recently, when it was discovered that in 2007, under the last Government, thousands of British taxpayers were finding it easy to evade tax abroad. That is not favouring the rich. The present Government have done far more to tackle tax avoidance and evasion, and to make the raising of revenue more efficient, than any of their predecessors for 20 years or more, including the Government in which I served. Looking back, I have to concede that.

I do not have time to go into all the other measures that have been introduced, but ending the annuities racket and giving more flexibility to those who are saving for their retirement and their old age, so that they can make more use of their own resources, is a major social reform, on which I congratulate the Government and the Pensions Minister in particular. All that has been taken further in the Budget, together with our drive to help business. That is very important: we have to be pro-business. We are trying to revive the economy through lower corporate taxation and more extension of investment allowances, and by easing the tax burden on North sea oil. This Budget is an extremely responsible package, and it bodes well for the future if we are returned to office.

The debate has been dominated by extraordinary arguments about deficits: the size of deficits in the past, the size of deficits now, and where the deficit will go in future. Most of those arguments are based on strange interpretations of statistics or wild over-reliance on forecasts that are at least five years out, which has reduced the debate to a rather simplistic level. I agree—indeed, it is absolutely fundamental—that tackling the problems of debt and deficit is an essential pre-condition of putting the disasters of 10 years ago, and since, behind us, and paving the way for a modern, competitive economy in future.

[Mr Jack Straw (Blackburn) (Ind)]

Will the right hon. and learned Gentleman give way?

[Mr Clarke]

No, I will not, because, with great respect to the right hon. Gentleman, it would not be fair to the 30-odd other Members who wish to speak.

The hon. Member for Leeds West keeps criticising the Chancellor for not succeeding in eliminating the deficit entirely in the last five years. I am very glad that he did not do so. It is the same with all forecasts—[Interruption.] It is not possible to find a Chancellor who has produced forecasts that are three, four or five years out and which resemble what actually happened. It is necessary to take account of what is happening in the real world. Macro-economic policy has to be pragmatic.

I cannot tell what will happen over the next five years, and nor can any Opposition Member. Will China actually have a soft landing? What will happen to the oil market? Is the recovery in the United States really sustainable? Will the eurozone begin to achieve a bit more growth this year and beyond? What about difficult emerging markets like Brazil? The fact is that we are part of a globalised economy—quite apart from the impossibility of forecasting with exactitude what will happen here.

The Chancellor has cut the deficit substantially, and has moved nearer to getting it under control. Had he moved at a faster pace, heaven knows where we would be now, but we would be in a very difficult situation. Actually, I do not know whether the Labour party thinks that he should have moved faster or more slowly, but I am sure that it is not capable of maintaining progress. I hope that we can achieve a surplus in the next Parliament—and so, obviously, does the Chancellor—but that will depend, again, on whether circumstances permit us to do so. In five years’ time, we shall find out where we are.

Meanwhile, having that kind of responsibility is an essential precondition to raising our educational standards and continuing to tackle the skills shortages which always slow up the British economy—we are making great progress with apprenticeships, and we have much further to go. At last we are beginning to see business investment come through, with more confidence and, I hope, improved credit for businesses. That should pave the way for the productivity growth that we desperately require. We need infrastructure investment, which the Government are pressing on with. We need the EU reforms, which the Prime Minister was talking about earlier. If we can complete the single market—if we can extend it to services, if we can have a common energy market, if we can have a common market for the digital economy, if we can have an EU-US trade agreement—all that will reinforce the efforts of the Government to put this country in a much better position than any other to look optimistically to the future.

If we were in the world of traditional politics of 30 or 40 years ago, this Government would be on a walkover in this election, producing figures to die for after taking over a disaster. We still have to rise above the cynical comedy of today’s protest politics. This Budget shows that a competent Conservative Government can finish the job.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order.

18:20

[Mr Alistair Darling (Edinburgh South West) (Lab)]

I continue to admire the humour and chutzpah of the right hon. and learned Member for Rushcliffe (Mr Clarke) in delivering that speech.

Thank you, Mr Deputy Speaker, for allowing me to make what I am pretty certain will be my last speech in this House; I am very grateful to you for that. I will not follow on from the comments of the right hon. and learned Gentleman, although I will return to some of the points he made, and nor will I follow on from what the Secretary of State for Work and Pensions said, except by saying this: I agree very much with what my hon. Friend the Member for Leeds West (Rachel Reeves) said in relation to annuities. Here we are, days away from people being able to choose what they do with their annuities, yet we hear that we are still to recruit the people who are going to be giving the advice—let alone training them and let alone members of the public being able to access that advice. The only thing the Secretary of State did was lay off some of the blame on to his Liberal Democrat colleague—so when the inevitable inquiry starts as to why these things were mis-sold, we know where the blame will be apportioned.

I draw the House’s attention to my entry in the Register of Members’ Financial Interests, but I want to focus on the Budget as a whole. The most notable thing in the report by the OBR—it has done a very good job over the last five years—is in the second paragraph, where it says that the Budget is not expected to have any material impact on the economy. Call me old-fashioned, but I thought that was what Budgets were for.

The economy was growing in 2010—and it was growing in 2010—because of the measures we put in place in 2008 and 2009 to stop a recession becoming a depression. The Chancellor last week and the Secretary of State today implied that nothing particular had happened at that time, but we came within hours of the banking system collapsing. That is why we were facing such a difficult set of economic circumstances by 2008-09, and it took a Government committed to doing something about it—our Government—to make sure our economy was growing again in 2010. Sadly, what happened after that was that the economy slowed down, to a large extent because of the rhetoric and the fact that the current Government chose to trash what was happening and mendaciously claim we were like Greece, and as a result the Chancellor’s public spending figures are now way off what he planned in 2010.

[Mr Straw]

Does my right hon. Friend agree that, contrary to the myths peddled on the Government Benches, up until the financial collapse the Conservatives backed our spending plan and our debt levels were significantly lower than those of most other countries, including the US?

[Mr Darling]

My right hon. Friend is right. Our debt levels were the second highest of the G7 group of economies in 1997, but 10 years later they were the second lowest. On public spending, last week the Chancellor blamed all our woes on our alleged overspending. How was it that the Conservatives were supporting our public spending plans right up until December 2008? As for the Liberal Democrats, they were in a different stratosphere from the rest of us when it came to calling for more public spending.

At the last election five years ago the essential argument between us was whether we could halve the deficit in a five-year period, which was my judgment of what we could safely and realistically do. The Chancellor—the shadow Chancellor at that time—said that that was woefully inadequate. But what was woefully inadequate five years ago was announced as a personal triumph last week. He has managed to do what I said we could do, but he somehow says it is a great triumph on his part and something we should be grateful to him for.

Let us look at what the Chancellor has actually done in relation to borrowing. He announced last week that at long last borrowing was on a downward curve. Every Budget he has ever presented shows borrowing on a downward curve. The difference between this Budget in 2015 and the Budget in 2010 is that it is on a downward curve all right, but he is borrowing three times more than he expected to borrow in 2010 because the economy slowed down so badly in 2011-12.

As for debt, we all expected that it would be shown that we were not going to hit the Chancellor’s original target of debt reducing as a share of national income by 2015, and that was what was expected from his autumn statement in December, yet, lo and behold, last week suddenly he was meeting his target, by a minuscule amount—coming from 80.4% to 80.2% of GDP. Why was that? It was not because of some economic miracle. It was because he looked around the Treasury cellars and found assets he could sell, one of them being a thing called Granite, which is an absolute monster of financial alchemy. Northern Rock produced it, into which it fed sub-prime mortgages, and the more sub-prime they became, the more mortgages had to be fed into this thing to keep it going. After five years it is, of course, possible to manage these things and get them to come right, and that is why the debt is coming down—because he is selling off this asset—yet even the OBR says it is highly uncertain whether or not this target will actually be met. So when we look at what the Chancellor said on the causes of where we are now and what he has done over the last five years, I have to say his credibility and track record are not as great as he would have us believe.

On the public expenditure figures of last week, the OBR has described the Chancellor’s spending profile as a rollercoaster. If we want to go on a rollercoaster, we go to Disneyland, not the British economy. Anybody else whose plans had been described as a rollercoaster would have hung their head in shame. What sort of planning can people put in place when they have no idea what is going to be spent? We have the absurd situation where the Ministry of Defence may have to lay off armed services personnel in 2016-17 because of the steep decline in public spending, only to say, “It’s all right. We’ll be able to re-engage you in two years’ time.” How can universities plan for research and development when we have such a steep decrease in public spending now, with the promise of perhaps something in the next few years?

The former Chancellor the right hon. and learned Member for Rushcliffe knows as well as I do that when we look at spending profiles for four or five years, the last two years are pretty doubtful.

[Mr Kenneth Clarke]

indicated assent.

[Mr Darling]

The right hon. and learned Gentleman nods. They are pretty doubtful for one of two reasons: one is that a lot can change in that time, and the other is that the person presenting them has every intention of changing them as and when we get to that time. I do not believe for one moment that the Chancellor has changed his philosophy or beliefs from when he told the House last year that he wanted to reduce public spending to the lowest share in modern times—certainly since the welfare state and the national health service were introduced. All that has changed is that that was a political embarrassment last year, so he has simply shoved up the numbers at the end of the spending profile to be able to say, “Look, I’m not going to cause you any difficulties; public spending is going to rise, not decrease.” That is nonsense; the Tory view of public spending has not changed one jot.

Where I part company with many Government Members is that I do not think public spending is almost de facto a bad thing. It is extremely helpful to an economy in education and research and development, never mind the things an advanced economy demands in relation to the welfare state and pensions. So when we look at that profile, it is not credible, and I think it also conceals what the Conservatives would really like to do.

I want to say one thing about oil. I welcome what has been proposed. It is very sensible, because the oil taxation regime had to change, but I just remark in passing—and I am sorry only one nationalist has turned up to the debate—that the OBR forecasts are 47% below what it proposed just a year ago. North sea oil revenues are a 10th of what the nationalists told us they would have if they had an independent Scotland. This is another example of where pooling and sharing resources across the United Kingdom makes a massive difference. If Scotland had been independent today, it would have been faced with cuts that would make the austerity that is now being visited on the economy look like a Sunday afternoon tea party. They would have been substantial and damaging to the people of Scotland. That is why the nationalists have nothing to say about this; they have no one to blame for this problem but themselves.

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

Will the right hon. Gentleman give way?

[Mr Darling]

I have never actually met the hon. Lady, but I will certainly give way to her.

[Dr Whiteford]

I am grateful to the right hon. Gentleman for giving way. Would he accept that, over the past 30 years, oil revenues have contributed billions of pounds that have consistently bailed out Westminster’s bad economic management? Would he also accept that oil prices go up as well as down, and that the long-term trajectory of oil revenues is an upward one?

[Mr Darling]

I agree that oil prices go up and down, but when I said that last year during the referendum campaign, I was told that I was scaremongering, that I was talking Scotland down and that that could not possibly happen. The hon. Lady should listen to her former leader. He told us that the oil price would never drop below $113 a barrel, but look what happened a few months later.

In relation to the oil price, I would like to say in passing that whoever is Chancellor in the future will increasingly face a structural problem in the economy. North sea oil revenues are not going to return to where they have been for the past 30 years, income tax revenues are decreasing, corporation tax is proving more and more difficult to get, and the Government’s ability to collect money through fuel duties is steadily diminishing. This is all going to put more pressure on measures such as VAT. All Governments are going to have to face these facts, and the fall in oil prices brings them into sharp focus.

The current low levels of productivity are a matter of great concern. The Chancellor had a lot of fun comparing Yorkshire and France, but French workers are in fact more productive. That is not because our workers are lazy, or anything like that; it is simply because French firms have invested more. That is why certainty in public spending is important. It is also important that the Government should do those things that the private sector is not going to do. For example, I have increasing doubts about the ability of the private sector to provide us single handed with the energy generation that we are going to need. I am in favour of replacing our nuclear power plants, but the proposals for the next nuclear power station are heavily dependent on the French and Chinese Governments, and I worry about that. I speak as an advocate of the mixed economy, but I believe that we now need to ask ourselves whether we have reached a stage at which it might be cheaper and more effective for the Government to be doing more in that regard, rather than leaving it to the private sector.

On transport infrastructure, it will, I hope, be for the next Government finally to make a decision on additional expansion, whether at Heathrow or elsewhere in the south-east. Actually, none of those arguments has changed in the 10 years since the last White Paper was published on the subject. I also hope that the next Government will take advantage of the present ability to borrow very cheaply by borrowing to invest. I personally would spend more time on HS3 than on HS2, but I recognise that I might be in a minority in holding that view, on my own side and in the House as a whole. To be honest, there would be much more benefit, particularly to the northern part of England, in spending more money on the transport links there than in building a fast link between Birmingham and London. However, that is something that the next Government are going to have to deal with. I speak as a former Secretary of State for Transport. The Department for Transport’s record on announcing such plans is pretty good, but it is not quite so good when it comes to delivering. Indeed, many announcements were made last week, but I distinctly remember announcing the same things myself 10 years ago. Perhaps that illustrates the problem that all Governments face.

One of the profound issues that needs to be discussed as we go into the next election is what people expect the Government to do in regard to the provision of services such as education, health and pensions and what sort of society we want to live in. However, this Budget does not begin to address those questions, which is why I shall have no hesitation in supporting my hon. and right hon. Friends in the Division Lobby tonight.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I suggest that we now move to a time limit of six minutes, as we have had a few withdrawals.

18:33

[Sir Nicholas Soames (Mid Sussex) (Con)]

I congratulate the former Chancellor, the right hon. Member for Edinburgh South West (Mr Darling), on his speech. I always admired his Olympian calm when he was under great pressure in the past few years. I know that the House will miss him very much indeed. [Hon. Members: “Hear, hear!”]

I warmly welcome the Budget, and I congratulate my right hon. Friend the Chancellor on a truly formidable achievement in accomplishing a huge turnaround in the financial fortunes of our country and our people after the catastrophic failures of the last Labour Government left our economy in such a very bad place. The United Kingdom now has one of the fastest-growing economies in the world. The extraordinary rate of the growth in new jobs is truly exceptional. In my constituency of Mid Sussex, we have the fourth lowest unemployment of any constituency in the land. In Yorkshire, business and enterprise have created more jobs in a year than were created in the whole of France. That is indeed a superb record.

Mid Sussex has a vibrant economy with many small and medium-sized businesses, all of which will warmly welcome the Chancellor’s review of business rates, which are clearly in need of far-reaching reform. It would be good, for example, to see increased help for the independent shops in East Grinstead, Burgess Hill and Haywards Heath and in the villages so that they can compete with the enormous challenge of online business.

Many of my constituents will welcome the new arrangement for ISAs that will enable first-time buyers to have a tax-free way of saving for their first homes. This is a hugely significant and very welcome step. There is also a warm welcome for the Chancellor’s help for hard-working people and their families by raising tax allowances and increasing the amount that people can earn without paying income tax. As my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) said, an enormous number of people will feel significant advantages as a result of this Budget, with 27 million people having their taxes cut and another 4 million people on low wages being taken out of the income tax system altogether—and so they should be. The freezing of fuel duty has made an enormous difference to people’s disposable income. All these steps are most welcome in the south-east of England and particularly in my constituency.

I note that my hon. Friend the Financial Secretary to the Treasury has now left the Chamber, but there are still Treasury Ministers on the Front Bench. May I enter a special plea to them? The rail services on the Brighton line and to East Grinstead are of immeasurable importance to commuters in my constituency, but they have been truly appalling since the works at London Bridge started. Given the extraordinarily high price of tickets, these inconveniences are wholly unacceptable and have gone on for too long. The Under-Secretary of State for Transport, my hon. Friend the Member for Devizes (Claire Perry) has been very helpful in working with Network Rail and with Southern, for both of which the concept of a rail passenger service appears still to be in a formative state. I ask my right hon. Friends on the Treasury Bench urgently to consider the question of compensation for my constituents, who have been terribly mucked about over the last few months as they have struggled to get to work and to get back on time to see their families.

May I enter one more piece of special pleading, which endorses a point made by the former Chancellor, the right hon. Member for Edinburgh South West? My constituency is part of the powerhouse of the south-east but I must tell my right hon. Friends on the Treasury Bench that it is constantly held back by the lack of good infrastructure. I am of course pleased with the plans for the A27, but the pressure of housing and growth is leaving towns such as East Grinstead and Haywards Heath without the proper infrastructure to enable them to cope. As the right hon. Gentleman said, money is cheap at the moment, and this is the time for the Government to borrow and to spread some largesse among the towns that never see any infrastructure spending. The housing situation in my constituency cannot improve without better infrastructure, and of course, if Gatwick were to get a second runway, the position locally would be truly catastrophic.

Thanks to the determination of the Chancellor and the Government to stick with their long-term economic plan, our businesses can invest and our people can benefit from the extraordinary global flow of ideas, innovation and new market opportunities. I hope that these improvements will lead to major increases in productivity, which is increasingly the fundamental key to growth and, above all, to a higher-wage economy.

I continue to remain anxious about the level of skills required as our economy responds to changes in technology and globalisation. I am disappointed to see that we are not producing nearly enough engineers, and I welcome the steps the Government are taking to support vital skills training. I share the Chancellor’s view about the huge potential for our country and about the opportunities that exist for our young people, but it remains the case that, in this astonishingly networked world in which our country now has to make her way, we continue to be unprepared for these challenges. I applaud the Government’s determination to put that right.

18:39

[Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab)]

First, I congratulate my right hon. Friend the Member for Edinburgh South West (Mr Darling) on not just an excellent speech, but the tremendous work he did in those difficult three years alongside the then Prime Minister. When the world gathered in April 2009, applauding the then Prime Minister and then Chancellor for the work they had done on pulling people together, no one could have thought that the absurdity would exist where the last Labour Government were blamed for the sub-prime mortgage collapse in the United States and the collapse of the financial institutions across the world.

For 30 seconds, I just want to pay tribute to those who have been instrumental in anything that I have been able to do in my public life and in this House, starting with my wonderful family and my closest friends. They were somewhere in the Gallery when I made my maiden speech, and two are here from Canada in the Gallery tonight. Without our family and friends we could never do what we achieve, and so often they take the brunt of the rough and not the smooth in politics. I, of course, want to thank the workers, who are often forgotten in our democracy but who make it possible for us to be here in our political parties, for their dedicated work. I thank the voters and the people of Brightside, of Hillsborough and of Sheffield. I also wish to pay tribute to my colleagues in the House, including my right hon. Friends the Members for Edinburgh South West and for Blackburn (Mr Straw), who served in Cabinet with me. My right hon. Friend gave 36 years of dedicated service in and out of this House, and he deserves a great deal of credit for it.

My first Budget was Nigel Lawson’s of March 1988 and it was seminal in my life because my dog, Ted, was violently sick halfway through. My hon. Friend the Member for Bolsover (Mr Skinner), in a very loud voice, in only the way he could, pronounced, “Someone should clear up this dog’s breakfast.” I was not sure whether he was referring to what the dog or the Chancellor had delivered. That Budget certainly had a detrimental impact which I hope this Budget will not achieve.

I wish to make three quick points. I have already commended my right hon. Friend the Member for Edinburgh South West for what he said about what happened through those difficult times. We do not just have to believe him; we can believe what Mark Carney, the Governor of the Bank of England, said in a speech made on 28 January in Dublin. In his second point about why our economy had managed to come through and bounce back, he said that we had a fiscal system that allowed budget deficits to rise during a downturn. It is self-evident that that is the case and it needs to be done, but it is not self-evident, in all the rhetoric we have heard over the past five years, that anyone on the Government Benches has fully understood what saved us from complete calamity—it certainly was not austerity. It has not been austerity in Greece, Spain, France or Italy that has saved those countries; what has been instrumental has been what was implemented by the Federal Reserve in the United States and by the Bank of England here: quantitative easing—printing money, as my mother called it. It eased the unfortunate—in the long term—bubble in house prices, rather than the investment in business for which it was intended, but it did make a significant difference in terms of allowing us to return to growth and to have sufficient money in the economy.

Paradoxically, the payment protection insurance mis-selling scheme also did that. The PPI repayments have amounted to £20 billion of money going into families and into local economies that people have spent. If a political party had announced that it was going to give, in a Budget, just before an election, £20 billion to selected families across the country, people would have had a fit. Yet that has made a significant impact on what has happened.

We will not and cannot allow a doubling of the pain in the next Parliament to take us backwards, with the unthinkable becoming the unachievable. That is clearly what would happen if the unfair changes and the unfair further additional austerity measures were to be implemented—and, of course, we do not know about many of them. Should the Conservatives be the lead or majority party, they will be implementing further cuts, on top of the 50%-plus of austerity measures that the coalition has already signed up to. We know about the 10% cut in the budgets in schools, because the Prime Minister has announced it. We know about the enormous cuts already in the pipeline in further education, with a 24% cut in adult skills funding. We know about the proposed budget changes already for welfare. We know what is happening in local government, with the most deprived areas taking the biggest hit. We know that if these austerity measures go any further, there will be a massive hit on those least able to take it. This is a crucial moment, when we decide whether we go backwards or forwards to a Britain we are proud of.

18:45

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

It is a privilege to be called in this debate, Mr Deputy Speaker, and, in particular, to follow the right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett). I pay tribute to his lengthy service in the House and his major achievements. He will be greatly missed, not just in the House, but in Yorkshire.

I welcome this Budget, which is good for individuals, families, businesses, pensioners and farmers. Obviously, the best news is that more jobs are being created in Yorkshire than in France, as the Chancellor mentioned. I wish to make a special plea on behalf of one category: older women who are too young to retire but who may see too few opportunities to work. I recognise the help being given in this Budget to farmers and make a plea that the particularly welcome rule enabling self-employed farmers to spread their average earnings over five years be introduced this month, before Dissolution. Farming and fisheries are the two most dangerous industries, so may I also make a plea that we need better mobile phone coverage in rural areas, to reduce the risk of accidents on farms away from the house?

Let me dwell for a moment on the reform of the common agricultural policy fiasco in 2005, which led to huge fines and penalties in the European Union for late payments. I welcome the fact that common sense has broken out and that in this month we will revert to paper applications, with only initial registration online. I ask that digital by default be laid to rest this year and that we press forward to make sure that the mapping is easier in future years.

I ask that the vouchers the Government are going to make available in urban areas for upgrading to superfast broadband also be made available in rural areas. Too few farms and rural businesses yet have the benefits of a decent speed and a stable connection for broadband. It is not acceptable that farms and rural businesses have only the basic legal entitlement of 5 megabits and subsidised satellite services, and that the promise of 100 megabits will not reach the farms. Will we therefore see the vouchers extended to rural areas?

I ask the Minister who is summing up to address the issue of the costly failure— £155 million—of the Rural Payments Agency computer. It raises a wider issue relating to contracts under successive Governments: why do we see failures in areas such as the Child Support Agency and, more recently, the RPA? When Governments can supply that big a contract, what are we doing wrong? Can we also make sure that the spectacle of disallowance and EU fines will become a thing of the past? Will the Government confirm tonight that the additional extension of one month offered by the European Commission for basic farm payments will be accepted and agreed? Will we ensure that payments are made on time? The extension to 15 June is welcomed by the farmers.

I welcome the fact that this Budget is good news for savers. The individual savings accounts—ISAs—will encourage savings and investments, and the review of capital investment allowance will be welcome. This is a prudent and responsible Budget, setting a steady course to cut our debt, reduce the deficit and, in the words of my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), achieve a surplus by 2017-18.

This is probably the last contribution that I will make to any formal debate in this House. It has been an enormous privilege to have served 18 years here. I have spent five years as MP for Thirsk, Malton and Filey; 13 years as the MP for the Vale of York, for which I was the first and last Member; and for 10 years before that I was a Member of the European Parliament.

The icing on the cake was being elected by colleagues, from across the House, to chair the Environment, Food and Rural Affairs Committee, which so perfectly reflects the interests and concerns of those living in Thirsk, Malton and Filey—food, farming, fisheries, the environment, the countryside and rural communities. We have been wonderfully served by exceptionally dedicated and extremely effective staff led by the Clerks, with superb special advisers, assistants and others. I have also been blessed with parliamentary colleagues on the Committee, some of whom are in the Chamber today. Together we have formed a dedicated team, really pressing for proper scrutiny of an extremely important Department, which I hope will survive and grow bigger in the next Government.

As I face early release, I pay tribute to my predecessors, including my right hon. Friend the Leader of the House who is also leaving. I wish my successor the very best of luck. I pay personal thanks to my husband for allowing me to do this job, to my supporters for standing by me, and to my electors locally for returning me at successive elections.

18:51

[Wayne David (Caerphilly) (Lab)]

I pay tribute to Members on both sides of the House, especially those who are stepping down, for the contribution they have made to politics; I am sure that we all appreciate their work.

My constituents regard this Budget as a monumental irrelevance. I say that because this Budget has done so little for so many people. Over the past few years, people’s standard of living has been eroded and their quality of life has declined, and this Budget has done nothing to reverse that trend.

In Wales, we have seen the publication of the Welsh Index of Multiple Deprivation and the work of Professor Steve Fothergill of Sheffield Hallam university. Both works have underlined just how bad things are in many south Wales valley communities. Professor Steve Fothergill, for example, has focused on the impact that welfare reform has had on many former mining communities. He has estimated that, in some 36 wards in the south Wales valleys, at least £800 per adult has been lost. The communities as a whole have suffered from that substantial loss of capital.

The situation has been getting progressively worse in the top end of the valleys. Lower down the valleys, there are also pockets of deprivation. Lansbury Park in the centre of Caerphilly is now the worst off ward in any part of Wales. It was tipped over the edge by the introduction of the bedroom tax. In my constituency, more than 1,000 households have been hit hard by that tax. In the past, I have referred to specific cases as examples, one of which I will refer to again. Mr and Mrs Goodwin live in the Caerphilly borough in Blackwood. Both of them are registered blind. After living in their council house for 30 years, they now have to pay a massive surcharge because two of their rooms are deemed to be surplus rooms. That has hit their quality of life and standard of living extremely hard. What is true of them is true of so many other people the length and breadth of this country. Some 57% of those people who have been hit by the bedroom tax have disabilities. What can people like Mr and Mrs Goodwin look forward to? Let us be clear about what will happen if the Conservatives win the election. The Office for Budget Responsibility has said that it anticipates a rollercoaster profile for implied public services spending, with

“a much sharper squeeze on real spending in 2016-17 and 2017-18”.

In other words, the cuts, bad though they have been, are nothing to what they are likely to be over the next few years if the Conservatives win the election. People must not worry though because there will be a massive boost in public expenditure as we approach the election after this one.

Things will get much, much worse before there is any chance of improvement, which is why it is so important that we take this opportunity, on the eve of our general election campaign, to recognise that a Labour Government would offer real hope for people. They would scrap the bedroom tax, introduce a sensible protection plan, increase the minimum wage, end exploitative zero-hours contracts and, above all else, bring in a different set of values that put people first, and that put the many before the few.

18:56

[Chris White (Warwick and Leamington) (Con)]

Although I am pleased to follow the hon. Member for Caerphilly (Wayne David), I have to say that I offer a more optimistic approach. I am happy to say that, in Warwick and Leamington, the signs of economic growth are strong, not least with the number of jobseeker’s allowance claimants falling by 70% since 2010, and the number of claimants aged between 18 and 24 falling by 79% over the same period. We have also seen a growth in the number of businesses that have taken on new employees, with more than 2,700 apprenticeships being created since 2010.

The Budget contained several welcome measures for Warwick and Leamington, the first of which was the support for the creative sector that contributes so much to our local economy. Leamington Spa is now increasingly referred to as “Silicon Spa” due to the growth in our technology and creative industries. As the Budget emphasises, the creative industries deliver both cultural and economic benefits to the UK.

The tax relief for the video games sector, for which colleagues and I on the all-party group for video games have campaigned, has already significantly benefited the video games industry in Leamington. The tax relief has created confidence in the sector with the local industry supporting some 1,200 jobs.

I am also delighted that the Chancellor announced an extension of the skills investment fund, which will provide £4 million to ensure that support for training and development in the creative industries continues for a further two years. Renewed focus and support for a more traditional, but similarly creative industry, was also announced in the Budget. The west midlands has long been a hub for manufacturing, but it is now a resurgent sector of our economy. I was delighted to note that, according to the most recent figures, the manufacturing sector grew by more than 2.5% in 2014 alone.

Since 2010, the Government have invested a great deal in the manufacturing sector, including through innovation catapults. High-value manufacturing is growing in significance in our region. I was particularly pleased to see the one millionth cooker roll off the production line at Aga Rangemaster, just outside my constituency office.

Innovation is key to unlocking further potential in the manufacturing sector and I am delighted that the Government have extended the research and development tax credits, particularly for small and medium-sized enterprises. That measure is estimated to benefit some 15,000 businesses.

As co-chair of the all-party group on manufacturing and chair of the all-party group on video games, I have been privileged to watch the regeneration of manufacturing and the exciting development of the creative industries as a whole. I would like to take this opportunity, however, to make the point that there is still more to be done to achieve the potential in these parts of the economy. We need more support for innovation, more apprenticeships, not least through the excellent Warwickshire college, a continued focus on research and development and support and encouragement for small businesses wishing to grow and expand. I believe that we must do all we can to support these vital industries, rebalance our economy and create additional jobs, but overall the Budget provides assurance that the economic plan is working and that our economy is back on track.

19:00

[Mr Ronnie Campbell (Blyth Valley) (Lab)]

All Members look at the Budget and see what is in it for their constituents. I did the same last week, for the whole north-east of England. When I got a look at it, I thought that there was one little chink of hope: I might get the Blyth and Tyne rail link reinstated in my constituency. I might be lucky, and I know that the county council has put some money aside, but I am not sure what will come from the Budget. We hope that the money might be there, but as for everything else, all my constituency is getting are a few crumbs. Some might be getting their pension, which is their own money, of course, but otherwise a few crumbs have fallen off the table that my people have managed to gather and I am sure that everybody else is thinking the same. As far as I am concerned, all we are getting in the north-east of England is the usual pie in the sky.

A lot has been said about what is happening now, but what will happen after this? What will happen if this lot get elected again? I went and had a look at the TaxPayers Alliance’s site to see what it was doing. We all know what the TPA is: the reserve Tory party, the ones who get paid by big business to tell the Tories what to do. It is talking about ending national bargaining, which means another freeze on wages. Another freeze, after five years of freezes, with some people getting no increase and some people getting only 1% increases. We can see where that is coming from, and that is what the TPA is telling the Tory Government.

The TPA wants an end to the triple lock on pensions. There we are: it is telling the Tories to end the triple lock on pensions. We could go on to benefits, of course. The TPA wants to freeze benefits for two years, so my constituents are in for a right surprise if they get them. That is another thing that will happen at the next election. Then, of course, there is the £12 billion that has to be cut from social security. All that has got to happen, and this is a Budget for happiness? I think that it is a Budget for disaster.

Then there is the cutting back. Apparently it is imperative that the next Government cut back on winter fuel allowances and bus passes. Last week, I saw on television that a compassion pill had been invented—someone could take it and become compassionate. I think £25,000 would give every Tory Member one, to see if we could get some compassion into their hearts for the people of this country, who have suffered for five years.

The TPA says that the next Government “need” to save £70 billion; that is what it is telling you. It is not telling us, thank God—I hope they are not, mind—but it is telling you, because those people are your people. That is who they are.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Obviously, when Members say “you” they mean me. Do not worry about it, Mr Campbell. Carry on.

[Mr Campbell]

I apologise, Mr Deputy Speaker.

What have we got? We have the pension provisions. Okay, that is those people’s money and I suppose they are entitled to it, but I can tell Members what happened a few years ago when the miners were given the chance to pull their pensions out of the national mineworkers’ pension fund. I was chairman of the local branch at the time, not an MP, and I remember the spivs coming in big style. We had nothing to do with them, but they had meetings in social clubs and pubs and brought all the lads in. The Major Government said at the time that people could take their pension then as long as they got a better deal, the lads thought that they were getting a better deal and, of course, the spivs and speculators all came in. The lads all gave up their pension, saying that they were going to get a better deal, but within a year to 18 months they had to come back into the pension scheme.

That was a scandal waiting to happen, because there was no advice at all. The miners were finished—it was after the miners’ strike—and we told them to keep their pension where it was, but of course the spivs were telling them how wonderful their options were.

[Mr Jim Cunningham]

I remember exactly what my hon. Friend is talking about. Under the Thatcher Government, people were encouraged to come out of the state earnings-related pension scheme and to go into private pension schemes. I remember Rolls-Royce spending a lot of money encouraging people to do that, and look at how that ended up.

[Mr Campbell]

It nearly ended up in a scandal. The Government opened up the mineworkers’ pension scheme again so that people could bring their money out of the schemes they had been conned into joining. A lot of miners lost a lot of money, so the warning is there. As has been mentioned in many speeches today, the Government must be very careful that they do not fool the people.

I want to mention the national health service, because 65% of new contracts in the NHS have gone to private companies. I do not know what will happen if the Tories are elected at the next election, but I can tell Members one thing: in five years 65% of contracts in the NHS have become private and that is a disaster waiting to happen. I think that the Tories are waiting for 100% private contracts in the national health service, so that it is totally privatised. The Labour party is prepared to put in at least 5,000 more doctors and 20,000 more nurses, and I hope that that is a reality and that we can afford to pay for it.

I have to mention the banks, as they cost the taxpayers of this country a lot of money over five years. It is time that we started taking a lot more money off the banks than we are taking now. They owe the taxpayers of this country big time and we should increase the levy and say that they should pay the money back. We should not have bailed them out in the first place.

19:07

[Martin Horwood (Cheltenham) (LD)]

It is always interesting to follow the hon. Member for Blyth Valley (Mr Campbell). I am glad that he is such a supporter of the triple lock on pensions. He must remember, of course, that it was the Liberal Democrats and not the Labour party that introduced the triple lock and restored the link with earnings broken all those years ago by Mrs Thatcher.

The economy is undoubtedly looking stronger now, not just according to the headline figures, with unemployment down, growth up, the deficit cut by a third in absolute terms and half in terms of GDP, inflation and interest rates both under control and living standards finally on the rise. It is stronger in a more subtle way, too. We have invested in infrastructure and in apprenticeships and skills, and carbon emissions are falling even while economic growth is increasing. Renewable energy has nearly tripled. This is a more sustainable economy and has strength in that regard as well.

I have some sympathy with something that the hon. Member for Caerphilly (Wayne David) said. When we think about the performance of the economy, we do not think enough about quality of life, and it would be a good thing to have a well-being Budget as well as a classical economic Budget, perhaps delivered by the Prime Minister the day before to put the economic Budget in context. It is important to think about not just economic growth but our quality of life and the state of the nation’s well-being, as well as to have reported to this House indicators on things such as mental and physical health, crime and sense of security, biodiversity, greenhouse gas emissions and access to green space, and education and children’s happiness. That would be good in setting the context for the main Budget.

There is no doubt that in classical terms, at least, the economy is looking much stronger. Liberal Democrats and Conservatives have both taken the flak for the difficult decisions made in government that were necessary to secure those improvements and both parties should share the credit. I am certainly finding that the most popular headline policies in the Budget seem to be those pushed by the Liberal Democrats, such as taking more and more of the lowest paid earners out of income tax altogether; providing £1.25 billion over five years for mental health, particularly for children and new mums; and smaller items that might have passed almost unnoticed, such as £10 million for new school kitchens in support of the provision of free school meals.

It is on future spending plans, of course, that the coalition parties somewhat part company. The Chancellor identified £5 billion from tax avoidance and evasion and aggressive tax planning to help balance the books, which clearly we would welcome, and perhaps even push further on, but the other £25 billion he identified are all from public spending cuts, either in welfare or unnamed Government Departments. Of course, he wants to carry on cutting, even after the books are balanced, and apparently without seeking to raise a penny from those who can afford to pay more. That seems to me to be calculated to damage public services far more than they need to be damaged, to cut more than needs to be cut and to take us towards a less fair society, not a fairer one.

There were a few items in the Budget of particular interest to Cheltenham. I am very pleased that Cheltenham racecourse got a mention; it is not quite in my constituency, but it is economically very important to it. The commitment to a racing right that guarantees a more secure income from betting to racing is very much to be welcomed. I also welcome the commitment on superfast broadband, although there are still questions to be asked on exactly how that will be implemented, even in urban areas such as mine.

I welcome the endorsement for tidal lagoon power, although there are a few qualifications around that. I hope that the negotiations on the strike price will be negotiated quickly and hopefully concluded before the general election. I hope that they will reflect the fact that, unlike the nuclear industry, which receives a huge subsidy, being a 60-year-old mature industry, lagoon power is a cutting-edge, pioneering feat of engineering which has enormous potential for safe and sustainable growth in energy.

The Budget also included a reference to the intelligence services. The Chancellor made a very welcome commitment to right the injustice that has been suffered by the widowers, widows and former civil partners of firefighters, police officers and those in the intelligence services with regard to their pension rights. In the Budget documents, however, the commitment for the intelligence services is not quite so cast-iron; they talk about examining the possibility of doing the same thing for the intelligence services. Many of my constituents work tirelessly for the safety and security of this country. It is fantastic that the widowers, widows and former civil partners of firefighters and police officers will have their pension rights looked at and the injustice remedied, but it would be very unfair if the same right were not extended to the intelligence services. That is just one small way in which we could make our society fairer as well as building the stronger economy that we can all now celebrate.

19:09

[Frank Dobson (Holborn and St Pancras) (Lab)]

Having been a Member of this House for 36 years, I suspect that I have listened to about 45 Budget statements, but I must say that I cannot remember one that was so self-congratulatory—the Chancellor of the Exchequer delivered it almost like a lap of honour. I must concede that he can claim one great success: he has been very effective in getting across the idea that the worldwide recession was created by the Labour party, not by the stupidities of the banking system worldwide, and that the British economy was in decline when this Government took over. The fact is that the economy was actually growing when they took over. It then went into decline and is only now creeping out. If we are now seeing a bigger than usual increase in output and growth, that is because we had fallen so low and are growing our way out of a very deep pit.

One of the things that the Tories promised before the previous general election was that there would be no rise in VAT, but their first Budget did just that.

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

Will the right hon. Gentleman give way?

[Frank Dobson]

No, because that would take up other Members’ time.

The Tories also promised to clear the deficit. The right hon. and learned Member for Rushcliffe (Mr Clarke) said that nobody can forecast that. Well, perhaps they cannot forecast it, but they did make that promise and they have not kept it; they have reduced the deficit by a third. They promised to reduce the national debt but, as my right hon. Friend the Member for Edinburgh South West (Mr Darling) pointed out, they have managed to reduce it by a fraction only by fiddling the books—that is as good a way of describing it as any. They said that they would rebalance the economy, but they have no more done that than the Liverpool captain rebalanced the membership of his team the other night. Then there is the claim that we are all in it together. Well, a lot of people have been dropped in it together, and they are not the rich people.

I would like to deal with something that, in a sense, has nothing directly to do with the Budget: taxation. The fact of the matter is that the House of Commons has had a pathetic record over the past 50 or 60 years when it comes to determining what the levels of taxation should be and how they should be applied. Time and again we have come up with a system that helps tax evasion and avoidance and lets people get away with late payment. It is no good simply blaming the civil service, because there has been a failure to deliver what every Government have said about people avoiding tax.

The problem is that the details of all taxation are formulated in secret with Treasury officials plus some experts, many of whom return to their day jobs in the private sector afterwards to pursue what they call “tax efficiency”. In other words, they exploit the loopholes in the taxation system that they helped formulate a year or two before. Years ago our predecessors decided to do away with secret treaties. I think that we now need to do away with secretly formulated taxation. I believe that in future the House of Commons should decide on the principle of a particular tax and then a Committee of the House should summon all the experts before it and decide on the detailed implementation so that we do not have the hole-and-corner fiddling and special pleading that has left us open to so much tax evasion and avoidance and late payment that people have been allowed to get away with.

If the House of Commons is to restore its reputation, we need to take our duty to check on the raising of taxation much more seriously than we have done. If we fail to do that, our reputation will continue to be low, because people expect that when Parliament passes a law, that law will work and it will do what Ministers said it would do. When we pass laws that do not do what Ministers said they would do, that undermines all of us, not just those Ministers. I think that the House of Commons has to take its duties in relation to taxation far more seriously in future, and I hope that it will.

19:18

[Mr Robin Walker (Worcester) (Con)]

It is a pleasure to follow the right hon. Member for Holborn and St Pancras (Frank Dobson), and I agree with a great deal of what he said about taxation and the importance of clamping down on tax avoidance, although I gently point out that this Government, having closed the tax gap and, as my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) pointed out, made our tax system more progressive, have a better record than their predecessor.

I welcome the Budget, which is about securing this Government’s legacy of growth, jobs and recovery in the economy. It is about delivering on a plan, and a plan that is working. To see that, we need only look back at where we have come from. After the previous Government left the biggest peacetime deficit in our nation’s long history, the deficit has been halved and we have started to pay down the debt as a percentage of GDP. We are achieving record employment against Labour’s legacy of mass unemployment, and growth against its record-breaking recession. The number of apprenticeships has doubled, youth unemployment has been slashed, businesses are confident to invest and people are beginning to be confident to save once again.

Under the previous Government, many people were afraid to go to the bank in case they could not get their money out. We took over in a crisis and at the end of five years of difficult decisions we will leave the country emerging into the sun. I remember, under the previous Government, walking down streets in Worcester where every third door displayed a repossession notice. Those streets now show none. I remember seeing unemployment in Worcester above the national average—well above 2,500 people. Now it is below a falling national average, more than halved since the general election, and long-term unemployment has fallen for each of the past 11 months in my constituency.

The number of people in work nationally is at its highest ever level and around 80% of the new jobs created have been full time. Opposition Members like to talk about zero-hours contracts and part-time work. Both increased hugely in the latter years of their Government, but they chose to do nothing about them. This Government have acted to ban exclusive use of zero-hours contracts and increased full-time jobs by well over 1 million. Labour Members also talk about a cost of living crisis, and it is true that over a long period wages failed to keep pace with inflation. This was the consequence of our economy being £112 billion smaller on their watch, more people being in competition for fewer jobs as a result of the 2009 crash, and the inflation caused by higher energy costs.

[Ms Gisela Stuart]

rose—

[Mr Walker]

I shall not give way. I am sorry; I want to keep time for other Members.

However, this Government have presided over falling inflation, which is now at its lowest level on record, more jobs and, in the current year, above-inflation increases not just in the minimum wage, but in average wages and take-home pay. The crucial decision to cut income tax for the lowest paid contrasts starkly with Labour’s decisions while in power to scrap the 10p rate and to push up employers’ national insurance. Instead of driving up the cost of employment and taking more of people’s wages in tax, we have helped businesses to create more jobs and, crucially, let people in the lowest paid jobs—part-time workers and those on the minimum wage—keep more of what they earn.

As the Chancellor set out, families are £900 a year better off than they were in 2010 and the official figures showing this are borne out by independent research, which Opposition Members used to quote when it suited their arguments. The latest figures from the Asda income tracker show average family discretionary spending power at £185 per week—the first time since its records began in January 2009 that that figure has risen above £180, and an increase of £16 per week since the same time a year ago. In April 2010, before the general election, the equivalent was £172.

As a member of the Business, Innovation and Skills Committee I welcome the fact that this Budget delivers further for business by cutting corporation tax to one of the most competitive rates anywhere in the world, incentivising the employment of young people and apprentices through further changes to employers’ national insurance liabilities, and launching the long-awaited reform of business rates. I welcome the extension of small business rates relief and the high street discount, as well as progress with the valuation system review but, as the Committee’s high streets inquiry concluded:

“The short-term tweaking of the Business Rates system is building up problems for the future and, instead, the....system needs fundamental reform.”

I look forward to supporting the case for fundamental reform. We need to look for a system that removes the bias against our high streets and town centres and rewards businesses that invest and expand. Business rates are currently the only area of taxation where there is not only no incentive, but a positive disincentive to take more people on, and this needs to change. I know that the British Retail Consortium and the Federation of Small Businesses have warmly welcomed the commitment to reform, and I hope that both will be extensively consulted on how it can best be delivered.

I also welcome the continuing focus on investing in skills and helping businesses to do so. The Budget saw the launch of apprenticeship vouchers for businesses to manage their own schemes, and businesses such as Worcester Bosch, Yamazaki Mazak, Titania cyber security, Comco and Green Lighting, which I visited during national apprenticeship week, will welcome the Government’s focus on this aspect.

One of the best things about this Budget is its support for saving. As chairman of the all-party group on credit unions, I warmly welcome both the £1,000 tax-free allowance for savings and the administrative changes that will remove a burden from savings organisations, including credit unions. Last week I attended my local hospital to see the launch of a payroll saving scheme from the Castle and Crystal credit union, which expanded into Worcestershire at my invitation. Such schemes will benefit from the Chancellor’s efforts to make saving more attractive.

In an age where saving for the deposit on a first home has become ever more challenging, I particularly welcome the launch of the Help to Buy ISA. My late father pioneered the policy of right to buy which helped thousands of people to own their first home in the 1980s, and I am hopeful that Help to Buy, combined with this innovative savings scheme, can help thousands more to enjoy the security of owning their own home in the 21st century. Help to Buy has already helped 184 families in Worcester and more than 900 in Worcestershire to get on the housing ladder. With the Help to Buy ISA I hope we can make a difference for hundreds more.

I welcome this Budget continuing the increase in the basic state pension. On the doorsteps of Worcester I often hear from pensioners who are very concerned about the fact that they may be paying income tax on a small pension inherited from a deceased partner. The move to increase the income tax threshold to £12,500 in the future will take thousands of those pensioners out of income tax altogether, which will be an extremely positive reform.

19:24

[Hazel Blears (Salford and Eccles) (Lab)]

It is a pleasure to follow the hon. Member for Worcester (Mr Walker). Perhaps he has caught a bit of the virus of optimism bias this evening, but it was a pleasure to hear what he had to say.

This is probably my last chance to speak in Parliament. I am sorry that it sounds to colleagues like a series of valedictory speeches, but we are all taking our opportunity, which I want to use to talk about an issue close to my heart, and it is what brought me into politics more than 30 years ago.

Poverty in Salford was all around me—poor housing, no jobs, but above all at that time a sense of hopelessness and a belief that things could never be different. I was brought up by parents who both left school at 14. They had no chance to stay on, but they were determined that their children would have the chance to do well and get on in life. I think my mum thought of the phrase, “Education, education, education” long before the former Prime Minister ever dreamed of it. Education was then and is now the key to progress and success, not just for individuals, but for our economy and our country as a whole. Social mobility is at the heart of that.

I shall start by saying a few words of thanks and congratulations—do not worry, it will not all be this nice—to the Chancellor and to the Chief Secretary to the Treasury, in particular for finding £200,000 a year for the next couple of years to support the Speaker’s parliamentary placement scheme, which has been such a success and has changed the lives of so many young people over the past four years. I set it up because I was very worried about the fact that so many of our leading Members of Parliament and our Ministers came from what I called the transmission belt—being a special adviser, working for a Minister, getting a safe seat and being fast-tracked into the Cabinet. In 1979 only 3% of all MPs took that route. At the last election the figure was 25% and rising.

Our scheme aimed to bring working-class young people to work in Parliament—people who would never have got a foot in the door. They included Kay Nuttall from Salford, who had a fantastic experience here, went back to Salford, got a great job and stood to be a parent governor at her child’s school—a contested election that she won, and she is Labour. It is amazing. Another participant was Siraj Odedra, who stayed in Parliament and is working for my right hon. Friend the Member for Slough (Fiona Mactaggart). He no doubt will have a long and, I hope, successful career in politics as well. Thanks very much for taking that step. I thank all the Members of Parliament who helped me establish the scheme and those from all parties who have agreed to take it on. I hope we will have a long-lasting scheme that gives young people the sense that they come here and can make a difference to politics.

I thank Alan Milburn for his work on the Social Mobility and Child Poverty Commission. In his recent report, “Fair Access”, he said:

“Unpaid internships clearly disadvantage those from less affluent backgrounds who cannot afford to work for free for any length of time…Given their centrality to young people’s career prospects, internships should no longer be treated as part of the informal economy.”

That means that we should introduce proper terms and conditions, including remuneration. I am pleased to say that long-term unpaid internships are virtually a thing of the past in Parliament. When I came here, they were widespread. Unfortunately, they still exist in the media, fashion, culture and the creative industries. That means that unless young people have the bank of mum and dad, they cannot make that first step in life.

I thank the Social Mobility Foundation and Victor Blank, the chairman, and David Johnston, the chief executive officer, who have done so much to remedy that situation. The Institute for Fiscal Studies has just done an evaluation of the Social Mobility Foundation’s work. It found that those programmes give people the kind of back-up they would get if they had had a private school education or a good family background, which means that among those who go to university, the Social Mobility Foundation projects increase the likelihood of attending a Russell Group institution by between 17% and 27%, compared with those with similar attainment from similar backgrounds who do not participate in the SMF programme. It is making a real change to hundreds and thousands of young people’s opportunities in the future.

The final thing I want to highlight is a local project, because for all my political career, I have been extremely proud of the things that happen in my constituency. We have the RECLAIM project, which is a two-year leadership programme, again for young people, men and women, who would never get a chance to do such work. It aims to inspire, challenge and develop people to become true leaders for the future. A young woman called Jaimeel, a local girl, who has been through the project, says:

“When I started RECLAIM I had very little idea about who I was, who I wanted to be or where I wanted to go. Due to RECLAIM I have completed several work experience placements, including a project to design a gym. I am a member of a music collective. I have had a work experience placement with the Co-op and with Investec Specialist Banking.”

She is now on the second year of an accountancy degree at Birmingham university. Her life has been changed by the RECLAIM project.

The thing that concerns me most is that in real terms in the next period, education spending will fall by 7% and the widening participation budget has been slashed from £130 million to £67 million. This a false economy. All the examples I have given show that our young people have talent. If we give them hope, encouragement and support, they will have the same chances that people like me have had. I hope that the next Government will take that on and make it a reality.

19:30

[Christopher Pincher (Tamworth) (Con)]

During most of her speech, the right hon. Member for Salford and Eccles (Hazel Blears) spoke of optimism, a word that might have been coined for her. She is never knowingly under-optimistic, and we will certainly miss her sunny disposition.

Five years ago, like the right hon. Lady, I was canvassing for election. At that time, Tamworth was a town in trouble. Unemployment was climbing to 6%, businesses, including well-known names such as Woolworths, were going to the wall and people were losing hope. If you walked from the great city of Worcester to Tamworth, and then down Glascote road, you would see in window after window repossession notices as banks took possession of people’s homes. The grisly legacy of the previous Labour Government was that people were not just losing their jobs or their shops, but losing their homes as well. Walk around Tamworth today and you will see a town that is rebuilding. Just 427 people in the working-age population—fewer than 1%—are claiming jobseeker’s allowance. Unemployment is falling faster in Tamworth than anywhere else in the country: the BBC tells us so. It also tells us that wages are outstripping inflation. Since 2010, 105 new businesses have been created in the town. New jobs and new skills are being created, and with those new jobs and new skills comes new hope. Jobs are transforming people’s lives, and this Budget was a Budget for jobs.

I should like to speak about some of the more detailed elements of the Red Book that will help people and their jobs in Tamworth. Every year, I hold an export conference at Drayton Manor to help small and medium-sized enterprises in my constituency to build the knowledge and confidence to export their goods and services. I am especially pleased that the Chancellor announced £3.5 million of new funding to help our trade with that great, unfathomable market—China. I mention that particularly because Birmingham airport has just extended its runway and it is now possible to travel long-haul directly to China, sending business folk to that place to do better business with it.

I hope that when the Chancellor considers that investment, he also remembers the £7.5 million that he has given to the northern powerhouse to aid its overseas trade delegations. In his next Budget, I hope that he will consider matching that funding to create a midlands powerhouse. Although we have in this Budget the £60 million invested in the Energy Research Accelerator in the midlands, Birmingham and surrounding areas could benefit from a midlands powerhouse strategy to help our economy to grow and prosper. I trust that the Chancellor will take that on board.

Also buried deeply in the Red Book is the determination to build up a study of regeneration on our larger estates in the midlands. That is welcome, but I hope that the Government, in their determination to look at the challenges that we face on big estates in Birmingham and Coventry, will also recognise that smaller towns in Staffordshire, such as Tamworth, Burton and Cannock, have smaller estates that face challenges and also require study and investment. I hope that the study that the Chancellor is considering will look at those smaller estates as well.

I end with a plea for a business in my constituency that benefits from the Budget. It is called Invotec, and it exports electronic circuit boards around the world—very successfully so. It employs 250 people in Tamworth and in Telford in Shropshire. However, while this Government and this Budget tear up more and more red tape, there is still a problem with exporting those circuit boards because they are used for defence purposes. No other country in the EU applies a licence regime for every circuit board that is exported. As a result, Invotec faces difficulty in selling to its clients. BIS undertook to review the situation, but the report that was due to resolve it has not been published. I encourage those on the Treasury Bench to find the time to encourage BIS to publish that report and that resolution so that Invotec can export its wares around the world and compete with our European competitors.

This Budget will be welcomed in the boardrooms and in the living rooms of Tamworth. It is a Budget for jobs—jobs that pay the mortgage, pay for the foreign holiday, and pay the taxes that pay for the schools and hospitals that we all want and need, and that must be fit for purpose in the 21st century.

19:36

[Yvonne Fovargue (Makerfield) (Lab)]

This Budget was summed up by the chief executive of Citizens Advice as a disappointment because

“People on the lowest income and those without savings benefit least”.

“But what about the increase in the personal allowance?”, I may hear those on the Government Benches say. There are two issues with that for the lowest-paid. First, there is the relationship with the benefits system. The lowest earners claiming housing benefit and council tax benefit lose 79p in every £1 that they gain through the increase in the personal allowance. Secondly, once they are out of tax, they are out of tax—they cannot gain any more for being even more out of tax. Raising the threshold at which national insurance is paid would be much more targeted at low-paid workers and enable them to keep much more of their income, and I am disappointed that that was not in the Budget.

Let us move on to the unexplained £12 billion saving in the social security budget. From where—or rather from whom—will this come? Will it be low-paid families who are claiming in-work benefits? They have already been hard hit by this Government. Will it be people with disabilities? They have already been hard hit by this Government. Will it be children in poverty or young people? They have already been hard hit by this Government. I suggest that people have a look at Real Life Reform’s reports to see the real stories of those who have been hit by this Government’s welfare changes. Those people are certainly not feeling any optimism. In fact, one of its most recent reports says that at least 75% of them were feeling “not at all” or “not very” optimistic about their chances for the future. Will this £12 billion saving be clarified before the election so that people know exactly what they are voting for and exactly who they are voting for to be hard hit even further?

“Northern powerhouse” is easy to say, and I would love us to have one, but what is actually being delivered to councils in the north by this Tory-Liberal Democrat coalition is cuts of 75% more than in the rest of the country. Simply devolving responsibility and cutting budgets will not empower anybody.

It is good that savings are not double-taxed, but I regret the level being set at £1,000 of interest. Most of my constituents can only dream of £1,000 in total savings. The Chancellor’s figures are predicated on an unprecedented rise in household debt. Surely we should be looking at ways of preventing that. It seems that debt for the country is bad, but debt for the individual is welcomed. We should at least be looking to provide help for those who fall into unmanageable debt. It is worth remembering that an extra 0.5% of interest on a rising mortgage rate will put a further 600,000 people at risk of losing their homes. Where is the help for low-income savers to build a small pot for a rainy day, keeping them out of the clutches of the payday lenders and rent-to-own companies like BrightHouse?

Talking of exploitation, what extra protection are the Government putting in place to prevent the most vulnerable from being ripped off by companies offering to help unlock their pension pot? This is Money spent one hour and £100 to set up a fake website that popped up on Google alongside the Government’s own site when a search was done for Pension Wise. We already know that this happens in many other areas. For example, there are many sites offering to help people get the European health card for a fee of £49, even though it is free. Con artists are already looking at this as a great opportunity to make a fast buck. What is being done to protect people who are googling for information on who can help? The helpline is not yet up and running, so what is being done to help those people now?

The Budget has been called a “rollercoaster” by the Office for Budget Responsibility, but I would rather describe it as a game of snakes and ladders. Unfortunately, the ladders appear to be targeted at the rich, while the snakes are for the poorest and most vulnerable. Let us stop playing games with people’s lives and make the next Budget a Labour Budget, with a strong economic foundation that delivers a fairer recovery for all.

19:41

[Neil Carmichael (Stroud) (Con)]

It is a great pleasure to participate in this debate. This is a good Budget not only because it is fiscally neutral, as my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) has said, but because it underlines the fact that the long-term economic plan is producing solid results. It has been endorsed by none other than President Obama, who has pointed out that the UK and US economies are the only two that are really growing, so we must be doing something right. It has also been endorsed by the OECD, which has noted the solid performance of our strategy and suggests that we should not turn away from it. The Institute for Fiscal Studies has also pointed out that living costs are now becoming more favourable. That is the overall background.

The plan is good for another set of reasons. First, it is making sure that getting a job is a good thing, which is what we want to see. I inherited 1,488 unemployed people in my constituency, but we have got the figure down to 551. That is fantastic and exactly the direction of travel we should be taking. It is part of the strategy we have pursued, and that was underlined in last week’s Budget.

We need more savings and we need to turn the economy into a saving economy rather than one of debt. The actions taken to encourage not only pensioners to save, but young people to save for mortgages, are absolutely fabulous. Our course is absolutely right and we can only conclude that we have cause to celebrate.

The Budget is also about rebalancing the economy and creating a real economy that actually makes and sells things. We need infrastructure not only to enable our manufacturers and engineers to operate, but to promote and save the environment. That is why I was really pleased that the Chancellor recognised the need for more investment in my constituency to defend our land and houses against flooding. That is appropriate because it is both a real economy activity and worth while.

Training and education is another big area. I have been campaigning for some time for a university technical college in my constituency and we are going to get one on the site of the old Berkeley power station. This Government are committed to training, because it makes it possible for people to get jobs that last and that are highly skilled and worth while. That is exactly what the Secretary of State for Work and Pensions said earlier: 80% of all new jobs are full time and 80% are highly skilled. That is what we want to see, and that is what I am seeing in my constituency. The situation has been buttressed by the performance of our economy and strengthened by the Budget.

I have also been campaigning for action to make it easier for road hauliers to recruit and train drivers. The Chancellor has helpfully responded by signalling in the Budget that that is exactly what is going to happen.

Not only have I successfully campaigned for a university technical college in my constituency; I have also been at pains to make sure that manufacturing and engineering are put under the spotlight and that schools and colleges work with business to make it a reality. We have to continue to attract investment, so what has the Chancellor done? He has made it easier and more attractive for businesses from afar to come to my constituency. That is absolutely brilliant, because we need high-tech modern businesses with plans to invest and the ability to translate research and development into products and services that people want.

I salute the overall approach the Chancellor has been at pains to take over the past five years. The real problem is that we inherited an economy that was swamped by debt, which does nothing for investors, hard-working families, the unemployed or people who need proper care. The challenge was, “Where is the money going to come from and what are we going to do to solve the problem of debt?” The Government have done something about that.

[Mr MacNeil]

Will the hon. Gentleman give way?

[Neil Carmichael]

I am not going to give way, because a lot of Members want to speak and it would be unfair to do so.

We have to make sure that we deal with our debt. We are on the right course.

The point I want to leave Members with is that it is essential that we continue to make our economy work for families, pensioners and people who need assistance, because that is how we will generate the capacity to pay for all the things we need. That is why the growth rate of 2.6% is very welcome: it is sustainable and reliable and we should embed it. The long-term economic plan should be saluted and cheered at every opportunity.

19:47

[Meg Munn (Sheffield, Heeley) (Lab/Co-op)]

I am pleased to speak in my final Budget debate. In his Budget speech, the Chancellor said:

“Future economic success depends on future scientific success”.—[Official Report, 18 March 2015; Vol. 594, c. 776.]

I agree entirely, but this Budget does not do enough to unlock the potential of our science, engineering and technology industries, which have the capacity to grow and to invent and develop new products that will create jobs and wealth. Research by EngineeringUK shows that simply filling the demand for new engineering jobs could generate an additional £27 billion a year for the UK economy from 2022.

The Government claim that 8% of jobs created while they have been in power have been in skilled occupations, but the large demand for more skilled people is not being met. We need more engineers. Companies need 182,000 people with relevant engineering skills per year.

[Mr Jim Murphy (East Renfrewshire) (Lab)]

I think I speak on behalf of the whole House when I say that we regret that this is my hon. Friend’s last ever speech in a Budget debate. On the need for more engineers and qualified people, will she reflect on the particular need for more women in engineering roles?

[Meg Munn]

My right hon. Friend may know that I have been banging on about that for years; I will come to it shortly.

There is currently an annual shortfall of about 55,000 skilled workers. The Chancellor’s commitment for financial support for PhD and research masters degrees will certainly help, but to keep up with demand we need to nearly double the number of engineering graduates. We need action on a much larger scale. We should be slashing tuition fees for engineering courses and providing bursaries to help students with living costs.

The Government tried using a programme to increase the number of skilled women engineers, but it was a complete failure. The employee ownership fund had £10 million to develop women engineers, but just £104,000 has been allocated. Unfortunately, despite me and the Women’s Engineering Society—of which I am a patron— pressing them, the Government have refused to reinvest the unspent funds into schemes specifically aimed at women.

Public services have been neglected not only in the Budget speech, but in reality. The Chancellor tried to give the impression that the Budget devolves resources to northern cities. He also claimed that

“the quality of public services has not gone down—it has gone up.”—[Official Report, 18 March 2015; Vol. 594, c. 770.]

However, the reality is that our front-line services have been cut to the bone. The fundamental question is: how they will be funded in the future? The silence from the Government Benches is deafening.

In the next 10 years, there will be a 27% increase in the number of those aged 80 or over in Sheffield. Without a new funding settlement, social care services will be severely affected, with more and more of my constituents unable to receive the preventive, joined-up services they need, and some will receive no support at all. How much longer are the Government going to spin the better care fund as a fund? They claim that my local authority will revive £37.8 million, but that figure represents the total amount of pooled budget shared with the NHS: they are top-slicing existing resources. Not surprisingly, decimating social care puts more pressure on the NHS. I am not surprised that Sheffield Teaching Hospitals NHS Foundation Trust has rejected the Government’s most recent offer on budget cuts, under which it would have had to find an additional £40 million in savings. Enough is enough.

In recent months, reports of child sexual abuse have been widespread, but a recent Ofsted report concluded that three quarters of councils do not deliver children’s social care to a good enough standard. The Public Accounts Committee has found that there has been little or no improvement in outcomes for children in foster and residential care, nor in how well they are looked after. It highlighted the abject failure of the Department for Education to take any responsibility for driving up standards. Let us not underestimate the effect of the downward pressures on local authority budgets in contributing to these issues. The College of Social Work has called on the Government to allow real social work to thrive and to invest in the service. It is hugely disappointing that the Government have again failed to make extra funding available to protect children from sexual abuse.

Social workers are often the glue that holds integrated services together. They possess the skills and expertise to lead multi-disciplinary teams and to provide help, care and, where necessary, protection. As such, the profession plays a key role in reducing delayed discharge, bringing mental health services into the mainstream, preventing emergency admissions, and supporting and enabling people to live full, independent lives. By contrast, the Budget will do little or nothing to contribute to these services.

When I was first elected 14 years ago, my constituents were seeing the start of the investment in the public realm that characterised the Labour years—new schools, hospitals and health centres and improved roads all led to better lives. This year, the revenue support grant for my local authority will have been cut by 50% compared with 2010. Local government cannot continue to absorb such pressures. It is no wonder that the people of my city have little time for the Tories. This Budget did not try to tackle the real issues at local level or to provide solutions to real problems, and it will do little to improve the lives of the constituents whom it has been my privilege to represent for the past 14 years.

19:53

[Jeremy Lefroy (Stafford) (Con)]

It is a great honour to follow the hon. Member for Sheffield, Heeley (Meg Munn). I entirely agree with her on two matters. The first is the need for more engineers, particularly women engineers. I saw that when I visited Alstom in my constituency recently and met women engineers, all of whom came from outside the UK. They are very welcome there, but with one exception, there were no British female engineers. The second is her call for a new model for health and social care funding, which the next Parliament will have to look at. At the moment, what we have from most—in fact, all—of the major parties is a sort of patchwork of funding for health and social care, but that is not enough to meet the demographic needs of the future.

In May 2010, the number of jobseeker’s allowance claimants in my constituency was 1,530, but it is now well below 600, the lowest figure since the current series of records began. However, there is absolutely no room for complacency. Not only are we working for full employment in Stafford, we want wage levels to rise in real terms. I will give a few examples of where the additional jobs have come from.

On Friday, I visited Turner Construction, which specialises in civil engineering works, house building and fitting. It plans to more than treble its turnover and work force between now and 2018, having already trebled its work force since 2009. That reflects two things: one is people’s increasing confidence in the performance of the economy, which means that they are investing in extensions and new kitchens; and the other is that house building is picking up again. Figures from the National House Building Council show that the number of homes started in my constituency has increased from 317 in 2013—compared with a national average of 188—to 473 last year. That includes a welcome increase in social house building, particularly through Stafford and Rural Homes. The increase is partly owing to the arrival of 1,000 servicemen and women and their families from this year. That has brought Stafford an investment of £150 million in military facilities and homes, and should provide a permanent boost of at least £15 million annually to the local economy, as well contributing greatly to community life.

Last month, I attended the opening of the Risual academy at Stafford college. Risual is an IT business, which was established in 2006, and now employs 120 people, with much of its increase having come in the past three years. It, too, intends to expand its staff considerably in the coming years, but it has run up against a skills shortage, as other hon. Members have mentioned. That is why it has decided to work with the local college to train young people to take up such positions.

If businesses are to expand or modernise, they need the space to do so. That is why Staffordshire county council has invested in a new business park to the north of Stafford. The wisdom of doing so was shown when Alstom announced in late 2014 that it would build its new world-class research and manufacturing facility for automation at Redhill, despite the fact that, as an international company, it could have chosen to go elsewhere. Its large transformer factory, which is the only one in the UK, has a full order book, almost all for exports. The Perkins engine plant in Stafford has also invested in the past few years, both in plant and in apprentices, and it too makes a considerable contribution to the UK’s balance of payments.

If we are to continue that story of successful job creation and investment, there is much we need to do. First, we need to improve careers guidance and advice. That issue has been raised with me by students and employers, and it is part of the manifesto of the Institute of Chartered Accountants in England and Wales, of which I am a member. Secondly, the increase in apprenticeships during this Parliament to more than 2 million needs to be maintained. I welcome the pledge to increase the number of apprenticeships to 3 million, but we need to work continuously to improve their quality. Thirdly, we have to continue to increase investment in infrastructure. Fourthly, we need to improve productivity. As hon. Members have mentioned, we still lag well behind our competitors. There is no simple solution: better training, more spending on research and development and greater investment in plant and equipment will all help, but education about work and working effectively at school are also essential. Finally, we need to maintain the drive to improve exports. UK Export Finance has been expanded, and the UK’s diplomatic network has been put at the service of exporters, but we need to do far more if we are to reach our target of £1 trillion of exports by 2020.

In conclusion, I want to address the opportunities in the heath sector. In Stafford, we are very aware of the importance of our national health service. We have been through extremely difficult times, but we have worked together as a community to ensure that we retain an excellent district general hospital with an accident and emergency department, when some people told us that it would be closed or privatised, or would become a cottage hospital. We are still campaigning for a return to 24/7 A and E with paediatrics and consultant-led maternity, and we will continue to fight. At the same time, however, I welcome the investment being made in refurbished wards, operating theatres, the expanded A and E department, chemotherapy and dialysis. In Stafford, we are building the district general hospital of the future, with an emphasis on acute care for the frail and elderly, alongside first-class general services for children and adults. I am determined to work with everybody to make that dream a reality.

19:59

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

The thematic focus on jobs in this debate helps us to get to the heart of why last week’s Budget was a huge missed opportunity. The Government had a chance to move away from a cuts agenda that has stifled recovery, but they failed to take it. Instead, Scotland alone is looking at a further £12 billion of cuts over the next four years, which will hamper our economic recovery, damage our public services and harm our poorest communities and families.

Everyone welcomes the fact that finally the economy is recovering and unemployment is falling, but it has been a painfully slow process. It is the slowest recovery from recession in history. The OBR does not expect real wages to return to 2008 levels until the second quarter of 2016. On the most recent figures, the UK’s GDP per capita is still 1.8% below pre-recession levels and the current account deficit—a measure of our trade and income flows with the rest of the world—is worse than at any point in the UK’s history.

In 2010, the Chancellor said that the UK would run a surplus of £5 billion in the current structural budget this financial year. Instead, he now expects a structural current deficit of over £45 billion. In the six years to March 2016, the Chancellor’s borrowing target from 2010 is set to be missed by £150 billion. The austerity programme simply has not worked in the way he led us to expect.

If austerity has failed in economic terms, it has been a disaster for people, especially people on the lower half of the income spectrum. When we look at the cumulative winners and losers from the changes to the tax and benefits system over the past five years, we see that those who are trying to raise children have taken some of the heaviest hits to their incomes and living standards. The distributional analysis by the Institute for Fiscal Studies demonstrates that in every income group households with children have lost relative to those without children.

Given the rapid growth of child poverty levels, we should be particularly concerned about those in the lowest-income households. The Child Poverty Action Group points out that almost two thirds of the children who are growing up in poverty in the UK today have at least one parent in work. I have said before in the House that in-work poverty is one of the greatest challenges we face. The Budget offers little that will help those families. Indeed, measures such as the increase in the personal allowance tend to benefit higher-paid workers and higher-rate taxpayers far more than those in low-paid work. That is symptomatic of the wrong priorities that we have seen from this Government. On the Government’s own figures, the poorest 20% of households will be worse off by an equivalent of £466 a year. I am fortunate to represent a constituency in Aberdeenshire where unemployment is extremely low, yet in parts of Banff and Buchan, one in four children is growing up in poverty.

[Mr MacNeil]

Does my hon. Friend agree that the increase in VAT, which was proposed by the Liberals and the Tories, certainly did not help poor people, and that it is unforgiveable that Labour abstained on that vote?

[Dr Whiteford]

I agree with my hon. Friend that regressive taxation has played an important part in driving up child poverty. The pernicious combination of low pay and cuts to tax credits and child benefit has been the main driver of child poverty in our communities and of the increased pressure on parents to comply with the sometimes quite unreasonable and disproportionate conditionality in the system.

Child poverty has long-term consequences for the health, education and life chances of those who experience it. That is why it is short-sighted of the Government to short-change families and inflict yet more financial pain on those who are already carrying the can for the financial collapse.

I do not want to leave the topic of jobs without acknowledging the significance of the Budget announcements on the North sea fiscal regime. Many of the better-paid jobs in my constituency are in the energy sector. However, it is not just those who work directly in the oil and gas sector and its supply chain who depend on the industry, but myriad large and small local businesses, including retailers, hoteliers and service providers. The Government’s U-turn on the fiscal regime in the North sea, at long last, is very welcome, but it could have been done months ago when problems started appearing on the horizon—some of them predating the fall in oil prices. It has taken the Chancellor four years to reverse the tax increases he has imposed on the sector since 2011.

Will the Chief Secretary, who is back in his place, now accept that his supplementary charge was a mistake that has had a detrimental impact on our offshore energy sector and on the people who work in the industry, onshore and offshore? Will the Government provide assurances that their poor stewardship of our oil and gas resources will give way to a period of fiscal stability for the sector? Over the past five years, the one consistent chorus that I have heard from every part of the industry has been, “Stop shifting the goalposts on tax.” While we are still seeing announcements of job losses in the north-east, it is more important than ever that the industry can plan ahead with confidence.

There has been a cosy consensus around austerity that implies that it is inevitable, necessary and unavoidable, but there is nothing inevitable about it. The Chancellor had headroom in the Budget to make small increases in public spending, while still bringing down the deficit and debt. Such small increases would help to protect our public services and our social fabric, which has never looked so worn and fragile. Professor Simon Wren-Lewis of Oxford university argues that the Government’s austerity programme may have cost the UK economic growth equivalent to 5% of GDP. No doubt economists will argue the toss on the detail, but the huge loss of potential tax revenues that that represents helps to explain why the OBR’s 2010 forecasts on public borrowing have been £150 billion out over the past six years.

An alternative approach to deficit reduction could benefit the economy and expand the tax base, bringing real and sustainable economic growth. The benefits of that are simply not reflected in the Treasury’s modelling. The SNP leader, Nicola Sturgeon, has set out an alternative to the austerity agenda to support jobs and public services. I hope that in a few weeks’ time, an enhanced group of MPs will sit on these Benches and make that case. We will be a strong voice not just for the people of Scotland, but for everyone in the UK who wants a progressive alternative to this failed austerity project and this failed coalition Government.

20:05

[Richard Graham (Gloucester) (Con)]

Today’s debate focuses on work and pensions—the two issues that are at the heart of this Government’s mission to ensure that everyone is better off working and everyone is better off saving. Neither of those things was remotely true in 2010 and both are much closer to being true today. It is vital that Britain allows this Government to finish the job of making both those crucial philosophies true.

The first part is about ensuring that universal credit is rolled out and implemented effectively everywhere. That means that, finally, the tax credits that have prevented so many people from working for longer than 15 hours will no longer prevent people from doing so and that many of my constituents will have the chance to benefit from having full-time jobs.

At the same time, we need to get the spirit of the triple lock, which has brought security so effectively to those on the basic state pension by giving everyone £950 more than they were getting in 2010, into the world of annuities, which have been liberated, so that those who need and want them can have them, but those who do not want them do not have them. The small income that many of my constituents generate from their savings should not be taxed, so that there is an incentive to save. The means-tested pension prevented many people from saving, because they could see that their neighbour was better off not saving. We must not allow that world to continue.

That is our mission. It is what my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) called free market economics with a social conscience. In my words, it is getting the economy right in order to improve lives. That is the mission that this Government have been on for the past five years and it must continue.

How does it feel on the ground in my Gloucester constituency? Youth unemployment went up by 40% under the previous Government and it has gone down by almost 60% under this Government, from 760 to 345. There were too many families with two generations, if not three, in which no one was working, meaning that there was no role model. Some 2 million children across the country were growing up in those households.

Today, we have 5,900 new apprenticeships in Gloucester, which is more than double the pace under the previous Government. That is not about statistics, but about opportunities for individuals. People who come from backgrounds that meant that they never imagined they would be able to get a job and that they faced a future on benefits are getting the skills that they need for a lifetime of opportunities. In terms of social justice, there is no better individual story than that of Beauty—a Nigerian woman who was trafficked to this country and who, with help from a number of us, was given the chance to stay in this country and is now training to be a nurse in a hospital in Gloucestershire. That is the mission.

Interestingly, only today, I read the best indicator I have come across of business confidence in the south-west of England. It stated:

“Turnover and profit growth are expected to remain steady”.

It said that there were good prospects for jobs. However, there was a but: the prospect of a new Government makes many business leaders nervous about their long-term prospects. It is no surprise that businesses are nervous. They should be, and so should parents because the shadow Business Secretary announced recently that the Labour party would axe the level 2 national vocational qualification from being considered an apprenticeship. That would be a disastrous blow for the many people who leave school at 16 or 17, start with a level 2 and go on to improve the level of their apprenticeship.

We need a Government who are fiscally responsible—as the Budget was—and who produce specific instances of improving the lives of our constituents. I was delighted with the encouragement for tidal lagoon power and its first historic opportunity to develop marine energy from Swansea bay. The company is headquartered in Gloucester and is a £1 billion project. Opportunities in the future with three or four further tidal lagoons will offer thousands of jobs in south Wales and around Gloucestershire. There was also encouragement for my plan for the redevelopment of Gloucester railway station. That was confirmed by the announcement this morning by the Department for Transport that we will be getting a new station car park with up to 240 new places and a new entrance to our station on Great Western road, linking our hospital and the station directly for the first time. That will come in 2016.

I also welcome the announcement by the Chancellor—we await the full details—that the campaign that I and my hon. Friend the Member for Winchester (Steve Brine) have been running for justice for police widows has been accepted by the Government. That is a good example of where a stronger economy allows for social justice and for the Government to make decisions that improve the lives of those who, through no fault of their own, were victims of an historical injustice.

Some things remain to be done, and we await the details of the retirement guidance on savings. That is critical and we must work to ensure that it is good. We must continue with auto-enrolment and to reverse the decline of those with pensions and savings. We might consider a new ISA for care. I say yes to 3 million apprenticeships—deeper, broader and perhaps more for the over 50s. The hon. Member for Leeds West (Rachel Reeves) said there have been five wasted years, but they were not wasted. We must now build on those years to ensure that we go forward with an even better, stronger economy, helping those who have less.

20:11

[Mr Jamie Reed (Copeland) (Lab)]

It my solemn duty to inform the House that outside this Chamber the Prime Minister has informed the BBC that he will not seek a third term as Prime Minister. I think this is a constitutional first. It is the first time in our history that a Prime Minister who has yet to win a general election—let alone contest a second one—has ruled out serving a third term as Prime Minister. We are all grateful, Mr Speaker.

As the MP who represents England’s most remote and least accessible constituency from Westminster, I was disappointed but not surprised by the Budget. The job of any Government, particularly in the wake of the Scottish referendum, must now be to facilitate the ambitions of the English regions. A new constitutional settlement for Scotland also compels a new constitutional settlement for the other nations of the United Kingdom. Difficult? Yes, but inescapable, and the Budget ducked that challenge.

As a starting point, I will again look to Scotland. During the recent debate surrounding the future of the UK, Scottish nationalists sought deliberately to conflate the entire concept of England with Toryism. That is and was a knowingly false claim. The insinuation beneath the lie was that the English are content with London’s dominance of the national economy and with how Westminster functions, but nothing could be further from the truth. In cities such as Liverpool, Manchester, Newcastle and Leeds, dissatisfaction with how London runs the show and how Westminster functions is about to erupt. People are dissatisfied all over the country, so I will talk about regional growth policy for England.

Regional devolution is a necessity, but it is only the beginning of what England requires. Beyond our great cities, the nation building that England needs will be much more difficult, and the Government must begin to concentrate their efforts in the peripheral areas outside our major conurbations. England is beset by a toxic disconnection between the governed and the governors, and that problem is central to the proposition of regional economic growth in our country. Nowhere is that disconnection more keenly felt than in that forgotten England, largely ignored by the political mainstream and the national media—those places people have heard of but have never been to. In our rugby league towns and our lower-league football cities, a crisis is taking grip that the Budget did nothing to address. Right now, England’s peripheral economies are experiencing a collapse in their reserves of “social capital”.

Social capital can be defined as those people with “talent”: literate, numerate, ambitious, financially adept and engaged with civic society. Successful regional economies are built on that class, which oxygenates local economies and acts as the arteries of local and regional civic life, including in health care, local government and commerce. In short, the Government’s task in those areas should be to create nothing short of a vibrant, thriving, mercantile class. Whatever public investments those areas might receive, without the software of social capital, new hardware will be largely pointless. We have seen that in a blunt and unsophisticated way through our foreign policy efforts in “nation building”. It is now time for nation building in England.

In many places, driven by austerity, the community fabric is being destroyed and the pillars of local society and community are disappearing. Therefore, when the Chancellor presents a Budget in which the takeaway message is that “the worst is yet to come”, those areas understandably wince. Such communities are used to dealing with the consequences of factory closures, but a new challenge is on the horizon. What happens to these communities when the Government pull out? It is a vital question and it is left unanswered by the Budget. At the centre of attempts to drive regional economic growth is the essential question about the role of the state. What size should it be? Should it command more or less resource? Should those resources be spread more thinly, performing more functions, or should they be concentrated by performing less? Away from that debate, austerity is not just crucifying the public and private sectors in these peripheral areas; it is also causing the social capital to flee. Life outside the premier league is tough, as figures released today by the Industrial Communities Alliance demonstrate perfectly.

For my constituents, the Budget provided precious little in the way of encouragement for our ambitions—those ambitions are likely to be achieved despite, not because of, anything the Government are likely to do. After 10 years of work, Copeland and west Cumbria—Britain’s energy coast—is on the verge of a transformative era that will see billions of pounds of investment, tens of thousands of new jobs, and the emergence of our area as a world leader in high-skilled engineering, manufacturing and research and development.

We are about to witness investment on an Olympic scale, and the Government should have used the Budget to ensure that we have the tools we need to deliver on our ambitions after five years of savage cuts to our area, but that has not happened. We needed more investment in developing skills for local people and our young people, to ensure that we can truly benefit from the work we have put into developing Britain’s energy coast after the last 10 years. In west Cumbria our local secondary schools require significant investment after the Government withdrew the Building Schools for the Future money—almost £70 million—allocated by the previous Government. Along with local head teachers, businesses and Cumbria county council, I am developing a plan for secondary school investment in my constituency, but the Government must contribute to that. Their record so far has been shameful, and if they cannot or will not fund new secondary schools, they should at least help to enable and expedite such schemes.

I would have liked the Chancellor to support my call for improvements to the A595, and for more to have gone into our health service. I would have liked the money that was taken from hospitals in Millom, Maryport, Keswick and elsewhere immediately after the last general election to be addressed, but it was not. It is a matter of record and frankly weird that the Chancellor spoke about the battle of Agincourt more than he mentioned the NHS in his Budget statement, and he could have done a lot more to ensure that local government was given the type of settlement it needs.

William Cobbett, the radical Tory, left a chequered legacy that was in part contemptible. He also wrote “Rural Rides”, which was published in 1830 after touring England on horseback to discover for himself the condition of England. He famously wrote:

“I defy you to agitate a man on a full stomach”.

The Chancellor and the Prime Minister should saddle up, get around England and see for themselves in the 21st century the agitation in the country at large.

20:17

[Mrs Mary Glindon (North Tyneside) (Lab)]

It is an honour to follow my hon. Friend the Member for Copeland (Mr Reed) who is such an advocate for the north and particularly his area.

When I made my maiden speech in June 2010, I paid tribute to former colleagues working in the Child Maintenance and Enforcement Commission at Longbenton, and said to Members that we as fellow public servants should do all we can to protect our colleagues across the public sector from harsh Government cuts. My words obviously fell on deaf ears as far as the Government are concerned, because since then they have constantly attacked our public services in an attempt to balance the books. Under the coalition we have seen the erosion of pay and conditions for teachers, the police and firefighters, despite campaigns to demonstrate clearly that those workers have a case. To add insult to injury, the 1% pay rise announced by the Chancellor last year did not apply across the board, with some workers—particularly nurses—scandalously missing out on that below-inflation increase.

This year in the Chancellor’s Budget, civil servants will lose any remaining contractual pay progression. Moreover, the announcement of a further £30 billion of cuts to come will not only be an attack on the most vulnerable in society, who have no choice but to rely on the welfare system, but will mean public servants facing the threat of further job losses, further cuts to their pay and conditions and, for those who keep their jobs, more pressure in the workplace.

The Public and Commercial Services Union points out that in the past few years public sector workers have suffered a loss in real wages of up to 20% because of the pay freeze and pay cap, as well as higher pension contributions. Many workers in the civil service are on low pay. Ironically, the very workers who will be administering universal credit will be eligible to receive it themselves.

The Government have made big play of the fact that they want to tackle tax evasion and avoidance. However, with proposals afoot to reduce the number of Her Majesty’s Revenue and Customs staff by 10,000, the Chancellor will be hard pressed to collect the £5 billion target he has set, which falls far short of the tens of billions actually lost to the Treasury every year. HMRC is stretched to the limit and the team responsible for the enforcement of the minimum wage has fewer than 200 staff across the country. In fact, HMRC needs 100 more compliance officers to ensure that workers can get what they are due. How can the Chancellor claim that living standards are on the rise when the vast majority of ordinary people working for Government Departments across the land have seen their living standards and job security fall year on year under this coalition? Poor growth and poor pay will do nothing to boost our economy. It is no wonder the Chancellor has not been able to clear the deficit as he promised he would do by this year.

I would like to raise another important employment issue. I listened attentively to what the Chancellor had to say about helping the oil and gas industry. His words were good news for the industry, which has been hit so hard by the fall in oil and gas prices. That is all fine, but, while the measures will help operating oil and gas companies, there is nothing to ensure that in return for concessions there will be an expectation that UK fabricators will be given the opportunity to tender for related contracts. In the past five years, the majority of North sea fabrication contracts have gone overseas. The Government could do a lot more for the fabrication industry without breaching either EU or World Trade Organisation regulations. Companies such as OGN in North Tyneside have a track record of supporting thousands of jobs when they win these contracts, instead of companies from other countries which benefit directly at the expense of the British taxpayer.

In conclusion, people in North Tyneside, whether they work in the public sector or the private sector, have little hope for a better future with this Budget. The Tory Chancellor has let the people of North Tyneside down yet again.

20:19

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

The Chancellor did not deliver a Budget last week; he delivered a party political broadcast on behalf of the Tory party. The macro-economic state of our country, which is the real purpose of a Budget statement, was almost entirely absent. His speech had two purposes: first, to give the impression that the worst of austerity was now over and that the sunny uplands now beckon if only we vote Tory at the election; and, secondly, to shoot as many Labour foxes as he could squeeze into an hour on his feet. I want to show that he failed on both counts.

The Chancellor claimed that factors such as lower inflation enabled him to ease up on austerity by pulling back his target of a £23 billion surplus after the elimination of the structural deficit to a mere £7 billion. The fact is, however, that the pathway by which he might meet even this more modest target of a £7 billion cutback is, frankly, pure cloud cuckoo land. The rate at which the deficit has been cut by this Chancellor has averaged so far about £7 billion a year. The deficit still stands at £90 billion. Yet according to page 23 of the Treasury Red Book, the deficit will supposedly go down by £15 billion next year, then by a whopping £36 billion the year after that, then by £27 billion and then by £18 billion in 2018-19. These are, frankly, confetti figures. They have been manufactured and thrown about simply to produce a political feel-good factor that somehow austerity is easing off. This is the most enormous con being perpetrated on the British people. Either those figures are wildly wrong and will never remotely happen, or, if the Chancellor does choose to push them through, they will mean cuts in benefits and departmental expenditure on a scale of up to three to four times anything that has previously been experienced. I suggest that the nation will never stand for that. If he does press them, I think there will be an explosion on the streets.

The Chancellor also failed to shoot Labour’s fox that he is still determined to take the British state back to the 1930s. That was the cat he let out of the bag in his autumn statement three months ago. Page 75 of the Office for Budget Responsibility report on the Budget gives the lie to any idea that he has backtracked when it states that Government expenditure under the Chancellor’s latest twiddling of the figures

“would be the joint lowest level in consistent National Accounts going back to 1948”.

The truth is that almost all the vainglorious boasts the Chancellor made are either seriously misleading or not supported by the evidence. He claimed that the deficit was being cut this year, when in fact that is only due to the exceptional delaying of tax payments until the end of the fiscal year by the super-rich to take advantage of the reduction in the top income tax rate to 45%. Without that, which of course will not be repeated, the deficit would have risen this year, and on present policies, it will rise in future years.

The Chancellor promised the biggest increase in real spending for a decade in 2019-20. As others have said, however, that is only because of the rollercoaster boom and bust after massive cuts in 2016-18, which any Whitehall mandarin will tell the Chancellor is a crazy, not to say utterly irresponsible, way to manage public services. He claimed that national debt will begin to fall in 2019-20, but that is only because he is planning to pocket the £20 billion windfall from selling off the proceeds of bank privatisation, not because there has been any change in the fundamentals of debt inflation.

The Chancellor complimented himself on a nationwide recovery. The truth is that London and the south-east continue to pull away from the rest of the country. Manufacturing and construction still badly lag behind the financial sector. He claimed that Britain stood tall and was now beginning to pay its way in the world. The truth is exactly the opposite: the OBR is predicting that in 2014 Britain had its biggest current account deficit since 1845. I repeat that: not 1945, but 1845—nearly 200 years ago.

The Chancellor claimed that with rising real wages, albeit by a fraction and only because of the collapse in oil prices, prosperity was now returning to British households. The truth is that real wages are still nearly 8% below their pre-crash level, while at the top inequality marches on relentlessly. The ratio between the average FTSE chief executive’s remuneration and median pay in those companies is now on average more than 140:1. The Sunday Times rich list shows that the richest 1,000 people in the UK have actually doubled their wealth in the past five years, from a staggering £250 billion to an almost unimaginable £500 billion. I think the conclusion from all this is unavoidable: the real problems of the economy have not been addressed, we are investing far too little, productivity has collapsed and the UK continues to run up debts at an unsustainable rate.

20:28

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

The Government parties are trying to brainwash us into thinking they have an economic plan, when in actual fact it is an economic puzzle, given some of the measures announced.

The Government have to be challenged over their allegation that the Labour Government created the economic situation in 2010. I think the Conservatives have forgotten that in opposition they said they would match our Budget pound for pound—in fact, they said we were not spending enough. That does not suggest any economic foresight on the part of the Chancellor when he was shadow Chancellor. Moreover, the previous Governor of the Bank of England, who was an adviser to the then Chancellor and Prime Minister, said it was not the Labour Government’s fault. It actually started in America with Fannie Mae and Lehman Brothers—the bankers—and the housing crash. In other words, the Government have become apologists for the bankers, rather than holding them to account for what they did to this country and the international community in 2008.

We should also remind the Government that we kept interest rates down to help young people, in particular, deal with negative equity. We introduced the quantitative easing that the Government are still carrying out today and persuaded George Bush—funnily enough, a Conservative American President—to pump more than $200 billion into the American economy, and when Obama came in a month later, he saved the motor car industry, which helped this country. If we had not bailed out the banks, some Ministers would be losing not just their houses but their pensions. We bailed out the banks partly because we knew that otherwise the ordinary person—the pensioner, the saver, the young person saving for a mortgage—would have gone under, but it also helped to rejuvenate industry.

As far as we know, the Chancellor needs to make another £30 billion of cuts, but we do not know if that means more cuts to the police. We know there will be benefits cuts, but we do not know where they will come from, and defence cuts, but we do not know whether there will be further cuts to the NHS. I am not scaremongering. Unless the Government tell us exactly where the cuts will be, it will be open to speculation. They have emasculated local government financially—is local government facing further cuts? Is that part of the plan? In Coventry, at least 1,000 jobs will go over the next three years, and the city council has to find £75 million in cuts, which will affect basic services. Today I attended a school where children were trying to save their local library. The council has granted a reprieve, but there is another area where the council might find itself in difficulty—care in the community. There has been bed blocking at the university hospital in Coventry because we do not have enough social workers to discharge people back into their own homes. Labour will certainly put that right.

People in the public sector have not been appreciated and have had their wage increases held at 1% for the last three or four years. The Government can say what they like about wages rising by about 2%, but purchasing power has dropped by 6%. They say we are back to 2010 wage levels—well, that is one heck of a cut over the past four or five years. We have also had cuts to the legal aid budget, meaning that people cannot get social justice. We have 1.6 million people on low-wage zero-hours contracts, yet the Government have the effrontery to hand back £6 billion in tax cuts to their friends. The Chancellor proposes to cut £12 billion by reducing welfare spending and £13 billion by reducing departmental spending. Where is this coming from? Only £2 billion of cuts have been announced, so where might these cuts come from? I have already indicated some areas where they might fall.

The NHS is due to have increased funding in line with Simon Stevens’s proposals, which the Government are supposed to be in favour of. Similarly, the education budget is supposed to be protected, as is overseas development assistance. As I just mentioned, the Government have promised £6 billion in personal tax cuts, without bothering to inform us how they will be costed. We should also consider the NATO commitment to spend 2% of GDP on defence, which the Prime Minister recently advocated. If they do not achieve this, will we see more cuts and job losses in the defence industry? The Government have also promised to ring fence universal benefits and the state pension triple lock. So it comes down to this: where do they plan to make the cuts and why will they not open up and tell us?

20:34

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

It is a pleasure to follow my hon. Friend the Member for Coventry South (Mr Cunningham). Last week, the Chancellor proved to us all just how out of touch and deluded he and his Government are. Apparently, people in my South Shields constituency have better living standards than they did in 2010, despite weekly pay across the north-east being the lowest in the country and dropping again just last week, prices continuing to rise, public sector jobs being shed at the rate of over 1,000 a month since 2010 and having 28,000 people in the north-east stuck on exploitative zero-hours contracts.

At the same time as the Chancellor was making his statement, one of my local food banks moved to larger premises to cope with the increase in the working poor they feed. That is hardly a record that any Chancellor should be proud of. When he boasts about full-time employment, what he fails to mention is that this includes those who are self-employed. The reality for many of the self-employed I have spoken to is that they are low paid: some do not even take a wage themselves and many do not work full time. It is worth noting the correlation between high levels of self-employment, low pay and poverty. We need look only at other EU countries where self-employment is high—Greece, Spain and Portugal, which are countries where working people are struggling.

On hearing the Chancellor’s speech, people in Shields will have concluded either that he does not know their pain or that he does not want to know. I bet he does know that many of the people taken out of the unemployment figures in Shields have not found employment at all, but have been unfairly sanctioned or ushered into meaningless training courses just so they do not show up in the stats. If so, the Chancellor is painting a picture he knows does not match up with what is really happening in our country—a picture that my constituents are far too smart to fall for: they will see right through it.

It was not only on living standards that the Chancellor’s hype did not match the reality. What about his so-called northern powerhouse? We were told to expect big announcements, but in our part of the north, there were next to no announcements at all. He mentioned the north-east once in his speech and for every five projects announced in London and the south-east, he announced one for the north-east.

Looking more closely at the Chancellor’s plans for our region, it appears that they are totally vacuous and simply an afterthought. The northern transport strategy document re-announced a number of projects, some of which are still not under way. There was no announcement on business rates. Talks about reopening a ferry route to Norway were “welcomed”, but without a commitment that the Government would do anything to make any of these things happen.

I have been a Member of this House for just under two years. Prior to that, I lived and worked under this Government, and I am telling the House now that things were tough—at times, really tough. Life beyond this place has got tougher for the people of this country. I wanted to be here to give a voice to the people in my constituency who have suffered under this Government, and to fight for a Labour Government because Labour has a different way—a fairer and more balanced way.

We know from the Office for Budget Responsibility that another five years of this Government will bring a level of pain that will be nothing like the pain people have already seen. People have a choice. They can opt for cuts to the vulnerable on a faster and crueller pace, deep and damaging cuts to our police, defence and social care budgets and total decimation of our NHS coupled with VAT rises, or they can choose Labour’s plans to make work pay and bring the deficit down in a more responsible way, while protecting vital services like our NHS.

I conclude with the observation that the sun is certainly not shining yet, but come May, it will be—when we have a Labour Government.

20:39

[Alison Seabeck (Plymouth, Moor View) (Lab)]

I place on record my indirect interests in the register entry for my right hon. Friend the Member for Greenwich and Woolwich (Mr Raynsford).

The Chancellor had a throwaway line in the Red Book referring to a review he plans to undertake if he is re-elected and in government about whether the airport in Plymouth is needed and should be reopened. Let me point him in the first instance to the report produced for Viable, the group that has tenaciously kept the issue on the boil, and the report of some 146 pages produced for the city council at the end of 2014. I ask him to use those as a starting point rather than to delay the process by seeking a brand-new report covering the same ground.

In its Plymouth Plan, the city council has already made clear its intention of protecting the airport site. We also know that at last, as part of its bargaining tool to persuade the Government to back its expansion plans, Heathrow is considering offering slots or cash to smaller regional airports, and it will be interesting to see whether Gatwick follows suit. Governments of all complexions have missed a trick in relation to regional growth by not consistently supporting airports such as Plymouth. Plymouth should be receiving the sort of help that Dundee has received, which I think could be provided by the Government or one of the London bids.

The inclusion of Plymouth’s enterprise zone bid says a great deal about the quality of the offer, and I congratulate the Labour city council on making such a strong case, alongside the local enterprise partnership and businesses. Chancellors do not throw money away so close to a general election if they do not believe that doing so will bring about a positive outcome. Plymouth, under Labour, delivers.

One of the Government’s biggest failures has been their inability to keep the level of housing benefit down. Over the past five years, they have spent about £1.8 billion more than they planned to spend on housing benefit for people in work because they have depended on it to meet the cost of the otherwise higher rents that they have imposed through “affordable rents” or the private sector. That has happened notwithstanding the earlier mantra from, in particular, the then Housing Minister, the right hon. Member for Welwyn Hatfield (Grant Shapps), who made a number of rash promises virtually all of which, unsurprisingly, proved to be inaccurate or undeliverable. Since the election of this Government, the number of working people who are forced to claim housing benefit to pay their rents has risen by more than 50%, and the Budget does nothing for them.

The Budget is very light on anything specific to the delivery of much-needed social rented housing. There is the offer of an individual savings account for first-time buyers, but that will not solve the main problem, which is the fact that we are not building enough homes. I find the Secretary of State’s bare-faced cheek extraordinary, given that his Government have delivered the lowest level of house building since the 1920s. During the run-up to the great crash, Labour were delivering 200,000 homes a year. This Government’s record of building new and affordable social rented housing is abysmal, and enormous pressure has been imposed on the private rented sector, pushing up rents.

The Government cannot duck the evidence. The UK Housing Review and the live tables of the Department for Communities and Local Government give clear figures for social rented housing starts and completions. The Chief Secretary may wish to listen, because he got the figures wrong in the Chamber the other day. In 2009-10, there were 39,492 starts and 30,939 completions. In 2013-14, the last full year, there were a meagre 3,961 starts and 7,759 completions. That is a massive drop in the number of homes available for social rent. It is also a further indication that the rise in rents that has resulted from people being given no option but to rent in the private sector, and the increasing number of so-called affordable rents, have contributed to the inexorable rise of the housing benefit bill.

The Budget contains no measures to boost social housing numbers. Indeed, the Conservatives are now talking about introducing a right to buy for housing association residents, which would reduce the stock further and leave people with low incomes facing the pressures of the private rented sector with little hope of finding homes that they could afford without recourse to housing benefit. Successive housing Ministers have promised that their enhanced right-to-buy scheme, offering up to £77,000 per unit, would lead to a one-for-one replacement, but that scheme has failed dismally. Analysis shows that only one home has been built for every 21 that have been sold. That is not solving the problem.

The Government are pushing more and more housing associations to become developers, building homes for market sale rather than to meet social need. They will not be able to cross-subsidise from the market sales sufficiently to cover the loss of units from a potential right-to-buy option. That idea, floated by the Prime Minister, is yet another reason why people should vote Labour at the election. The hopes of home ownership aspirants can already be fulfilled through existing shared ownership schemes and other low-cost home ownership initiatives.

There has been a dramatic and deliberate reduction in the amount of social housing, and a further right to buy would have a devastating effect. The slashing of the social housing grant has already led to a reduction in the number of units that it has been possible to build. David Orr, the chief executive of the National Housing Federation, has said that this is

“not a budget to end the housing crisis.”

He did not mince his words, and he was right. Sadly, it is not a Budget that matches the reality of most people’s lives, and it will not help them to deal with the pressures that they face.

20:45

[Graeme Morrice (Livingston) (Lab)]

Like the Chancellor’s previous five Budgets, this one does nothing to recognise or address the problems faced by my constituents and many others across the country. It is a Budget that yet again demonstrates how out of touch this Government are.

The Chancellor talks of a national recovery and an economic plan that is working. However, the reality is that thousands of hard-working people in my constituency continue to experience low pay and in-work poverty. The Joseph Rowntree Foundation is right to say:

“There was little in today’s Budget to enable those on the lowest incomes to be part of an economic recovery.”

Indeed, about 18,000 of my constituents currently earn less than the living wage.

The Chancellor’s announcement of a 20p increase in the minimum wage will mean very little to my constituents. It is yet another example of a broken promise from a Chancellor who, over a year ago, promised to increase the minimum wage to £7 per hour. People in my constituency and across the country deserve better and it is clear that more needs to be done to help those on the lowest incomes. It was a Labour Government who introduced the minimum wage and it will be a Labour Government who go further and increase it to £8, because that is what people deserve.

[Adam Afriyie (Windsor) (Con)]

I have been listening very carefully to the hon. Gentleman’s words. Will the Labour party raise it to £8 even if it should be higher than that?

[Graeme Morrice]

I think that is a possibility, and I am glad the hon. Gentleman acknowledges we will have a Labour Government on 7 May.

Throughout the past five years, people have come to my surgery to tell me that their benefits have stopped or that they are struggling to pay their bills, and what is clear is that, month after month, people are worse off under the Tories, as the prices of food, heating and travel rise faster than wages. Given the continued struggle faced by my constituents and many others over the last five years, it raises the question: who is this Budget for? The answer is that this is a Budget made by the rich for the rich.

The bedroom tax continues and so do zero-hours contracts, and retail energy bills do not reflect the fall in wholesale costs. There can be no getting away from the fact that working people are £1,600 a year worse off after five years of the Tories. Indeed, the Institute for Fiscal Studies is right to say that

“the poorest have seen the biggest proportionate losses”.

The Budget offered nothing to help families with children, who have borne over 70% of the impact of this Tory Government’s changes to tax credits and benefits. The Chancellor said they “choose families” but it is clear from the Budget that they choose millionaires.

The Budget also offers nothing to help our young people. It speaks volumes that there was hardly any mention in the Chancellor’s Budget speech of any real commitment to help our young people and their prospects. Our young people are the key to the future success of our country, and our young people deserve the chance of a secure job with decent pay.

I know from speaking to young people in my constituency that many feel a sense of hopelessness about their situation. Indeed, nationally youth unemployment remains high, with 743,000 young people currently out of a job. In my constituency, youth unemployment remains above the national average, with 3.6% of young people in West Lothian unemployed. Even when our young people do get jobs, many of them are insecure zero-hours contract jobs. There was nothing in the Budget to address any of these problems, and that once again demonstrates how this Government have written off our young people.

Young people need a Government who will listen to their concerns and ensure they have a better future. They need a Labour Government who will introduce a jobs guarantee scheme for all young people out of work for a year and over 25-year-olds out of work for two years, and I have no doubt that this scheme will be of enormous benefit to all young people in my constituency.

My constituents cannot afford another five years of the Tories, but it is clear that there would be further pain to come if they were to form the next Government. Indeed, the Office for Budget Responsibility has warned that there is to be

“a sharp acceleration in the pace of implied real cuts”.

We need a Labour Government to ensure that that does not happen. We need a Labour Government with a plan for working people and their families and for our young people. We need a Labour Government who will stand up for the whole of my constituency and for the whole of our country.

20:49

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

It is great to follow my hon. Friend the Member for Livingston (Graeme Morrice), who has reminded me that when Labour introduced the minimum wage, it was fiercely opposed by the Conservatives, who said it would bring about the end of the universe as we knew it. Also, unless I am much mistaken, that was when we had our last all-night sitting in the House. We kept the debate going until 8 o’clock in the morning, with a full house on the Labour side all waving their Order Papers as we brought in the minimum wage. That was one of our proudest achievements, and one that we should never forget. We should never take any lectures from the Conservatives on that subject.

Today, I want to talk about the dog that did not bark—the thing that was not mentioned in the Budget. According to the latest news from Asda Mumdex, 70% of women think that it is the most important factor affecting their lives. It is called the NHS. I am not sure whether its omission from the Budget was the logical extension of the Government’s trying to take politics out of the NHS, which the right hon. Member for South Cambridgeshire (Mr Lansley) tried to do with dubious success. However, to try to do that now would be to deny the fact that the NHS is deeply political because it is a service that is dependent on an annual decision on what percentage of the tax take we should spend on it.

I do not know whether the Conservatives want to take politics out of the NHS by moving to an insurance model, for example, but if they do, I would have to warn them about making comparisons with what is happening in the United States of America. The US spends 16.9% of its GDP on health but produces only 3.1 hospital beds per 1,000 of population, whereas we spend 9.3% of our GDP on health and produce three hospital beds per 1,000 people. So ours is an extremely efficient system. My constituency has some of the best in NHS provision, as well as the second largest number of doctors and life sciences professionals in the country. If something cannot be done in Edgbaston, in the University Hospitals Birmingham NHS Foundation Trust, then it cannot be done.

I have set up an NHS tracker service for my constituents, and in the past month, 400 of them have come forward with responses which show that 17% said that either they or a member of their immediate family had been to accident and emergency in the previous month, of whom only 78% were seen in under four hours, with 16% waiting longer to be seen. Also, 67% of the respondents said that either they or a family member had seen a GP in the previous month, with 34% being seen on the same day and 24% being seen in one or two days. However, 11% had to wait more than a week to be seen, and 8% waited more than two weeks. This tells us that the service is being stretched to the limit.

We also know that the Government have tried to delay a number of decisions until after 7 May. For example, when Monitor tried to arrange the tariffs for specialised hospitals, the University Hospitals Birmingham NHS Foundation Trust faced a potential deficit of £60 million because of the funding structure, but when a number of hospitals objected, all that happened was that Monitor delayed the decisions. We will now have to wait until the end of May or early June and hope that the problem will go away.

The problem will not go away, however, because the botched £3 billion reorganisation that the Tories and the Lib Dems saw through not only cost us a lot of money but created unnecessary structures. We now have about 440 new bodies and administrative layers. They have not improved patient care, but they have diluted accountability and made it even more difficult to find out who is actually in charge.

In addition, there has been an increased reliance on agency staff in our hospitals, and people have been made redundant only to be rehired. We have ended up with a Tory Government who are trying to make us believe that the NHS is fine and things are working, but even in the best areas, such as mine, things are about to be stretched beyond their limits. The dismantling of some of the state structures that has taken place over the past few years will become worse if there is another Tory Government. In three areas—local government, education and the health service—state structures have been dismantled in a way that makes some services simply undeliverable.

So what I want in my patch in the NHS is: a return of the 48-hour GP guarantee; a stop to the closures of the walk-in centres, because the ones we have are being used; and a better use of our pharmacists. Above all, I do not just want an extra 20,000 nurses and 8,000 extra doctors to be recruited—I want more of them to be trained. Although the Chancellor forgot to mention the NHS, it is still extremely important. However, it is currently not funded and structured in a way that is sustainable, and that is one of the most important omissions of this Budget.

20:56

[Yasmin Qureshi (Bolton South East) (Lab)]

Since this Government were elected five years ago, three mantras have been quoted by the Con Dems against the Labour party, and I want to debunk some of them. The first is the suggestion that, somehow, the global financial crisis was caused by the Labour party. [Laughter.] The second is that, somehow, that was because we had a light touch in our regulation of the banks. The third is that, somehow, our party is anti-business. Conservative Members started laughing when I mentioned the global crisis, but they perhaps need to be reminded that when Labour came to office in 1997 the national debt to GDP ratio was 43% but by 2002, five years later, it was down to 30% under Labour. So let us not have any lectures about our financial prudence.

The banking crisis occurred later—I expect more laughter—but Conservative Members should stop laughing because if the banking crisis was our fault, why were the USA, Japan and the entire world having the same problem? That is why it was called the global financial crisis. It was not the UK’s financial crisis; it was the global financial crisis, which we know started with the sub-prime mortgages in the USA, the collapse of Lehman Brothers and the other things that happened. So it is wrong for the Government to have said what they have said for the past five years, and I hope that the British people, who know the truth, will reject them at the forthcoming election.

We keep hearing about our light-touch regulation, with people saying, “You took your eyes off the banks and you regulated them too lightly.” Yet this Chancellor and this Prime Minister were saying up until 2010 that the Labour party was far too stringent on the regulation; we were being accused of stifling business and of over-regulating the banks. So which way do Conservative Members want to play this: were we overly light or too strong? I would say that we regulated the banks properly. Again, the Government have collective amnesia and they need to be reminded.

The current national debt is £1.36 trillion, whereas when Labour left power in 2010 it was £0.76 trillion, about half what it is now. The national debt to GDP ratio is about 95% now, so we need take no lectures from Conservative Members about financial management and fiscal prudence. The reason there remains such a high debt, much bigger than when we left office, is that the Chancellor’s austerity measures meant he was not able to get the revenue receipts he needed to close the deficit.

Although jobs have been created, which we welcome, most are on zero-hours contracts, part-time jobs and poorly paid jobs. Many people still have to rely on working tax credits to make ends meet. It is worth remembering that, in 2007, the Labour Government borrowed £37.7 billion, but spent £28.3 billion on big projects, such as building hospitals and schools, which helped the economy. By contrast, when this Government borrowed £91.5 billion in 2013, they invested only £23.7 billion. The rest was used to bring down the budget deficit, so there has been no economic miracle.

Today’s debate is about jobs. We are told by Government Members that we are the party that is against business. Well, since 2010, it is Labour that has constantly urged the Government to fulfil the infrastructure projects that we pushed for and it took years for the legislation to be passed so that they could go ahead. We called for a reduction in VAT and in national insurance to help small businesses. We called on the Government to reduce business rates to enable start-ups and to allow local authorities to help small businesses. We have constantly argued that the banks were not lending enough money to small and medium-sized enterprises. We are the party that said we would build 200,000 new homes. We are the party that said that all 18 to 24 year olds who qualify would get apprenticeships, which is about 1 million young people. We are the party that said that it would create 20,000 more nurses training places and 8,000 more doctor and GP training contracts.

[Adam Afriyie]

The hon. Lady is saying that Labour is the party for all sorts of things, but was it not also the party that did nothing about zero-hours contracts when it was in power?

[Yasmin Qureshi]

When zero-hours contracts are properly used, which is rare, they are fine—I am talking about students who work part time—but we now have 1.5 million people on them.[Interruption.] I am sorry; I thought that the hon. Gentleman wanted to intervene again.

[Adam Afriyie]

I am happy to intervene.

[Yasmin Qureshi]

No, no. To say that we are a party that does not believe in business or enterprise is wrong. We are a party with a social conscience. Some years ago, when my right hon. Friend the Leader of the Opposition talked about producers and predators, he was said to be anti-business; he was not. We are the party that believes in fairness. We are the party that believes that if a person does a day’s work, they should be properly remunerated. We are the party that spent many hours in the previous Parliament arguing for the minimum wage when everyone in the Conservative party was trying to argue against it. We have a record of which we should be proud.

21:03

[Liz McInnes (Heywood and Middleton) (Lab)]

Last week, we had the Budget announcement and the eclipse. One plunged the nation into darkness and the other one was a rare and important astronomical event. [Interruption.] I got one laugh, thank you.

The Chancellor claimed that Britain was walking tall again, giving the impression that our economy was booming, that well-paid jobs were being created, and that voters were better off now than they has in 2010. But are voters really better off, because that is not what they are telling me in Heywood and Middleton?

Many of my constituents work in the public sector where they have seen their pay frozen since 2010 or have been subjected to below-inflation pay rises. Some NHS workers have seen their pay fall by as much as 30% through the withdrawal of recruitment and retention premiums and reductions in out-of-hours pay on top of flatlining basic wages, not to mention additional pension contributions.

[Ms Gisela Stuart]

At the same time as people on regular employment contracts are undermined, our hospitals are spending extraordinary sums on agency payments, destabilising the labour market even more.

[Liz McInnes]

My hon. Friend makes a good point about the amount of money NHS trusts are having to pay for agency workers. It is scandalous that NHS staff are being made redundant and the spaces created are having to be filled by agency workers. The problem is also caused by the stress that is now caused to NHS staff, as so many NHS staff are off sick with stress that yet again the gaps are having to be filled by agency workers.

To get back to Heywood and Middleton, none of my constituents is coming to see me to tell me how much better off they are now than they were in 2010—quite the opposite, in fact. As TUC general secretary Frances O’Grady said,

“The Chancellor’s Britain, where happy people skip to their secure jobs to celebrate their rising living standards, is not one that many will recognise.”

Last week, the Prime Minister was falling over himself to tell me that the claimant count in Heywood and Middleton was down, in answer to a question I had not asked. The reality that he does not see is that constituents come to see me in dire financial straits because of benefits sanctions when their benefits are withdrawn for minor reasons, such as being a few minutes late for an interview. That leaves them penniless and forced to seek help from one of the biggest growth industries under this Government—food banks. Yes, the food banks do wonderful work and I for one am very grateful that so many people give freely of their time and energy to help those less fortunate than themselves, but I have yet to talk to a single volunteer at a food bank who does not express regret that such a thing should have to exist.

Cuts to taxes on savings do not mean much when there is no money to save. In my constituency, 40% of local workers are paid less than the living wage, with women workers particularly badly affected. Sadly, my constituency features in the top 10 worst areas of the UK for payment of the living wage. When I asked the Prime Minister about those figures he responded on the subject of the minimum wage, yet the minimum wage has risen by just 70p under this Government and is set to rise by 20p in October. Those meagre sums will go nowhere near far enough to meet the Government’s objective of ending in-work poverty.

Enforcement of the minimum wage is lacking in resources and the HMRC team responsible comprises fewer than 200 staff across the whole country. At least 100 more national minimum wage compliance officers are needed to ensure that workers get what they are due. Although workers have an alternative means of pursuing the minimum wage by applying to a tribunal, the imposition of fees for applications to employment tribunals mean that workers who might have taken that route will approach HMRC instead, generating yet more work for an already under-resourced work force.

Today, we have the evidence of five years of Tory-led austerity, with wages driven down, damaged public services and devastated lives. In the Budget, the Chancellor has reminded us that he is either incapable of or uninterested in building an economy that works for the good of all. Perhaps only the cuts to beer, cider and spirits will be of comfort to public sector workers, who might want to drown their sorrows at the prospect of even more cuts in their living standards to come.

21:09

[Mark Durkan (Foyle) (SDLP)]

I rise not to make any party political points on the Budget, with regard to parties formerly or currently in government, but to respond to a Budget statement that was full of smuggery and spin. It seems to me that the Chancellor was claiming circumstantial credit for things such as low commodity prices and low inflation and using that context to set out a Budget stall that was very much about making an election statement. However, I need to look at such a Budget and ask what the implications really are for the next spending period and for my constituency.

Beyond some of the measures that the Chancellor announced, not all of which I disagree with—indeed, some of them no one would disagree with—it is quite clear that he has locked in further heavy cuts for the next spending period, not least in welfare. I represent a constituency that is consistently ranked as having the highest level of unemployment anywhere in the UK, and the problem is genuinely lack of work, not lack of work ethic. It is also a border constituency. We must therefore judge the measures in the Budget and in what is promised for the next spending review, courtesy of the previous autumn statement, in terms of the implications for our economy and our services.

It is not the case that the Budget has little to do with the circumstances in a place such as Derry because all the key service decisions are devolved. Many of those decisions are rightly devolved, and I want to see more decisions made at that level, but of course the spending power of the devolved Executive is determined here, and of course the working circumstances for many of our businesses as well as our services are still determined by the Chancellor’s Budget statement.

The hon. Member for Birmingham, Edgbaston (Ms Stuart) pointed out that the Chancellor said nothing in his statement about the health service. I agree with her, but actually he said very little about the public services at all, and in circumstances in which he was using a degree of spin and a few wheelie turns to try to say that austerity was coming to an end earlier and that an easing was in sight. Nothing was offered to the people in key public services who have endured pay restraint after pay restraint, even as their work loads have increased. As payrolls have decreased and work loads have increased, the pressures on them have gone up and the rewards have gone down. With the exception of what they can find in the changes in the personal tax allowance, absolutely nothing—not relief or respite—was offered to them. Instead, they are being offered more of the cuts that will affect the circumstances in which they are working very hard to provide those services.

It must be remembered that the private sector in Northern Ireland, and certainly in my border constituency, is very dependent on selling across the border, and in circumstances in which our trade is affected, so our retail sector and those selling services to households are losing out because, with the current exchange rate, trade is going across the border and people are purchasing across the border, rather than locally. For those who export, much of their business is in the south, and obviously the continuing pressures in the eurozone and the high exchange rate affect those markets. The Budget therefore contains no great news for our public sector, on which Northern Ireland is very dependent, and nothing to relieve the pressures faced by our private sector.

The Chancellor referred to the Government’s moves in relation to corporation tax for Northern Ireland and the Corporation Tax (Northern Ireland) Bill, which we welcome. We recognise that the Chancellor made it clear that he is committed, if he is returned to that position, to go on reducing the headline rate of corporation tax for the whole of the UK, so the differential that we will achieve for Northern Ireland will not be as marked as it was when people first sought the devolution of corporation tax. We also know that the Government are saying that the commencement of the devolution of corporation tax in 2017 will only be on the basis that the Treasury is satisfied at that point that Northern Ireland has a balanced and sustainable budget.

We see this year that the Government set out pre-conditions for the introduction of the corporation tax Bill, such as that the Assembly had to deliver welfare reform measures in terms that it might have preferred not to. The question arises whether the Executive and the Assembly will similarly be told in 2017 that what will then be the corporation tax powers Act will be activated only on the basis of decisions then made, such as the welfare cuts to be imposed at that time. We know that £12 billion of welfare cuts are foreseen in the next spending review period, so again we have to ask where that is going to leave the Executive in Northern Ireland and, more importantly, people in my constituency.

21:16

[Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)]

It is a pleasure to follow my hon. Friend the Member for Foyle (Mark Durkan), who spoke with characteristic passion on behalf of his constituents in Foyle and more broadly in Northern Ireland.

In his speech last week, the Chancellor of the Exchequer said that

“the north grew faster than the south”.—[Official Report, 18 March 2015; Vol. 594, c. 767.]

However, when we scratch beneath the surface, the Chancellor’s headline figures do not match the reality on the ground. In the region where my constituency is situated, the north-west, it is true to say that in a single year, 2012-13, the north-west was the fastest growing region in the country, and that is welcome, but if we look at the first three years of this Government, 2010 to 2013, the overall figures for the north-west show that we have grown more slowly than any region other than Northern Ireland. So yes, there is welcome news in that one year, but taking the three years as a whole, the picture is not quite the one that the Chancellor set out.

I welcome the fact that unemployment is down. In my constituency in Liverpool, the memories of jobless economic recoveries of the past are very real, especially the impact of the Thatcherite policies of the 1980s. Unemployment can leave a scar on communities that may last for generations. As we all know, the evidence shows that once people are out of work, it can be very hard for them to get back into it. In my constituency many people are managing to find work. Over the past year the claimant count is down by 28%. Work is a good thing, but the quality of jobs is surely critical as well. Once again, the story is more complicated than that set out by the Chancellor last week or the Secretary of State earlier this afternoon.

Too many of the jobs in Liverpool are insecure, low paid jobs. The growth in agency work lies behind a large part of the fall in unemployment in my constituency. Recently, I met two local people, one of them a constituent, who worked at a factory in Liverpool. They had worked there for several years. However, they are paid and technically employed not by the company that runs the factory, but by one of the biggest agencies and suppliers of contract labour. They do the same work as regular staff, but are paid £2 an hour less, and the supply of hours is sporadic and uncertain. Their holiday and sick pay entitlements are far worse, and scandalously, one of them told me that when he suffered an injury at work, the medical centre at the factory turned him away because technically he was not an employee. Surely such working arrangements are unfair and wrong.

[Julie Elliott (Sunderland Central) (Lab)]

However bad those contracts are, does my hon. Friend accept that the explosion of zero-hours contracts, which are even worse than agency contracts, has occurred under this Government because of the tightening of some regulations to try to stop the abuse of agency worker regulations?

[Stephen Twigg]

I am grateful to my hon. Friend, who is absolutely right to make that point as we seek to understand the reasons for that and find solutions. I will come to that next.

I pay tribute to the employment, enterprise and skills select committee of Liverpool city council and its chair, Councillor Barry Kushner, for undertaking painstaking research that shows the extent of this problem. Their work has revealed that there are currently about 6,500 vacancies in Liverpool, over half of which are agency jobs. The council has identified the Swedish derogation as a major cause of the increase in exploitation. This derogation allows for agencies to employ staff directly and the eventual engager—the employer—to treat workers less fairly than their directly employed workers. Without the derogation, the system would still allow for the use of agency workers, which can still be of real use in various sectors, but the engager would be obliged to give the agency workers the same rates of pay as their permanent staff after a 12-week period in employment. The two local people I met who have been working for years at the same factory, but are paid less than the colleagues they are working alongside, feel like second-class citizens. Reforming this area would make a real difference for them. That is why I am delighted that my hon. Friend the shadow Business Secretary has promised that a Labour Government would end the Swedish derogation for agency regulations—a change that cannot come soon enough.

Other long-term changes need to be made. To tackle the structural problems of a low-pay, low-skilled job market, we need to ensure that entrants to that market have the appropriate skills. As a country, we have failed for far too long in this respect. My right hon. Friend the Leader of the Opposition has talked about the “forgotten 50%”—the young people who do not get the opportunity to go to university. It is welcome that fewer young people are unemployed, but our youth unemployment rates are still significantly higher than those of countries such as Germany, Austria and Norway that have invested in high-quality technical, vocational and practical education that breaks down the barriers between different sorts of learning.

We need to strengthen devolution within England. That is why the Andrew Adonis review recommended an English devolution Act, a central plank of which would be to devolve powers and funding for skills, and commission 19-plus further education provision based on local decision making. On top of this, city and county authorities should have the power to commission the Work programme in order to get the long-term unemployed back to work. I pay tribute to Liverpool’s mayor, Joe Anderson, and to Liverpool city council for the extraordinary work they have done to promote apprenticeship and work opportunities for people of all ages, but particularly young people.

[Ben Gummer (Ipswich) (Con)]

The hon. Gentleman is making a speech of characteristic subtlety, which is why he is no longer on the Opposition Front Bench. He is making some good points about apprenticeships. Does he not regret that the Leader of the Opposition has pledged to end all level 2 apprenticeships across the country on a blanket determination, which will do more damage to people’s ability to learn good skills than any other policy that anyone is proposing in this House?

[Stephen Twigg]

That is not what the Leader of the Opposition has said. I worked on that policy. We want to ensure that apprenticeships are high quality, learning from the countries I mentioned that have a great track record in this area. Our policy is not the policy to which the hon. Gentleman referred.

I appear not to have received the extra minute for the intervention that I think I should have had, Mr Speaker. Should I have that extra minute?

[Mr Speaker]

Yes. I would not want the hon. Gentleman to be denied, and I think that in the interim the appropriate adjustment has been made. I am glad that he is alert to his rights.

[Stephen Twigg]

I am immensely grateful to you, Mr Speaker.

To get this right, we need to give priority to spending on education. That is why the commitment that the Labour party has made to protect the entire budget of the Department for Education, including early years and 16 to 19, is so important. That contrasts significantly with the Conservative policy, which does not protect early years and 16 to 19. Those are precisely the areas that have faced the biggest cuts over the past five years, and they would face even bigger cuts were the Conservatives to win again. Investment in education and fairness in the jobs market should be features of a Budget, but they were not features of this one.

21:24

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

May I first take the opportunity to note the many valedictory speeches by right hon. and hon. Members who have chosen to step down at the forthcoming general election? They brought back many good memories of my time working with them.

My right hon. Friend the Member for Edinburgh South West (Mr Darling) reminded us of the necessary steps he took after the global banking crisis, which, of course, the Conservative party wants to airbrush from our recent economic history. I am glad we managed to keep the cash machines working, but the recklessness of the banks left a dreadful legacy and deficit that has stayed with us to this day.

My right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) spoke passionately. He has been a good friend to many Members on both sides of the House and he will be an enormous loss to Parliament. He is such an impressive individual and one of the great parliamentarians whose capability is incomparable.

My right hon. Friend the Member for Salford and Eccles (Hazel Blears) spoke passionately about her advocacy of getting young people involved in politics. Her achievements will be seen for many decades to come. My hon. Friend the Member for Sheffield, Heeley (Meg Munn) and my right hon. Friend the Member for Holborn and St Pancras (Frank Dobson) also talked about their belief in public service and the need to invest in public services, and they told us that we should never forget the need to regulate the banking sector and make sure that the dreadful activities we have seen are never repeated. Those were fine valedictory remarks. I do not have time, in the final moments of several days of debate on the Budget, to congratulate and thank my many other colleagues who spoke passionately today.

This is the coalition’s last Budget. The final verdict is in. There are no more opportunities to pull rabbits out of the Government’s Budget boxes, whether they be red or yellow. For all the Chancellor’s complacency about walking tall and how we have never had it so good, the residual legacy of last Wednesday was confirmation that, if the Government parties get their way with their proposed public investment in vital public services, the rollercoaster will be pushed over a precipice.

The Chancellor tried every trick in the book to distract from the Government’s plan for extreme cuts, and he hoped that the public would not notice his record of failure on living standards and borrowing. Every target he has set has been missed and every promise broken.

In 2010, the Chancellor told us that the structural deficit would be eradicated in time for this Budget—it would all be gone—yet we are still borrowing £90 billion this year, which is only a 5% fall from last year’s deficit. Tax receipts should have been strong and tax credit costs significantly lower by now, but in the low-wage economy that this Chancellor has fostered—with an epidemic of job insecurity and zero-hours contracts up 20% in this past year alone—revenues have stagnated and the Government are spending £25 billion more on social security than the Secretary of State for Work and Pensions and the Chancellor had expected. We were meant to have an export-led recovery, heading towards £1 trillion-worth of exports by 2020, but we have already fallen a little bit behind that target—about £300 billion behind it. Moreover, our triple A rating, which was once this Chancellor’s litmus test of economic credibility, was, of course, downgraded.

It was not supposed to be like that, as my hon. Friend the Member for Caerphilly (Wayne David) has pointed out, and this is not where the Chief Secretary’s party wanted to be, either. The Budget spectacle over the past few days has been not of a responsible Government focused on the economy, but of an out-of-touch Chancellor in denial and focused on political survival and a Chief Secretary counting down the hours and living out his own fantasy, which even his own leader could not bear to sit through.

The reality is that we have had one and a half Budgets in two days from two parties that had nothing to offer the majority of people in this country. Those two parties are basing decisions on party political interests and their perceived electoral advantage, rather than on what is in Britain’s best interests. The Chancellor’s Budget was a Budget that could not be believed, and the Chief Secretary’s statement was just unbelievable—a Budget not for public services, not for working people, not for families and not for the NHS.

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

Will my hon. Friend give way?

[Chris Leslie]

I will certainly give way to my hon. Friend.

[Andrew Gwynne]

Now that the dust has settled from Thursday’s Liberal Democrat statement, has my hon. Friend had the chance to scrutinise the document—published online, rather than available in the Vote Office—and if so, may I draw his attention to table 2.A on the scenario input assumptions? Did he notice, as I did, that the source for the assumptions was not authoritative bodies such as the ONS, the OBR or the IFS, but none other than the Chief Secretary to the Treasury?

[Chris Leslie]

I commend to Conservative Members, who should have a good read of it, this very authoritative document with very carefully crafted figures:

“Source: Chief Secretary to the Treasury”.

It was a classic. My hon. Friend knows that the real Budget was in the Red Book. Shall I pass it to him? Perhaps not.

The Chancellor told us in the Budget that everything was sunshine and roses, but in coalition Britain, 900,000 people use food banks, 600,000 people are affected by the bedroom tax, the typical working person is £1,600 a year worse off and the NHS is in crisis. The Chancellor tried to find the best statistic, however obscure, to muddy the waters and deny what most working people know, which is that their wages have eroded year after year as we have experienced the longest period of prices exceeding income since the 1920s. He did that by relying on a forecast for this year, rather than real data, and by adding university and charitable income, as well as what are known as imputed rents from homes even if they are not actually rented. That was basically designed to say, “If you stand on one leg and squint a little, there you are—you’re back to 2010 levels of affluence and incomes.” Even on that statistical measure, from election date to election date—rather than the start of the calendar year, as the Chancellor tried to use—people are still worse off than they were. Of course, all that does nothing to change the burden of higher taxes and lower tax credits that have seen families worse off by more than £1,000 a year. As ever, the Chancellor may give a little with one hand, but he takes away much more with the other.

By the way, now that the Chancellor has taken the time to enter the Chamber, it would be interesting to know whether he has spotted the Prime Minister’s announcement this afternoon. I understand that the Prime Minister has indicated that he will not stand for election again after this general election. He has said tonight that he is likely to be gone in a couple of years’ time, so what will the country be voting for at the next election? I can see the poster now—“Vote Cameron, get Osborne”—and all the right-wing agenda that would go with it. A Prime Minister who did not win his first election, and had not won a second election, would be saying that he would not win a third.

Of course there were a few give-away measures in the Budget, and we welcome anything that helps those on lower and middle incomes. Why, however, does the Chancellor still stand by the biggest give-away of them all? His tax cut for the wealthiest 1%—those earning £150,000—means that someone earning £1 million each year gets an annual tax cut of £42,000. That is simply unfair and unacceptable, and that is why we will vote against those income tax plans this evening. We will vote against the Government’s Budget plans for public services and public investment, because although we must balance the books as soon as possible in the next Parliament, going so far beyond that—with cuts over the next three years that are twice as deep as those of the past three years—means extreme cuts to services on a scale not experienced for generations. [Interruption.]

[Mr Speaker]

Order. There is a most discourteous exchange taking place between those on the two Front Benches while the hon. Gentleman the shadow Chief Secretary is addressing the House. Modesty forbids me from naming the errant Members, but I feel sure that they will correct their behaviour at once.

[Chris Leslie]

Perhaps we can ask Hansard for a transcript later. I would certainly be interested to read that.

When we look at the Chancellor’s plans—and those of the Secretary of State for Work and Pensions—we see that he is thinking about cutting for the next three years at twice the level we have seen over the past three years. The Chancellor realised how toxic his plans were shortly after the autumn statement, when he published the trajectory that showed he would take Britain back to 1930s levels of public investment as a share of national income. In the days running up to the Budget, we were therefore told that he had had a change of heart on public spending—coincidentally, it was just weeks before an election campaign. Sure enough, the figures for 2019-20 were shuffled around in the Budget. However, in the end, he just could not fight his gut instinct, so all he did was to front-load the cuts on to the first three years of the next Parliament and hope that nobody would notice.

Unfortunately for the Chancellor, the Office for Budget Responsibility did notice. It said that his plans will mean

“a much sharper squeeze on real spending in 2016-17 and 2017-18 than anything seen over the past five years”

and

“a sharp acceleration in the pace of implied real cuts to day-to-day spending on public services”.

That will create what the OBR calls

“a rollercoaster profile for implied public services spending through the next Parliament”.

We remain with a path of public spending that is based on ideology and political game playing, rather than a Budget for our public services based on what the economy requires and what our country needs.

I ask my hon. Friends to imagine the impact these extreme plans will have, especially on the public services that the Government say are unprotected—the police, bus and rail services, the Army and our defences—and on all those who depend on tax credits to make ends meet. I encourage my hon. Friends to take a moment to look at exactly what those extreme cuts will mean. They are not just statistics in the Red Book; they will have real consequences for real people’s lives.

To take social care as an example, in the past five years, the number of vulnerable people who receive social care support has fallen by 500,000 and the number of home-delivered meals—meals on wheels—has fallen by 59%. Of course, there has also been a rise in the peremptory 15-minute visits. That is just what has happened so far, before the Government tip social care over the precipice of the rollercoaster. Just imagine what the next three years could bring. Care cuts like this are health service cuts. As my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) said, our health services will be placed in real jeopardy in that scenario. It says everything one needs to know about this Chancellor that the battle of Agincourt got twice as many references in the Budget speech as the NHS. When I look at the Government’s Budget, it is not so much “Henry V” that comes to mind as “The Comedy of Errors”.

This path of spending—extreme and unnecessary, going way beyond tackling the deficit—is why we will vote against the Budget resolutions tonight. This is a Budget that delivered little, but revealed much. It revealed the Conservatives’ ideological obsession with shrinking public services in preparation for a privatised society. There is no support for those struggling on low incomes and in insecure work, no credible action to tackle tax avoidance and close the tax gap, nothing to reverse their tax cut for millionaires and no help for the NHS. We have a Chancellor who is full of spin but is fooling no one, and a Chief Secretary who is enjoying his final days in office but not in power.

What we need is a Labour Government who will put the interests of the British people first; who will balance the books in a fair way; who will help small businesses with a cut in business rates, rather than simply helping the largest corporations; who will raise living standards by raising the minimum wage and expanding free child care; and who will govern for the many and not for the few, because Britain succeeds when working people succeed. That would be a better plan and a better Budget. That is why I urge my hon. Friends to reject the Budget of this failing Government.

21:39

[The Chief Secretary to the Treasury (Danny Alexander)]

We have had a good debate with distinguished contributions from Members across the House, and like the shadow Chief Secretary I particularly wish to recognise the contributions of those who are not seeking re-election to this House. A number of hon. Members said that their speech would be their final contribution here, including the hon. Members for Sheffield, Heeley (Meg Munn) and for Thirsk and Malton (Miss McIntosh), the right hon. Members for Holborn and St Pancras (Frank Dobson), for Sheffield, Brightside and Hillsborough (Mr Blunkett), for Salford and Eccles (Hazel Blears) and for Edinburgh South West (Mr Darling). I am sure the House will agree that in their different ways they have all made a significant contribution to British public life, and the whole House will be grateful for their service to their country.

The right hon. Member for Salford and Eccles spoke movingly about the circumstances in which she grew up and the commitment to social mobility that that imbued in her—a commitment I strongly share. I am grateful for her kind words about the Government’s decision to support the Speaker’s parliamentary placement scheme, which as the House will know provides opportunities for many young people from disadvantaged backgrounds to work in this House. Credit should go to the right hon. Lady, and to you, Mr Speaker, for promoting that scheme. In her remarks she gave some examples of young people who have benefited from the scheme that she promoted, and many hon. Members will have encountered young people who have gained apprenticeships through it.

My hon. Friend the Member for Thirsk and Malton spoke about her rural constituency, and drew attention to the issues facing rural communities and the need for broadband. As a Member who represents a very rural constituency, I share that concern. I draw her attention to the supplementary document that was published alongside the Budget which included the strategy for superfast broadband, and indeed for moving to ultrafast—[Interruption.] The shadow Chief Secretary is muttering, but I will come to that point. The supplementary document on the move to ultrafast broadband set out a new and ambitious strategy for this country, including moves towards superfast broadband for 95% of households through the BT scheme, the roll-out of 4G broadband to 98% of households, and the availability of a vouchers scheme for the most remote households to gain satellite connections. I hope that that answers her point, which I am sure is an important issue for many hon. Members.

Other strong contributions included the one from my hon. Friend the Member for Cheltenham (Martin Horwood)—I do not know whether he is in his place. He made an important point about the decision in the Budget to extend the pension changes to police and fire service widows and widowers where someone has lost their life in the line of duty. We made clear in the Budget that we also intend to extend that change to apply to members of the security services who have lost their lives in the line of duty. That pension change is not yet fully worked out, but we intend to make it along the same lines as the measure announced for police officers and members of the fire service who lose their lives in the line of duty.

The hon. Member for Liverpool, West Derby (Stephen Twigg) made a balanced speech—I think he was the only Labour Member to welcome the strong record of job creation we have seen since 2010, and I credit him for that. He also—fairly, I think—called for further improvements to the quality of job creation, and the measures that the Government announced in the Budget, as well as the creation of more than 2 million apprenticeships during this Parliament, will help to support the agenda he described.

We also heard distinguished contributions from two former Chancellors of the Exchequer. My right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) provided distinguished service in government during this Parliament, and indeed for many, many decades before that—[Laughter.] I know he is standing again; I am not citing him as a Member who is stepping down. He is an immortal in this House as far as many of us are concerned. In his remarks he gave strong support for a balanced, fiscally neutral Budget, and responsible measures from the coalition Government. He rightly celebrated the rise in the income tax personal allowance, a matter to which I will return. I am bound to say, however, that his customary generosity deserted him when describing the political heritage of this particular policy commitment. My hon. Friend the Member for Cheltenham corrected the balance of the ledger in that respect, when he made clear that this policy emerged from the 2010 Liberal Democrat manifesto. It is making a huge difference to 27 million people.

[Mr Kenneth Clarke]

I cannot remember whether I raised personal allowances once or twice in my Budgets, but once certainly, so it does have slightly older antecedents. I always thought it was a good idea. I was unfortunately discouraged by the then Prime Minister who told me that he thought there were no votes in it.

[Danny Alexander]

It is fair to say that the current Prime Minister also discouraged this policy. In the television leaders debates in 2010 he said it could not be done and could not be afforded. We have shown in this Parliament that we can afford it. The difficult decisions we on the Government Benches have been willing to make in other areas have meant that we have been able to deliver the largest income tax cuts for working people in a generation. That is something of which I am very proud indeed.

My right hon. and learned Friend also rightly highlighted how much progress we have made in tackling tax avoidance during the course of this Parliament. He was humble enough to admit that progress had not always been as strong during his time as Chancellor. There were many measures in the Budget to tackle tax avoidance and evasion.

We then had a contribution from the right hon. Member for Edinburgh South West. It is fair to say that there were many things in the Budget that he was not very keen on. He certainly made that clear. He did not like the rollercoaster, as he described it, of the public finances. I have set out my own alternative scenario on that. He did not mention the big dipper that the public finances had been on during his time in office.

The right hon. Gentleman rightly welcomed the package of measures to support the oil and gas sector, which was a very strong feature of the Budget. The measures will ensure that the sector, which is suffering from a dramatic fall in the oil price, has some confidence in the future. He welcomed those measures, but he rightly pointed out that the oil revenues in the OBR forecast at this Budget were a little more than a 10th of those predicted by the nationalists in the recent Scottish referendum. He made the point that had Scotland voted for independence and experienced the fall in oil prices, the difficult decisions made in this Parliament—I think I quote him correctly—would have seemed like a school picnic in comparison.

The right hon. Gentleman was too modest to remind the House of the service he rendered to his country with the leadership he showed in the Better Together campaign. I hope that Members on all sides of the House express their appreciation for that. It was certainly something I experienced first hand. It was immensely important in ensuring that the people of Scotland voted the right way in the referendum. The experience of working with him on that campaign, although we may have disagreed on many other matters over the years and will no doubt continue to do so, is one I will always remember. He showed himself to be a man of the greatest statesmanship in his conduct of that campaign.

Before I respond to some of the other points, I want to respond to the jibes from the shadow Chief Secretary—[Interruption.] It certainly is not—there are another 10 minutes to go. The shadow Chancellor, the shadow chunterer, is in his place chuntering as usual. He doesn’t have many policies, but he sure does like to chunter.

The Budget, as set out in the Red Book, was agreed by Conservatives and Liberal Democrats working together in the coalition Government. There is no policy measure in the Budget which Liberal Democrat Ministers did not sign off. Are there differences in the way the two parties in the coalition would approach the task of deficit reduction in the next Parliament? Yes, of course there are. I have made clear in this House and outside that there is another way we can meet the fiscal mandate that all parties signed up to when we voted for the charter for budget responsibility in January. Opposition Front Benchers appear to have forgotten about that, but we can do it in a more responsible and stable way. For that reason, last week I published and set out an alternative fiscal scenario for the next five years—a plan to borrow less than Labour and cut less than the Conservatives, a plan to give the UK a brighter future without sacrificing financial prudence. As the independent OBR mentioned in its economic and financial outlook, this profile of public expenditure

“is driven by a medium-term fiscal assumption”,

but

“both parties have said that they would pursue different policies if they were to govern alone.”

The Budget that my right hon. Friend the Chancellor presented last week is a coalition Budget that reflects the hard work the coalition Government have carried out over the past five years to turn the country around from the mess we inherited from Labour and to set us on a path back to prosperity. I do not hesitate, therefore, to speak in favour of it.

[Chris Leslie]

This is very confusing. So the right hon. Gentleman supports the Budget, but he opposes the Government. He wants to be a Minister, but he does not want to be a Minister. Will he at least agree that the cuts for the next three years are extreme and would be damaging, and will he confirm that he does not support the depth of the cuts to our public services over the next three years?

[Danny Alexander]

It really is not that confusing. Even the shadow Chief Secretary ought to understand that two different parties in a coalition Government will have different views about the future direction of policy in this country. I would say—[Interruption.] If the hecklers would silence themselves, I would say that Labour signed up to £30 billion of deficit reduction in the first three years of the next Parliament when they voted for the charter for budget responsibility. I am sure you remember the occasion, Mr Speaker. It was an important debate in the House, and one to which the country should be paying great attention. It is fair to say that all parties in the House have different views about how to achieve that £30 billion of cuts, and I set out my view to the House on Thursday.

[Andrew Gwynne]

Tell us!

[Danny Alexander]

If the hon. Member for Denton and Reddish (Andrew Gwynne) had not been cavorting so loudly, the shadow Chief Secretary might have been able to listen to my speech on that occasion.

[Sir Nicholas Soames]

Inexplicably, my right hon. Friend seems to have failed to mention the excellent points I made about my constituency, particularly the need for more spending on infrastructure in Mid Sussex and compensation for passengers being grievously delayed by improvements on the railway line. Will he look into these matters and let me have an answer before 6 May?

[Danny Alexander]

My right hon. Friend made his points so powerfully I did not see the need to repeat them, but I will certainly look into the matters he raises and respond to him. However, the Government have a very good record of investment in infrastructure, including the largest programme of rail investment since Victorian times; the largest programme of rail investment since the 1970s; and a huge investment programme in broadband infrastructure.

This is a Budget for fiscal responsibility that meets the supplementary target for debt as a share of GDP that the Government set in 2010. The deficit has fallen by a half over the Parliament, and every year we have borrowed less than set out in the autumn statement. This is a Budget, too, for a strong economy. The UK is the fastest-growing major economy in the G7. We have record numbers of people in work and the highest employment rate in our country’s history. It is very different from the predictions we heard from Labour Members, who said that jobs would be lost this Parliament. Instead, nearly 2 million jobs net have been created. Astonishingly, more jobs have been created in the UK since 2010 than in the whole of the rest of the EU combined. That is a truly extraordinary record.

There were measures in the Budget to support job creation and key sectors in the economy. I have mentioned the measures to support the oil and gas sector, which have been widely welcomed by Oil & Gas UK, Sir Ian Wood, who authored the Wood review, and many other figures in the oil and gas sector who see the package as one that will increase confidence in the sector.

I could mention the measures we took on alcohol duties, which were particularly warmly welcomed by the Scotch Whisky Association, as I discovered at its reception at the Scottish Liberal Democrat conference in Aberdeen on Friday evening. We also announced radical new measures to pilot full retention of business rate increments in Manchester and Cambridge, and a number of hon. Members have welcomed the wide review we announced of the way in which the business rate system operates.

This is a Budget that delivered on several key Liberal Democrat party priorities. I particularly note the package of measures to support mental health. The hon. Member for Birmingham, Edgbaston (Ms Stuart) wrongly said that the Budget did not mention the national health service. In fact, it contained a full package of measures to help fund additional support for people suffering from mental ill health. I pay tribute to the Minister of State, Department of Health, my right hon. Friend the Member for North Norfolk (Norman Lamb), who worked very hard to devise this package. It is a £1.25 billion package that provides measures for children’s mental health services, perinatal mental health services, and to improve support for the mental health of people who are out of work. Worth more than £1 billion over the next five years, we will be able to start new access standards and see 110,000 more children cared for over the next Parliament. Some £118 million will be invested over the next four years to complete the roll-out of the children and young people’s increasing access to psychological therapies programme. The measures to support mental health in this Budget mark a radical departure and a radical change. It is perhaps not surprising that some hon. Members said that the national health service was not mentioned in the Budget—so weakly has mental health been accorded its proper status under previous Governments. Because of the Liberal Democrat involvement in this Government, that particular thing has changed.

The Budget included further big increases in the income tax personal allowance, increasing the tax-free allowance to—[Interruption.]

[Sheila Gilmore (Edinburgh East) (Lab)]

rose—

[Danny Alexander]

No, I am not giving way. I am going to make some progress. The hon. Lady was not here for the debate, so I am certainly not giving way to her.

[Chris Leslie]

rose—

[Danny Alexander]

No, I am not giving way. I am going to finish.

The income tax personal allowance will increase to £10,800 in 2016-17 and—

[Chris Leslie]

Will the right hon. Gentleman give way?

[Danny Alexander]

No, I will not.

This is the most significant tax cut for working people in a generation. As a result of the increases to the personal allowance, a typical basic rate taxpayer will be £905 a year better off in 2017-18, and 27.2 million individuals will have benefited from increases to the personal allowance since 2010. As a result of these changes, over 3.7 million people—[Interruption.] Opposition Members do not like to hear about tax cuts for working people, Mr Speaker.

[Chris Leslie]

rose—

[Danny Alexander]

No, I will not give way. Opposition Members do not like to hear about tax cuts for working people because they did not deliver those cuts themselves. If they cared about cutting taxes for working people, they would be welcoming and celebrating the fact that 3.7 million working people on the lowest incomes no longer have to pay any income tax at all. That is something that Government Members would celebrate; Opposition Members should be celebrating it, too.

When a Government lose control of the public finances, it is the poorest who are hardest hit. That is why imposing fiscal discipline was such a priority for us in 2010. We created the stability necessary to deliver growth, jobs and investment. Last year, the shadow Chancellor channelled Ronald Reagan and asked, “Are you better off than you were in 2010?” On Thursday, the independent Institute for Fiscal Studies confirmed that families are set to be £900 better off in 2015 than they were in 2010.

Compared with five years ago, we have lower inequality; child poverty is down; pensioner poverty is at record lows; the gender pay gap is smaller than ever; and the number of students at university from disadvantaged backgrounds is at an all-time high. Some 1.9 million people are now in work, which is 1,000 new jobs a day, four fifths of them full time and four fifths in skilled occupations. This is a record to be proud of, and I am proud of these achievements. I am proud of the role my party has played in achieving them.

Responsible government does not mean standing on the sidelines and complaining about how long other people are taking to clean up the mess they created. Responsible government is about stepping up to the challenges and not flinching from taking the tough but necessary decisions. That is what we have done since 2010. We have created a stronger economy, we have created a fairer society, and we have delivered for the people of the United Kingdom. I commend the Budget to the House.

Question put.

21:59

Division 179

Ayes: 334

---

Conservative: 285
Liberal Democrat: 44
UK Independence Party: 2
Independent: 2

Noes: 250

---

Labour: 231
Democratic Unionist Party: 6
Scottish National Party: 6
Plaid Cymru: 3
Social Democratic & Labour Party: 2
Alliance: 1
Green Party: 1
Independent: 1

Resolved,

(1) That it is expedient to amend the law with respect to the National Debt and the public revenue and to make further provision in connection with finance.

(2) This Resolution does not extend to the making of any amendment with respect to value added tax so as to provide—

(a) for zero-rating or exempting a supply, acquisition or importation;

(b) for refunding an amount of tax;

(c) for any relief, other than a relief that—

(i) so far as it is applicable to goods, applies to goods of every description, and

(ii) so far as it is applicable to services, applies to services of every description.

The Speaker put forthwith the Questions necessary to dispose of the motions made in the name of the Chancellor of the Exchequer (Standing Order No. 51(3).

2. Income tax (charge and main rates)

Question put,

That—

(1) Income tax is charged for the tax year 2015-16.

(2) For that tax year—

(a) the basic rate is 20%,

(b) the higher rate is 40%, and

(c) the additional rate is 45%.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

22:15

Division 180

Ayes: 340

---

Conservative: 284
Liberal Democrat: 44
Democratic Unionist Party: 6
UK Independence Party: 2
Independent: 2

Noes: 244

---

Labour: 230
Scottish National Party: 6
Plaid Cymru: 3
Social Democratic & Labour Party: 2
Alliance: 1
Green Party: 1
Independent: 1

3. Income tax (Limits and Allowances)

Resolved,

That—

(1) For the tax year 2015-16—

(a) the amount specified in section 37(2) of the Income Tax Act 2007 (income limit for personal allowance for those born before 6 April 1938) is replaced with “£27,700”,

(b) the amount specified in section 38(1) of that Act (blind person’s allowance) is replaced with “£2,290”,

(c) the amount specified in section 43 of that Act (“minimum amount” for calculating tax reductions for married couples and civil partners) is replaced with “£3,220”,

(d) the amount specified in section 45(3)(a) of that Act (amount for calculating allowance in relation to marriages before 5 December 2005 where spouse is 75 or over) is replaced with “£8,355”,

(e) the amount specified in section 45(4) of that Act (income limit for calculating allowance in relation to marriages before 5 December 2005) is replaced with “£27,700”,

(f) the amount specified in section 46(3)(a) of that Act (amount for calculating allowance in relation to marriages and civil partnerships on or after 5 December 2005 where spouse or civil partner is 75 or over) is replaced with “£8,355”, and

(g) the amount specified in section 46(4) of that Act (income limit for calculating allowance in relation to marriages and civil partnerships on or after 5 December 2005) is replaced with

“£27,700”.

(2) Accordingly, for that tax year, section 57 of that Act (indexation of allowances), so far as relating to the amounts specified in sections 37(2), 38(1), 43, 45(3)(a), 45(4), 46(3)(a) and 46(4) of that Act, does not apply.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

4. Personal allowances for 2015-2016

Resolved,

That—

(1) Section 2 of the Finance Act 2014 (basic rate limit for 2015-16 and personal allowances from 2015) is amended as set out in paragraphs (2) and (3).

(2) In subsection (1)(b) (amount specified for 2015-16 in section 35(1) of the Income Tax Act 2007 (personal allowance for those born after 5 April 1938)), for ““£10,500”” substitute ““£10,600””.

(3) In subsection (8) (amendments of section 57 of the Income Tax Act 2007), omit the “and” at the end of paragraph (a) and after that paragraph insert—

“(aa) in subsection (1)(h), omit “36(2),”, and”.

(4) In section 55B(4)(a) of the Income Tax Act 2007 (transferable tax allowance for married couples and civil partners: entitlement to tax reduction), for “£1,050” substitute “£1,060”.

(5) The amendments made by paragraphs (3) and (4) have effect for the tax year 2015-16 and subsequent tax years.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

5. Corporation tax (charge for financial year 2016)

Question put,

That—

(1) Corporation tax is charged for the financial year 2016.

(2) For that year the main rate of corporation tax is 20%.

22:29

Division 181

Ayes: 337

---

Conservative: 282
Liberal Democrat: 44
Democratic Unionist Party: 6
UK Independence Party: 2
Independent: 1
Alliance: 1

Noes: 240

---

Labour: 228
Scottish National Party: 6
Plaid Cymru: 3
Green Party: 1
Independent: 1

[Mr Speaker]

With the leave of the House, I will put the remaining motions together.

6. Taxable Benefits (diesel cars)

Resolved,

That—

(1) In section 141(2) of the Income Tax (Earnings and Pensions) Act 2003 (diesel cars: the appropriate percentage), in Step 3, for “35%” substitute “37%”.

(2) The amendment made by paragraph (1) has effect for the tax year 2015-16.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

7. Taxable Benefits (vans)

Resolved,

That—

(1) The Income Tax (Earnings and Pensions) Act 2003 is amended as follows.

(2) In section 155 (cash equivalent of the benefit of a van), for subsections (1) and (2) substitute—

“(1) The cash equivalent of the benefit of a van for a tax year is calculated as follows.

(1A) If the restricted private use condition is met in relation to the van for the tax year, the cash equivalent is nil.

(1B) If that condition is not met in relation to the van for the tax year—

(a) if the van cannot in any circumstances emit CO2 by being driven and the tax year is any of the tax years 2015-16 to 2019-20, the cash equivalent is the appropriate percentage of £3,150, and

(b) in any other case, the cash equivalent is £3,150.

(1C) The appropriate percentage for the purposes of subsection (1B)(a) is—

(a) 20% for the tax year 2015-16,

(b) 40% for the tax year 2016-17,

(c) 60% for the tax year 2017-18,

(d) 80% for the tax year 2018-19, and

(e) 90% for the tax year 2019-20.”

(3) In section 156(1) (reduction for periods when van unavailable), for “155(1)” substitute “155”.

(4) In section 158(1) (reduction for payments for private use), for “155(1)” substitute “155”.

(5) In section 160(1)(c) (benefit of fuel treated as earnings), for “section 155(1)(b)” substitute “section 155(1B)(b)”.

(6) In section 170 (orders etc relating to Chapter 6 of Part 3), for subsection (1A) substitute—

“(1A) The Treasury may by order substitute a different amount for the amount for the time

being specified in—

(a) section 155(1A) (cash equivalent where van subject only to restricted private use by

employee),

(b) section 155(1B)(a) (cash equivalent for zero-emission van), and

(c) section 155(1B)(b) (cash equivalent in other cases).”

(7) Article 3 of the Van Benefit and Car and Van Fuel Benefit Order 2014 (S.I. 2014/2896) is revoked.

(8) The amendments made by this Resolution have effect for the tax year 2015-16 and subsequent tax years.

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.

10. Income Tax (PAYE)

Resolved,

That provision may be made as to the matters that may be provided for by regulations under section 684 of the Income Tax (Earnings and Pensions) Act 2003.

11. dISTRIBUTIONS

Resolved,

That provision may be made amending Chapter 3 of Part 4 of the Income Tax (Trading and Other Income) Act 2005.

12. Disguised investment management fees

Resolved,

That provision may be made about sums arising to individuals who perform investment management services.

13. Losses from miscellaneous transactions

Resolved,

That provision (including provision having retrospective effect) may be made amending Chapter 7 of Part 4 of the Income Tax Act 2007.

14. Remittance basis of taxation

That provision may be made increasing the remittance basis charge.

15. Loan relationships

Resolved,

That provision (including provision having retrospective effect) may be made amending Part 5 of the Corporation Tax Act 2009.

16. Intangible fixed assets

Resolved,

That provision (including provision having retrospective effect) may be made amending Part 8 of the Corporation Tax Act 2009.

17. Expenditure on research and development

Resolved,

That provision may be made about tax relief for expenditure on research and development.

18. Deductions for carried-forward losses

Resolved,

That provision (including provision having retrospective effect) may be made for and in connection with restricting the deductions that may be made by companies in respect of losses carried forward from earlier accounting periods when calculating their profits for the purposes of corporation tax.

19. Pensions

Resolved,

That provision may be made in connection with the taxation of pensions.

20. Pension Flexibility (beneficiaries’ annuities etc)

Resolved,

That—

(1) Part 4 of the Finance Act 2004 is amended as follows.

(2) Section 167(1) (the pension death benefit rules) is amended as follows.

(3) In pension death benefit rule 3A (payments that may, by way of exception, be made to a nominee) after “other than” insert “a nominees’ annuity in respect of a money purchase arrangement or”.

(4) In pension death benefit rule 3B (payments that may, by way of exception, be made to a successor) after “other than” insert “a successors’ annuity in respect of a money purchase arrangement or”.

(5) Part 2 of Schedule 28 (interpretation of the pension death benefit rules) is amended as follows.

(6) After paragraph 27A insert—

“Nominees’ annuity

27AA(1) For the purposes of this Part an annuity payable to a nominee is a nominees’ annuity if—

(a) either—

(i) it is purchased together with a lifetime annuity payable to the member and the

member becomes entitled to that lifetime annuity on or after 6 April 2015, or

(ii) it is purchased after the member’s death, the member dies on or after 3 December

2014 and the nominee becomes entitled to the annuity on or after 6 April 2015,

(b) it is payable by an insurance company, and

(c) it is payable until the nominee’s death or until the earliest of the nominee’s marrying, entering into a civil partnership or dying.

(2) For the purposes of sub-paragraph (1)(a) a nominees’ annuity is purchased together with a lifetime annuity if the nominees’ annuity is related to the lifetime annuity.”

(7) After paragraph 27F insert—

“Successors’ annuity

27FA (1) For the purposes of this Part an annuity payable to a successor is a successors’ annuity if—

(a) the successor becomes entitled to it on or after 6 April 2015,

(b) it is payable by an insurance company,

(c) it is payable until the successor’s death or until the earliest of the successor’s marrying, entering into a civil partnership or dying,

(d) it is purchased after the death of a dependant, nominee or successor of the member (“the beneficiary”),

(e) it is purchased using undrawn funds, and

(f) the beneficiary dies on or after 3 December 2014.

(2) For the purposes of sub-paragraph (1)(e), sums or assets held for the purposes of an arrangement after the beneficiary’s death are undrawn funds if—

(a) immediately before the beneficiary’s death, they were held for the purposes of the arrangement and, as the case may be, represented (alone or with other sums or assets) the beneficiary’s—

(i) dependant’s flexi-access drawdown fund,

(ii) dependant’s drawdown pension fund,

(iii) nominee’s flexi-access drawdown fund, or

(iv) successor’s flexi-access drawdown fund,

in respect of the arrangement, or

(b) they arise, or (directly or indirectly) derive, from undrawn funds under paragraph (a) or from sums or assets which so arise or derive.”

(8) In section 216(1) (benefit crystallisation events and amounts crystallised) the table is amended as follows.

(9) In the second column of the entry relating to benefit crystallisation event 4, after “any related dependants’ annuity” insert “and any related nominees’ annuity”.

(10) After the entry relating to benefit crystallisation event 5C insert—

[Mr Speaker]

With the leave of the House I will put the four procedure motions together. The House will be intimately conscious that I am referring to the motions on future taxation, television tax relief, wholesalers of alcohol and country-by-country reporting referred to on page 21 of the Budget resolutions.

Procedure (future taxation)

Resolved,

That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain the following provisions taking effect in a future year—

(a) provision about the basic rate limit for the purposes of income tax,

(b) provision about personal allowances for the purposes of income tax,

(c) provision for corporation tax to be charged for the financial year 2016,

(d) provision about the tax treatment of certain employment-related expenses and benefits,

(e) provision amending the description of vehicles which are exempt vehicles for the purposes of the Vehicle Excise and Registration Act 1994,

(f) provision about the rates of climate change levy,

(g) provision about the rates of landfill tax, and

(h) provision about the taxable value of single-dwelling interests for the purposes of the annual tax on enveloped dwellings.

Procedure (television tax relief)

Resolved,

That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision for tax credits to be paid to television production companies in respect of expenditure or losses on television production activities in connection with further descriptions of programmes.

procedure (wholesalers of alcohol)

Resolved,

That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may make provision for the approval and registration of wholesalers of alcohol.

procedure (country-by-country reporting)

Resolved,

That, notwithstanding anything to the contrary in the practice of the House relating to the matters that may be included in Finance Bills, any Finance Bill of the present Session may contain provision enabling the implementation of the guidance on country-by-country reporting contained in the OECD’s Guidance on Transfer Pricing Documentation and Country-by-Country Reporting, published in 2014 (or any other document replacing that Guidance).

FINANCE (MONEY)

Monday 23rd March 2015 Commons Chamber

Queen’s recommendation signified.

Resolved,

That, for the purposes of any Act of the present Session relating to finance, it is expedient to authorise—

(a) the payment out of money provided by Parliament of expenditure incurred by the Commissioners for Her Majesty’s Revenue and Customs in connection with the approval and registration of wholesalers of alcohol, and

(b) the payment out of the National Loans Fund or the Consolidated Fund of sums required to redeem, or to meet expenses incurred in connection with the redemption of, government stock.

Finance (Money)

Queen’s recommendation signified.

Resolved,

That, for the purposes of any Act of the present Session relating to finance, it is expedient to authorise—

(a) the payment our of money provided by Parliament of expenditure incurred by the Commissioners for Her Majesty’s Revenue and Customs in connection with the approval and registration of wholesalers of alcohol, and

(b) the payment out of the National Loans Fund or the Consolidated Fund of sums required to redeem, or to meet expenses incurred in connection with the redemption of, government stock.

Ordered,

That a Bill be brought in upon the foregoing Resolutions;

That the Chairman of Ways and Means, the Prime Minister, the Deputy Prime Minister, Mr Chancellor of the Exchequer, Secretary Vince Cable, Secretary Iain Duncan Smith, Secretary Eric Pickles, Danny Alexander, Priti Patel, Andrea Leadsom and Mr David Gauke bring in the Bill.

Finance Bill

Presentation and First Reading

Mr David Gauke accordingly presented a Bill to grant certain duties, to alter other duties and to amend the law relating to the National Debt and the Public Revenue, and to make further provision in connection with finance.

Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 193) with explanatory notes (Bill 193-EN).

Business without Debate

Monday 23rd March 2015 Commons Chamber

Business of the House

Ordered,

That, in respect of the Finance (No.2) 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.—(Mr Wallace.)

1915 Armenian Genocide

Monday 23rd March 2015 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Mr Wallace.)

22:44

[Stephen Pound (Ealing North) (Lab)]

I am glad that Members have decided not to leave the Chamber. The subject of this Adjournment debate is the commemoration of one of the most appalling, heinous acts that has ever been committed on this earth: the Armenian genocide of 23 and 24 April 1915.

May I at the outset put one thing firmly on the record? What I have to say tonight is not an attack on the Government of Turkey. I am not criticising the Government of Turkey. I realise that these debates frequently engender much heat and very little light in Ankara, but I am talking specifically of the actions of the Ottoman empire and particularly the Young Turks, whom I will mention later, in 1915.

I make no apologies for raising this matter. Not only are we approaching the 100th anniversary of this appalling crime against humanity, in which 1.5 million people were killed in the most horrendous circumstances and an attempt was made to destroy an entire people—their culture, nationhood and very being and existence. This is also a time when two books have just been published. The first, “An Inconvenient Genocide” by Geoffrey Robertson, once and for all proves to those gainsayers who are still out there that the genocide was real and that it did happen: the dates, names and times are provided. The other excellent book is “The Fall of the Ottomans” by Eugene Rogan, which contains a chapter on the annihilation of the Armenians.

It is otiose even to ask the question, “Was there genocide?” Yet the question has been asked many times. People have said there was no genocide in 1915, but to a certain extent that was not the only genocide. The Armenians—a people of incredible, intense culture and great sophistication—were assaulted between 1894 and 1896, when 200,000 people were killed. There was the Adana massacre of 1909, in which 20,000 to 30,000 people were killed. In particular, leading up to 1915, after the 1912 Balkan wars, refugees from the Caucasus and Rumelia—they were known as muhacirs—moved from the south Balkans and the Caucasus into Anatolia. That movement into the traditional Armenian land, coupled with the aftermath of the battle of Sarikamish—which took place on 24 December 1914, when the Russians defeated the Ottoman army—led to a completely different situation whereby the peaceful Armenian people suddenly found themselves between different warring factions: on the one hand the Ottoman empire, and on the other people moving into their land, so they were dispossessed. The then War Minister, Enver Pasha, demobilised all Armenians from the army—many of them fought in the Ottoman army—into labour battalions, and the infamous tehcir law, which is known as the deportation law, was passed by Talaat Pasha, the Interior Minister.

At that particular time, the Young Turks had arrived—the Committee of Union and Progress as they were known—and the massacre commenced in Istanbul on the night of 23 April. It is impossible to imagine what it must have been like. Anatolia––western Armenia––was a peaceful country in which the Armenians had succeeded greatly. They had filled many posts, not just in the army, but in medicine and law. They were a peaceful and prosperous people. Just as the upper echelon of Poles at Katyn were massacred, similarly the upper echelon of Armenians were taken to slaughter.

Did it happen? There were so many eyewitnesses there at the time. American Ambassador Morgenthau gave a detailed account, and Father Grigoris Balakian, who survived and was in Istanbul when the entente fleets finally sailed in at the end of the war, gave an incredible amount of detail. Above all, one of the reasons why we in this House can discuss this matter and know about it is the single, definitive volume describing the horror of the genocide, namely the famous “Blue Book” by Lord Bryce and Arnold Toynbee.

[Jim Shannon (Strangford) (DUP)]

Obviously, this is an important issue for us as parliamentarians. Does the hon. Gentleman agree that it is past time that the Turkish Government not only admitted to the historical genocide of 1.5 million Armenians, but apologised for the most horrific atrocities they carried out at the time? We cannot ignore the fact that the Turkish Government have to apologise for that.

[Stephen Pound]

I am grateful to the hon. Gentleman for his intervention, but I am reluctant to go entirely down that route. Obviously the Turkish Government should do so, but today I am talking about the commemoration in this House, particularly as we approach 24 April. I cannot disagree with him—I surprise myself at how seldom I disagree with him—but we should concentrate on the subject at issue.

One and a half million people were driven to die in the burning sands of the Syrian desert in a death march to two concentration camps, in which the men were killed first. The then Interior Minister said, “Kill the men, the women and all the children up to the height of my knee.” If that is not genocide, I really do not know what is. In Trabzon—or Trebizond—14,000 were killed. Many of them were put into boats, which were dragged into the Black sea and sunk. People were injected with typhoid or morphine. Experiments took place on children in a way that presages what happened under the Nazis. Incidentally, what happened in Trebizond was witnessed by the Italian consul general, Gorrini, who started out being sceptical, but ended up as horrified as every other civilised person.

It happened: it is incontrovertible that it happened. It happened within the memory of some people still living. Their grandparents and their great-grandparents died: their bones are still there in the Syrian desert, and their homes are still there in Anatolia, no longer occupied, although their Christian churches have been destroyed. It is within living memory, so why are we not recognising it?

One of the joys of the Freedom of Information Act is that we can get hold of copies of confidential briefings from the south Caucasus team. Last time this issue was raised by Baroness Cox, that indefatigable friend of Armenia—she has visited Nagorno-Karabakh some 70 times, not always in a combat role, but frequently under fire—she had a debate on 29 March 2010, and I have been provided with the document, although it is partly redacted. The Foreign and Commonwealth Office position at the time was that

“it is not appropriate for the UK Government to use the term genocide”.

However, the briefing states:

“The British Government recognises that terrible suffering was inflicted on Armenians living in the Ottoman Empire…and we must ensure that the victims of that suffering are not forgotten.”

I am torn between admiration of the honesty of the ministerial officials and slight horror, because the middle paragraphs are entitled “Bear Traps”—things to watch out for. It goes on to say what would happen to Anglo-Turkish relations if the British Government agreed to the term, and it talks about early-day motion 357 and various other debates.

The crux of the reason why the Government would not agree to recognition is that in one debate—I have had three debates on this subject—the then Foreign Office Minister Geoffrey Hoon said that we could not call it the Armenian “genocide” because Raphael Lemkin did not invent the word until 1944 or 1945. Let us think about that for a minute. When Cain killed Abel, there was no word for fratricide, but Abel was just as dead as if there had been such a word. Raphael Lemkin was present in Berlin at the trial of Soghomon Tehlirian, one of the members of the Armenian Revolutionary Federation who was part of the Nemesis group that assassinated 10 of the 18 perpetrators of the genocide indicted in the military tribunal in Istanbul at the end of the first world war, in what most people think was an attempt to minimise the impact of the treaty of Versailles. Raphael Lemkin, who is accepted as the originator of the word, said that it was his experience of that trial, listening to the evidence of the genocide of the Armenian people, that made him use it. The assassination of Talaat Pasha in Berlin in 1921 clearly precedes the use of the word “genocide”, but the same person—the man who coined the word—was actually at that trial and referred to it.

We are not entirely sure how many, but 20 or 22 national Parliaments have recognised the Armenian genocide, including the devolved Assemblies in Scotland, Wales and—I am delighted to say—Northern Ireland. No one who visits the Genocide museum in Yerevan and sees testimony from all around the world, photographs, cards, letters and books can remain unmoved. No one can deny for a moment that something horrible and terrible beyond human imagination took place in western Armenia at that time.

Genocide is a crime that is intended to destroy a people. Genocide denial is a crime that is intended to destroy a people’s memory. The Armenian people will not have their memory, their culture, their individuality, their strength or their national pride destroyed. Many people have tried; none has ever succeeded, nor ever will they. Think of the double agony of those people whose families were massacred, whose culture was destroyed, whose homelands have been taken over and who are now having that very act denied. That, for me, is the supreme double cruelty.

The British Government will be represented in Gallipoli on 24 April. By coincidence—I make no comment about that—that is the same day as the international recognition of the Armenian genocide. The Gallipoli landing is often prayed in aid by those who apologise for the Ottoman empire of the time. They say that the Gallipoli landing somehow stimulated the action of the Young Turks, who were terrified that some Armenian fifth column would arise and attack Turkey with the Russians. In reality, as we all know, the massacre that started the great genocide took place on the night before. To suggest that moving the commemoration of Gallipoli to the same day, 24 April, as the Turks have done, is anything other than a provocative act is pushing credulity.

Will the British Government be present? President Putin will be there. Francois Hollande will be there. I have heard that a distinguished colleague of mine, although he might not be from my side of the Chamber, will be there. I admire that, I respect that and I am proud of that. We will hear from him later. Can we not go the extra mile? Can we not finally give support and succour to the Armenian people whose relatives died? Can we not say to the Armenian community in this country—one of the most peaceful, law-abiding, hard-working, decent communities that we are proud to have in our country—that we, along with 22 other countries of the world, recognise the genocide that took place? Edinburgh has recognised it. Many councils have recognised it. Even my own little borough of Ealing has done so. We have a strong Armenian apricot tree growing in Ealing soil—British soil—in commemoration of that event. I would like to see a memorial garden in Ealing.

I would like to see wider recognition. Is that not fair when a people have suffered, as have the Armenian people? In many cases, they have suffered in silence. We do not see huge marches through the city or massive protests. The Armenian people are a dignified people. The people of Armenian descent in our country concentrate on hard work, on achievement and on preserving their dignity, but they also keep their culture. They have integrated, but they have not been assimilated. To be Armenian is to be a good citizen, but it is also to be different. That unique, special Armenian quality is worthy of a little recognition.

Can we not finally say it in this House—maybe not tonight, maybe not even before the election, but some time soon? For years it has been our policy to deny that the Armenian genocide took place, and yet we have the FCO briefing here that talks about the suffering of the Armenian people. Would it hurt so much? Are we not straining at the gnat here? Could we not go that last little bit and say, “Yes, it happened.”? Then, hopefully, the wave of global condemnation would wash up even across the battlements in Ankara and the Turkish Government would admit that their predecessors, the Ottoman Government back in 1915, did commit appalling crimes.

I was in this House, as were you, Mr Speaker, when the then Prime Minister, Mr Blair, apologised for the Irish famine of 1848. He apologised on behalf of this country for an appalling act that was horrendous in its brutality and in its impact on the Irish people. He felt justified in apologising for that. Some people said that he should not have done so. I think that he did so because this country was very much a part of that process. I think that Mr Blair did the right thing in apologising.

We have an opportunity tonight to do the right thing, and not just by our Armenian friends, our Armenian brothers and sisters, our Armenian community, our Armenian fellow citizens—those people who have earned the right to our respect and friendship through their contribution to our society. We have an opportunity to do the right thing not just for the sake of Armenia and the Armenian people, but for the sake of humanity. Humanity really needs to recognise what happened in 1915. As long as it is denied, it can happen again. As long as we say, “It didn’t happen”, we echo the terrible words that everybody remembers from Hitler in 1939, when he justified the invasion of Poland by saying, “Who now remembers the annihilation of the Armenians?”

I think that all decent people, all human beings, recognise and remember the annihilation of the Armenians, and I hope that we are all determined to recognise it and ensure that it never happens again. I say to my Armenian friends, fellow citizens and Armenian brothers and sisters: we thank you for all you have done for this country, and this is our small way of returning that thanks.

23:00

[Mr John Whittingdale (Maldon) (Con)]

I congratulate the hon. Member for Ealing North (Stephen Pound) on obtaining this debate and putting with his customary eloquence the case for why it is important that we in this House remember what was one of the first great crimes of the 20th century. He has worked on behalf of his constituents from Armenia and the Armenian community generally for a long time, and it was a pleasure to be in Yerevan with him just over a year ago.

It is entirely right that we in this House mark the centenary of the Armenian genocide. We have commemorated other genocides here, such as those that took place in the Balkans and in Rwanda and, of course, the holocaust. As the hon. Gentleman said, the term “genocide” was originally coined by Raphael Lemkin who, when he came to describe what had happened to his own people—the Jewish people—initially had the experience of hearing about the massacre of the Armenians, which undoubtedly influenced him.

The hon. Gentleman made a strong case, and I concur that we should use the term “genocide” to describe what was clearly a deliberate attempt to kill an entire people. In a sense, whether we use that word or not there is no question but that the massacre of more than 1 million people—perhaps 1.5 million Armenians who were either massacred or starved to death—was a horrendous crime. Both he and I have visited the memorial to the genocide in Yerevan and the museum, and anybody who goes there can be left in no doubt of the true horror of what occurred. The evidence is overwhelming. Those who try to dismiss it cannot argue with the records, photographs and accounts of witnesses, both Armenian and international, not least those from this country whose testimony is perhaps among the most powerful. As a result, it is important that we remember what happened, and renew our determination to ensure that that kind of event never happens again.

The hon. Gentleman is right to say that this is not about apportioning blame, certainly not to the present Turkish Government, and I welcome the fact that the Prime Minister of Turkey talked about the shared pain and offered his condolences a year ago. I hope that that provides an opportunity to try to build reconciliation between Armenia and Turkey, and to normalise relations and perhaps in due course to re-open the border between those two countries. I hope that can still be achieved.

I was very struck by a speech that I heard not long ago by the former Prime Minister of Armenia and Armenian ambassador to this country, Dr Armen Sarkissian. He said that of course we should remember what occurred and commemorate the loss of life, but that more importantly it is an opportunity to celebrate the survival of a great people and a great country. I am delighted that we have had the chance this evening to put that on record in this place, and in four weeks’ time I shall be honoured to pay my own tribute in Yerevan to those who died.

23:04

[The Minister for Europe (Mr David Lidington)]

I congratulate the hon. Member for Ealing North (Stephen Pound) on securing the debate. I pay tribute to the moving way in which both he and my hon. Friend the Member for Maldon (Mr Whittingdale) spoke about the tragedy that befell the Armenian people just over 100 years ago.

It was on 24 April 1915 that about 250 leading members of the Armenian community in Istanbul were arrested. This marked the beginning of a campaign of forced deportations directed against the Ottoman Armenian community. From 1915 to 1916 during the course of the deportations to the Syrian desert, it is estimated that well over 1 million Ottoman Armenians lost their lives as a result of massacres by soldiers or irregulars, forced marches, starvation and disease. A number of other minorities, such as the Assyrians, also suffered.

The British Government of that time robustly condemned the forced deportations, massacres and other crimes. We continue to endorse that view. British charities, as we look back, played a major part then in humanitarian relief operations. The deaths of more than 1 million Armenians in the Ottoman empire was an appalling civilian loss of life against the backdrop of the first world war, a conflict which itself broke new ground in developing international warfare on an industrial scale.

Today, the centenary of those terrible events has huge significance, as the hon. Member for Ealing North said, for the people of Armenia and for the worldwide Armenian diaspora. As an inseparable part of the tragedy of first world war, it is entirely appropriate that we in this country include this tragedy in our remembrance of the first world war to honour the dead, and to draw lessons from history and hope for a better future. The British Government’s commemorations this year have focused on how the first world war shaped society and touched lives and communities. The deportation and massacres of the Ottoman Armenians, and the role played by the UK and other allies in reporting the atrocities and helping the survivors, are an indivisible part of that story. The events and commemorative activities, which the Armenian community in the UK will organise on 24 April and over the course of this year, will help to illuminate further that period of history for British people, some of whom may be hearing about it for the first time.

The appalling nature of the events of 1915-16 were brought home vividly to me when I visited the Tsitsernakaberd memorial museum in Yerevan during my first ministerial visit to Armenia in 2012. When I went back to Armenia last year, I laid a wreath at the memorial to pay my respects to those who had died and those who had suffered. As has been said, in this centenary year my hon. Friend the Member for Maldon, as chair of the British-Armenian all-party group, and our ambassador to Yerevan will be present at the Armenian Government’s commemorations on 24 April in the Armenian capital.

As discussed in today’s debate, for this country and the Commonwealth the dates of 24 and 25 April have great significance for an additional reason, as the days we remember the centenary of the allied landings at Gallipoli. On 24 April, His Royal Highness the Prince of Wales will attend a ceremony in Gallipoli to honour the memory of all those who died during the campaign, including soldiers from Britain, Ireland, France, Australia, New Zealand, the Indian subcontinent, Canada and Sri Lanka, as well as the Ottoman soldiers who died defending the peninsula. Those sombre commemorations in both Gallipoli and Yerevan should be used to honour the memory of those who lost their lives, whether soldiers or civilians, and to reflect carefully on the painful lessons we have learnt from history and how to prevent such events from happening again.

The hon. Member for Ealing North asked me a direct question about the Government’s policy on the recognition of the events in Armenia as a genocide. I have to say to him that the Government’s policy, indeed the policy of successive Governments, has not changed since 1988 when this matter was reviewed. We take the view that genocide is not simply an expression of a political judgment. It is now a crime, and the British Government recognise as genocide only those events found to be so by international courts—for example, the holocaust and the massacres in Srebrenica and Rwanda. We do not exercise a political judgment in ascribing the term “genocide” to a set of events, whether in Armenia, the Holodomor in Ukraine or the massacres of the Kurds by Saddam Hussein in 1998.

In honouring and reflecting upon the past, it is vital that we look to the future. The peoples and Governments of Turkey and Armenia need to find a way to face their joint history together and forge a new, more constructive relationship, and part of the role the UK seeks for itself is to support them in finding this path forward. I will not pretend that we from London can provide instant answers, but we are doing what we can practically to foster people-to-people exchanges and links between the two countries to break down stereotypes and barriers. For example, we have just completed a successful exchange of Turkish and Armenian Chevening alumni who visited each other’s countries for the first time.

Ultimately, the Governments of Armenia and Turkey must take the lead in forging and delivering that new relationship. For that reason, the UK Government strongly supported the imaginative diplomacy that led to the Turkish-Armenia protocols in 2009. The protocols envisaged opening the border and initiating diplomatic relations without any preconditions, and it is a matter of great regret that the ratification process for those protocols has not moved forward. I hope that both sides will continue to consider creative ways to re-set their relations and open up new channels for dialogue and co-operation.

This year, we will reflect with sadness on the nature and horrific scale of the deportations, massacres and other crimes in 1915-16 and on the importance of this centenary for Armenia and Armenians worldwide, but we will also renew our commitment this year to promote reconciliation between Armenia and Turkey. A genuine step forward along that path to reconciliation would take us towards a more peaceful and secure future for everyone living in the region. I continue to hope that both Turkey and Armenia can find a way to look together towards a brighter future.

[Stephen Pound]

I have immense respect for the right hon. Gentleman—he and I have met the President of Armenia, and I entirely respect his position—but immediately after the genocide, the British Navy took 50 of the worst suspects from the Young Turks to Malta to try them because it recognised that what had happened was against civilisation. There was not sufficient legislation at the time for the trial to take place so the British took them back—probably rightly so—but does he not agree that we need that recognition now so as to avoid such a situation in the future? I am not criticising Turkey. I am talking about the Ottoman empire.

[Mr Lidington]

I hesitate to get into a legal dispute with the hon. Gentleman, but we take the view, as have successive British Governments, that international law, including the 1948 protocol on genocide, is not retroactive, and that is part of the explanation for our position. That is not to detract from the horror of what took place 100 years ago, or to suggest that we will draw back from our commitment to seek the reconciliation of the peoples of Turkey and Armenia and to strive as hard as we can to bring about that much desired outcome.

Question put and agreed to.

23:14

House adjourned.

Mr Speaker’s Ruling (Presentation of Public Petitions by Ministers)

Monday 23rd March 2015 Commons Chamber

The following Private Ruling given by Mr Speaker is published in accordance with the Speaker’s undertaking of 5 November 1981 (Official Report, c. 113)

When a Member of the House accepts appointment as a Minister of the Crown, he or she accedes to the convention on collective responsibility.

The procedures of the House depend on its being able to rely on the presumption that whenever a Minister speaks or acts in the course of its proceedings, he or she does so on behalf of Her Majesty’s Government. Ministers cannot choose to assume or divest themselves of their status as Ministers of the Crown in the course of the House’s proceedings––this would introduce a degree of uncertainty and ambiguity which would be injurious to the clarity of its proceedings.

The specific question has been raised with me whether a Minister can present a public petition on the Floor of the House. The Government cannot present a petition, and a Minister cannot act as a private Member. I have therefore ruled that a Minister cannot present a public petition on the Floor of the House.

Ministers are, however, free to present a public petition informally (that is, by depositing it in the petitions bag at any time at which the House is sitting), but the Votes and Proceedings will not in such cases identify the Member who deposited the petition.