(8 years, 1 month ago)
Commons ChamberThere are those who will argue, in the light of Brexit, that we should not worry about borrowing and debt. They are usually—not always, and I certainly exclude the hon. Gentleman from this—the same people who have argued consistently for the past 10 years that we should not worry about borrowing and debt; it is the reasons that have tended to change. First, they argued that we need not worry about borrowing because the business cycle had been abolished and there would be no downturn, so that was all right. Then their argument was that we should borrow because we needed a fiscal stimulus, and then because gilt rates were so low. But with debt last year at almost 84% of our GDP, maintaining fiscal credibility must absolutely remain our priority. If we had not taken the measures we have on public finance over the past few years, we would be in a far worse position still. Analysis shows that from 2010 to 2020, if the structural deficit had remained the same we would have borrowed an additional £930 billion. That is a huge sum to add to our current debt total.
We have already set out our plans for finding departmental savings and in my new role I will be working closely with my fellow Ministers to make sure we stick to those plans. We have a strong record on delivering such commitments—we have done so every single year we have been in government, and we are not going to let up in our efforts now.
I am also determined to look at what further scope there is for delivering the value for money that the taxpayer deserves. I have spent the past six years working hard to make sure we get the tax revenues in, so am not about to see those revenues spent without delivering as much for our money as possible. I will therefore also take forward our work on finding further efficiencies across the public sector. That work was announced at the last Budget and I will be taking it forward straightaway, to explore all avenues for making innovations, finding reforms and saving time and money across the public sector.
This is without doubt a time of considerable uncertainty. That has its own implications for the current stability of our economy. We anticipated short-term turbulence in the event of a decision to leave the European Union, and that has been reflected in the economic developments that have unfolded. It is clear that we must pursue policies that help us grow in the future. That means pursuing pro-business tax policies, improving our skills and our infrastructure, and looking out to the world, enabling us to trade and benefit from globalisation, as there are real signs of opportunities ahead from such an outward-facing approach.
I congratulate the Chief Secretary to the Treasury and the Financial Secretary on their promotions. Does my right hon. Friend join me in welcoming the Prime Minister’s proposals for infrastructure bonds, which will boost economic growth and give the country vital infrastructure?
My hon. Friend raises an important point about how the Government are doing all they can to support infrastructure in this country. As I said, we have a proud record on that, and an infrastructure pipeline worth, I think, £480 billion. We have taken steps to reform our planning system to help infrastructure, and established the National Infrastructure Commission. My hon. Friend is right to highlight the proposals set out by the Prime Minister in that area.
We can take measures to help improve infrastructure in this country, but all measures to help growth—whether our outward-looking approach to trade, our pro-business tax policies, or improving infrastructure or skills—can and must go hand in hand with the need to take our public finances seriously, and the Government will pursue that balanced approach.
What we hear from the Labour party continues to be unbalanced, and there is a failure to take into account the need for credibility with the public finances. Labour may have changed a lot of its personnel, but I fear that there is a degree of continuity in the failure to face up to challenges in the public finances, and the motion reflects that. I therefore urge the House to oppose the case for fiscal indiscipline that we have heard today, and to oppose the motion before us.
(8 years, 7 months ago)
Commons ChamberUrgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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There has been a shift in public opinion in recent years, and the pressure on companies to pay the tax that is due under the law is greater than ever before. I welcome that, and I welcome that change in public opinion, but it is the measures taken by this Government that mean that we are getting additional sums from large companies, as has been demonstrated in the past couple of days.
Following the successful Google settlement, will the Minister confirm that the Government will continue to work with our international partners and organisations such as the OECD to continue taking a lead to ensure that our tax laws are complied with—action that Labour failed to take over 13 years?
My hon. Friend makes an important point. It was very much the Prime Minister who got the OECD and the G20 to focus on how multinational companies are taxed. It is right that we did that and that we are making progress, and I am pleased that this is coming to fruition.
(8 years, 9 months ago)
Commons ChamberHMRC’s “needs enhanced support” service was brought in as a partial replacement of the inquiry centres. My hon. Friend raises an interesting point about HMRC’s presence. However, it has a strong record in dealing with avoidance and evasion, there has been a substantial increase in prosecutions and it is hard to open a newspaper without reading reports of the wealthy facing significant tax bills because HMRC is successfully closing down tax avoidance schemes. That shows that HMRC is reducing this behaviour.
I am heartened by the Minister’s confirmation that reducing the tax gap and protecting tax revenues remains a key priority. Will he confirm that the progress in that area has been strong since the Government took office, resulting in more than £57 billion extra tax revenue being collected compared with 2005-06?
(9 years, 1 month ago)
Commons ChamberThank you, Madam Deputy Speaker. I will try to make a little progress. In response to that intervention, I will not speculate about announcements that might or might not be made tomorrow, but I will say that universal credit is a sensible reform that comes alongside a whole raft of other measures by which the Government are helping hard-working people.
My hon. Friend makes a reasonable point. There was a certain correlation between the previous Government’s generosity and election years.
The Government are bringing in a raft of measures to help working people. We are giving this nation’s children the best start in life. We have increased our spending on childcare and early-years education by £1 billion. We have given 15 hours of free childcare entitlement to all three and four-year-olds, as well as to the poorest 40% of two-year-olds, and we are doubling that for families in which both parents work. We are extending the right to request flexible working to all. Through tax-free childcare we are giving 20% support on childcare costs, up to £10,000 per child. Universal credit will increase the childcare support for low-income families to 85%. Our pupil premium and early-years pupil premium are giving schools, nurseries and childminders additional money to ensure that children from the most disadvantaged backgrounds do not fall behind. Through our childcare business grant scheme we have 4,500 new childminders and over 30,000 new childcare places.
(9 years, 2 months ago)
Commons ChamberI will certainly make that assurance and indeed, I will set out in a little detail what we are doing in that field. I referred to my hon. Friend as a fellow Hertfordshire MP. However, if I remember correctly, at the time of the negotiation, he was part of the team in Downing Street who were involved in the undoubted success. It is characteristic of his modesty that he did not draw attention to that point, but I daresay that a lot of the credit for the successful negotiation lies in his hands.
Smaller changes to the own resources decision affect some member states’ contributions and the balance between the pillars of the own resources system. Those are somewhat detailed, but I hope it will be helpful to set them out for the Committee, because they are, in essence, at the heart of the Bill and clauses we are debating.
Specifically, the smaller changes include the following: the member states’ retention rate for traditional own resources—TOR—which covers member states’ collection costs for customs duties, is reduced from 25% to 20%. That change will have no impact on the ultimate cost of the EU budget to the UK on account of the UK rebate. For the period 2014 to 2020, the ORD also reintroduces the reduced rate of call for VAT-based contributions for Germany, the Netherlands and Sweden. Austria will revert from its reduced call rate over the 2007-2013 multi-annual financial framework to a standard call rate of 0.3% over the 2014-2020 MFF. The financial benefit of the changes to the UK depends on technical factors. Even so, on current estimates, those changes point to a benefit of approximately £150 million over the course of the MFF.
My constituents are still reeling from Labour’s great recession. Will my hon. Friend assure me that the Bill will not result in any new taxes or new contributions from the UK?
The right hon. Gentleman refers to my dead bat, but I thought I had played a flourishing cover drive. The Prime Minister has set out objectives for a renegotiation, which will then be taken to the British people, who will decide our future as members of the European Union. We believe we should do a wide range of things to ensure that Europe works better for its members. We have consistently argued the case for fiscal discipline and we are not alone in making that case. Indeed, the Bill itself demonstrates that there is strong support for a fiscal disciplinarian approach within the European Union—the fact that we were able to negotiate a reduction in the multi-annual financial framework was a considerable achievement. In those negotiations, we had the support of member states such as Germany, France, Sweden, the Netherlands, Denmark and others.
My hon. Friend the Member for North Dorset (Simon Hoare) made a very important point about protecting the UK’s rebate, which is important to my constituents in Havant and throughout the country. Will the Minister confirm how much of the UK rebate the Labour Government gave away?
I will certainly make that point. It was estimated by the European Commission to be of the value of €9 billion over the previous MFF period. In this MFF period, it would be in the region of £2 billion a year, which would be a considerable loss. The Government will not be repeating that.