The Economy

Andrea Leadsom Excerpts

Thursday 24th October 2019 Commons Chamber

[The Secretary of State for Business, Energy and Industrial Strategy (Andrea Leadsom)]

This has been an interesting debate, in which strong views have been expressed by 41 Back Benchers.

Let us look at the UK economy. This year, we have seen more people in work than ever before, with more women in work than ever before. The number of workless households is down by more than 1 million since 2010, and there are 200,000 more businesses than last year. Wages have grown at their fastest rate in 11 years, and there has been the biggest ever increase in the national living wage. We are investing in the skills of the future, with more than 800,000 people participating in an apprenticeship in England in the last full academic year.

We have every reason to believe in our ability to succeed. We are the world’s fifth biggest economy and the ninth biggest manufacturer. We speak the world’s international business language. We have the best contract law and one of the most trusted judicial systems in the world. We have the most creative and innovative financial services sector anywhere, and three of the top 10 universities in the world. For the seventh year in a row, we have the most powerful capital city on earth.

But let us look at what Labour has on offer. Labour has proposed a punitive new tax every two months since Corbyn took office. Jeremy Corbyn’s party—

[Mr Speaker]

Order. Resume your seat. I very gently say that, when names are put into these speeches, it is the responsibility of the Secretary of State to delete those names. We do not name people in the Chamber but refer to them by their title. That is a pretty obvious point.

[Andrea Leadsom]

Thank you so much, Mr Speaker.

The Leader of the Opposition has voted against £7,800-worth of tax cuts for hard-working people, and the British Chambers of Commerce has warned that Labour’s plans for our economy would send an “icy chill” up the spines of business owners and investors.

There have been too many contributions for me to mention them all, but I have picked out some that were particularly interesting. The hon. Members for Aberdeen North (Kirsty Blackman) and for Glasgow East (David Linden) both talked about the importance of immigration to Scotland, and I am delighted to mention at the Dispatch Box the amazing contribution that EU citizens have made to our country. That is why I am so pleased that over 1 million people have already been granted settled or pre-settled status under the EU settlement scheme, enshrining their rights in law.

I congratulate my right hon. Friend the Member for Central Devon (Mel Stride) on being elected as the new Chair of the Treasury Committee, and I commend his call for Barclays to reconsider pulling out of the new UK banking framework, which was agreed with 28 UK banks. He is right to look into that issue.

The hon. Member for Gedling (Vernon Coaker) talked about the tax gap. He should be reassured that, since coming into office, this Government have secured and protected more than £200 billion that would otherwise have gone unpaid. Our tax gap is at a near record low.

My hon. Friend the Member for West Worcestershire (Harriett Baldwin) talked about the financial services Bill. I can assure her that that Bill will maintain the UK’s world-leading regulatory standards and ensure that the UK remains fully open to international markets after we leave the European Union.

The right hon. Member for Kingston and Surbiton (Sir Edward Davey) was right to welcome the United Kingdom’s amazing efforts on offshore wind. I commend him for the part he played in ensuring that the UK is a world leader in the deployment of offshore wind.

My hon. Friends the Members for Aberdeen South (Ross Thomson) and for Ochil and South Perthshire (Luke Graham) spoke as true Unionists and supporters of the Union. They highlighted how no-deal Nicola is not acting in the interests of Scotland.

My hon. Friend the Member for North Cornwall (Scott Mann) talked about how this Government are dealing with climate change, not just talking about it. Labour, however, has promised something that it cannot deliver and does not understand. Several unions have voiced their concern about the damage of a 2030 target for decarbonisation. The GMB dismissed it as threatening “whole communities” and “jobs”, as well as being “utterly unachievable”. The “30 by 2030” report put out by Labour today shows plans to hike up stamp duty on millions of homes, with home owners forced to spend tens of thousands to move home and local communities losing any say on onshore wind. However, this Government have a positive record on decarbonisation. We are the first major economy to legislate for net zero. Since 1990, we have reduced carbon emissions by 42% while growing our economy by nearly three quarters. We have shown that decarbonising can create jobs and prosperity. It has already produced 400,000 jobs in the low-carbon sector, and we hope that the number will reach 2 million by 2030. Our path to reaching net zero is realistic. It is based on science and has been supported by the Committee on Climate Change. We care too much about this issue to make pointless political promises that are just not deliverable.

My hon. Friend the Member for Bolton West (Chris Green) welcomed the Government’s investment in towns and cities, with the £3.6 billion new towns fund, which will support our high streets. I also wish to mention the hon. Member for Ynys Môn (Albert Owen), who highlighted the fact that this would be his last Queen’s Speech. I wish him well and thank him for his contribution in this place. My hon. Friend the Member for Copeland (Trudy Harrison) talked movingly about her daughter’s new apprenticeship in the nuclear sector—we wish her well with that. My hon. Friend is rightly a great champion for new nuclear.

The hon. Member for Bury North (James Frith) raised the issue of Orkambi. All of us across the House are delighted by the achievement of my right hon. Friend the Health Secretary on Orkambi, which can be a vital drug for many cystic fibrosis sufferers. I also wish to mention the hon. Member for Newport West (Ruth Jones), who is calling again for the BBC to honour the right of the over-75s to get their free TV licences. I completely agree with her about that.

Finally, may I say that it is very refreshing to have spent a whole six days—albeit with a brief interval—debating the exciting positive future that awaits this country? As the Prime Minister said, this is

“a new age of opportunity for the whole country.”—[Official Report, 14 October 2019; Vol. 666, c. 19.]

As MPs, we should never lose sight of whom we serve, and this Queen’s Speech is about the people’s priorities. It is about the things that really matter to people in their everyday lives: more police; better schools; a stronger NHS; more support for those in need; and a United Kingdom that rewards hard work today, that protects the environment for tomorrow, that spreads opportunity right across our shores and that flies the flag for global free trade.

Instead of self-doubt, we need self-belief in ourselves and in our abilities as a country to build the low-carbon, high-tech, business-backing United Kingdom we all want to see, spreading opportunity right across our shores. From our universities to our creative industries, from offshore wind to outer space, we have so much to shout about in this great country, and this Queen’s Speech will help us to do even more. From attracting the best minds in the world to exporting the best products to the world, we can make the United Kingdom the greatest place on earth. I commend this Queen’s Speech to the House.

Question put, That the amendment be made.

High Speed 2

Andrea Leadsom Excerpts

Wednesday 10th July 2019 Westminster Hall

[Stewart Hosie (in the Chair)]

Before I call the right hon. Member for South Northamptonshire (Andrea Leadsom) to move her motion, eight Members have notified me that they intend to speak, and I suspect many more may wish to intervene. We only have an hour. I do not want to limit the key points that anyone wishes to make, but if we can have a little brevity, it would be greatly appreciated.

[Andrea Leadsom (South Northamptonshire) (Con)]

I beg to move,

That this House has considered the business case for High Speed 2.

It is a pleasure to serve under your chairmanship, Mr Hosie, in my first debate as a Back Bencher in more than five years. I am delighted to have this opportunity to discuss one of the biggest concerns for many of my constituents, and to outline why I believe that the business case for High Speed 2 must be urgently reviewed by the Government.

I first became aware of HS2 when it was proposed in 2009 by the then Labour Government. Investment in infrastructure, creating jobs and growth, improving travel times between our major cities, and closing the north-south divide were all put forward as reasons in favour of the UK’s second high-speed train line. However, those supposed benefits unravelled one by one, and it quickly became apparent that HS2 is not the right infrastructure project, will not improve point-to-point travel times, and will not close the north-south divide. It will create jobs, yes, but at an eye-wateringly expensive rate, far beyond what we might expect from a similar project.

Those of us who expressed concerns about HS2 even while it was still in consultation were dismissed by others as nimbys and told that we were flat wrong about the wider benefits that HS2 would bring to the north. I was then and continue to be willing to be proved wrong, but with the delay to the notice to proceed, growing concerns about the project’s spiralling costs, ongoing engineering and design difficulties and, even now, the rumours that the line past Birmingham might never be built, it is high time for the project to be thoroughly reviewed to ensure that it will actually deliver for taxpayers.

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

It is a pleasure to hear the right hon. Lady speaking in a debate, rather than her listening to me asking for one. Does she recall the number of times that I have said in the Chamber of the House of Commons that HS2 will cost much more? Every time I said it, £10 billion more, and going past that. Now, it is accepted that it will cost £100 billion. Does she agree with that figure?

[Andrea Leadsom]

The hon. Gentleman has raised the issue a number of times, and it is true to say that many think the costs will overrun. I will come back to that.

For me, both as a concerned constituency MP and as someone with 25 years of experience in finance, including project finance, I am alarmed at just how much the business case for HS2 has changed since the project was initially proposed. The business case that HS2 relies on now bears little resemblance to what Parliament was told at the start of the process—if I cast my mind back to when I first became an MP in 2010—nor to what we voted on when the enabling legislation was passed, which I voted against, or when the subsequent main legislation was enacted.

First, we were told that HS2 was about reducing journey times and improving the economy by bringing businesses and workers from the south to the north to spread economic prosperity around the country. Then we were told it was about capacity constraints on the west coast main line, and managing the continual growth in annual passenger numbers. Both arguments no longer stack up.

On improved journey times and associated productivity gains, the underlying assumption built into the business case for HS2 was that any time spent travelling for business purposes was wasted time, and that business travellers undertake no productive work while travelling. In the 21st century, technological advances such as mobile devices and improved wireless internet connections clearly mean that work and leisure activities are increasingly mobile, and increasingly affordable and accessible for rail passengers. Such advances are expected to continue.

[Graham Stringer (Blackley and Broughton) (Lab)]

I have great respect for the right hon. Lady, but she is fundamentally wrong on this issue, although she is right to criticise the way in which the Department for Transport uses travel times. In the assessment of all transport infrastructure, the Department fails to take into account the economic investment that always follows investment in transport. The case is the opposite of what she is saying: it underestimates the benefits from HS2.

[Andrea Leadsom]

The hon. Gentleman makes my point for me: the business case needs to be reassessed with accurate underlying factors taken into account. It is the case that the more productivity on trains increases, in particular as faster fifth generation—5G—mobile internet is rolled out across the country, the less valuable the journey time savings are, and therefore the smaller the estimated benefits of HS2 become on those measures.

[Maggie Throup (Erewash) (Con)]

My right hon. Friend is talking about journey times, and I completely agree with her that this is not about journey times. She also mentioned capacity, and it is about that, but it is also about one more thing—connectivity. We have not had a new railway line north of London for 150 years. Surely now is the time to improve our infrastructure and to make our trains and lives fit for the 21st century.

[Andrea Leadsom]

My hon. Friend is absolutely right—we certainly need to invest in our rail infrastructure—but my question is whether HS2 is the right piece of infrastructure.

The argument for the business case around journey times and productivity quickly collapsed, and HS2 Ltd turned to arguing for capacity instead. That capacity argument has been questioned almost since it was first made, and most recently by the Lords Economic Affairs Committee in its report of May this year, “Rethinking High Speed 2”.

The original business case for HS2 was put forward at a time of strong and continued growth in passenger numbers in the preceding years, and the expectation was always that this growth would continue unabated. That is not the case. I made that point in 2011, when I led an HS2 debate on the Floor of the House. As I said then, HS2’s forecasts were “heroic” when compared with Network Rail’s numbers over the same period. According to the Commons Library, across the entire rail network, annual passenger growth peaked in 2011 at about 8%, and growth has been on a downward trend since then. Passenger growth between London and the west midlands has now fallen to 2% growth per annum, against a decadal average of 6%.

It is true to say that the west coast main line is the busiest mixed-use rail corridor in Europe, with 15 fast trains coming into Euston in most peak hours of the week and little to no availability in that period for additional train paths. However, capacity on the trains themselves is a different matter. As anyone who travels at rush hour between Euston and Milton Keynes—as I do frequently—will know that there is always high capacity pressure on any of the trains during that peak period: about 95% of all available seats on morning peak arrivals into Euston are occupied, with many trains cramped and uncomfortable. Again according to the House of Commons Library, across the entire day only about 60% of all available seats into Euston are in use. For the other major cities on the line of route—Birmingham, Leeds, Liverpool, Manchester and Sheffield—across the entire day, all of those stations operate at less than half their passenger capacity in terms of seat availability.

[Mr Sheerman]

Will the right hon. Lady give way?

[Andrea Leadsom]

Very briefly.

[Mr Sheerman]

As the right hon. Lady knows, I am a very experienced traveller between Wakefield and London, and know the routes well. May I ask her to pay attention to my hon. Friend the Member for Blackley and Broughton (Graham Stringer), from Manchester, because he is wrong? All the research in France and other places shows that having super-speed or high-speed trains sucks power away from the regions. What has happened in France? More power to Paris, and less to the provincial cities.

[Andrea Leadsom]

I fear that I am very much aware of what the hon. Gentleman says, and I agree with him.

Clearly, therefore, much of the capacity constraint on the west coast main line is spatially and temporally specific, being focused on the peak rush hours, and only in Euston and Birmingham. The biggest issue is crowding on individual trains at those times, rather than crowding throughout the day.

[Laura Smith (Crewe and Nantwich) (Lab)]

Does the right hon. Lady agree that HS2 will free up the main line so that freight will be able to operate more freely, which will help with congestion on our roads and be far more beneficial to the environment?

[Andrea Leadsom]

The hon. Lady is right that building a train line frees up capacity for freight lines and all sorts of other things; the question is the business case for this particular project. The question must be asked: is it worth spending £55.7 billion of public money, as allocated by the Department for Transport, to alleviate crowding issues in the morning and evening peaks? The main alternative considered by the Government, known as the strategic alternative, could have achieved the same result at a much lower cost, through a combination of infrastructure and rolling stock upgrades, at a cost of around £4.9 billion in 2011 prices. Additional capacity and more fast-line services could be delivered via Euston to relieve the specific pressure points during the peak-hour rushes, rather than building a whole new line that would create unneeded capacity throughout the day.

The Lords Economic Affairs Committee report concluded that the Government have

“yet to make a convincing case for proceeding with the project”

and it has

“not seen convincing evidence that the nature of the capacity problem warrants building HS2.”

[Mr Ivan Lewis (Bury South) (Ind)]

On the point about finance, is the right hon. Lady aware that HS2 has entered into an astonishing 270 or more non-disclosure agreements with third parties? Does she agree that the Government should make public the number of non-disclosure agreements, settled agreements, compromise agreements and any other arrangements that include non-disclosure provisions with former staff members?

Does the right hon Lady share my concern that funding from an unauthorised redundancy payment scheme operated by HS2 was used to fund some or all settlement or compromise agreements with former senior staff? In some cases, those staff were regarded as having made serious protected disclosures about their concerns over HS2’s financial statements. Transparency is essential in the funding of this project. Does the right hon. Lady agree?

[Andrea Leadsom]

The hon. Gentleman mentioned that to me yesterday, and I am gravely concerned. As all right hon. and hon. Members will know, I am extremely unhappy at the prospect of non-disclosure agreements preventing whistleblowers from coming forward with information that is vital to the public interest or their own personal interest. People should not be gagged under any circumstances.

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

I congratulate my right hon. Friend on securing this debate on a topic we have discussed many times. I voted against HS2 at every opportunity in the House of Commons. In 2013, I predicted that it would cost in excess of £100 billion. The then Secretary of State laughed, and I think he was quite right to—it is clear that the project will be far in excess of £100 billion.

Does my right hon. Friend recall the report by Sir John Armitt in August 2018? His committee stated that, given that hubs are no longer in the centre of cities but on the outskirts, an extra £43 billion of infrastructure spending would be required to make use of the current hub sites that have been chosen. That has not been programmed into the budget at all.

[Andrea Leadsom]

My hon. Friend makes an important point about the lack of point-to-point movement in HS2. Passengers do not end up at the Bullring in Birmingham, or in the west end of London; they just end up somewhere on the outskirts wondering how on earth they will get to where they want to.

The business case for HS2 is seemingly not based on improved journey or improving capacity on journeys between the cities along the line of route. That was alarmingly confirmed by the chief executive of HS2 Ltd, Mark Thurston, in November last year, when he appeared before the all-party parliamentary rail group. At that meeting, Mr Thurston remarked that to remain on time and on budget, HS2 Ltd was considering fundamental changes to the project, including, but not limited to, reductions in the speed that HS2 trains will operate at and reductions in the total number of trains per hour.

With fewer and slower trains, it is hard to understand how the business case can be maintained, given the growing lack of incentive for passengers to choose to take a more expensive HS2 train over a classic service. I have asked HS2 Ltd to confirm whether it is modelling the impact of such changes, but so far I have been unable to obtain a definitive response.

As the former chairman of HS2 Ltd, Sir Terry Morgan, said when he appeared before the Economic Affairs Committee on the 22 January, nobody, not even he as a former chairman of the project, can say with any certainty what the final cost of HS2 will be. That cost has gone up and up over the years. In February 2011, we were told that HS2 would cost £37.5 billion. By January 2012, that figure had crept up to £40.8 billion. In June 2013, we were told the total cost had risen to £50.1 billion. Today, based on the funding envelope set out in November 2015 —not an estimate of the cost but rather the money available from DFT for the project—we are told that HS2 will cost the British taxpayer £55.7 billion. That is £55.7 billion for a single train line.

We have not actually seen a comprehensive breakdown of the costs for the full Y network of HS2 since 2013, although the National Audit Office has more recently said that, at the time of the 2015 spending review, the full cost should have been estimated at £65 billion. HS2’s land and property budget alone is expected to be five times greater than originally forecast, but that is of no help whatsoever to my constituents. I have had cases in South Northamptonshire where family farms have been cut in half, people have been forced to sell their businesses at a vastly undervalued rate and one constituent has been forced out of the family home that she had lived in for many years through a lifetime tenancy under the Agricultural Holdings Act 1986. There are countless examples where I have had to intervene time and again on behalf of my constituents, due to the insensitive behaviour and slow engagement of HS2.

[Maggie Throup]

I, too, have had some very sad cases, where HS2 Ltd is not doing itself any favours. Considering the overall spend, the quibbling is over very small amounts. If it got that bit right, it might get more people on its side to make sure it delivered the project, which my constituents welcome, as long as they are looked after. If part of the line is cancelled, those properties will be blighted for ever.

[Andrea Leadsom]

I certainly agree that HS2 needs to do much more to protect those who have been affected through no fault of their own. There has been real hardship. There are countless examples in my constituency and I am aware of many in other constituencies.

As hon. Members have set out, concerns have been raised by industry experts and former whistleblowers from the company that the total cost for HS2 may very well be in excess of £100 billion. In contrast, DFT has separately announced investment of £48 billion in our railways over a five-year period through to 2024, comprising major infrastructure upgrades across the country and newer, faster, more comfortable trains to improve the passenger experience. I totally applaud the DFT for that decision—it is the right sort of investment and will improve our railways in all parts of our United Kingdom, sharing the benefits among all rail users.

We should consider HS2 in the context of alternative uses for the money for infrastructure investment. I was delighted when my hon. Friends the Members for Banbury (Victoria Prentis), Eddisbury (Antoinette Sandbach) and North Warwickshire (Craig Tracey) advised me they would contribute to today’s debate. I pay tribute to my right hon. Friend the Member for Chesham and Amersham (Dame Cheryl Gillan) for all the excellent work she continues to do to raise concerns about this project.

I am a passionate advocate for better infrastructure. There is no doubt that properly targeted infrastructure investment can massively improve productivity and enable growth and economic opportunity equally for all parts of our United Kingdom, including in the north and the regions, but getting the best bang for our buck has to be at the heart of all that we do. With the benefit-cost ratio for HS2 declining to 1.4 in October 2013 and remaining unchanged in the intervening period, it is vital that we make sure that we are investing in the right infrastructure projects. The Government’s own guidance on value-for-money assessments has said that a benefit-cost ratio of 1.4 for phase one would represent a low value-for-money project.

What can we do? My hon. Friend the Member for North West Leicestershire (Andrew Bridgen) has spearheaded a whole host of alternative transport project proposals with the TaxPayers Alliance—he will expand on that later. I am pleased that the hon. Member for Luton North (Kelvin Hopkins) is here to set out his own ideas about better value-for-money projects. We have to think creatively about our transport infrastructure and be brave enough to scrutinise the value for money of any project if we think it might not deliver the benefit it promises. We have to hold HS2 Ltd to account to ensure that it is open and transparent in all that it does.

In conclusion, I ask the Minister in her response to commit to a full review of the business case for HS2, before the notice to proceed is granted later this year, and to make a clear and open statement on the Floor of the House on whether this project truly does represent good value for taxpayers’ money.

The Economy

Andrea Leadsom Excerpts

Thursday 22nd March 2018 Commons Chamber

[Jim Shannon]

I absolutely agree. The hon. Lady and I have discussed these things on many occasions. We have a very similar opinion.

I feel that the failure is one that society and perhaps the Government need to address. It has accumulated over a number of years. The economy is essential, as is reducing the deficit, and I support sustainable borrowing, but it is also essential that we provide the support and level of care to make life bearable for our constituents.

Interest rates were referred to earlier. It is absolutely critical that they do not increase so that we keep the economy stabilised, provide opportunities and make sure that we put money in the pockets of our constituents. That will also keep the economy going in the direction that we want so that we make sure that we create more jobs and employment.

I am aware that we bit off too much before the financial crisis, but we cannot compound the problem by putting constituents in debt, or close to debt, as they pay the continual minimal rises that we place on their shoulders. We must do as much as we can to economise while not asking too much from people who are squeezed to the limit. We are moving forward and reducing our nation’s debt, but that must not be at the expense of our constituents. I feel that we face that danger at present, and I ask the Minister to take that into account in his response.

[The Leader of the House of Commons (Andrea Leadsom)]

On a point of order, Madam Deputy Speaker. I have listened to representations following my business statement. For the benefit of the House, I can say that Monday’s general debate will now be on national security and Russia.

[Madam Deputy Speaker (Dame Rosie Winterton)]

I thank the Leader of the House for her courtesy in letting us know as quickly as possible that the debate has changed.