Amendment of the Law

Baroness Bray of Coln Excerpts

Thursday 19th March 2015 Commons Chamber

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

The Chancellor’s Budget yesterday has been warmly welcomed by business organisations up and down the country. The British Chambers of Commerce, for example, has said:

“The Chancellor’s focus on business growth and prosperity will receive a warm welcome from businesses of all sizes”.

It is certainly the kind of Budget that businesses in my constituency wanted to see, and what is good for businesses is good for our constituents and the communities in which they operate—something that Opposition Members do not always appear to understand.

Despite the strong growth we have seen under this Government, there is no denying that things have been challenging for smaller businesses. Things are getting better, but at my most recent business breakfast club last week, several local businessmen and women raised their No. 1 concern: there is still more that could be done to support businesses, especially smaller businesses and the high street more generally. I expect that they welcomed what they heard yesterday.

In particular, they will have liked the Chancellor’s big announcement that the major review of business rates will report back in time for the 2016 Budget, which is just one year away. It sounds to me like the Government need to be getting on with that, as there is a massive amount of work to do. As he said, business rates have not kept pace with the needs of the modern economy and the whole structure needs rethinking. The advent of online businesses, both commercial and retail, has thrown the whole system out of kilter. When one considers the massive retail giants such as Amazon, one realises that it cannot be right that the businesses on our high streets that continue to trade out of bricks and mortar, in shops and other premises, should have to pay tax on the space they occupy while their online competitors do not. There is no longer the same relationship between the size and location of premises and the contribution businesses make through business rates. As I have said, that cannot be right, so I welcome the decision to have a root-and-branch review.

It is great news that corporation tax is to be reduced again to 20%, which sends an important signal that Britain is really open to business, with

“one of the lowest rates of a major economy in the world.”—[Official Report, 18 March 2015; Vol. 594, c. 776.]

It is to be regretted that the Labour party wants to raise the tax, were it ever to get a chance—what a retrograde step that would be.

Another measure that will surely benefit business is the announcement that fuel tax will be frozen again, making that the longest duty freeze in 20 years. Many small businesses that depend on a van or some other vehicle will continue to benefit from the freeze as well as from the much lower petrol prices at the pump, which we are all enjoying at the moment.

I very much welcome the Chancellor’s continuing commitment to supporting our creative industries. As the Member of Parliament for Ealing Central and Acton, which of course contains the world-famous Ealing film studios, the world’s longest continually running studios, I am delighted that he proposes to make TV and film tax credits more generous, along with expanding support for video games and a new tax credit for orchestras. As a member of the Culture, Media and Sport Committee, I participated in our report on growing our creative industries, which make an increasingly important contribution to Treasury revenues. On a visit to Los Angeles to find out whether the UK is seen as a good place to film and do business, we were given a resounding yes, and our film tax credits were singled out as a major reason for more studios choosing to shoot films over here. I was delighted to learn recently that Ealing Studios is fully booked for the whole of this year. That is a tax credit that earns far more than it costs.

I also welcome the Chancellor’s plans to provide more support for our digital infrastructure, funding work to improve mobile networks, funding free wi-fi in our public libraries and continuing to roll out ultra-fast broadband to nearly every home, which is vital in a world where people work on the move and at home. However, I still make the point that many smaller businesses, as my hon. Friend the Member for Brentford and Isleworth (Mary Macleod) said, continue to get a poor deal when it comes to superfast broadband. In Park Royal in Acton, many businesses complain that they keep being promised that it is just around the corner, but it never actually happens. That is crazy. Park Royal is less than 15 miles from one of the busiest international airports in the world. We need all our businesses to be properly and speedily plugged in. To be fair, I have had an assurance from the Secretary of State for Culture, Media and Sport that this issue is being looked at, but we need it to happen fast if we are not to leave our small businesses in places such as Park Royal at a disadvantage.

Business will benefit from the good news on tax cuts for hard-working people, families and savers. The more comfortable and secure we feel financially, the more likely we are to feel able to spend a little more, so it is great news that yet again the personal tax allowance will be raised. Next month we will see it go up to £10,600, and it will go up again next year to £10,800 and then £11,000. According to the Office for Budget Responsibility, the average taxpayer in 2015 will be better off by £900 a year, compared with 2010. The best news for the low paid is the raising of the minimum wage to £6.70 an hour in October, the largest real-terms increase since 2008. Apprentices will get a pay rise, too—up to £3.30 an hour.

Basic rate taxpayers with savings will be able to enjoy the first £1,000 of the interest they earn on savings tax free. Higher rate payers will benefit from the first £500. From this autumn, savers will be free to take money out of an ISA and put it back in later in the year without losing their tax-free entitlement. These measures are all about freeing up people’s earned and saved money, which can only help businesses.

I welcome this Budget because it does what Conservatives do best—trust the people. We trust the people to make investments in their businesses and to drive growth, and they have. We trust the people to invest in their employees and bring on apprentices, and they do. We trust the people to spend their own hard-earned money in retirement in a way that best suits them, and they will. Put simply, and unlike the Labour party, we trust the people to do the right thing—and it is paying off, with the fastest growth of any major economy in the world. More people are in work than ever before, paying down the deficit and taking more people out of tax. The Opposition may not like it, but the plan is working. As Government Members know, we cannot invest in proper public services, including the NHS, unless we have a strong economy to pay for it. If we cannot get the economy right, we cannot make the investments we all want to see. This Budget puts Britain firmly back in business and I support it.

Oral Answers to Questions

Baroness Bray of Coln Excerpts

Tuesday 10th March 2015 Commons Chamber

[Andrea Leadsom]

It is extraordinary. I wonder if the hon. Gentleman would like to admit that every Labour Government when they leave office leave unemployment higher than when they came in. That is the truth of the matter. The Government are sorting out the mess left by the Labour Government, which was the worst financial crisis in British peacetime.

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

18. Does my hon. Friend agree that, thanks to our long-term economic plan, the Government have supported businesses through cutting businesses taxes? Does she further agree that the real difference between the Government and the Labour party’s approach is that while we have been cutting taxes on businesses, it wants to put them up?

[Andrea Leadsom]

Yes, my hon. Friend is exactly right. There is the risk under Labour of a return to an anti-business system that has already been recognised by people who are themselves trying to run businesses in the UK that are contributing to our economy. She has been assiduous in her constituency in supporting business. She has more than 8,000 new start-ups, and I was delighted to visit Clare and to meet the Ealing Mums in Business, who are doing everything that they can to build successful businesses from small beginnings, to talk to them about access to finance.

The Economy

Baroness Bray of Coln Excerpts

Wednesday 26th November 2014 Commons Chamber

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

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

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

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

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

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

“the start of real pay growth”,

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

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

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

[Andrea Leadsom]

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

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

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

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

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

Oral Answers to Questions

Baroness Bray of Coln Excerpts

Tuesday 2nd September 2014 Commons Chamber

[Danny Alexander]

The hon. Lady should celebrate our tax avoidance programme because it ensures that people who avoided paying tax under the previous Labour Government now pay tax under this coalition Government. She should welcome the fact that the programme is bringing in £7 billion more than was the case under the previous Government, not criticise it.

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

8. What fiscal steps he is taking to help businesses to invest and export.

[The Financial Secretary to the Treasury (Mr David Gauke)]

The Government are actively supporting the export and investment aspirations of British businesses. To ensure that companies have access to world leading export finance, Budget 2014 announced that Export Finance’s direct lending facility will be doubled to £3 billion and the rate of interest cut by a third to the lowest level allowed by international agreements. UK Trade & Investment is on track to help 50,000 companies export by 2015, double the number supported in 2010, and to encourage investment, the Government have cut the main rate of corporation tax to 21% and will reduce it further to 20% in April 2015.

[Angie Bray]

I have a successful small company in my constituency that sells skin care products across the world, and most recently, to China, but it would appear that the Chinese Government are insisting that online customers in China can purchase only up to $100-worth of product at any time unless they turn themselves into a registered business. Surely that must be against World Trade Organisation rules, so will my hon. Friend will look into it as a matter of urgency?

[Mr Gauke]

My hon. Friend is a doughty champion for her constituents and businesses located in her constituency. She raises an important point and I will make sure that both our embassy in China and the Department for Business, Innovation and Skills are aware of her concerns. The Government recognise the importance of trade with China and we want to do everything that we can to bring down barriers to enable as much trade as possible.

Oral Answers to Questions

Baroness Bray of Coln Excerpts

Tuesday 24th June 2014 Commons Chamber

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

HMRC is increasingly successful in bringing in its yield. It has to develop the most effective ways of working, and if it can find more efficient ways of doing so, that is fine. The important point is that HMRC is bringing in more money than it has ever done before.

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

The Chancellor of the Exchequer will recall that we met a group of McDonald’s apprentices and an Ealing McDonald’s franchise owner, Atul Pathak, last week to celebrate the announcement by McDonald’s of 8,000 new apprenticeships across the UK. Does my right hon. Friend agree that the Government’s initiative on supporting apprenticeships has been one of our great success stories—good for the economy and good for youth unemployment?

[Mr Osborne]

We had a fantastic meeting with McDonald’s employees, at which my hon. Friend was present, and it was heartening to hear about their confidence in their economic future. It is remarkable that we have had an hour of Treasury questions, during which we have discussed youth unemployment, and there were Department for Work and Pensions questions yesterday, but not a single Labour MP has mentioned the welfare plan that their leader published last week. That shows why the Labour economic policy lacks credibility even with Labour MPs and why the Labour leadership is in crisis.

Finance (No.2) Bill

Baroness Bray of Coln Excerpts

Tuesday 8th April 2014 Commons Chamber

[Priti Patel (Witham) (Con)]

I have thoroughly enjoyed the debate so far. I am astonished by the ground that we have covered, because we are solely here to address corporation tax, which has not been explored anywhere near enough in the light of the Labour party’s amendment.

As my hon. Friend the Member for Enfield North (Nick de Bois) said, the amendment would create uncertainty and put jobs and future investment at risk—there is no doubt about that. The Labour party wants to reverse the Government’s low business tax approach by putting up corporation tax, which would send out all the wrong messages to the business community. It is farcical that Labour Members are dressing up their so-called policy as a way to help small businesses with business rates. They are cynically trying to pitch big business against small business. The Government have clearly shown that we can help all businesses, both large and small, by cutting corporation tax and, importantly, easing the burden of business rates, which the Minister and the Chancellor of the Exchequer have done.

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

Does my hon. Friend agree that it is often not an either/or situation? Small businesses often depend on larger businesses for work.

[Priti Patel]

My hon. Friend is absolutely right. She gets to the heart of the debate and shows why Labour has no credibility. Labour Members cannot claim to want to help small businesses when, as the Minister pointed out, at the last general election, when they were in government, they proposed to increase the small profits rate of corporation tax from 21% to 22%. We have also heard about the Labour party’s so-called interest in small business, but in government it presided over the closure of 6,000 small post offices. There is fuel duty and energy costs for small businesses, too. On many issues, Labour lacks credibility. We should put things into context and beyond doubt.

--- Later in debate ---

[Sheila Gilmore]

I am glad that the hon. Gentleman is interested in business rates, the subject we are discussing. Our suggestion is that in order to make a real difference to those businesses, we can go far further in the way we deal with business rates.

Rather dramatic statements are made that a suggested change of 1% in the rate of corporation tax will result in companies—on the basis of that alone—changing their plans, leaving the country or not coming here. These statements are made but it is not clear whether there is evidence for them. The impact of the 21% to 20% change in corporation tax is not—or so it would appear in the initial period at least, according to the OBR report—to increase take from corporation tax, but to decrease it.

[Angie Bray]

Does the hon. Lady agree that there is some certainty on business rates because we have the cap of 2% and a reduction in costs for those with rateable values under £50,000? That is something of which businesses can be certain. In the meantime, we need to make sure that larger companies can be certain of the tax regime in this country. Having a review will only create uncertainty, which is the one thing that businesses looking to invest really do not like.

[Sheila Gilmore]

We must review constantly what we do to get it right. The suggestion is that a review in itself causes uncertainty, but there are many uncertainties in business. The constant discussion about the EU, Britain’s place in it and whether there should or should not be a referendum is an uncertainty. I am sure that many people who feel strongly about that nevertheless feel it is so important that they are willing to risk that level of uncertainty.

Autumn Statement

Baroness Bray of Coln Excerpts

Thursday 5th December 2013 Commons Chamber

[Mr Osborne]

Although the hon. Lady put her question in quite a partisan way, she hits on a very good point. There are sometimes big increases in welfare spending that are not subject to the kind of control that we in this House exercise on much smaller sums in Government Departments. Precisely because of the forecast increases in employment support allowance and housing benefit, it is right for us to bring those issues to the House and discuss them. It is a bit wrong-headed to complain on the one hand that housing benefit is going up too much while on the other hand campaigning to increase housing benefit. No doubt we will be able to have a fuller debate when we introduce the welfare cap.

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

I thank the Chancellor for his statement and for listening to businesses about their concerns over business rates. Businesses right across Ealing Central and Acton will welcome the cap on business rate rises, and many others will welcome the £1,000 reduction for those with houses of rateable values up to £50,000. It is a Christmas present come early for many, so I thank the Chancellor.

[Mr Osborne]

My hon. Friend is another who has been an assiduous campaigner on behalf of the shops, pubs and restaurants, and indeed the charity shops, in her constituency. These measures really will help on the high streets of Ealing and Acton, and I am glad that they have been so warmly welcomed. The people who run these businesses are the epitome of hard-working and aspirational people. This Government and our party are going to stand by them.

Cost of Living

Baroness Bray of Coln Excerpts

Wednesday 27th November 2013 Commons Chamber

[Christopher Pincher]

My hon. Friend is, as ever, apposite in his point, and we look forward to hearing Labour’s plan—plan A, plan B, plan Z? One day perhaps we will hear what it might be.

We have heard something from the Leader of the Opposition, whose latest stunt is to announce an energy price freeze. We should beware geeks bearing gifts, because that announcement is pretty hollow for three reasons. First, if a price freeze is imposed, companies will simply hike their prices before the freeze and afterwards, and people will be paying artificially high energy prices. That is what Professor Dieter Helm says, as well as Adam Scorer from Consumer Focus. Even the hon. Member for Southampton, Test (Dr Whitehead) has raised that concern. He is a Labour member of the Energy and Climate Change Committee and says that Labour’s plans for an energy freeze are somewhat sketchy.

The second reason a freeze will not work is that rather than break up the big six oligopoly, it will entrench it. Stephen Fitzpatrick of Ovo and the First Utility company—the company of choice for the Leader of the Opposition—say that a price freeze will make it more difficult for them to break into the market and operate, and that it will entrench the position of the big six, rather than break it up. The third reason the freeze will not work is that it will jeopardise £125 billion-worth of investment that we must make in short order in our energy infrastructure—£25 billion of that in the pipes and pylons that keep our lights switched on.

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

Is there not a fourth problem? It would be a brave Government indeed who called an end to the so-called 20-month freeze precisely because, as they would know, prices would be likely to increase. Therefore, the chances are that prices would be frozen at that level.

[Christopher Pincher]

My hon. Friend makes a valid point. I suspect that, were we, heaven forfend, to have a Labour Government, they would show a great deal of pusillanimity in the face of the energy companies—the big six that they created. We need to ensure that we get that infrastructure funding flowing from private enterprise. Unless we get that money from the private sector, the poor old taxpayer must foot the bill.

We do not need an artificial, high price freeze in future; we need price cuts now. That is what will help our constituents, and that is what they want. That is what the Energy Bill will deliver. We need to make it easier for people to switch: 24-hour switching could save people up to £200 on their energy bills. We need to get rid of the array of tariffs—under Labour, there were more than 400—and put people on the lowest tariff available. That could save people £158. If we also roll back those green levies and do not impose the £125 carbon tax that Labour tried to impose through the Energy Bill in the other place just two weeks ago, that will save our constituents money. That is real help for real people now, not the conjuring trick that the Leader of the Opposition, like some street magician, wants to undertake.

We will remember at all times and in all circumstances that the Labour Government, like a bunch of boy racers behind the political wheel, wrapped our economy around a lamppost. Never, ever will we let it happen again.

--- Later in debate ---

[Guy Opperman]

The Opposition spokesperson chunters from a sedentary position. On jobs figures and the economy, she will doubtless be addressing the fact that in her constituency unemployment has fallen by 12.5% in the last year, that youth unemployment has fallen by 16.5% and that the number of apprenticeship has risen from 620 in 2009-10 to 1,170 according to the most recent statistics. That is real action to help people in the north-east.

[Angie Bray]

Will my hon. Friend give way?

[Guy Opperman]

I will not give way to my hon. Friend. I have great respect for her, but it would not be fair on those who have yet to speak.

--- Later in debate ---

[Ian Swales]

I am sorry; I have taken two interventions already.

We hear a lot from Labour about wages, but it is what ends up in people’s pay packets that really counts. When Labour left office, people on the minimum wage were paying a massive £35 a week in tax and national insurance. Since then, the minimum wage has gone up by £20 a week, but the national insurance bill for those people has gone down by £9 a week, with a further cut to come in April.

[Angie Bray]

In my constituency, there are fewer people unemployed, and employers welcome the cut in national insurance contributions because it helps to create more jobs. Also, nearly 5,000 people there are now paying no tax at all. That is the way to help people who are finding life tough: more jobs and less tax.

Money Transfer Accounts

Baroness Bray of Coln Excerpts

Wednesday 17th July 2013 Westminster Hall

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Bayley.

I am delighted to have secured this debate on the provision of money transfer account services by banks and their impact on Britain’s ethnic minority communities in particular. Remittance plays a vital and complementary role in helping to lift millions of people out of poverty across the world, and it plays a vital role in ensuring that, as well as our commitment to aid, we engage the public in giving to their loved ones, who are often on the verge of poverty and would not qualify for development aid. This is a vital debate because we need to consider how we support individuals to give to family members across the world.

Remittance helps to save lives through direct support by providing for loved ones in remote areas of the world. It helps save lives in the Indian subcontinent, for instance in Pakistan and Bangladesh, and in many other places, especially during times of crisis such as Cyclone Sidr in Bangladesh a few years ago and the earthquake and floods in Pakistan. Many of our constituents from various African and Latin American countries send money through remittance.

I will focus on the recent decision that has propelled us into calling for this debate. Barclays made the decision to withdraw banking facilities from small and medium-sized community-based money transfer agencies, which provide low-cost, legitimate routes for sending money to remote places across the world. In some of those places, it is very difficult for mainstream money exchange and money transfer companies that do not have networks, agents or structures to get assistance to family members. Taking the example of disasters, those are the times when people need to get assistance to their families immediately, which is certainly what happened in countries such as Pakistan and the many others that I mentioned.

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

I thank the hon. Lady for giving way so early in this debate. One area she has not mentioned is Poland. I have a large Polish community in my constituency that is facing the loss of One Money Mail, which has become a tried and trusted service for many people in the Polish community when sending remittances back to Poland. Those people are extremely concerned that they may have to lose the service, which they have grown to trust and which they use frequently; it will be a great loss to the community.

[Rushanara Ali]

I thank the hon. Lady for her intervention. She has added an important perspective to the debate, which is that the issue also affects countries that people might not have thought about.

I commend parliamentarians, because some 46 Labour MPs have already signed a letter to Barclays, and I know that the all-party group on Somaliland and Somalia has also made representations to the Government. MPs and parliamentarians from both sides of the House, and many other people, have raised the alarm bell with the Government. That highlights our deep concern about how decisions that have been made in the past, not just by Barclays but by other banks such as HSBC, to remove banking facilities that are affordable for hard-pressed families who are trying to get support to other parts of the world, have been supported rather than punished. We should encourage people to give, and I hope that the Government will consider the issue closely.

According to the Financial Times, more than 250 money transfer companies are now facing closure following the decision by Barclays to withdraw the service. Other banks have already withdrawn it, so the suggestion that those small and medium-sized companies could go elsewhere is nonsense. We need to ensure that the decision of those banks does not send a signal to other banks that there is something wrong with such businesses and that other banks should not do business with them, which is essentially what has happened. That is the insidious conclusion that is being drawn at the moment. Allegations are being made that those businesses, many of which are in our constituencies, are engaged in activity that is not legal.

Barclays has said to me that it is concerned about only the 1% of companies that represent 46% of the problem. The Government and regulatory authorities should consider how to assist Barclays and other companies that need to clean up operations where there are problems. If that 1% is a problem, assistance should be provided to address that problem rather than involving the 99%, in the case of Barclays, that do not pose a problem. If that logic were applied to the banking sector, for instance, we would not have a banking sector left. I ask the banking sector to have some empathy and to think about what the consequences would have been for it if, during the financial crisis, all companies in the sector had had to be shut down just because there were certain bad apples.

I hope the Minister will consider the issue and answer the question about how we can focus and zoom in on the areas where there are cowboy operators, which none of us want. The diaspora and ethnic minority communities in this country and across the world do not want to see cowboy operators; they want legitimate, well regulated mechanisms for sending money to loved ones.

As I said, 45 other MPs and I supported the letter to Barclays bank that the Minister has seen, and I look forward to hearing what he, his Department and the regulatory authorities will do to try to help with this important matter. We are asking for some breathing space. We are asking Barclays—I do not believe this is an unreasonable request—to extend the date from August by another six months to give the Government, the regulatory authorities and the Minister the breathing space to bring people together, including the British Bankers Association, the banks and interested parties such as the money transfer agencies and the communities that use their facilities, wherever possible, to arrive at a solution that does not lead to the industry’s closure.

More than $3.2 billion of remittance a year is sent from the UK, and remittance amounts to some $530 billion worldwide, which is more than the total global international development budget. We must act internationally in concert with our American partners. The decision to apply fines to Standard Chartered and HSBC has led to the decision by UK banks such as Barclays to stop remittance facilities. Frankly, the companies have nothing to do with what has happened in the US with the breaching of sanctions, or with the other cases in which banks have been involved, but they are being punished.

If we do not find a way to address the problem, the risk is enormous, because there will be no legitimate ways for people to send money to remote parts of the world. Of course, there is virtually no way for people to get assistance to countries such as Somalia through a legitimate route. We need a constructive way forward, and I hope the Minister can explain how his Department and officials will work with the banking sector to develop an industry-wide solution so that we can ensure that the remittance and money transfer industries are strengthened in light of the crisis, rather than destroyed.

I also hope that the Minister will consider that if banking facilities to money transfer agencies end, what is likely to happen is what used to happen before a regulated mechanism was in place. On the whole, people who are not wealthy want cheap and affordable means to get assistance to their loved ones, particularly in times of desperation and crisis, such as when a family member has died and money needs to be sent quickly for burials and associated costs, or when there is an urgent health care emergency, likely or actual conflict or a humanitarian emergency, as was the case in Somalia and the rest of east Africa in 2011 and as is likely to happen in future. If there is no legitimate route to send money, there is a major risk that the industry will be driven underground and that clandestine mechanisms will be used to get money to family members. If that happens in the billions of pounds, we will not be providing remitters with the back-up, support and legal mechanisms to send money safely to their loved ones. It will also mean that some countries are unlikely to be able to monitor the amount of money flowing into their economy, leading to inflationary pressures.

Furthermore, there are security issues. People worry, rightly, that their money might end up in the wrong hands, and potentially in the hands of extremists. In countries such as Somalia and Somaliland, there are grave concerns about that risk.

Economic Growth

Baroness Bray of Coln Excerpts

Wednesday 15th May 2013 Commons Chamber

[David Rutley]

Absolutely. We are categorical about that. We have a very clear plan. We are the only party in the House that is presenting proposals for an in/out referendum, and things will stay that way. On the back of that, I am confident that we can secure an outright Conservative victory.

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

Does my hon. Friend agree that it is essential for us to get the message across that only under a Conservative Government will the country have an EU referendum, and that the referendum will come after we have renegotiated our terms of membership with the EU? That is vital if we are to give people a proper choice and present them with the best options. The draft Bill that was published yesterday underlines that message very clearly.

[Mr Speaker]

Order. I must gently remind the House that interventions should be brief. A large number of colleagues are still seeking to contribute to the debate, and I am keen to accommodate them, but brevity is essential if I am to do so.