Oral Answers to Questions

Debate between Bill Esterson and David Gauke

Tuesday 29th April 2014 Commons Chamber

[Bill Esterson (Sefton Central) (Lab)]

9. What recent estimate he has made of how much the reduction in the additional rate of income tax to 45% will be worth each year for a person earning £1 million a year.

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

The cost of reducing the additional rate of income tax to 45% is estimated to be around £110 million a year, as set out in table 2.2 of Budget 2013. We have not broken down the impact by income ranges. That is because there is a significant behavioural response associated with the additional rate of income tax. The behavioural response is estimated in aggregate and reflected in the costing.

[Bill Esterson]

Ordinary people are £1,600 a year worse off under this Government. More than 15,000 working people in my constituency alone are paid less than the living wage. Is not the reality that a tax cut for millionaires is totally the wrong priority when so many ordinary people face a cost of living crisis?

Banking

Debate between Bill Esterson and David Gauke

Wednesday 15th January 2014 Commons Chamber

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

This has been a thoughtful and interesting debate. I particularly thank my hon. Friends the Members for West Worcestershire (Harriett Baldwin), for Bournemouth East (Mr Ellwood), for Northampton South (Mr Binley), for Redcar (Ian Swales), for Spelthorne (Kwasi Kwarteng) and for Hexham (Guy Opperman), all of whom made excellent and intelligent speeches. I am not sure that I would use quite the same words to describe the speech made by the shadow Chief Secretary, the hon. Member for Nottingham East (Chris Leslie), but I hope that he will not take that personally. I have a lot of sympathy for him—after all, he spent a number of years making speeches in debates like this one, saying that we were going too far, too fast, and that a plan B was needed. We do not hear quite so much about that now.

We have heard a fair amount about the cost of living in recent months, but Labour party spin doctors have been briefing the press that they are about to bring that campaign to an end, so where does Labour go now? How does it fill the vacuum that exists where an economic policy should be? The answer is, “With a bit of banker-bashing.” I could say, “Same old Labour”, but in reality the rhetoric that we have heard today and during the current Parliament is not consistent with what the last Labour Government did.

When it comes to dealing with the risks and excesses of our financial system, Labour is in no position to criticise us. It is extraordinary that the people who crashed the car now wish to give us a lecture on road safety. They left us with a regulatory system that had failed catastrophically—a system that had failed to identify risks, or, when they were identified, failed to do anything about them—and, when the crisis came, it was not clear who was in charge. But who was the special adviser in the Treasury who was running the show when the tripartite regime was established? The shadow Chancellor. And who was the City Minister in the run-up to the crisis? Again, the shadow Chancellor.

It was this Government who produced the Financial Services (Banking Reform) Act 2013 and implemented the Vickers report, and this Government who established the Financial Policy Committee, involving the Bank of England once again and providing clear lines of responsibility. It is this Government who have ensured that we ring-fence deposits, separating them from volatile investment banking, and it is this Government who have introduced a bail-in power that protects taxpayers, to ensure that shareholders and creditors, not taxpayers, are first in line to pay for a bank failure. It was the last Government who presided over a system whereby individual bankers could not be held properly to account. Under our laws—laws passed by this Government—reckless management of a bank could result in seven years in prison. Under the last Government, it could result in a knighthood.

[Bill Esterson]

Don’t worry, I’m not after a knighthood. The Minister’s party colleague, the hon. Member for Northampton South (Mr Binley), made it clear that the funding for lending scheme has failed and that lending to small businesses has fallen. The Minister’s comments have been notable in their failure to mention what he is going to do about funding for small businesses. Will he tell us now?

[Mr Gauke]

Gross lending is up, but one thing that will not help small businesses is if our interest rates rise prematurely because we do not have credibility. We have given this country economic credibility and that has helped to keep interest rates lower for longer.

Our system ensures rigorous scrutiny before someone can have a serious position in a bank. Labour’s system could allow someone like Paul Flowers to become chairman of a bank. While fines went back into the banking system in the past, now they go to support military charities and others.

Oral Answers to Questions

Debate between Bill Esterson and David Gauke

Tuesday 13th July 2010 Commons Chamber

[Mr Gauke]

My hon. Friend is absolutely right to highlight the fact that we live in a globalised world and that businesses can choose where they locate their activity. That is why we are introducing substantial cuts in corporation tax, from 28% to 24%. I was delighted to read this morning that the previous Chancellor was an enthusiast for reducing corporation tax—although we did not see so much evidence of that when he was in power. The fact is that the Budget proposals will benefit all sectors of society, including manufacturing, and we will see £13 billion more investment over the next few years as a consequence of those measures.

[Bill Esterson (Sefton Central) (Lab)]

Many businesses in the north-west saw the value of regional development agencies and were very much opposed to their abolition. What consultation was carried out with business leaders on the proposal to abolish RDAs?