Banking

Chi Onwurah Excerpts

Wednesday 15th January 2014 Commons Chamber

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The Minister has spoken in strong terms about the experience of the financial services. Does he accept that the unique way in which bonuses drive short-term risk taking led to the scandals that we witnessed, and, indeed, to the financial crisis? Does he really believe that the reward for short-term risk taking behaviour to meet bonus targets should be more than 100% of the reward that someone receives for doing his or her own job?

[Sajid Javid]

What I do accept is that badly structured and badly designed bonuses will lead to bad behaviour. I am sure that the hon. Lady herself accepts that if an arbitrary cap is imposed on bonuses and it leads to an increase in fixed pay but no overall fall in overall pay, the bad behaviour will actually worsen.

We are putting our house in order. We are learning from the huge mistakes of the last Government, and are ensuring that we create a country in which the public can trust that their money is secure and our banking sector can flourish.

Investing in Britain’s Future

Chi Onwurah Excerpts

Thursday 27th June 2013 Commons Chamber

[Danny Alexander]

It is clear that the hon. Lady’s campaigning is a model of parliamentary effectiveness and I urge her to continue with it to the further benefit of her constituents.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

In response to my right hon. Friend the Member for Newcastle upon Tyne East (Mr Brown), the Chief Secretary spoke of his “commitment to the A1”. What he actually said in his statement was:

“Any hon. Member planning a trip to Scotland…will want to see a better A1 north of Newcastle.”

Is that really his idea of a commitment? If he can say nothing more credible—I hope that he can—is it any wonder that he inspires so little confidence in the country?

[Danny Alexander]

I am sorry to hear such a curmudgeonly response to what I thought was a very positive announcement. [Interruption.] The point that I was making in my statement was that there are a number of long-standing issues on our highways network that have never been addressed. We have set aside the funding and will bring forward the plans to ensure that the improvements to that route take place between now and 2020.

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 12th March 2013 Commons Chamber

[Danny Alexander]

I certainly share my hon. Friend’s admiration for micro-breweries: one in my constituency has recently produced a beer called Ginger Rodent, which sold out in its first run. I look forward to more sales when it is in the House of Commons bar in June. As for the rest of his question, I take it as a Budget representation.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

11. What recent estimate he has made of the extent to which the rate of increase of average earnings has kept in line with the rate of consumer price inflation.

[The Financial Secretary to the Treasury (Greg Clark)]

The average gross weekly earnings of full-time employees rose by 2.8% between the last quarter of 2011 and the last quarter of 2012, while consumer prices rose by 2.7%. As a result of the increases in the personal tax allowance and rising employment, average household disposable income has increased by 2.8% more than inflation.

[Chi Onwurah]

Clearly the Chancellor has no understanding of what it is like to get by on a low income when increases in prices such as VAT mean debt and hardship for many families. Equally, last week the Office for Budget Responsibility confirmed that the Prime Minister has no understanding of his economic policies either. Is that why the Chancellor is implementing a tax cut for millionaires—because he does not understand real life or economics?

[Greg Clark]

If the hon. Lady had a grasp of economics, she would understand the need to take people out of taxation, which is what we have done through the increase in the personal allowance. In fact, that increase affects the lowest paid most of all and is equivalent to a pay increase of 4.5% since the general election. A higher personal allowance is a better policy than the shadow Chancellor’s plan to introduce the 10p rate, which the Financial Times described as “a pretty basic howler”.

Economic Policy

Chi Onwurah Excerpts

Monday 25th February 2013 Commons Chamber

[Mr Osborne]

I think that someone on the Opposition Benches shouted from a sedentary position, “Tax cuts for the rich,” when my hon. Friend was suggesting tax cuts for small businesses. That tells us everything about the Labour party’s attitude to enterprise. We have reduced the small companies rate, which was due to go up to 22% under the plans we inherited. It is now 20% and, as from the beginning of this year, we have had a tenfold increase in the annual investment allowance to help small businesses.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Who does the Chancellor think has been the most humiliated in the eyes of the public—the credit rating agencies that gave triple A ratings to junk investments and therefore helped cause the financial crisis, or the Chancellor, who staked everything on the same triple A rating and then lost it?

[Mr Osborne]

Unfortunately the hon. Lady’s list did not include the shadow Chancellor, so I cannot give her an answer.

Autumn Statement

Chi Onwurah Excerpts

Wednesday 5th December 2012 Commons Chamber

[Mr Osborne]

First, let me say that I completely understand why my hon. Friend wants to make sure, on behalf of his constituents in Lancashire, that any development of shale gas or unconventional gas that is undertaken is environmentally safe and safe for local communities. We are absolutely determined to ensure that that is the case. That is why we stopped the exploration that was taking place until we were sure that it was safe, and a decision on that is still pending from the Energy Secretary. As has been demonstrated in the United States, however, local communities often benefit from the jobs and investment shale gas projects bring. My hon. Friend is right that this new single office must make sure that regulation is straightforward and simple while also being rigorous so that local communities are protected.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The north-east is the only UK region with an export surplus, which shows that where there is demand, we rise to the challenge, but it is also the region with the highest unemployment rate, so why is the Chancellor attacking the unemployed as workshy scroungers living a life on benefits and doing nothing to get demand and jobs back in the economy?

[Mr Osborne]

I have never used that language at all. What I have said is that we have got to make savings in the benefits bill and, in my view, it is very important that we have fairness in our society. One element of fairness is that people on out-of-work benefits should not be earning more on average than the family that goes to work, which is why we have introduced the benefits cap. I could not quite understand what the shadow Chancellor was saying about Labour’s position on the benefits cap. He certainly led all Labour Members through the Division Lobby time and again against the benefits cap, but I think they will want to check exactly what he said in reply to my statement.

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 6th November 2012 Commons Chamber

[Sajid Javid]

We carefully consider all submissions from stakeholders, including the FairFuelUK campaign. The important thing is that had the Government continued with their inheritance on fuel duty, that duty would have been 10p higher, which would have made things a lot more difficult for ordinary people.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

10. If he will use the revenue received by the Exchequer from the forthcoming auction of the 4G mobile telephone spectrum for the purpose of building affordable homes over the next two years.

[Emma Reynolds (Wolverhampton North East) (Lab)]

11. If he will use the revenue received by the Exchequer from the forthcoming auction of the 4G mobile telephone spectrum for the purpose of building affordable homes over the next two years.

[The Chief Secretary to the Treasury (Danny Alexander)]

No decision has been taken on how to use the full revenue from the 4G mobile spectrum auction, but the Department for Business, Innovation and Skills was allocated an entitlement of up to, but no more than, £600 million for science projects from the fund. As I said in answer to an earlier question, on 6 September the Government announced an ambitious housing package to boost housing supply, building on our £4.5 billion investment to deliver 170,000 affordable homes over the spending review period.

[Chi Onwurah]

Perhaps the Chief Secretary is reluctant to commit because he does not trust his colleagues in the Department for Culture, Media and Sport to overcome their history of delay and dither when it comes to 4G. In Newcastle, thousands of families are on the council house waiting list and thousands of construction workers are unemployed. Does he not agree with the director general of the CBI, who said that this plan was exactly what the economy needed?

Multiannual Financial Framework

Chi Onwurah Excerpts

Wednesday 31st October 2012 Commons Chamber

[Mark Reckless]

Many hon. Members will be asking themselves the same question.

We heard from the Financial Secretary what these EU officials are paid. The Prime Minister went to Brussels a week or two ago and said that one in six EU officials earned more than €100,000. He might have understated his case, because we need to compare like with like. Not only do they earn more than €100,000 but they pay a special, incredibly low tax rate that applies only to people who work for the EU. They get an enormous expatriate allowance that shoves on another €15,000 to €20,000. They get a huge housing allowance. And, while a group of people in this country are about to lose child benefit of about £85 a month, EU officials get paid, tax free, another €300 per month per child. They contribute virtually nothing to their pension contributions. Under the arrangement we have in this country, any time a public official earns more than the Prime Minister—£142,500—that has to be signed off by the Chief Secretary to the Treasury. If we had to sign off every time an EU official was, in effect, getting the same take-home pay there as the Prime Minister’s salary here, that would apply to more than 5,000 European Union officials, or more than one in six. The Chief Secretary would be doing nothing but signing off those requests.

Today we have an opportunity to debate and vote on the multiannual financial framework—the long-term budget. This comes round once every seven years. It requires unanimity among member states and primary legislation in this House to implement it.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Does the hon. Gentleman agree that, despite the agitation among Government Members, the real issue is not the objective—there is a general consensus on the need for cuts to the budget—but the weakness of the Prime Minister in being unable to negotiate and having to threaten a veto?

[Mark Reckless]

No, and that is not a sensible point at all, because we have a one-off opportunity. It is this House that ultimately votes, so if any Government Members feel uncomfortable—not because of who I will be following through the Lobby, but because of who may be following me, in support of my Conservative amendment—I say to them: if we send the Prime Minister to Brussels telling him that it is acceptable to agree an inflationary increase, he may come back to this House having agreed that inflationary increase. We will then have to vote on primary legislation, in Committee and on Report, for that inflationary increase for the EU budget, all the way to 2020. If Members do not want that, they should vote today for my amendment.

The other strong argument for the amendment is this. Some people say, “We’re not going to get a real-terms cut,” but we will certainly not get one if we do not even try. If we use the veto, that is not a bad place to be; in many ways, it is better than where we would be with an agreed inflationary increase. There are two strong reasons for that. First, either we operate within a multiannual financial framework under the old, frozen ceilings carried forward, or we agree new ceilings going up by inflation, allowing higher budgets in future. Each of those budgets is always negotiated under qualified majority voting annually; the question is, where we have unanimity and where we need legislation, do we allow inflationary higher limits to 2020 or not?

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 26th June 2012 Commons Chamber

[Mr Gauke]

I am grateful to my hon. Friend for raising that point and I am happy to look into the case. HMRC’s record in dealing with end-of-year reconciliations and improving accuracy is moving in the right direction, but there is more to do.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

15. What representations he has received on the treatment of different savoury products for the purposes of levying VAT.

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

HMRC is shortly to publish on its website a summary of the responses to its consultation, “VAT: Addressing borderline anomalies”. The response document will contain a list of those who contributed to the consultation.

[Chi Onwurah]

As I am sure you know, Mr Speaker, Newcastle is the home of the Greggs pasty, so I was hopeful that the Chancellor’s latest U-turn but one would have resolved the great savouries shambles, but now I learn that he has turned his wrath on the pretzel sellers of Newcastle, including Auntie Anne’s in Eldon Square. Could the Chancellor possibly focus on bringing growth to the economy, rather than confusion to our eating habits?

[Mr Gauke]

I am sure the hon. Lady is aware that Greggs welcomed what we said about hot food. None the less, there has been an anomaly in the tax system whereby some hot foods have been treated differently from others. We are seeking to remove that anomaly and that is exactly what we are doing.

Unemployment (North-east)

Chi Onwurah Excerpts

Wednesday 20th June 2012 Westminster Hall

[Mr Wright]

I absolutely agree with my hon. Friend. Some of the measures the previous Labour Government put in place, against the most severe global financial crisis the world has seen for at least a century, did to some extent mitigate the savage effects of unemployment.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I congratulate my hon. Friend on securing this debate on an issue of such great importance to the north-east, even if it is of less importance to the Government. Newcastle has seen its unemployment rate go up by approximately 20% in the past year. In addition, its national unemployment ranking has gone up by 30 places. A year ago, it had the 76th highest unemployment rate in the country; now it has the 47th highest. Does that not suggest that the Government’s measures are feeble and are leaving the north-east and Newcastle behind?

[Mr Wright]

I absolutely agree with my hon. Friend, and I will go on to mention some job losses that her constituency is facing. The region still, and by a considerable margin, has the highest unemployment rate in the country at 11.3%. The figures published today show that unemployment has increased by 8,000 in the past quarter, to 145,000 in the north-east. The number of people claiming jobseeker’s allowance has increased by 900 on the previous month. In Hartlepool, the number of people unemployed stands at 4,612, a rate of 11.6% and the 30th highest of all the UK constituencies. That jobless figure of 4,612 is more than 10% higher—503 higher—than it was a year ago.

Today’s statistics also show that the number of people who are economically active in the north-east has gone down, from 75.4% to 75.2%, as has the proportion of the adult population in employment, from 66.6% to 66.5%, whereas the national rate for England is 70.8%. On unemployment and economic prospects, the gap between the north-east and the rest of the country is getting wider and should be a huge cause of concern for the Government. From their actions—or rather, the lack of them—and from the priorities we have seen today in their not sending a Minister, I do not get the sense that that is the case at all.

--- Later in debate ---

[Ian Swales]

I have hardly started. I will give way in a moment, when I have got further into my speech.

Solutions to the problem have to be bottom-up and top-down. My local council—before an Opposition Member points it out, it is a Labour council—deserves praise for its infrastructure work, adding new seafront work and leisure investment to the huge Environment Agency spend on flood defences, as well as the Government investment in MySpace, which is going on in Redcar. It was good to see the Association of North East Councils visiting Redcar a few weeks ago to see what is happening. However, it is disturbing how many of the construction jobs are not going to local people. I have raised that with the council, because it is important for the north-east to help itself as much as possible and not to have such jobs going to people who travel into the area. My local council is taking a high risk, however, because the Audit Commission says that at the end of the work it will have the highest debts in the country for the size of the council, but at least it is doing something.

I praise the Government for investment in local infrastructure, in the Teesside railway system and, in particular, the recently announced refurbishment of stations, including all six in my constituency. House building is obviously a good option, but in areas such the one I represent the population is static or declining. We need to upgrade our housing stock. That is true throughout the north-east, but as I keep reminding my council, if we do not plan for the overall stock we get market failure. That has already happened in three parts of my constituency: South Bank, Grangetown and West Dormanstown.

We need a lot more focus on enterprise by our councils. I cannot speak for other areas, but my local council of Redcar and Cleveland often proves to be difficult to deal with. We recently lost 200 jobs when a potential new investor simply gave up and went somewhere else. I welcome the new enterprise zones, including three in my constituency, which are already attracting interest. I hope that we will prove to be easy to deal with and get companies into those zones.

These debates always lead to a lament for the RDA at some point, and the hon. Member for Hartlepool has already touched on that. It is interesting to note that, in a sense, RDAs were not a regional policy; they covered the entire country and all got large sums of money. I salute the bravery of the present Government in supporting only projects in hard-pressed areas such as the north-east with the regional growth fund. That is one reason why the north-east is getting a large share of the regional growth fund money.

[Chi Onwurah]

The hon. Gentleman says because all the RDAs were abolished, the abolition of One North East was not a regional policy. As a member of the Liberal Democratic party, however, does he not agree that his party stated specifically that One North East would be saved, because it was admired by both public and private sectors? Its demise has been regretted ever since its abolition.

[Ian Swales]

That was never party policy, but it was a remark made by the Business Secretary. I think everyone recognises that One North East was the best of the regional development agencies. My point was that giving money to every region will not rebalance the economy. I salute the bravery of our Government in not giving money to regions that do not need help.

A month or two ago, I said in this Chamber that in the two years before the general election, the RDA approved 96 projects, worth £148 million, in which One North East directors had to declare an interest. Of those, only eight projects and £6 million related to the Tees valley. The Tees valley got a poor deal from One North East. Experian assessments place Hartlepool, Middlesbrough, Redcar and Cleveland in the weakest 10 economic areas of the country, so I welcome the local enterprise partnership and its work.

The LEP is doing a lot of good work, part of which is defining clusters—we have process industries and automotive clusters, and we are now developing a steel cluster. The welcome news is that Sahaviriya Steel Industries has bought the Redcar steelworks, and is now producing; Tata is still in the area, and opened a new research centre just two weeks ago, which had some Government support; Siemens has its worldwide centre for steel processing development in Stockton; and Teesside university is opening up a new department, so a good cluster is developing there. We also have clusters in green technology, and I welcome new initiatives in renewables, with the industry forming the Energi Coast group—20 companies getting together to exploit the new market jointly—and Narec has been included in the new technology innovation centre for renewables. Clusters attract like-minded companies. Global Marine Systems has just relocated from Essex to Middlesbrough, and last month it hired the Riverside stadium to recruit people.

Manufacturing is having some success in the area. International trade is booming with record exports— the best ever—from the region during the 12 months to March, including 20% growth in exports outside the EU. Jonathan Greenaway, a partner at PricewaterhouseCoopers in Newcastle, recently reported those successes and said:

“This is a great time of opportunity for manufacturers, and…UK companies are really rising to the challenge.”

We have some problems with the public sector, to say the least, with job losses and so on. I believe that taxpayers expect efficiency in public services and that they do not see them as job creation exercises, but there has been a worrying trend of relocation of jobs, certainly out of the Tees valley. Under the previous Government, the ambulance service was lost—it still baffles me that an area of 750,000 people is not deemed capable of running its own ambulance service, but that was moved out of the area. We also lost the office of Her Majesty’s Revenue and Customs in Middlesbrough, and thus 400 jobs. There are other potential problems, such as the Insolvency Service office in Stockton. I urge the Whip to reverse that trend and to move jobs to hard-pressed areas in the north-east such as Teesside.

I note that some agencies are looking at Yorkshire and the north-east as a region. I point out to them that the Tees valley is exactly the midpoint—I measured it this morning—and an ideal location for headquarters. The regions are massive, however: Sheffield in South Yorkshire is as close to Southampton as it is to the constituency of my right hon. Friend the Member for Berwick-upon-Tweed (Sir Alan Beith).

For 13 years, the north-east had a Labour Government—almost all MPs and councils were Labour—but between 1997 and 2010, the number of unemployed people in the region went up by 7,000, and the rate remained approximately the same, despite the unprecedented amount—

Oral Answers to Questions

Chi Onwurah Excerpts

Tuesday 6th March 2012 Commons Chamber

[Mr Gauke]

So he is an ex-Harry Redknapp fan.

Complexity in the tax code can provide opportunities for avoidance, but, equally, much of the complexity that exists is a consequence of attempts to crack down on avoidance. The Government have set up the Office of Tax Simplification, and we are determined to do what we can to simplify the code and address avoidance and evasion.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Stamp duty land tax avoidance schemes cost the Exchequer hundreds of millions of pounds a year, but my questions on the subject have been met with complete complacency by Ministers. I was told:

“HM Revenue and Customs… is aware of a number of marketed… schemes. HMRC considers that none of the schemes… is effective in reducing… liability”.—[Official Report, 17 January 2012; Vol. 538, c. 708W.]

Now we hear that the Chancellor is going to crack down on such schemes. Which is it?

[Mr Gauke]

There are many marketed schemes that HMRC is convinced do not work, and that will be established in the courts. I suggest that those who are sometimes persuaded by claims that a particular scheme will work should treat them with caution. However, the Government are determined to crack down on stamp duty land tax avoidance. We took steps in the last Budget, we took steps in the autumn statement strengthening the disclosure regime, and there may well be more to come.