Oral Answers to Questions
John Cryer Excerpts(9 years, 4 months ago)
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Andrea Leadsom
I am grateful to my hon. Friend for that question. As he will know, the LIBOR fines imposed on banks for the appalling rigging of LIBOR are being used for mainly military charities, and a few other ideas have been put forward. I shall bear his remarks in mind and mention them to the Chancellor.
John Cryer (Leyton and Wanstead) (Lab)
Further to Question 8, what measures is the Chief Secretary taking to tackle the activities of payroll and umbrella companies that promote bogus self-employment which in turn fuels widespread tax evasion?
Danny Alexander
We have already announced measures to deal with intermediaries, both offshore and onshore. As the hon. Gentleman will know, a consultation on the issue is taking place at the moment, and it is important to ensure that companies cannot put in place artificial arrangements that are designed to reduce their tax bill and often have the consequence of removing important employment rights from workers. We continue to take that matter incredibly seriously.
Oral Answers to Questions
John Cryer Excerpts(10 years ago)
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Mr Osborne
We are taking steps to reduce business taxes, when others would put them up. We are also taking steps to ensure that energy costs for manufacturers are lower; we set out a package in the Budget. Above all, we are creating a country in which people want to invest and create jobs because they have confidence in our long-term economic plan.
John Cryer (Leyton and Wanstead) (Lab)
The number of tax compliance inspections of companies by Her Majesty’s Revenue and Customs is falling, rather than rising. Why is that the case?
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.
Oral Answers to Questions
John Cryer Excerpts(10 years, 2 months ago)
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Mr Osborne
My hon. Friend is absolutely right that the low interest rates put in place by the independent Bank of England have made life more difficult for savers, although, of course, the growing economy is good news for savers as well as borrowers. My hon. Friend has warmly supported what we have done in the Budget, not only to give people access to their pension pots but to introduce the new ISA. We have also introduced the new savings bond for pensioners, which will come into effect at the end of the year, with higher interest rates to help those in his constituency who have worked hard and saved hard.
John Cryer (Leyton and Wanstead) (Lab)
Real wages have fallen by £1,600 since the election, so will the Chancellor now answer the question repeatedly asked by Opposition Members: will wages in real terms be higher or lower at the next election than they were at the last election?
Mr Osborne
Britain is better off because we are rescuing this country from the economic mess in which the Opposition left us. There is a complete fantasy in the Labour party, demonstrated again in the past hour, that one can have an economic policy that destroys the banks, destroys business and destroys the public finances but somehow helps the people of the country in the process. As we learned to our cost under the previous Labour Government, that is not the case. They wrecked the economy and we are recovering it.
HMRC Inquiry Centre Closures
John Cryer Excerpts(10 years, 4 months ago)
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Mr Gauke
They are the result of research undertaken by HMRC. Matters can often be resolved over the telephone rather than in a face-to-face meeting. The hon. Gentleman rightly highlighted a case in which an 85-year-old gentleman caught two buses to attend an inquiry centre. If it is possible to drive that service more easily over the telephone, so be it, but there are circumstances in which a face-to-face meeting will be appropriate, so that will be provided.
HMRC’s research has highlighted that up to 1.5 million customers need extra help with their tax and benefits affairs. Many of them need help only for a specific event in their lives, such as when they approach retirement. Others may have low literacy skills, or a mental health condition may make it difficult for them to cope with their affairs. The new, more accessible service will be tailored to the needs of customers who require extra help. Specialist help will be provided over the telephone by extra support advisers who have the time, skills, knowledge and empathy to handle customers’ inquiries at a pace that suits them, and who can identify when a customer needs extra help. If a customer’s query cannot be dealt with over the phone, they can arrange a face-to-face meeting with a team of mobile advisers based across the United Kingdom. Such meetings can be arranged at a time and place convenient to the customer, and extra help will be delivered through HMRC’s voluntary and community sector partners who have been provided with extra funding so that they can support more customers and refer them directly to the new service.
John Cryer (Leyton and Wanstead) (Lab)
The Minister says that the service will be more accessible, but can he guarantee that? More than 280 offices will be closed. It is very difficult for the ordinary man and woman in the street to see how the service will be more accessible than it is now. I am sure that he will use the phrase, “Taking the service to the people, rather than people coming to bricks and mortar.” The advantage of bricks and mortar is that it cannot be closed down or moved. Services that go into the community can disappear: lorries, vans or whatever vehicles are used for mobile services can disappear.
Mr Gauke
The point I was making is that, yes, 281 inquiry centres are being closed, but there will be something like 350 venues that will be used for face-to-face meetings under the new regime. HMRC fully acknowledges that there is a need to deal with those people who require enhanced support and face-to-face meetings. It has been clear about that.
Oral Answers to Questions
John Cryer Excerpts(10 years, 5 months ago)
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Mr Osborne
The economy has grown by 2.8 % over the past four quarters, which is the point. First, when the shadow Chancellor was in office, he predicted that there would be no more boom and bust—we had the biggest boom and the biggest bust—and secondly, he predicted that there would be no recovery unless we borrowed and spent our way into economic risk, which has turned out to be untrue. I do not know why anybody in the Labour party still listens to his predictions at all.
Mr Speaker
Order. Mr Cryer will be heard. The House should hear him. His constituents should hear him. It is really just a matter of courtesy.
John Cryer
The Liberal Minister used to be a loyal servant of Britain in Europe. Does he still agree with its founding principles?
Danny Alexander
I still very much take the view that Britain is better and stronger as a full member of the European Union and that membership of the European Union is vital for our trade and for 3.5 million jobs in this country, which is why I will resist any attempts to take Britain out of the European Union.
Oral Answers to Questions
John Cryer Excerpts(10 years, 7 months ago)
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Sajid Javid
We are committed to ensuring that small and medium-sized enterprises have the access to finance that they need, and we were pleased with the recent announcement by the Bank of England and the Treasury on refocusing the funding for lending scheme on to SMEs from next year. My right hon. Friend will also know that, in the autumn statement, we announced further improvements in the lending appeals process and a consultation on requiring banks to share more information on SME lending.
John Cryer (Leyton and Wanstead) (Lab)
T5. What assessment has the Chief Secretary to the Treasury made of the relationship between consistently falling real wages and the rapid growth of zero-hours contracts?
Danny Alexander
As the hon. Gentleman knows, the Secretary of State for Business, Innovation and Skills has been acting on zero-hours contracts; it is a subject that is currently under review in his Department. I have made a strong assessment of the connection between sustainable economic growth of the kind that this Government are delivering and the availability of jobs in the private sector, 1.4 million of which have been created since 2010.
Oral Answers to Questions
John Cryer Excerpts(10 years, 10 months ago)
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John Cryer (Leyton and Wanstead) (Lab)
1. What recent comparative assessment he has made of trends in real wages in the UK and in similar economies.
The Chancellor of the Exchequer (Mr George Osborne)
The hon. Gentleman asks about trends in real wages. The main deterioration in wages and salaries was from 2007 to 2009 when growth fell from 5.7% to minus 0.6%. This is a vivid reminder of the damage that the great recession did. The Government have taken continued action to help with the cost of living so that last year real household disposable income grew by 1.4%, the fastest growth for three years. Of course, however, these remain difficult times for families, and the only way to deliver improved living standards for the long term is a sustained, balanced economic recovery with low mortgage rates, more jobs and more income tax-free. Our economic plan is delivering that. The Opposition’s plan for more spending and more borrowing would make things worse.
John Cryer
Well, that is one of the most vacuous answers I have ever heard, and that is against some very stiff competition. In the past three years real wages in this country have fallen lower than in any G20 country bar one—we are second from bottom. For how long is that going to be sustainable?
Mr Osborne
Let us be clear: this country had one of the deepest recessions of any of the countries in the G20 or anywhere else. We had one of the biggest banking crises and our country has had to recover from that, but I point out that in the hon. Gentleman’s own constituency there are now 12,000 more people in work than at the time of the election, and unemployment is down by a third.
Oral Answers to Questions
John Cryer Excerpts(11 years ago)
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Sajid Javid
My hon. Friend is right to raise that issue. He will have upmost in his mind the fact that under Labour, house building fell to its lowest levels since the 1920s. The Government are supporting hard-working households who have saved but who do not have a large deposit from the bank of mum and dad to help in buying their own home. The Help to Buy equity loan scheme he mentioned will help 74,000 families and has already helped 4,000. My hon. Friend will be pleased to know that 20% of the £1.8 billion of additional funding we have promised for affordable homes will go to shared ownership.
John Cryer (Leyton and Wanstead) (Lab)
Will the Help to Buy scheme help to increase the supply of housing? I am not talking about buying capacity; will it specifically increase the supply of housing?
Sajid Javid
The short answer is that it most certainly will, and it has been welcomed by the Home Builders Federation. I am pleased that the hon. Gentleman is now concerned about the issue. House building fell to its lowest levels since the 1920s under the previous Government. The number of affordable homes decreased by 421,000 over 13 years and local authority waiting lists almost doubled from 1 million to 1.8 million under Labour—a shameful record.
Oral Answers to Questions
John Cryer Excerpts(11 years, 2 months ago)
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Mr Gauke
My hon. Friend makes an important point. It is important that we have better information that we can provide to developing countries. Whether we do that by exchanging information along the FATCA lines or by encouraging better global reporting to tax authorities by multinational companies, that information will prove very helpful for both developed and developing countries.
John Cryer (Leyton and Wanstead) (Lab)
The Minister will be aware that some employers are increasingly using payroll companies and umbrella companies to avoid paying tax and national insurance. What can the Government do to address that tendency?
Mr Gauke
We are taking measures to address this: the hon. Gentleman will be aware of the action that we took in the last Budget to close the loophole relating to offshore companies. We of course want a tax system that ensures that the tax is consistent with the economic reality, and that is what we intend to have.
Youth Unemployment and Bank Bonuses
John Cryer Excerpts(12 years, 6 months ago)
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Danny Alexander
I will give way in a moment.
We have plans that will help to foster a recovery led by our private sector, by entrepreneurs and by exporters, creating the kind of growth that the Opposition failed to deliver in over a decade in government. We face the monumental task of dealing with their legacy of unsustainable spending and debt-fuelled consumption, which left the coalition the task of dealing with the largest peacetime deficit on record.
Danny Alexander
If the hon. Gentleman looks around Europe at the countries that have failed to tackle their deficits, he will see much more serious economic problems—problems of the kind that we would have here if we followed Labour’s policies. He should start by apologising for the mess that his party made of the economy.
Danny Alexander
I am going to make some progress now.
As the Secretary of State for Business, Innovation and Skills outlined today, we will also take the tough decisions to tackle excessive executive pay. At a time when millions of workers face a pay freeze or worse, and when many businesses are confronting a difficult trading environment, the highest-paid cannot be disconnected from reality. That is why the Secretary of State announced new measures to drive through greater transparency on executive pay, to empower shareholders to deliver responsible pay, and to reform remuneration committees to break the old boys club.
It is for that same reason that the Government are leading efforts, domestically and internationally, to reform our banking sector fundamentally in order to protect our competitiveness while safeguarding our stability. We are abolishing the tripartite system of regulation that failed so dramatically in the run-up to the last crisis, and putting the Bank of England in charge of both micro and macro-financial supervision. We are reforming the sector itself, as recommended by the Independent Commission on Banking, to safeguard the UK’s position as host to a world-class financial services sector without putting UK taxpayers at risk.
We have implemented a permanent bank levy to ensure that banks make a fair contribution to tackling the deficit, reflecting the risks that they pose to the system while encouraging them to move away from riskier models of funding. As we announced in the autumn statement, we have increased the levy from 1 January this year to ensure that it yields at least £2.5 billion a year, which is more than the amount yielded by the previous Government’s one-off tax on bonuses—a tax that
“failed to change the industry’s behaviour over pay”.
Those are not my words, but those of the previous Chancellor, who was responsible for the policy in the first place.
Through the Financial Services Authority’s remuneration code, we have ensured that bonuses are deferred over at least three years, and linked to the performance of the employee and the firm. Through the disclosure regime, we have provided more transparency than ever on pay. And while the previous Government managed to get only four of the top 15 banks to sign up to the code of practice on taxation for banks that was introduced in 2009, we have ensured that all are signed up.
Our expectations of the banking sector are clear: banks should make a full and fair contribution. They must respect the spirit, not just the letter, of the law, and make a commitment not to use artificial schemes to avoid tax. The new Bank of England Financial Policy Committee, established as a result of this Government’s reforms, has warned that in these turbulent times it is capital levels, not bonus payments, that have to be the priority. Did the hon. Member for Leyton and Wanstead (John Cryer) want to intervene?
John Cryer
Going back to the subject of unemployment rates, youth unemployment in my constituency has gone up by 140% since the election. That is what is happening now, not what happened under the previous Government. Will the Chief Secretary to the Treasury deal with the immediate issue and tell us why that is happening? Will he also tell us whether he thinks it is a price worth paying?
Danny Alexander
As I made clear earlier, I do not consider it to be a price worth paying. That is why the Government are doing everything possible, through investment in apprenticeships, in our youth contract and in the Work programme, to ensure that there are opportunities for people.