Oral Answers to Questions

Julian Sturdy Excerpts

Tuesday 6th March 2012 Commons Chamber

[Danny Alexander]

I entirely share my hon. Friend’s sentiments; she expresses them very well. We will be investing £760 million a year by 2014-15 to extend free child care to disadvantaged two-year-olds.

[Julian Sturdy (York Outer) (Con)]

3. What steps he is taking to strengthen consumer protection in financial services.

[The Chancellor of the Exchequer (Mr George Osborne)]

In the Financial Services Bill, the Government are establishing a new financial conduct authority with additional powers to protect consumers and promote effective competition. On the day on which banks are writing to customers who were possibly mis-sold payment protection insurance, we are ensuring that banks will be open about any unarranged overdraft charges and interest payments on savings accounts.

[Julian Sturdy]

I thank the Chancellor for his response. As families and individuals try to get on top of their debts, will the Chancellor outline whether the Government believe that new legislation is required to ensure that credit markets act in a responsible rather than predatory manner towards customers?

[Mr Osborne]

We are introducing legislation through the Financial Services Bill. It creates the financial conduct authority, which will have additional powers and will, I think, be a powerful champion of consumers. Rather than wait for legislation, we are taking action with the industry’s agreement to introduce a seven-day ban on store card retail incentives so that people cannot take out a store card and immediately get a special offer with it in the shop; and we are stopping excessive card charges being hidden on statements.

Rural Bank Closures

Julian Sturdy Excerpts

Tuesday 21st February 2012 Westminster Hall

[Glyn Davies (Montgomeryshire) (Con)]

I have been a Member of the House for almost two years now, Mr Brady, and you have chaired a huge proportion of the proceedings in which I have taken part. It has always been a pleasure.

I, too, congratulate the hon. Member for Brecon and Radnorshire (Roger Williams) on securing today’s debate. He represents a neighbouring constituency to mine, and they are two of the most rural in Britain. One reason I did not prepare a speech for today was that I knew that I would only be repetitive. I could have filched the hon. Gentleman’s speech, and said pretty much the same, because our experiences are so similar. However, I want briefly to associate myself with the issue that he has raised, and with his remarks. All that I need to change is his references to Presteigne—although I represented it for eight years as a regional member in the National Assembly for Wales, so I know the town well. The point is that very few changes would need to be made in the speech to make it apply to my constituency and, I am sure, rural constituencies across Britain.

The hon. Member for Brecon and Radnorshire and I have worked together for many years on the issues in question, on the Development Board for Rural Wales, and in other contexts. Nearly all that work would come under the general heading of the defence and promotion of rural services. The way in which society has moved in the past half century has put enormous pressure on rural services, and that is a huge threat. Protecting and retaining those services has been incredibly difficult, and we shall not be able to retain and protect them all. However, that work has been a big part of my life, and of the hon. Gentleman’s life.

One of the reasons I have become so engaged with the issue in question is that I decided as a young man that I enjoyed living in the middle of Montgomeryshire and would never live anywhere else. I deeply love the place. All my fellow students from Llanfair Caereinion high school left the area to find work—we did not have any—and even at a young age I became very engaged in seeking to retain and develop our economy, as the key to providing employment that would encourage people to stay. There has been huge pressure across rural services, and the banks issue must be considered within that whole bracket. Rural schools close, because as families have fewer children there is pressure on them, and many village schools are closing. That is still happening and will continue; but what we do will affect the rate of closure. The same is happening with hospital services. Increased specialisation in skills and treatments means it is not possible to retain all rural hospitals. Some of them are closing, and, even more importantly, some of the services available in them are moving away. Transport is another serious issue, because of the acquisition of cars. There is not the same level of rural public transport that there used to be. I do not mean any criticism of the Welsh Government, but the grant for rural transport has been substantially reduced this year. The retention of transport links is strongly connected to the retention of banks; significant reductions are being made, with the result that services will be reduced.

Financial services are a key part of life today, whether those are provided by banks, building societies or post offices. People in rural areas, and perhaps in particular the elderly and the most vulnerable, who are not familiar with the internet or sometimes do not have access to it—because clearly broadband is not as effective in rural areas as it is in the areas now becoming used to it—do not have access to financial services. Yet the bank is crucial. When the last bank closes that is a death knell in the village. We must do all we can to retain those services where it is possible.

[Julian Sturdy (York Outer) (Con)]

My hon. Friend is making a powerful argument about local rural services. Shops are also suffering, because if cash points in villages are lost and people cannot get access to the cash, they do not spend it locally. That has an impact on local shops and on tourism in rural areas.

[Glyn Davies]

That is right. As we reduce spending power, every service goes. Each one affects the others.

Child Benefit

Julian Sturdy Excerpts

Tuesday 21st February 2012 Westminster Hall

[Mr Gauke]

I am conscious that I have three minutes left and I have barely begun to deal with the various points raised by my hon. Friend the Member for Christchurch, who secured this debate.

We recognise that most higher rate taxpayers are not super-rich. But, as my right hon. Friend the Chancellor has said,

“a system that taxes working people at high rates only to give it back in child benefit is very difficult to justify at a time like this.”

He went on to say:

“We simply cannot ask those earning just £15,000 or £30,000 to go on paying the child benefit of those earning £50,000 or £100,000.”

The debts of the previous Government have to be addressed. Consequently, we have had to make difficult choices. By removing child benefit from higher rate taxpayers, the Office for Budget Responsibility estimates that we will save £2.5 billion a year. The savings mean we can continue to direct child benefit support to where it is needed most, supporting millions of families, and millions of children from birth until the time when they leave full-time education at the age of 18 or even 19.

[Julian Sturdy (York Outer) (Con)]

Will the Minister give way?

[Mr Gauke]

I will give way, but we are eating into the time of my hon. Friend the Member for Christchurch.

[Julian Sturdy]

I want to touch on the transferable tax allowance, which has already been mentioned. I have written to the Treasury about it, and it is a way of bringing fairness back into the system. Will the Minister respond to that?

[Mr Gauke]

I am grateful, because I want to respond directly on that point. The Government, as stated in the coalition agreement, want to recognise marriage in the tax system. We remain committed to that and we will introduce proposals at an appropriate time, as is consistent with the coalition agreement. We remain committed to what is in the coalition agreement.

Autumn Statement

Julian Sturdy Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

My hon. Friend absolutely has my assurance. If he wants to contact me with specific proposals that will create jobs in Cleethorpes and elsewhere in Lincolnshire, would he please let me know and I will do what I can to advance them, within the rules and the planning laws. As he knows, I am trying to reform those laws to make it easier to get the go-ahead for development that is sustainable and in tune with our broader environmental objectives. I want to make the planning system more rapid, and I should put on the record that the campaign that he has fought with other Members to get those Humber bridge tolls reduced shows that Cleethorpes has a powerful champion in my hon. Friend.

[Julian Sturdy (York Outer) (Con)]

As a Yorkshire MP, I strongly welcome the Government’s decision to electrify the trans-Pennine rail link between Leeds and Manchester and the huge boost that that will bring to our northern economy. As a York MP, too, may I ask the Chancellor whether the Treasury has examined the strong economic case for linking Leeds to York?

[Mr Osborne]

I do not have the specific details in front of me, but I will certainly engage with my hon. Friend on that proposal, and I hope that we can advance it.

National Insurance Contributions Bill

Julian Sturdy Excerpts

Tuesday 23rd November 2010 Commons Chamber

[Julian Sturdy (York Outer) (Con)]

I am delighted to contribute to this important debate. It is essential to assist economic recovery by incentivising entrepreneurship and private sector-led growth and I make no apologies for supporting the coalition Government’s focus on encouraging our small and medium-sized businesses, which this Bill does in abundance. The Bill’s benefits are threefold. First, it will contribute to the Government’s wider economic recovery programme through a small increase in national insurance contributions. Secondly, it will promote and support small businesses and entrepreneurship. Thirdly, it will fulfil the coalition’s pledge to raise the threshold of income tax personal allowance.

Like other hon. Members, I shall focus my contribution mainly on the second of those benefits—the so-called national insurance holiday for small businesses. First, however, it might be useful to take stock of the history of NICs. This form of taxation was introduced in 1911 before being expanded in 1940 to help fund the national health service. The scheme has always consisted of benefits financed by contributions from earners, employers and others. NICs have always been flexible and responsive to the wider economic situation and thus linked to the ever-changing needs of society. Given the wider economic outlook and the appalling financial legacy that we have inherited, it is absolutely right that we now consider increasing these rates. However, as a low-tax Conservative, I hope that the actions we take to repair our broken economy today will be replaced with lower taxation policies across the board in future.

Turning to the scheme’s main benefits, I am absolutely delighted that the Government have already taken measures to make Britain a more business-friendly country once again. The Bill adds to the welcome return to promoting and encouraging entrepreneurship rather than suffocating businesses with endless regulation and red tape, as sadly occurred too frequently in the previous decade. By raising NICs, we will encourage the creation of private sector jobs in regions that are too reliant on public sector employment by reducing the cost of employing staff in new businesses.

NICs will be abolished for the first 10 jobs created in new start-up enterprises during the first 12 months of the business. As we have heard, the exemption will be available for new businesses within a three-year qualification period. Such measures will save businesses vital cash, thereby encouraging further growth and new employment opportunities, which are vital at this time. Early forecasts suggest that about 400,000 employers will claim the holiday, covering 800,000 employees. The average benefit per business will be about £2,000, as my hon. Friend the Member for Newton Abbot (Anne Marie Morris) has mentioned. The total cost to the Treasury is estimated at about £940 million.

[Barry Gardiner]

The hon. Gentleman will know that the October 2010 claimant level for JSA in his constituency was 901, but the figure for my constituency was about two and a half times that. Why does he think that his constituency and his benefit claimants should benefit from the holiday period while mine should not?

[Julian Sturdy]

I think that the hon. Gentleman is talking about the regional aspect of the measures, which is important and has already been raised by some Members. I shall address that issue and if he wants to intervene on me again, I shall be more than happy to take his intervention.

As we appreciate the cost of the scheme to the public purse, it is only right to drill down into the specific details. There are many concerns about the holiday provision not applying to three English regions—Greater London, the south-east region and the eastern region. I accept that this limitation might seem unfair, particularly to those right hon. and hon. Members who represent such areas, but we live in extremely difficult economic times and the woeful financial legacy will limit our ability to extend the holiday relief to every part of the country. That is regrettable, but it is a fair compromise. It is well-known that the gap between the northern and southern economies is widening and has been for the past 13 years, so it is essential that the coalition focus on closing the gap by encouraging new private sector-led growth in the north.

An unhealthy dependence on the public sector has blighted many northern towns and cities for too long. Alongside the creation of local enterprise partnerships and the regional growth fund, it is essential that private enterprise be given a boost in northern cities—such as mine, York, I confess. Economic recovery will take place only if the private sector leads the way. Only private sector expansion in the areas that are most dependent on the public sector will ensure that the recovery leads to sustainable, long-term stability in local economies. Sustainability is key.

I am sure the holiday aspect of the Bill will be welcomed by many small businesses throughout the country. It has already won the backing of the Federation of Small Businesses. I know that Opposition Members say that that is not the case, but I believe it is, although the federation raises concerns about the length of the relief and the number of firms to which it will extend. Although my support for the Bill remains unequivocal, I must confess that I share some of those concerns, while understanding the financial constraints placed on the Government.

I fear that we might be slightly short-sighted in limiting access to expansion to new firms alone, and in allowing new firms to claim it only during the first year of their business operations. I admire the way in which the coalition has governed thus far with a long-term prospect. I ask the Front-Bench team to review through the same visionary lens the time scales and business exemptions from the contributions holiday over the course of the next year or when the financial position allows. My hon. Friend the Member for Newton Abbot raised that point, referring to micro-businesses, and I agree wholeheartedly with her comments.

In conclusion, I strongly believe that the Bill sends out exactly the right message from the Government to budding entrepreneurships. This is positive Government-led action that our small and medium-sized businesses will welcome. More broadly, this action must be supplemented by Britain’s banks. Put bluntly, too few small and medium-sized businesses are receiving flexible finance. Members in all parts of the House should unite in urging the banks to free up vital cash flow. The new emphasis on bank lending, alongside the measures contained in the Bill, will ensure that our private entrepreneurs receive practical assistance in a true time of need.

The Bill will play a vital role in our economic recovery and future growth, and I will strongly support it.

Equitable Life (Payments) Bill

Julian Sturdy Excerpts

Tuesday 14th September 2010 Commons Chamber

[Julian Sturdy (York Outer) (Con)]

Thank you for calling me, Mr Deputy Speaker. I will try to be brief.

The sorry tale of the Equitable Life debacle has been raised on the Floor of the House on countless occasions over the past decade, and impressive words have been spoken, but it is real action that policyholders seek. In my view, the last Administration’s failure to deal with Equitable Life was one of their most inexcusable errors.

Quite simply, Labour’s abject decision plainly to ignore its duties to Equitable Life policyholders should not be forgotten. It is utterly shameful that the Labour Government literally waited for people to die rather than implementing the ombudsman’s findings back in 2008, when they were, in essence, found guilty of maladministration. It is because of that rather bleak reality that those on this side of the House can be proud that the coalition Government have moved so quickly to introduce a Bill that finally provides the authority for a payments scheme. There is a stark contrast between the last Government and the new Government in that respect.

We must start making progress now, but policyholders could be forgiven for continuing to doubt whether payments will come to fruition any time soon, and it is on that specific point that I want to concentrate during the last couple of minutes of my time. On 17 July 2008, the parliamentary ombudsman, Ann Abraham, published a damning report which clearly advised Ministers to set up a compensation scheme for policyholders. Among the ombudsman’s proposals was a recommendation for an independent payment scheme. I welcome the fact that a commission is now up and running, but I am concerned about the time scales set out by the Financial Secretary when he made his statement on Equitable Life in July. I fear that by allowing the commission to report back in January 2011, the Government have unintentionally created too much of an additional delay, particularly given the age of some policyholders. Furthermore, it is in everyone’s interests for actual payments to be made with all due haste. Again, the current mid-2011 target is simply too far away for many affected investors.

I strongly urge the Government to do all that they can to bring forward the deadlines, and to ensure that policyholders do not have to wait a day longer than is absolutely necessary.