Budget Statement
Lord Brooke of Sutton Mandeville Excerpts(9 years, 8 months ago)
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Lord Brooke of Sutton Mandeville (Con)
My Lords, it is a real privilege to follow the noble Lord, Lord Rooker. I am junior to him in entry to the Houses of Parliament, but it is always a pleasure to participate in a debate with him. The noble Lord, Lord Davies, must be very grateful to him. I shall stay mainly in Britain, although I have visited all the states in the United States except North Dakota and Nebraska, and I have been told that if I have done South Dakota in depth I do not need to hurry back.
The late Ian Wallace, the singer, had a party trick, much in demand at Christmas Day Matins, of singing the carol “The First Noel” to the tune of “On Ilkla Moor Baht ’at”. To borrow the cliché about singing off the same hymn sheet, which always reassures one that the Church of England is still alive, both sides in the Budget debate are doing this but one of them has the hymn sheet upside-down, and the Treasury never does that. As Paul Johnson of the Institute of Fiscal Studies characterised it, there is much truth in the numbers both sides are using but Mr Miliband is quoting gross earnings, whereas the Chancellor is quoting net income, which enables them to have a dialogue about the outcome. In Mr Miliband’s case, a top rate of tax down from 50% to 45% and tuition fees of £6,000 sound good but are in fact doing more for the rich than the poor.
Kipling did not write until 1906 his romantic poem, “A Smuggler’s Song”:
“Five and twenty ponies,
Trotting through the dark—
Brandy for the Parson,
’Baccy for the Clerk;
Laces for a lady, letters for a spy,
And watch the wall, my darling, while the Gentlemen go by!”,
but Pitt the Younger had lanced the Revenue’s excise boil in the 1780s by slashing the customs duties and in the process, in 1787, sustaining his newly launched Consolidated Fund with the duties that consequentially emerged in profusion from the shadows.
In column 782 of Hansard for 18 March, Mr Miliband poses the rhetorical question, “What about hedge funds?”, and since then his special adviser on private health funds has helpfully revealed that he must have been talking to himself. Mr Miliband implies constancy in policy but practises vacillation, although I agree that he does not go as far as UKIP, which has used a single saving in expenditure to fund a double-figure flood of new expenditure projects. The White Knight in Alice, who once invented a pudding during the meat course, would be a good candidate to be UKIP’s policy director. Finally, Mr Miliband said that the Chancellor of the Exchequer had not acted on tax havens, but the diverted profits tax was promised in the Budget Statement for legislation this week, to be brought into effect next month.
On another front, 2015 has seen a marked increase in the number of sightseers in the Royal Gallery, looking at Maclise’s painting of Wellington and Blücher on the evening of Waterloo. I am not yet clear whether, when the Chancellor gave public largesse towards repairing the buildings at Hougoumont on the field of Waterloo, where the Brigade of Guards saw out Waterloo’s “livelong day”, he was aware that his own namesake, George Osborne, had been the lead figure in the first half of Thackeray’s “Vanity Fair” until his fictional death on the field of Waterloo in June 1815.
As it has just been announced that the living quarters at Hougoumont, which are suitable for four people, are to be managed as a holiday let by the Landmark Trust, this brings us neatly to one of the pressing questions of the hour; namely, the supply of new housing, where there is still a chronic shortage. The demand side does not currently need encouragement, which might even be counterproductive. Of course, the creation of the first 20 housing zones is encouraging on the supply side but they are not the total answer and we still sigh for the 300,000 houses, mentioned by the noble Lord, Lord McFall, which Harold Macmillan and Percy Mills orchestrated annually in the 1951 Administration. But there were bomb sites to build on then and by now we are the second most highly populated member state of the European Union after Malta.
The dilemma of new space for building adds ironic exacerbation to the issue of the contribution of immigrants within the construction industry. Immigration strains education and health provision in the community but, ironically, it adds to housing demand as well—although working in the industry, they have to have homes themselves. There are no easy answers and UKIP’s responses are unreal as well as unreliable. Happily, and not least because of the presence of the particular Treasury Minister on the Front Bench this evening, infrastructure has been a persuasive magnet in forward planning for the next five years, not only in the comprehensive strategy for the north but in south Wales and the south-west.
I will conclude with a final issue that has not been given front-page billing by either side in the overall argument—the crux of productivity growth, which is always the joker in the pack but is also a hidden complication when even greater employment than the current figures, which Martin Wolf rightly described in the Financial Times as “stunning”, is still looked for. I served my last Parliament in the Commons during Gordon Brown’s first Parliament as Chancellor. I knew that productivity growth, like higher education, was one of his favourite feeding pastures and in consequence I used to put the subject down as a monthly item for Treasury Questions, which incidentally provoked him from time to time into contradicting whoever was his Chief Secretary at the time. But I hope that in the next Parliament it will soon receive more attention. I imagine that what the Budget Statement calls,
“the biggest increase ever in the apprentice rate”,—[Official Report, Commons, 18/3/15; col. 768.]
will make a step in the right direction and a modest contribution to productivity growth, but I have not yet embraced the specifications of what is called the “new national energy catapult” announced in Birmingham, which sounds as though it would have pleased Boulton & Watt.
To end on a similarly appreciative personal note, the House of Lords Library has done its habitual miracle by distilling in a comprehensible form the raw Treasury data into a Library briefing pack for this debate. We are all in its debt.
Small Businesses: Finance
Lord Brooke of Sutton Mandeville Excerpts(9 years, 9 months ago)
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Lord Newby
The noble Lord will be amazed to discover that I do not agree with him at all. He has failed to point out that since this Government came into office private sector employment is up by well over 2 million and the majority of that is likely to be in small and medium-sized businesses.
Lord Brooke of Sutton Mandeville (Con)
May I commend to my noble friend my experience in running a small business where I found that our bills got paid significantly faster if we asked our auditors to call up the company that owed us money?
Banking: Parliamentary Commission on Banking Standards
Lord Brooke of Sutton Mandeville Excerpts(11 years ago)
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Lord Brooke of Sutton Mandeville (Con)
My Lords, it is a privilege to be the first participant in this important debate to congratulate the most reverend Primate the Archbishop of Canterbury on having secured it, and for the manner in which he introduced it. His qualifications for it are enviable. Having read his mini-biography in wonderment at where he found the time to achieve so much, I hope he will forgive my language if I say that I think he is playing a blinder. I thank him, too, for having arranged the packaged provision of relevant papers in the Printed Paper Office.
My own participation in this debate is for three reasons. The oldest of these is that when, long ago, I spent two years at Harvard Business School acquiring an MBA, my highest marks were in a course titled “Business Responsibilities in American Society”, which I supposed played some part in determining my subsequent career. My second reason is that for 24 years I was the third longest serving Member of Parliament for the City of London since 1283. Those years included the paradigm shift of Big Bang, from personal contact to largely screen and telephone business. Although the dramatis personae of that era are not an interest to declare, Sir Nicholas Goodison, the chairman of the Stock Exchange who negotiated and navigated Big Bang so well, was and is my oldest friend. My third reason is the debate on banking standards during Report stage of the Financial Services (Banking Reform) Bill on 26 November 2013, not least the most reverend Primate’s comments.
I must allude to a longstanding friendship with the honourable gentleman the Member for Chichester in the other place, who chaired the Parliamentary Commission on Banking Standards—henceforth referred to as the PCBS—and who has been a mentor to me on this, as he was earlier on the development of the euro. I say “mentor” because during the four years that I was a Treasury Minister under my noble friend Lord Lawson of Blaby, I was the only one of eight Ministers in the department in that period who had never worked in the City of London. Thus my responsibilities were concentrated on what Sir Douglas Wass once defined to me as the housekeeping end of the Treasury—a more fascinating portfolio than it sounds.
After leaving government, I was briefly a director of an investment bank but my comments hereafter reflect the views of the City of London Corporation. When the issues of this debate were discussed on Report for the banking reform Bill, your Lordships’ House heard, as we have heard again today, informed talk of standards, ethics and culture—not, I have to say, unknown at the Harvard Business School. One institution that spans this arena is the City Values corporate forum, a collaborative project supported by the Lord Mayor and the City Corporation. It draws on learning from the professions, academia and, happily on this particular occasion, clergy-based as well as secular sources. A report recently published by the forum provides a guide to help chairmen and boards to calibrate their approach to the oversight of values. Its goal is the achievement of ethical behaviour in the financial and business services sector.
We learnt from the PCBS that some banks tried to encapsulate values in their businesses by creating human resources handbooks running to in excess of 1,000 pages. I share the PCBS’s scepticism about mechanistic expressions of values. If we had consulted the Delphic oracle, I suspect that it would have found a discreet way of conveying a conclusion based on the criticism faced by the Financial Services Authority for just such a modus operandi.
The forum’s preference was for half a dozen building blocks that cumulatively would help institutions to build and maintain values. As an example, one building block would seek to cause a board to develop ways of measuring values, behaviour and culture and to deploy internal audit to renew and enforce them. The board would receive regular misdemeanour reports. This process would lead in due course to the board agreeing its values with its customers and employees as well. Finally, there would be an annual values report to the board for wider publication.
All this will need to go further than discussion in your Lordships’ House but I hope that the process that I have described, and other initiatives like it, will stimulate the debate. Existing mechanisms can also be deployed more prominently. For example, the rights and duties of shareholders also have an important part to play in influencing board behaviour. As other noble Lords have pointed out in numerous debates on governance in this House, they are frequently underused controls. The All-Party Parliamentary Corporate Governance Group, of which I am a member, now has four or five years of informed debate in this area literally under its breakfast belt. The rights and duties of shareholders are frequently underused controls.
In conclusion, I shall borrow some words from the forum’s report to which I referred earlier:
“Governing values well is a prerequisite for a truly sustainable business … The need for the board of any financial services business to govern values is now central to its agenda—not an ‘optional extra’”.
I owe to the Harvard Business School the wise observation that if you do not know where you are trying to get to, any road will get you there. From 18 years of running an international business outside the financial sector before I entered Mrs Thatcher’s first administration as its absolutely most junior member, I can confirm the virtue of that corporate satnav.
The participation in this debate is nicely balanced around the Chamber. In particular, I wish my noble friend Lord Carrington of Fulham well in his maiden speech, to which I look forward
Taxation: Evasion and Avoidance
Lord Brooke of Sutton Mandeville Excerpts(11 years, 6 months ago)
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Lord Brooke of Sutton Mandeville
My Lords, with the leave of the House, I appreciate the magnanimity of the noble Lord, Lord Davies of Oldham, in not grudging me four minutes out of the 40 minutes in today’s gap before he rises for the Official Opposition.
In his opening, the noble Lord, Lord Foulkes, regretted my party’s lack of participation, but I have been in the Chamber throughout, just as I was for all but 40 minutes of the 12 hours we devoted to the same-sex marriage Bill this week, which diminished temporarily my appetite for argument. I did think of speaking because of having participated in the debate on the Second Reading of the Finance Bill, following the Question for Short Debate last December on international tax implications, in which the noble Lord, Lord Browne, also took part. Unlike the noble Lord, I do not think that I received a briefing from ActionAid this time, so I make a plea, which no doubt will be read outside, to the charities and lobbyists on this subject that they keep a full list of the usual suspects in this area and send us a briefing on future occasions, even if we have not put our names down to speak, as we might thus be encouraged to do so.
The noble Lord, Lord Foulkes, said that the debate concerned the present Administration and not the 13 years before. I intervene to express a hope that the Minister will be prepared to say a word or two about the Charity Commission and its willingness to challenge the charitable credentials of a handful of black sheep where the charities have spent far less on charitable purposes than they have received in tax compensation, as has recently been reported in the press. This Government have taken some actions in this area already, whereas I think that the previous Government were less involved. It would also help if the Minister would indicate whether the Charity Commission needs any technical help with which the Treasury or Inland Revenue would be able to furnish it.
On a final, more light-hearted word, when my late noble kinsman was the Financial Secretary to the Treasury between 1954 and 1957 and was thus responsible to the other place for the Inland Revenue, he alleged that he once received a large anonymous banker’s draft from an equally anonymous taxpayer accompanied by a brief note, which said:
“I have not been sleeping well. I hope the enclosed tax contribution will cause me to sleep better. If it fails to do so, I shall send you some more”.
Budget Statement
Lord Brooke of Sutton Mandeville Excerpts(11 years, 9 months ago)
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Lord Brooke of Sutton Mandeville
My Lords, I should like to add a few words to this debate in the gap. I spoke for two minutes in a Question for Short Debate on 11 December last year on the impact of multinational companies’ financial practices and UK tax policies. I shall not speak for longer now on the same subject, not least for fear of my noble friend Lady Browning doing her mental arithmetic on my costs.
I support the plea of the right reverend Prelate the Bishop of Bristol earlier on this same subject. In replying to a debate on 11 December, my noble friend Lord Marland, at col. 1050 of Hansard, said that DfID had averaged expenditure of £20 million per annum over five years to support tax regimes throughout the world. He went on to identify specifically DfID spending £11 million in Sierra Leone, £8 million in Tanzania, £8 million in Rwanda, where the tax take rose six-fold, and £21 million in Afghanistan, where the tax take used to be 4% and has now gone up to 11%. DfID is, with the support of HMRC, building up its technical capacity to help further.
At this late moment in the debate I do not expect a detailed comment of any kind in the wind-up of my noble friend the Commercial Secretary, but a reiteration of a continuing commitment to this constructive and productive programme would be both welcome and reassuring.
Welfare Benefits Up-rating Bill
Lord Brooke of Sutton Mandeville Excerpts(11 years, 9 months ago)
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Lord Brooke of Sutton Mandeville
My Lords, my noble friend Lord Deben is not in the Chamber, although I had a word with him outside. I am not sure that he was fair in asking the right reverend Prelate the Bishop of Ripon where he would find the money on the previous amendment. However, when we get into the guts of this amendment, it would be reasonable to expect the Official Opposition at that stage to explain where they would find it.
My memory goes back to Grand Committee on a couple of Bills in the final two years of the previous Government. They were held in the Moses Room; one was on housing and the other was on planning. I recall that the second one occurred in the very first week of the then Governor of the Bank of England—who is still the governor—who expressed anxiety that a recession was now becoming a real possibility. I asked why the Government, in their explanation of the text of the respective Bills on housing and planning, thought that future conditions would be like conditions in the past. I was told by both the Minister and knowledgeable government Back-Benchers in Grand Committee that I was not to worry my head about these things. There was no acceptance that the economic ice was beginning to thin and, specifically, I was told that the recession had not yet happened.
It was only later that I recalled a new year message in the 1950s or 1960s in the Observer by its essayist Paul Jennings in his weekly article. He explained that the new year had come in over a weekend and he had therefore had the opportunity to use the weekend to explore in his diary what the publishers thought he needed to know in the coming year, which they had not supplied in the previous one. It transpired that the answer was the thickness of ice. He explained that he was now in a position to tell the Observer’s readers that you required half an inch of ice to sustain a duck and an inch of ice to sustain an infant, going up in a series of categories until you reached 16 inches for a County-class locomotive and 24 inches for a regiment of foot. It was on reaching the statistic for a regiment of foot that Mr Jennings began to wonder how they knew. He imagined a scene in the Crimea when not much else was happening. The same young Mr Hemmings who took part in the film “The Charge of the Light Brigade” was riding up to Lord Raglan with the news that they had just lost another battalion of the Grenadiers.
If I move from that analogy to the departure of the previous Government, I recall that Mr Byrne, the Chief Secretary to the Treasury, left a note for his successor saying that there was no more money. As a message, that seems to me as daunting for a new Chief Secretary as the news to Lord Raglan that he had lost a battalion of the Grenadiers during what must have been the Crimean War. It is therefore reasonable to ask the Official Opposition where they would find the money for their support for this amendment. Indeed, perhaps the Official Opposition might express some regret for their mistakes in government and explain to the Bench of Bishops what went wrong in their economic policies.
In the same context as the intervention by the noble Lord, Lord Griffiths, I shall personally look forward in the hope that we will be able to come back to that subject on a future amendment, in which I would much enjoy joining with him.
Lord McKenzie of Luton
My Lords, we have added our names to this amendment moved so comprehensively by the noble Lord, Lord Low. It requires that all the components of ESA—the personal allowance and the additional component for those in the work-related activity group, as well as those in the support group—are taken outside the 1% cap on uprating. As we have heard, the amendment rightly includes provision for children to be made under universal credit, although it remains to be seen how much progress the faltering universal credit will have made by the time the Bill is spent.
As we have argued on previous amendments, it is the vulnerable who are most affected by the Bill. This is particularly so for those on ESA for two specific reasons. They are much less able to increase their income through work and their living costs are generally higher. This is particularly so for those in the support group, who are furthest from the labour market, but also for those in the WRAG. It is worth remembering that there is a rigorous testing process for people who are unable to work due to ill health or disability. We know that the gateway to this benefit is tough. Although the process involving Atos has been improved, there are still many who end up on ESA only after a successful appeal.
Although individuals in the WRAG are closer to the labour market through their conditionality or otherwise, the route to paid work is not easy, as the noble Lord, Lord Low, said. We know that the Work Programme has not covered itself in glory in this regard. As things currently stand, individuals in the WRAG will lose something like £191 a year by 2015 as a result of this Bill. Those in the support group will fare little better in terms of income, being some £138 a year worse off by that date.
Macmillan has specifically drawn our attention to how these measures will affect people with cancer. Its estimate is that in excess of 40,000 cancer patients will be claiming ESA by 2015 with the presumption that they will be placed in the support group. Macmillan particularly stresses the impact of rising energy bills on this group. Like the noble Lord, Lord Low, I remind the Secretary of State that he should fulfil his commitment to make sure that people on ESA are being fully protected.
The noble Lord, Lord Brooke, challenged me to say where we think the money should come from. I thought I made it clear in the first debate that we think the Government should not proceed with the tax cut that is proposed for those earning £150,000 a year. The proposed tax cut from 50% to 45% would be a source of revenue. The Government say that this will not produce very much, but that assumes that people can get away with planning their income to defeat the thrust of that change. If the Government are alert to that, they could garner that revenue and we believe they should.
There is a wider argument about the extent of debt that can be sustained. The point I come back to is that the greater the failure of the Government in their economic policy—the greater the paucity or lack of growth in the economy—the more it will be necessary for the Government to borrow. If the Government can get growth back into the economy, that begins to ease the debt burden. There is another source there.
I also remind the noble Lord that these amendments take ESA out of the fixed uprating—the collar that this Bill puts around them—so a judgment would have to be made for each uprating period. Traditionally and rightly that has been an increase by the rate of inflation of one sort of another. That is what these amendments are doing. They are not technically, of themselves, proposing a different rate, although I made it clear that we support uprating by inflation for the year that we are about to enter.
It is clear from that combination of reasons that this proposal can and should be supported. It is not constrained by the economic position of the Government. It is the Government that have got themselves into a bind because they have failed to generate growth in the economy.
Welfare Benefits Up-rating Bill
Lord Brooke of Sutton Mandeville Excerpts(11 years, 10 months ago)
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Lord Brooke of Sutton Mandeville
My Lords, I was never a good enough cricketer to have played all-day cricket before I was 20 but, thereafter, I played it for another 40 years, and I can still recall vividly how being the first batsman to face the bowling after the lunch interval was always a tribulation. On this occasion, I am conscious that it was the close of the innings of the noble Lord, Lord Low of Dalston, that occasioned the interval, but it remains very much a privilege to share membership of your Lordships’ House with him. On any matter, I should, in cricketing terms, always give him the benefit of the doubt. In the mean time, the lunch interval has been surprisingly long, but I assume that there is a possibility, as sometimes happens in English cricket, that snow has affected the wicket.
The precise subject of the Bill is a new wicket for me to play on. I do not think that it is mandatory for me to declare an interest but, once upon a time, I was a Treasury Minister for nearly four years. Among the seven Treasury colleagues with whom I shared the ministerial responsibilities in those years, I was the only one who had never worked in the City, although I was, for 24 years, its MP. My noble friend Lord Lawson of Blaby was generous in involving us all in the gestation of Budgets but, in practical terms, my direct responsibilities might have been described as Treasury housekeeping, with all three main subjects being housekeeping oriented, and I had up to a dozen minor ones, including—perhaps unexpectedly—the Central Office of Information. It is quite possible that no one else in your Lordships’ House knows the origin of the ministerial concept of “the line to take”, except the noble Lord, Lord Hennessy of Nympsfield—and he knows only because I told him. However, it was the Treasury that thought of the policy first.
The only relevance to today’s business that I can detect from those years is that the EU budget Council, on which I sat for all my Treasury days, had methods of computation every bit as complicated as those in the Bill. It is a nice complement to the Bill, and to my noble friends in charge of it, to have had today’s Statement, which has enabled us to get our eye in. However, my remarks will be brief.
The great excitement on the Bill relates to whether the noble Lord, Lord McKenzie of Luton, can be seduced during its passage through your Lordships’ House into sharing with us how the official Opposition propose to handle the problem that the Bill addresses, for which they were in no small degree responsible for creating. I lived through the 1969 to 1971 recession running a business in New York City, of which my chief memory is the “news in brief” item in the Wall Street Journal to the effect that the best index of the recession’s severity was that the Mafia had had to lay off two judges in New Jersey. However, I acknowledge that running anything during a recession is not in itself amusing.
I do not know how many others in the Chamber of your Lordships’ House today have had the stamina to watch the video which is currently available on one’s PC within the Palace through the kindness of MoneyWeek. It raises all sorts of financial nightmares that lie ahead of us. I stayed with it till it reached its conclusion only because I wanted to see how it would end and I was unsurprised when it concluded with a hard sell to buy MoneyWeek and its attendant publications. To conjure up a quasi-Richter scale of nightmare, it had to be painfully repetitious but from Lloyd George’s 1909 legislation onwards, no Administration avoided some of MoneyWeek’s blame.
A more elegant prospectus was advanced by the article in the Times below the day’s cartoon on 17 January this year by its accomplished columnist Camilla Cavendish. Those who have approached Horse Guards on Whitehall from the Embankment will know that, pausing at the traffic lights when red at the Whitehall junction, enables one to read the Cavendish family motto on the back of a statue to the Duke of Devonshire, who served in Gladstone’s Cabinet: “Cavendo tutus”, a play on words meaning secure by being cautious. It promises well. I shall quote a single opening sentence and three paragraphs from her article, which was on current welfare expenditure. They will be marginally edited for clarity. The opening sentence reads:
“As the debate about welfare rolls on, … it is … revealing that far more working people get their income topped up by benefits than most of us ever imagined”.
The first paragraph I want to quote states:
“There is no official figure for exactly how many [working people] are on benefits. But what is clear is that their numbers increased dramatically under the previous Government: from 700,000 when Labour took office in 1997 to 4.7 million on the equivalent entitlements in 2010, rising to between 6 and 7 million people, once housing benefit and council tax benefit are included … in a period that was, for much of it, one of unprecedented prosperity”.
The second paragraph I wish to quote states:
“In the good times, it was possible to fudge the decision about which aim—rewarding work or rewarding children—should take priority. Now the decision is unavoidable. The coalition has broadly decided to prioritise work through the Universal Credit system, which aims to make paid work more worthwhile. But it is also sensitive to the risk that the rising cost of living is entrenching poverty. Until it imposed the 1 per cent cap last week”—
that was the week of 7 January—
“the coalition had continued its predecessor’s policy of uprating benefits in line with inflation”.
The third and final paragraph I want to quote—the last paragraph of her article—states:
“Poverty campaigners know that the public is unsympathetic to adults who don't want to work, so they have shifted the argument to defending welfare benefits for the low-paid. But the explosion in numbers in the past 15 years makes it difficult to defend the status quo”.
That concludes my quotations from that article.
When the noble Baroness, Lady Hollis, whom I am delighted to see in her place, chose and opened a debate on housing in the autumn of 2010, I said that I thought that subject, and those that we are debating today, were potentially the key endeavours of this Government. I reiterated that at the time of the Pensions Bill and the Welfare Reform Bill. I am without expertise in these matters but I regard them as so important that I sought to learn by attendance at the majority of Grand Committee proceedings on the Welfare Reform Bill where matters were, in my view, most admirably conducted throughout, although without, in cricketing parlance, my much troubling the scorer myself. However, I shall do the same on this Bill—this time, I gather, in this Chamber.
The great Claud Cockburn in his engaging memoirs said that the world was divided between those who preferred surprises and those who liked things to turn out as they expected. By illustration, he said that, if he were ever caught in an Alpine snowstorm, the mere sight of a St Bernard would restore his morale, even if the cask around its neck was empty of cognac.
I shall go into Committee with an open mind and recognition that the Bill can perhaps be technically improved but in the hope that we shall learn more than a little of the Official Opposition’s intentions, which the noble Baroness, Lady Hollis, implied would be more thoughtful than political. She must forgive me if I have misremembered her precise adjectives, but I have tried. If, however, the noble Baroness thinks that her speech was other than political, I think she may deceive herself. Certainly one would need to know more of the thoughtful detail to appreciate what its economic consequences would be. It is almost 60 years since I was a soldier but, if, unlike Grand Committee on the Welfare Reform Bill, we are to listen to unremitted hostility, it will seem, at least for me, in military terms as simply being smoke. These matters are too important for that.
Finally I shall speculate in Committee on what the late Lord Russell—Conrad to most of us—would have made of all this. In your Lordships’ House both he and the late Lord Newton—Tony to many of us—were kind enough to remind me that I had given them respectively their first maiden speeches on the order paper in the Oxford Union. Indeed in the interests of balance, I shall speculate on what Tony Newton would have made of it all too. In the mean time, that is not a bad double barrel. I hope your Lordships’ House will forgive me hereafter, although I shall obviously observe the rubric, if I am briefly absent at the 90th birthday party of the noble Baroness, Lady Sharples.
Banking: Quantitative Easing
Lord Brooke of Sutton Mandeville Excerpts(13 years, 2 months ago)
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Lord Sassoon
My Lords, I do not think that I touched on that point in a previous answer at all. UKFI has a responsibility, on behalf of the Government, to look, over time, at ways to create value out of the shareholdings, and that is what it will do. There is no question of any particular benchmark; we need to ensure that the taxpayer gets maximum value, subject to questions of competition and financial stability, over time, from the holdings in the banks. That is the mandate that UKFI has.
Lord Brooke of Sutton Mandeville
My Lords, when the moment comes for the disposal of the bank shares, can my noble friend give an assurance that the Government will make a more responsible decision than was contained in the sale of gold by the previous Administration?
Banking: Savings Accounts
Lord Brooke of Sutton Mandeville Excerpts(13 years, 6 months ago)
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Lord Sassoon
My Lords, this will be the focus of some of our attention when the legislation for the new regulatory structure comes forward. Treating customers fairly in the broadest sense is a critical part of what the FSA has been working on over the past few years. As we look at the remit, particularly for the new Prudential Regulation Authority within the regulatory structure, it is important to make sure that a proper focus is placed on that strand of work going forward. No doubt your Lordships will soon have an opportunity to consider these matters.
Lord Brooke of Sutton Mandeville
My Lords, is there a good reason why the NS&I tranche, to which my noble friend referred, cannot be bought through post offices?
Lord Sassoon
My Lords, the NS&I is a commercial operation and it has to make sure that it delivers its products in the way that customers want to receive them. It distributes a significant number of products through the post office network, including premium bonds. Some products are just marketed while others are available over the counter. I understand that these days the most popular channel for NS&I’s products is over the internet, but there is a variety of ways of obtaining them. NS&I’s products are designed product by product to suit customer needs.
Economy: Government Policies
Lord Brooke of Sutton Mandeville Excerpts(13 years, 8 months ago)
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Lord Brooke of Sutton Mandeville
My Lords, it is certainly a pleasure to follow my noble friend Lord Newby, and it is always a privilege and a pleasure to follow the lead of my noble friend Lord Lawson of Blaby, just as it was during the four years of his outstanding chancellorship at the Treasury. I was the only Treasury Minister in those four years never to have worked in the City, a condition that will infect my speech today, although in the Treasury’s housekeeping role I could not have enjoyed more being on the Treasury Christmas card committee. My noble friend was its chairman and I was the only other member. He gave guidance and took the decisions, I did the work, and our cards were voted much the best of all the Finance Ministry Christmas cards in the European Union by the Commission in Brussels. My noble friend was in characteristically grand form today.
The Library briefing note is of its usual high standard, but I saw it only an hour and a quarter before the debate started, and I shall concentrate on the wider world than Whitehall and the City. However, I am wholly behind the present Chancellor’s policies as laid out yesterday. When I was in the private sector 40 years ago, I would give up an annual day to sit at the feet of that polymath sage, Herman Kahn of the Hudson Institute, who was confident that the UK would survive in the post-industrial society because of its recognised global eminence in government, education and medicine. I am therefore particularly pleased about the Chancellor’s backing for advanced manufacturing, for life sciences and for the creative industries, all of which play well to our national DNA.
We should all be grateful to my right honourable friend David Willetts, in my right honourable friend Vincent Cable’s department, to his success in protecting the science base and the science budget, for reinforcing the finances of universities and for helping to secure the recent revision of student visa priorities and procedures. I smiled when earlier this week the Official Opposition claimed credit for having closed down 140 bogus institutions of further education, as if it was a badge of honour that after 13 years there should be 140 such institutions available to be closed down.
After a quarter of a century as the Member of Parliament for the most inner of inner city seats in the land, I no longer live in London except when attending your Lordships’ House, and I observe the national economy from the far end of Wiltshire, a county with so long a history as to be a proxy for a national bellwether. Wiltshire has 40 per cent of the world’s chalk grasslands—I repeat that that is a global figure—and so was a magnet for Bronze Age man since there were no trees to cut down. It was where Alfred the Great achieved his victory over the Danes at the battle of Ethandun in 878 on the downs above the great priority church at Edington. That was built on the medieval wool finances of west Wiltshire, the latter being why Bradford-on-Avon in its built environment has proportionately more listed buildings than any other place in England.
Until recently, Wiltshire had no higher education institutions other than the Royal Military College of Science at Shrivenham—we are, since Alfred, a very military county—but the Sarum Missal was a key text in the evolution of the Church of England; the spire of Salisbury Cathedral was the highest in Europe and a copy of Magna Carta sits in the chapter house; Wilton, just outside Salisbury, was the medieval capital of Wessex and the Wilton Diptych, now in the British Museum, is the earliest surviving painting in England. Scarcely a year goes by without new archaeological evidence emerging from the mysteries of Stonehenge and Silbury Hill. Advanced manufacturing, scientific research and online consultancy occur all over the county. As I said in an earlier debate, 200 yards from where I live is a small engineering firm that builds buses in Brazil and trucks in China, and won Boris Johnson’s prize for the new Routemaster bus.
I say all this is because—and I understand that the Prime Minister would approve—Wessex is not only the first proper region outside the home counties but a classic tourism county. Although I cannot be sure of the background, the news from the Rialto is that the vibrant and ubiquitous Wessex travel agency, Bath Travel, has recently sold its single medium-haul aircraft, which was always seen off from the marvellously convenient airport at Bournemouth until his recent demise by its exuberant chairman, the late Philip Bath. He knew most of the passengers, and they knew the reliability of his service to exotic locations all round the Mediterranean, the Atlantic and eastern Europe. It might have had its last flight in its colours because of old age or because of the state of demand, but it is a great loss to those passengers and, in either circumstance, it is a classic case of family finance needing a return to normal conditions of credit.
Tourism is an activity that has dozens of component aspects. Successful tourism requires each part to play its part well, and good performance requires good morale. When I was in the private sector, I had as clients two major family firms that had come here during the depression, because Garfield Weston and Forrest Mars thought that England was a soft market and then proved it. There is much to be said for Warren Buffett’s mantra that hard times represent good opportunities, but for our economy to benefit from them we need morale that makes us look on the bright side and enthusiastic leadership.
To return to London for a final footnote, I declare an interest as president of the British Art Market Federation, which employs 60,000 people directly, and another 60,000 indirectly, behind a turnover of nearly £8 billion. For generations, London’s art market has been the second largest in the world, but it was reported last week that China last year overtook us, part of the reason being the commercial disadvantage from which the EU suffers through the unique application of droit de suite, or artists’ copyright. The noble Lord, Lord Myners, who is taking part in the debate today, asked a Written Question about this, which was answered on Tuesday by my noble friend Lady Wilcox. I know that she was not seeking to mislead the House, but her Answer relied in part on admirable academic research conducted four years ago, whereas I know that her advisers at the Intellectual Property Office, a week before her Answer was given, had a copy of the British Art Market Federation’s submission to the European Commission’s current consultation on this subject, which is four years more up to date. It takes one back to Harold Macmillan’s remark about looking up a train in last year’s Bradshaw. This sector of the economy is not only sufficiently important but so great a British success story as to deserve, in a fast moving market, government being wholly up to date. I am not expecting a reply to this in my noble friend the Minister’s winding-up speech, but I look forward to news of the Government’s policy on these negative developments.