Economy: Purchasing Managers’ Index

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 11th April 2019 Lords Chamber

[Lord Bates]

I do not dispute that there are headwinds and that uncertainty is bad for business, which is why we want to resolve matters and move forward. However, one of the points about the purchasing managers’ index is that it asks people what their future intentions are, so if people had been “stockpiling” from the beginning of the year, that would not explain why they are now saying that they believe that they will buy more goods and are more positive about the future outlook. So that is not necessarily the right way to read the numbers.

[Lord Forsyth of Drumlean (Con)]

My Lords, given the performance of the German, French and Italian economies, which are all doing considerably worse than our economy, what explanation does the Treasury have for this?

[Lord Bates]

Given that it is hard enough to answer for the UK Government in your Lordships’ House, I will not attempt to answer for other Governments. However, I believe that the resilience we are seeing in the British economy is a tribute to a number of factors: the fact that the UK remains a prime location for foreign direct investment—we have the largest stock in Europe and the third largest in the world—and Forbes identified the UK as the number one location to invest and set up a business in 2018 and in 2019. All those factors—low taxation, a competitive economy and great skills—are the reasons why people are backing Britain.

Sibling Couples

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 21st March 2019 Lords Chamber

[Lord Bates]

There would be a tax consequence, because the spousal transfer in inheritance tax costs the Treasury some £2.5 billion per year. To extend the scope of that would involve a charge, and our judgment is that this case does not merit that.

[Lord Forsyth of Drumlean (Con)]

My Lords, given that the Financial Secretary to the Treasury has refused on four occasions to come to the Economic Affairs Committee and its sub-committee on the loan charge and shown himself unwilling to look at the evidence of hardship being caused, might my noble friend try lobbying the Chancellor on this matter instead? Could my noble friend acknowledge that this is not about avoiding inheritance tax? This is about people being able to continue to live in the family home. It is unjust. Is the Liberal Democrat policy not absurd—that the ability to live in the family home should depend on having a sexual relationship rather than a caring one?

[Lord Bates]

My noble friend makes his point. His point on the loan charge was debated here last night, when he and his representations were mentioned in dispatches by my noble friend Lord Wakeham. However, the point remains that we feel that there is a small number of cases. If a property is worth £1 million, and you divide it and take into account the personal thresholds of £325,000 times two, the liability on the death of one sibling will amount to some £70,000 in tax, which can be spread over 10 years.

Student Tuition Fees and Maintenance Loans

Debate between Lord Forsyth of Drumlean and Lord Bates

Tuesday 18th December 2018 Lords Chamber

[Lord Forsyth of Drumlean (Con)]

My Lords, is my noble friend aware that this was a recommendation of the Economic Affairs Committee of this House? One of the issues it focused on was the effect of counting the interest on student loans as income, which flattered the deficit and therefore provided some explanation as to why students were being charged as much as 6.3% on their loans. Given that we now have honest accounting on this matter, can we look forward to the Government implementing the committee’s recommendation that there be an immediate cut in the interest rate for student loans to 1.5%—the cost the Government bear in borrowing this money?

[Lord Bates]

We of course looked at the report, as I am sure the ONS did, and its recommendations were influential. I take the point my noble friend makes about the interest rate at one level, but at another, it is graduated so only those earning more than £45,000 a year will pay the full 3% above RPI. Those earning over £25,000 would pay only RPI. All of these things can be looked at in the post-18 education review, which is under way and due to report next year.

--- Later in debate ---

[Lord Bates]

Perhaps I misunderstood the question—I do apologise. I thought the noble Lord had asked what the effect was on the programme of sales of student loans—to which the answer is that there is no change. He is asking a different question: what about loans that have already been sold and will there be an effect? Of course, for those loans the value of the assets will be a matter for the institutions and organisations that have purchased the loans to account for in the correct way on their balance sheets. If that is still not the correct answer, I will be very happy to meet the noble Lord and write to him to clarify.

[Lord Forsyth of Drumlean]

My Lords, can my noble friend confirm that, had this change not been made, in 2050 the write-off in cash terms on the student finance book would be £1.2 trillion?

[Lord Bates]

I cannot confirm that number: I will have to look at it. The reality with these things is that we set them out, we follow the rules set down by the ONS and the OBR and we report accordingly in the Budget Statements.

International Development: Co-operation with the EU

Debate between Lord Forsyth of Drumlean and Lord Bates

Tuesday 11th December 2018 Lords Chamber

[Lord Bates]

I am very happy to reiterate the commitment on the important matter of humanitarian programmes in the unlikely event of a no deal. The more general point is covered in paragraph 108 of the political declaration, which talks about and articulates that very clear ambition. Of course, the EU itself is in a process of change in the instruments available. The EDF is coming to the end of its lifetime, and there is now discussion about a new neighbourhood instrument. We want to see what shape that takes before making any longer-term decisions, but the noble Lord is absolutely right to say that our interests and those of our European friends are very much aligned in this area.

[Lord Forsyth of Drumlean (Con)]

My Lords, would my noble friend agree that one of the biggest barriers to prosperity and development for developing countries is the European Union’s customs union, which results in their products being made less competitive and unable to reach our markets?

Brexit: Bank of England Report

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 29th November 2018 Lords Chamber

[Lord Bates]

We were covering that very point when the Office for Budget Responsibility produced its forecast along with the Autumn Budget. This showed that the forecast made in April about what would happen was underscored, and actually we achieved more. It increased its forecast going forward because it believed there would be more employment, more taxes and less debt.

[Lord Forsyth of Drumlean (Con)]

My Lords, in defence of the Governor of the Bank of England, can my noble friend confirm that these are not forecasts but scenarios whereby the Government think of three impossible things that could happen before breakfast and then ask the banks to plan accordingly to show that they would have the capital required to meet those extreme conditions? To present these as forecasts is misleading and undermines the Bank of England in carrying out its responsible activities.

[Lord Bates]

My noble friend has immense experience in the financial services sector and banking. What he sets forward is precisely the position. These should not be misinterpreted. They should be placed in the wider debate going forward and not taken out of context. I wholeheartedly agree with him.

Brexit: Economic Effect

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 18th October 2018 Lords Chamber

[Lord Bates]

I am very happy to reiterate that commitment which was given to ensure that, before the meaningful vote—and, indeed, the debate in your Lordships’ House—takes place, there will be an appropriate level of analysis to look at the consequences of the deal. Of course, we cannot set that out in detail now, because we do not know what the shape of that deal will be, but when it comes, that analysis will be made so that people can make an informed decision.

[Lord Forsyth of Drumlean (Con)]

My Lords, given that the Treasury model for short-term forecasting has been right for only one quarter since the referendum, and that the Chancellor has indicated that it is defective, what faith can we put in any long-term forecast, and why does the Treasury believe that its long-term forecasts are likely to be any more accurate than its short-term forecasts?

[Lord Bates]

My noble friend raises an interesting point. When we look at the actual economic data rather than the forecast, we see: unemployment falling to record low levels; inflation and the deficit on the way down; employment on the way up; wage increases at their highest level for a decade; and exports increasing. All this points to the fact that, as with all forecasts, these are not targets to be met but something to be beaten.

Debt Advice Services

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 6th September 2018 Lords Chamber

[Lord Bates]

We have provided significant additional funding to the credit unions. Wonga, which is in administration at present, is not a matter directly for government. The Financial Conduct Authority has issued advice that those who have loans with Wonga should continue to service those debts to avoid getting into further potential debt in the future.

[Lord Forsyth of Drumlean (Con)]

Perhaps I should declare an interest as chairman of a bank. Is my noble friend surprised that debt problems are growing when our daytime television is filled with ads for gambling and loans at exorbitant APRs?

[Lord Bates]

Certainly these are causes for concern. That is why we had a gambling review and followed the recommendation to introduce a £2 limit on fixed-odds betting terminals. That is why we put a cap on payday loans, abolished surcharges on credit and debit cards, and why we are currently undertaking a review through the FCA into high-cost credit. All those things are necessary for the reasons suggested by my noble friend.

Royal Bank of Scotland

Debate between Lord Forsyth of Drumlean and Lord Bates

Tuesday 5th June 2018 Lords Chamber

[Lord Forsyth of Drumlean (Con)]

My Lords, does my noble friend recall that, when the noble Lord, Lord Myners, was in charge of this matter and bailed out the Royal Bank of Scotland, I asked him what he expected the loss would be as a result of that involvement? He replied, “We will make a profit on this transaction”. Will my noble friend not take advice from the Opposition, which also sold our gold at a record low price?

[Lord Bates]

We recall the selling of half our gold reserves between 1999 and 2002 at the rock-bottom market price, but it is more important here to say that of course there is a problem. Then, in 2013 a Liberal Democrat Chief Secretary to the Treasury and a Conservative Chancellor produced a report which was put into the public domain saying what the future of RBS was. That involved radical restructuring, which is taking place, and as it is being concluded we are gradually disposing of the assets. That is the correct thing to do and we are right to do it.

Overseas Development

Debate between Lord Forsyth of Drumlean and Lord Bates

Wednesday 1st November 2017 Lords Chamber

[Lord Bates]

It may not be the case in the BVI, but it certainly may well be in countries such as Anguilla which have only recently graduated from the list of least developed countries. We are talking about losses that would be equivalent to the entire GDP of the country, so it is important that we offer assistance to them. After all, the primary purpose of aid is to help people in need—people in poverty—and for the purpose of economic development. In my view, and in the view of the Secretary of State and the DAC earlier this week, all those criteria apply in this case.

[Lord Forsyth of Drumlean (Con)]

Does my noble friend not think that the Secretary of State is to be congratulated on ensuring that money is directed where help is needed and on not being intimidated by bureaucratic rules which have resulted in people in need not being helped?

[Lord Bates]

My noble friend is absolutely right. This country has a proud record of providing leadership in the international community in the area of aid and assistance. It is important to put on record in the case of the Caribbean that the total assistance we provided immediately was some £62 million, of which only £5 million was ODA eligible. So the fact that it was not ODA eligible did not stop us from helping those in need, but because its purpose was obviously humanitarian and obviously going to people in need and distress, it should count.

Sterling: Euro Exchange Rate

Debate between Lord Forsyth of Drumlean and Lord Bates

Monday 9th October 2017 Lords Chamber

[Lord Forsyth of Drumlean (Con)]

My Lords, will my noble friend take this opportunity to remind people that the strength of the euro has been bought on the backs of those unemployed young people in Greece and the southern European states, that the eurozone is embarking on a project to screw that down even harder, and that the misery that will create is one of the reasons why we are best out of the eurozone?

[Lord Bates]

My noble friend is absolutely right that we are out of the eurozone as far as that is concerned. The strength of the UK can be recognised not only in how people respond to our market but in how they respond in terms of foreign direct investment. That is a much more concrete and long-term form of investment. The UK continues to be the second-largest recipient of foreign direct investment in the EU and second in the world only to the United States. The fact that companies such as Nissan, Toyota, Apple and Bloomberg are making major long-term investments in the UK should encourage us to do the same.

Barnett Formula

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 13th July 2017 Lords Chamber

[Lord Bates]

We are certainly always open. That is why we spend £120 in Wales for every £100 that we spend in England. We continue to be committed to that. It is why we increased the overall capital borrowing limit to £1 billion from £500 million, and we continue to look for opportunities to grow the economy in Wales, both within and outside the Barnett formula.

[Lord Forsyth of Drumlean (Con)]

My Lords, given the Prime Minister’s emphasis on fairness and on strengthening the United Kingdom, why are the Government so resistant to taking the advice of the late Lord Barnett and of the committee of this House that looked at the Barnett formula, which unanimously concluded that Wales lost out as a result and that a system based on needs would unify the United Kingdom and be fair to England, Scotland, Wales and Northern Ireland?

[Lord Bates]

I recognise that—and of course for 40 years there has been an ongoing debate about the Barnett formula. Our response to that, as my noble friend will recognise, is to believe that we should devolve to the devolved Administrations more responsibilities and financial accountability in taxation and how money is spent in the Budget. That is the best way in which to eventually work towards a needs-based rather than population-based formula.

St Helena: Airport

Debate between Lord Forsyth of Drumlean and Lord Bates

Monday 17th October 2016 Lords Chamber

[Lord Forsyth of Drumlean (Con)]

My Lords, I welcome my noble friend back to the Front Bench and to the service of the House. I suggest to him that, given the assiduous nature of the noble Lord, Lord Foulkes, on this matter, it might be a good idea to arrange for him to be sent to St Helena on the first commercial flight.

[Lord Bates]

I think that exile is a matter for the Foreign and Commonwealth Office and negotiated through the usual channels.

Immigration Bill

Debate between Lord Forsyth of Drumlean and Lord Bates

Wednesday 3rd February 2016 Lords Chamber

[Lord Forsyth of Drumlean]

I am grateful to my noble friend. I entirely accept what he says about Muslims being subject to horrors as well as Christians, but could he deal with the point that the problem for Christians is that they cannot go to the official camps because they fear for their safety, because, once again, they are a minority? Is there any possibility of creating some kind safe haven? That in itself may create a further security problem for them. The genocide point is that it would enable immediate action to be taken.

[Lord Bates]

Certainly, the situation is that we would take families from within the camps and from the surrounding areas. It is not exclusively from the camps; it is those who are identified as being in greatest need. The noble Lord, Lord Forsyth, raises an interesting point on the camps. I shall certainly feed that back to the department and seek some reassurance, and perhaps write to him and other noble Lords on what protections are arranged in the camps where DfID and others are involved to be sensitive to the needs of Christians.

European Union: Schengen Agreement

Debate between Lord Forsyth of Drumlean and Lord Bates

Tuesday 15th December 2015 Lords Chamber

[Lord Forsyth of Drumlean]

To ask Her Majesty’s Government whether they will encourage the European Union to suspend the Schengen arrangements and reinstate border controls between member states.

[The Minister of State, Home Office (Lord Bates) (Con)]

My Lords, the reintroduction of border controls within the Schengen area is ultimately a decision for the Schengen states themselves. However, given the possible security threats, the Government have a strong interest in ensuring that Schengen states effectively combat illegal transit into and across their borders.

[Lord Forsyth of Drumlean (Con)]

My Lords, I am grateful for that Answer. Does my noble friend agree that a Government’s first duty is to protect the security and well-being of their people? Given that the European Union has failed to police both its external and internal borders, is it not the duty of the Prime Minister to regain control of Britain’s borders?

[Lord Bates]

Of course, my noble friend is absolutely right, and we have control of those borders because, in the Maastricht treaty, as he and I know, Sir John Major managed to negotiate an opt-out from the Schengen area. We retain strong control over our borders, which is quite essential. We look at the situation happening in Europe at present and we are not dispassionate, because the issues and security concerns that we have about Europe ultimately come towards us—so we need to work with our EU partners. We believe that the type of discussion that they are now having about strengthening the external border to the EU is absolutely right and timely.

EU: Justice Opt-outs

Debate between Lord Forsyth of Drumlean and Lord Bates

Thursday 4th December 2014 Lords Chamber

[Lord Bates]

The noble Baroness says that we were not engaging in discussions, but these discussions through the working groups were absolutely ongoing all the time. That was the reason why we secured the improvements which we got through to the European arrest warrant in terms of proportionality, dual criminality and avoiding lengthy pre-trial detentions. In terms of every single one of the 135 measures, again, we set out very clearly in Command Paper 8671, which was laid before your Lordships’ House in July 2013, our view as to what the application was and whether it was necessary. From that, we took the view that 35 were necessary; that was why the Prime Minister wrote in July last year.

[Lord Forsyth of Drumlean (Con)]

Can my noble friend explain to me, as someone who voted for the Maastricht treaty on the basis of an assurance that justice and home affairs would always remain within the jurisdiction of this Parliament, why, instead of opting into the European arrest warrant, we could not simply have made a bilateral arrangement with the rest of the EU?

[Lord Bates]

I obviously acknowledge the fact that we both voted for the Maastricht treaty. We were both in another place at the time and were part of the Government who did that. I recognise that that was the right thing to do, but the reality is that the pass was sold on this in the 2009 signing of the Lisbon treaty. That is, we have to live in the real world, as we are now, and keep our borders safe. It was good that the opt-in on justice and home affairs was negotiated to be included by the previous Government, but it was this Government who actually took it and have exercised it in this regard.

Welfare Benefits Up-rating Bill

Debate between Lord Forsyth of Drumlean and Lord Bates

Tuesday 19th March 2013 Lords Chamber

[Lord Forsyth of Drumlean]

My Lords, I am grateful to the noble Lord, Lord Griffiths of Burry Port. I did not think that he was a bishop and I was addressing my remarks to the Bishops’ Bench, but I say to him that the burden of tax has gone up substantially, and the reductions in government expenditure have so far been quite limited. We are discussing not a cut in government expenditure but limiting the increase in government expenditure to 1%.

I have had several goes at persuading the right reverend Prelate to indicate where the money for his proposal might come from. One possibility might be for people to put wages up. If the Church of England were to put up its clergy’s wages, less would be claimed in benefits and more would be available for others, but that is not a practical proposition for the church because the church, like the Government, is faced with a financial crisis and has to live within its means. What is good for the church is good for the Government and is good for particular families.

The most irresponsible part of the arguments that have come from the Bishops’ Bench this afternoon is about what happens if inflation is allowed to let rip. I fear that that may be about to happen as we continue to print money and borrow. As the noble Lord, Lord McKenzie, pointed out, we are borrowing far more than we planned to meet our commitments and to be fair to the most vulnerable. What happens when inflation takes off? I remember the 1970s, when inflation was running at very high levels, at 20% and more, and interest rates were at 15% and more. Who suffered? Children, the poorest and families suffered. There is nothing Governments can do to protect them once inflation takes off.

We do not want to go back to that kind of society. It tried to cope with inflation by protecting people through indexation, but it was unable to keep up with it and the result was, as the then Labour Prime Minister put it so eloquently:

“Inflation is the father and mother of unemployment”.

Jim Callaghan said:

“We used to think that you could spend your way out of a recession, and now we know that you cannot”.

Those words were said as the Labour Government left in 1979, leaving another Tory Government to clean up the mess, just as we are doing now.

The right reverend Prelate’s amendment of course carries great emotional impact. We would all like to see working families with children have a higher standard of living, but the way to do that is to create the wealth that enables us to support those families and enables them to get the levels of income and employment that they need. You do not do it by shaving the edges of the currency, allowing inflation to take off and committing those families’ children as adults to a debt burden that, frankly, will be impossible to pay off. They would be paying the interest for the rest of their lives, and that would disadvantage their children. In rejecting this amendment, as I hope she will, my noble friend is speaking not just for our children but for our grandchildren, who are entitled to expect responsible government in these straitened times.

[Lord Bates]

My Lords, I support what my noble friend Lord Forsyth said. When the right reverend Prelate comes to respond to the debate, I would be grateful if he would comment on the following point. He made great play, and I do not underestimate this, of the effect and impact of limiting the uprating of child benefit and child benefits generally to 1%. According to Appendix 3 of the helpful Library note on the Bill, regarding the child tax credit element, in 2011-12 the child element of child tax credit increased by 11.1%, a significant sum. That followed significant increases of 13% in 2008-09 and 12.5% in 2004-05. If one is to argue that limiting that increase now to 1% would have a significant effect, if you take it as a snapshot, that may be the case, but if one looks over time, one has to factor in those significantly higher-than-inflation increases that have occurred in the child tax credit element in the past.

One of the problems with trading figures with regard to child poverty is that you get some curious results. One of the most notable is that in 2010 there were 300,000 fewer people in poverty because the recession had caused the median income to drop—in other words, children were said to have been pulled out of poverty not because anything had changed in their lives but because the rest of society had got poorer. We have to be clear about what we are arguing for when we talk about the interests of children, which of course should be paramount.

I turn again to a theme in the debate on the previous amendment: one cannot just take this in isolation. One needs to look at what the Prime Minister has announced today on childcare, for example, which will make a significant difference to people by enabling them to move into employment. One needs to look at the pupil premium or the raising of tax thresholds, which means that someone on the minimum wage has seen their tax bill halved under this Government. One has to look at these things in the round. Unlike the Opposition, we have ring-fenced the budget for the National Health Service, on which people significantly depend. Again, in the round, we need to get this absolutely correct.

I will react to the charge that somehow there is an easy pot at the other end of the income scale to be tapped into. As a result of this Government’s actions, the richest pay more tax on capital gains, more stamp duty on their homes and more tax on their pensions and are less able to evade tax than was the case before. These factors need to be borne in mind in the broad reach of these changes that I know when taken in cold, clinical isolation, one year at a time, without reference to trends over time, may allow one to draw one conclusion but should be placed in the proper context. I seem to recall from my youth the good theological concept of placing individual verses in context in order to understand their meaning, and one might think it was a good idea to place this one measure in the broader context in order to understand what the Government are doing to bring people out of child poverty, which we accept is significant. Other measures, such as limiting the proposed increases in fuel duty—another factor that has a big impact on the poorest in society, particularly those with families—and caps on rail fares and on council tax, all seek to address the issues.

We also need to recognise that child poverty has a wider set of causes than cash payment alone, and in many ways, we are focusing here on cash payment on its own. We need to place in context the fact that the children’s opportunities and their likelihood of being in poverty are affected primarily by the extent to which they live in a workless household. Therefore, all our efforts to get people into work should be welcome.

--- Later in debate ---

[Lord Forsyth of Drumlean]

I have the highest regard and respect for the noble Baroness, Lady Hollis. She knows more about social security and understands the issues better than anyone else. I wish that she was on the Front Bench. If she was, she would be putting forward alternative proposals that might be more attractive and meet some of the points that are being considered, but she is not on the Front Bench and there are no alternative proposals.

We have to contain public expenditure not to within our means, because we are spending more than our means; the noble Lord, Lord McKenzie, pointed out that the Government are already borrowing and spending £200 billion more than was planned. I am simply arguing that if we continue like this the pound will continue to sink. The cost of energy, which, as the noble Lord, Lord Kirkwood pointed out, is a major cost for families, will go up. He supports windmills and other forms of energy generation that are the most expensive known to the planet and which are put on people’s bills without their knowledge as a tax and add to the pressure on these families. That is another example of where, if he is worried about poor households, he should abandon his attachment to windmills and other things that are raising energy costs and adding to inflation. The name of the game is to contain inflation by not having daft policies such as windmills and other energy policies. It is to act in a responsible way so that people will not decide that they do not wish to buy government debt, which is already a problem, and will not result in further pressure on the exchange rates.

I am sympathetic to the points that the noble Lord, Lord Kirkwood, has made and with which the noble Baronesses, Lady Morgan and Lady Masham, are concerned in respect of the people who are affected. The problem is that the remedy that they propose would make things much worse. It is not a good place to be. We would prefer not to have started from here, but it was Mr Gordon Brown who put us in this position, ably assisted by the noble Baroness, and we must sort this mess out. Clever as it is, this amendment is a smart attempt to get round the basic purpose of the Bill, which is fundamental to protecting people on low incomes.

[Lord Bates]

I support the noble Lord, Lord Forsyth, but I want to go one step further. He has dealt incredibly effectively with the measured arguments put forward by my noble friend Lord Kirkwood in Amendment 9, but it does not quite hit the interesting amendment in the names of the noble Baronesses, Lady Morgan and Lady Masham. I want to make a couple of points drawn from the Office for Budget Responsibility report looking at this Bill and the impact assessment.

Front and foremost are two things. The first is the control of inflation and the second is the creation of employment. They will help the poor more than anything else. If we fail to tackle the debt, the cost of borrowing will rise, as my noble friend Lord Forsyth has said. If the cost of borrowing rises, inflation will rise on the back of it. Therefore it follows that tackling the deficit is the best thing that can be done to help the poor. In table 2 on page 6 of its forecast, the OBR estimates that inflation will be: 2.6% in 2013-14; 2.2% in 2014-15; 2% in 2015-16; and 2% in 2016-17 and thereafter. It is clearly assessing that the culmination of the effect of these and other measures being taken is to move us towards a situation in which inflation is on a steadily downward course. That is the OBR’s assessment, which was used as the basis of the 2012 Autumn Budget Statement. As noble Lords have said, we will find out tomorrow where we stand vis-à-vis that.

Other elements need to be taken into account. We have the Low Pay Commission’s report coming up shortly. The Low Pay Commission provides a report that influences the minimum wage. The report was submitted at the end of February. I do not know whether my noble friends on the Front Bench have had sight of that recommendation, but it, too, provides a lock. Despite in previous incarnations being against the minimum wage, the Government have said that they support the minimum wage and have always accepted the recommendations of the Low Pay Commission to increase income as a result. Taking that together with the changes to universal credit that are deemed to be providing additional benefits to people estimated at £168 a month for 3 million families and the likely increase in tax thresholds and their impact on the salaries and incomes of the poorest in our society, it seems fair and reasonable, as the noble Baronesses, Lady Morgan and Lady Masham, have suggested, periodically to undertake a review. Post-implementation reviews normally take place three to five years after implementation.

We are talking about some of the most vulnerable. I believe that the position affecting the poorest in our society will not be as great as some people anticipate and that the situation with the combination of policies that I have outlined will lead to an increase, but as we are not having the annual uprating review, some periodic review of how this is working against projections of inflation and of the impact on the poorest in society would be sensible. I encourage my noble friends on the Front Bench to support it if possible. Should such a review take place, it should not need focus on the one narrow measure that has been the theme of this debate but should assess the wider impact on the poorest in society, taking into account the other measures—the pupil premium, NHS, the lid on fuel increases, the increase in personal allowances, the increase in the national minimum wage et cetera—which we are talking about. With that, I support the noble Baroness, but I am afraid not my noble friend Lord Kirkwood.