Charter for Budget Responsibility

Debate between Lord Hammond of Runnymede and Mark Field

Tuesday 24th January 2017 Commons Chamber

[Mr Hammond]

It is always a pleasure to be gently chided by my hon. Friend, who is of course absolutely right. That is the conundrum about Britain’s productivity. We have some of the most fantastically productive companies and businesses—indeed, some of the most productive cities—in the world, but we also have some of the poorest examples of productivity performance. The challenge before us is to work out how to spread across the economy the best practice in productivity that we see in our economy so that all regions, and all corners and sectors of our economy, can share in this productivity performance and thus deliver the higher real wages and living standards that that implies. This is the biggest challenge facing the UK economy, but one that successive Governments have failed to do anything effective about.

[Mark Field (Cities of London and Westminster) (Con)]

I am certainly not in the mode of wanting to chide my right hon. Friend for anything in particular, but it is worth putting the productivity issues into context. It is also the case, as it has been during his time in office, not just as Chancellor but since 2010, that our unemployment rate has been rather lower, and that may have been a factor in the poor productivity that the UK economy has had relative to many of our European partners. This Government—or perhaps more importantly, British businesses—have made keeping employment rates a higher priority than the urgent need for improvements to productivity to which he refers.

[Mr Hammond]

My right hon. Friend, who represents one of the most productive sub-regions in the entire European Union, is of course right. There is a perfectly respectable economic argument that, as participation in the labour force increases, bringing more marginally productive workers into the labour force, that may have a depressing effect on labour productivity overall. However, the employment participation rates in Germany and in the UK are not all that different. I do not think we can explain a 30% productivity performance gap by differences in levels of participation in the economy. Indeed, there is much debate among economists about the cause of this productivity gap, and the cause of the generally poor productivity performance of developed economies over the past few years.

We chose at autumn statement 2016 to invest an additional £23 billion through a national productivity investment fund, which aims to raise productivity, support job creation, and boost real wages and living standards. Every penny we spend from this fund will be used to boost economic infrastructure, research and development, and housing. It will bring total investment in these areas to £170 billion over the next five years. It means that gross public investment will be at least 4% of GDP for the rest of this Parliament—that is higher than in any period between 1993 and the great crash.

Libya

Debate between Lord Hammond of Runnymede and Mark Field

Tuesday 19th April 2016 Commons Chamber

[Mr Hammond]

I can confirm that it is already on the agenda. Prime Minister Sarraj is aware of our focus on this issue, but it is a question of timing. At the moment, the Government have not got access to the great majority of their ministries and civil servants. They do not have access to their assets, so it would be premature to make that the No.1 issue. However, this Government are focused on the need to raise and to resolve these issues at the right point in this progression, and Prime Minister Sarraj has already been notified that we will do so.

[Mark Field (Cities of London and Westminster) (Con)]

We have seen a very thoughtful exchange between the Foreign Secretary and his shadow. Although there are flickers of optimism, the atmosphere remains very sombre, not least because, as other Members have pointed out, we have responsibility to a large extent for what has happened in Libya over the past five years. I say to my right hon. Friend, who has dealt with this whole issue of technical and other expertise very skilfully, that the British public would be very reluctant if there were any sense that our expertise was going into helping one side rather than another in what could still be a very bloody civil war. Although I appreciate that these are difficult things and that there are often no good guys on either side, there must be an appreciation that that would be something that would cause angst to the public if we are to have a functioning Libya in the years ahead.

[Mr Hammond]

I am grateful to my right hon. Friend for that. If only it were so simple as there being two sides; there are about 120 sides as far as I can make out. He is absolutely right. Of course we must ensure that our support is targeted at the Government of national accord. We have to look for bright spots. One of the positive things that I take from the situation in Libya is that, by and large, the different factions are not motivated by ideology, particularly by extreme religious ideology, as they are in some of the other conflict zones. A lot of this is to do with traditional money and power interests. It is about people wanting to protect their local fiefdoms and making sure that they and their communities get their share of the wealth of the state. Prime Minister Sarraj is going about this in exactly the right way. He is going with the grain of Libyan society, recognising that reality and trying to build a consensus mechanism around it.

Oral Answers to Questions

Debate between Lord Hammond of Runnymede and Mark Field

Tuesday 12th January 2016 Commons Chamber

[Mr Hammond]

We are following the case closely and we have already made the Portuguese authorities aware of Mr Singh’s asylum status in the UK. India has not yet presented Portugal with a formal request for extradition, and as such we are not aware of the full details of the charges that he faces in India. We will continue to monitor Mr Singh’s case and will make a decision on further action when all the facts are available. Ultimately, however, it is the Portuguese authorities that have jurisdiction in Mr Singh’s case and will decide whether or not to extradite him to India.

[Mark Field (Cities of London and Westminster) (Con)]

One area not raised in the letter of 10 November was that of national security. Would the Foreign Secretary like to tell us a little about that issue and how important ensuring that proper national security is maintained will be in relation to our remaining a member of the European Union?

[Mr Hammond]

As my right hon. Friend knows, national security is reserved to the member states and we regard it as very important that that should remain the case. However, there is a tension because national security interacts with many other agendas where the European Union does have competence—for example, around the regulation of telecommunications. Ensuring that that balance is maintained correctly, and that the crucial national security interests of the member states cannot be interfered with by the European Union, remains one of our priorities in the negotiations.

Oral Answers to Questions

Debate between Lord Hammond of Runnymede and Mark Field

Tuesday 24th November 2015 Commons Chamber

[Mr Hammond]

First, we need to work with the Tunisians to improve security so that the tourist trade can resume as soon as is practical. The EU is looking at the relaxation of olive oil quotas to allow Tunisia greater access to the European market for olive oil, a product it has aplenty, if it is able to export it. The Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Bournemouth East (Mr Ellwood), visited Tunisia a couple of weeks ago and discussed with the Tunisians a 49-point plan to support their economy. We are, with the French, seeking to act as cheerleaders for support within the European Union for the Tunisian economy.

[Mark Field (Cities of London and Westminster) (Con)]

Does the Foreign Secretary agree that we should take this opportunity to encourage institutions such as the Westminster Foundation for Democracy, and a range of other organisations and institutions in our western allies—the United States, France and Germany, to name but three—to ensure political stability and democracy is brought to Tunisia, Libya, and, hopefully, other north African countries?

[Mr Hammond]

Yes, I agree. Of course, Tunisia is ahead of the game, as it were. It is one of the success stories of the 2011 Arab spring, with a functioning constitution and democratic elections. All of that is challenged, however, by the desire of the extremists to target such success stories. We must stand with them.