European Union Membership: Science and Technology
Debate between Lord Hunt of Chesterton and Baroness Neville-Rolfe(9 years, 5 months ago)
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Lord Hunt of Chesterton
To ask Her Majesty’s Government what assessment they have made of the effect of withdrawal from the European Union on investment in science and technology in the United Kingdom.
The Parliamentary Under-Secretary of State, Departments for Business, Innovation and Skills and for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, the Government are committed to investing in science and making Britain the technology centre of Europe. We have a clear mandate for reform and will hold an “in or out” referendum on the UK’s membership of the European Union by the end of 2017.
Lord Hunt of Chesterton (Lab)
Since Peers on all sides of the House as well as the Financial Times and scientific institutions now agree that there should be more technologically advanced companies with UK ownership, does the Minister agree that this objective is threatened by the loss of European-funded research if the UK leaves the European Union?
Baroness Neville-Rolfe
Not at all. Our position is very sensible. We are looking for an improved position in a reformed Europe to end uncertainty. The Government’s plans involve various areas, including increasing economic competitiveness. Science and innovation are clearly vital ingredients in that economic competitiveness.
Low-income and Vulnerable Consumers
Debate between Lord Hunt of Chesterton and Baroness Neville-Rolfe
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Neville-Rolfe) (Con)
My Lords, first, I extend my gratitude to the noble Lord, Lord Whitty, for securing this wide-ranging debate and to all noble Lords who have given their very different perspectives—some cheerful and some rather gloomy. It has been a great opportunity to discuss how government can best support those on low incomes and vulnerable consumers. I have often agreed with the noble Lord on consumer and local government issues, but today his big picture is one that I just do not recognise. I could say the same about the noble Baroness, Lady Lister of Burtersett.
In this Government, we are all committed to helping those on low pay and protecting our most vulnerable consumers. We have taken action across government to tackle poverty, allow people to keep more of the money that they earn and give the most vulnerable a loud, clear voice. We have brought forward legislation when it is needed. As the noble Lord, Lord Whitty, said, the Modern Slavery Bill is about to come into our House. Later in the year, the Small Business, Enterprise and Employment Bill will come to this House and will deal with the operation of zero-hours contracts.
First, I would like to step back and look at fundamentals. I agree with my noble friend Lady Noakes. When the Prime Minister spoke at Davos in 2009, as the noble Lord, Lord Haskel, mentioned, he was looking at the problems in Britain then. Following that, the coalition arrived in Government in 2010 and found an economy and institutions reeling from the deepest recession for many years, of which one cause was a prolonged period of fiscal irresponsibility. “On its knees”, I think, were the words of my noble friend Lady Noakes. It left us with an inexorably rising deficit and cost 750,000 people their jobs. That was bad for everyone especially those on low incomes. To pick up the wording of the Motion, the “cumulative effects” have given us an awful legacy.
The key to being able to help low-income and vulnerable consumers is to deliver economic growth. The dire need to get the economy back in shape has been extremely challenging. The public sector has had to become slimmer, better organised and more efficient and many parts of it have responded very effectively to that challenge. Despite the challenges, the Government have reduced the fiscal deficit, while ensuring that the poorest and most vulnerable households are protected. The Government are the first to publish cumulative distribution analysis of their tax, welfare and public spending measures. This analysis shows that the richest 20% of households make the largest contribution to reducing the deficit, both in cash terms and as a percentage of their income. I am afraid it is extremely difficult to do the sort of analysis asked for by the noble Baroness, Lady Lister, on individual groups, such as the disabled.
More fundamentally, as Adam Smith pointed out, the best long-term protection for people as consumers, including the poorest, comes from the establishment of genuine competition among providers. We have encouraged this, thereby improving the economy and encouraging innovation. We have not sought to dictate prices—a policy some unwise politicians have recently suggested. This would be foolish and the effects catastrophic, especially on the poorest.
The noble Lord, Lord Haskel, mentioned that only one in seven has felt the benefit of the recovery. I would say that the economy is in a good place and quote the Office for Budget Responsibility forecast that real household disposable income will rise in every year to the end of the forecast period 2018-19. This is the best measure of living standards, as it includes employment levels and income.
Employment is one of the key areas that help people to look after themselves. The Government have done a great deal for job creation. More than 30 million people are now in work—a record high. A greater proportion of women are in work than ever before. Since 2010, an additional 2.1 million private sector jobs have been created. Creating jobs and helping people to find sustainable employment is the best route out of poverty.
In view of what the noble Baroness, Lady Lister, said, I am pleased to say that 768,000 more women are employed since the last election. Employment gives individuals financial security and self-confidence, which in turn strengthens families and helps children in those families, as my noble friend Lady Noakes said, and ripples through communities. Our labour market reforms are designed to reconnect the unemployed with the labour market. They have proved successful. Youth unemployment fell a record 253,000 on the year. Long-term unemployment fell 194,000—the largest annual fall since 1998. The percentage of workless households is also lower than it was under the previous Government. Unemployment in the past year has fallen at the fastest rate ever recorded.
We have also been improving education and skills, which, in time, will have a good effect on productivity. Apprenticeships have been a central plank of my department’s drive to open up new routes into work and to give people the skills and experience that they need to thrive. The Government are investing in real jobs for young people. By overhauling apprenticeships and vocational education, we are giving young people access to the tools they need to build a better future and we are giving employers the skilled workforce that they need to compete. We are on track to have 2 million apprenticeship starts this Parliament, and we have introduced national insurance breaks for employers hiring people under the age of 21. This is at the heart of our drive to equip people of all ages with the skills that employers need.
We are also helping people to start their own businesses, although many do this without any help. For our aspiring entrepreneurs, the start-up loans programme provides loans and ongoing business mentoring support. More than 2 million new businesses have been created since May 2010—more businesses, more jobs and more growth.
I commend my noble friend Lady Noakes for her interesting analysis of the situation on tax. I believe, as she does, that everyone loses out if taxes do not encourage wealth and innovation. The Government are committed to a fair tax and benefit system, where everyone contributes to reducing the deficit and those with the most make the largest contribution. We will make the UK much more competitive internationally by cutting corporation tax from 28% to 20% next year. For the individual, we will increase the tax-free personal allowance, which will rise to £10,500 by April 2015, taking 3 million people on the lowest incomes out of paying tax altogether. I am glad to say that 56% of these are women.
The noble Lord, Lord Haskel, talked about national insurance, mentioning that it is paid by the lower paid. Of course, our reforms to the personal allowance are more progressive than the Opposition’s proposals on the 10p tax rate, which the IFS said have no plausible economic justification.
I now turn to inflation. We inherited a difficult situation but we have kept inflation low, which is vital to consumers of every age. It was 1.2% in September—the ninth successive month that it has been below the target. The latest data on inflation from the ONS show that the annual rate of food price inflation was minus 1.5% in September. That is the lowest it has been since June 2002. It helps poor families struggling in the way that the right reverend Prelate the Bishop of Norwich described. It is also great news for all consumers.
The success that I have described mainly comes from running the economy responsibly, but we have also taken some specific steps which have helped with inflation—for example, the abolition of the fuel duty escalator and freezing council tax for four years, as well as many other measures.
We are committed to improving living standards, particularly for the low paid, whenever we are able to do so. The living wage was mentioned by the noble Baroness, Lady Crawley. She knows that we support businesses that voluntarily choose to pay the living wage when it is affordable and does not cost jobs. We have supported the national minimum wage, and this year we were very pleased to accept the Low Pay Commission’s recommendation of an increase above inflation. From October 2014, more than 1 million low-paid workers received up to £355 extra in their pay packets. The Government have been addressing the cost of living. They have cut tax for 26 million people, thereby reducing the income tax paid by a typical taxpayer by £705.
The noble Lord, Lord Whitty, mentioned fuel poverty. The fuel poverty gap fell from £1.07 billion in real terms in 2011 to just over £1 billion in 2012. Of course, fuel is a key expenditure for many. As a result of our measures, average pump prices are 13p per litre lower than under Labour’s fuel duty plan, helping motorists but also helping those delivering goods to our factories and shops, and prices are still coming down.
Many people worry about the cost of local services. Action in the Budget enabled local authorities to freeze council tax, should they choose, for the fourth year running. Thanks to government support, council tax bills could, therefore, have fallen by up to 11% in real terms by 2015. The noble Baroness, Lady Crawley, and the noble Lord, Lord Whitty, mentioned the difficulties faced by families with children. However, this is an area in which the Government have taken decisive action. We have introduced free school meals for all infant school pupils and will introduce tax-free childcare which will save families up to £2,000 per child. We have also introduced family-friendly employment policies and approaches across government. Nearly all the items that the noble Lord, Lord Hunt, read to us from the Conservative manifesto have been tackled.
Baroness Neville-Rolfe
Yes, indeed. Sure Start still exists and I have always been a big supporter of it.
The noble Lord, Lord Whitty, mentioned transport. For travellers, and those who have to commute to work, we are capping rail fare increases and reducing the scope for above average increases. Regulated fares include, in cities, season tickets, day singles and returns. We have invested in transport in a way that the previous Government were not always able to do. Things like Crossrail are making a major difference to London. The previous Government started Crossrail and we hope to finish it. It is a great project with benefits far exceeding the cost.
All commentators agree that housing is an important factor in vulnerability. However, I do not agree with the analysis offered by the noble Lord, Lord Whitty. For those in rental accommodation, the Government have announced that, from April 2015, annual rent increases in the social housing sector will be limited to CPI plus 1%, for 10 years. This new policy is intended to help ensure that rents remain affordable, and existing tenants are protected from large rent increases, while ensuring that landlords have the income they need to invest in the maintenance and improvement of existing homes and services, and in the provision of more new, affordable homes. The noble Lord, Lord Whitty, suggested a national register of landlords. We do not support a national register of landlords. It would be a financial burden on all landlords and cost £330 million, at current prices, over 10 years. These costs would be passed on to tenants through higher rents, while it is not clear that a register would be effective. We are also supporting new, affordable homes. This is another area in which all sides of the House are very interested. We are investing £4.5 billion of capital funding and the number of affordable home starts has increased in recent times.
Pensioners must have a decent life and a secure income in retirement. That is why we have protected them; for example, by using a triple lock for uprating. The basic state pension is increased each year by the highest of the growth in average earnings or price increases, as measured by CPI, or 2.5%. As a result, someone on a full basic state pension can expect to receive £440 more a year in 2014-15 than if it had been uprated by earnings since the start of this Parliament. The percentage of pensioners in relative poverty is close to the lowest ever recorded. We have also protected many key benefits for older people: free eye tests; free NHS prescriptions; free bus passes; free television licences for those aged over 75; and winter fuel payments.
I turn to welfare. The Government have continued to provide strong welfare support. Social security spending was £209 billion in 2013-14, which is 31% of total managed expenditure. However, to protect the long-term sustainability of the public finances, it is vital that the Government bring this welfare spend down. We are proud to have grasped the nettle. The Government have introduced universal credit to make work pay and simplify the benefits system. This is a major reform that is being rolled out carefully. Our priority will remain safe and secure delivery testing and learning.
The right reverend Prelate mentioned inefficiencies in benefit payments. That is why we are addressing this through the introduction of universal credit, which I believe will make a very big and important difference for those in and out of work. It ensures that work pays, and more work pays, with a transition to and from work no longer putting household income at risk in the way it did in the past.
I have already mentioned the cap on rental increases in the social rented sector. We need to make the best use of the housing stock and use what we have fairly and properly. Through housing benefit, taxpayers would have been paying £500 million a year for 1.5 million spare bedrooms, while there are 250,000 households in overcrowded social housing in England alone. I make that comment to the noble Baroness, Lady Lister, who talked about that issue with some passion. A very important thing is going on there. We are also absolutely committed to supporting people to make the transition, especially for those who are vulnerable. That is why last year funding for discretionary housing payments was trebled and why pensioners, of course, are entirely exempt—back to my point about pensioners.
The noble Lord, Lord Whitty, and the right reverend Prelate talked about child poverty. The Government are committed to our goal of ending child poverty in the UK by 2020. That strategy reflects the reality of child poverty in the UK today, with worklessness and education absolutely key root causes. Doing things about those issues is essential to eliminating poverty.
The noble Lord, Lord Whitty, also talked about gas and heating oil. I believe that the best way to keep bills down is to help people to save energy in sure, fair tariffs that encourage competition. We are also reforming the retail market, making it simpler to understand, and ensuring that everyone is on the cheapest tariff that their supplier offers for their preferences. I will write to my noble friend Lady Noakes on the points she made about green energy as it is a bit late in the day to start a discussion on that.
I believe that the new Consumer Rights Bill makes many really important changes. It is a 10-year Bill and will bring most benefit to the most vulnerable. It also introduces important reforms on lettings, which will bring about a new transparency, which the noble Baroness, Lady Hayter, mentioned. It will enable more redress for consumers when they have suffered loss.
We have also protected the funding for Citizens Advice, and we have been big supporters of National Consumer Week, rightly mentioned by the noble Baroness, Lady Crawley, for the great work that was done on doorstep crime.
In concluding, I thank all those who do such great work across the economy to help with consumer law, preventing rip-offs and cracking down on rogues. We in the Government are on the side of the low-paid and the most vulnerable, helping them to climb the economic ladder. Labour trapped people in a broken benefits system. We needed our skills systems and colleges to get out of the great recession. Too many people are still poor and in trouble, but thanks to this coalition Government the economy is on the mend and we are better placed to help the vulnerable and improve the livelihood of those on low incomes.