Devolution and Growth across Britain
Sajid Javid Excerpts(9 years, 6 months ago)
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The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
I echo the tributes that were paid to Charles Kennedy earlier today. I was not fortunate enough to know him well, but his reputation for courage, his principles and his humour were well known to all. My thoughts are with his family and friends.
I extend a warm welcome to all new Members of the House and to you, Mr Deputy Speaker, upon your return. I also welcome back the hon. Member for Streatham (Mr Umunna). I look forward to our many encounters over the coming months. The hon. Gentleman and I have an unusual connection. Soon after I was elected back in 2010, as was he, it came as a great surprise to be recognised so frequently by members of the public. I later discovered, after a particularly excited individual took a selfie with me, that they thought I was the hon. Member for Streatham. [Laughter.] I consider that to be a compliment, but I am not sure whether the same is true of him.
The title of our manifesto promised three things if we were returned to government: strong leadership, a clear economic plan and a brighter, more secure future for our country—our whole country. After Labour’s record-breaking recession, the British economy is experiencing record-breaking growth. Maintaining that growth will be at the heart of everything this Government do over the next five years. Because the Conservatives are the party of the many, not the few, we will deliver that growth in a way that benefits all of Britain’s people: creating opportunity for everyone, rebalancing our economy, devolving power to every corner of the United Kingdom—a one nation party; a one nation Government.
The Scottish and Welsh Governments already have more powers than they did five years ago. The Scotland Act 2012 contained significant new financial powers for the Scottish Parliament, all of which will be enforced by April 2016. The Wales Act 2014, introduced last December, moved various tax and borrowing powers from Westminster to Cardiff. Legislation introduced earlier this year paved the way for the devolution of corporation tax to Northern Ireland. Now we will go further.
Jonathan Edwards
The Secretary of State just mentioned the powers—including some minor taxes—devolved to Wales in the Wales Act 2014. Therefore, the principle of fiscal devolution seems to have been conceded. Why are he and his Government still insisting on a referendum about income tax devolution to Wales?
Sajid Javid
I thank the hon. Gentleman for his question and I assure him that I will come to just that point in a moment, but I hope he will please allow me to refer to Scotland first.
Of course, Scotland has had its referendum and its people chose to stay in the United Kingdom, which was the right decision. However, the referendum also sent a clear message that Scotland wanted a greater say over its affairs and greater control over its economic destiny. That is why we will deliver the Smith commission agreement in full.
Pete Wishart
The right hon. Gentleman may be one of the many in England, but in Scotland the Conservatives are most definitely the few, with their one Scottish MP and their 14% of the vote, their lowest share of the vote since the 19th century. Will he listen carefully to the clear demands from the Scottish Government about strengthening the Scottish Bill to give us the job-creating powers that our Scottish Parliament wants and the Scottish people voted for?
Sajid Javid
I remind the hon. Gentleman that although the Scottish National party did remarkably well in the election—and I congratulate it—still almost half the Scottish people did not vote for it, and there are all sorts of voices across Scotland that need to be represented in this Chamber.
Once the Smith commission agreement is in place, the Scottish Parliament will have additional powers on income tax and air passenger duty. All told, more than half the money spent by the Scottish Government will be raised in Holyrood. This package is an historic one for Scotland, which will soon possess arguably the strongest devolved Government anywhere in the world, empowered to build on the progress made over the past five years. Yet Scotland will retain the huge benefits of remaining part of a strong United Kingdom: the economic benefits; the social benefits; the defence benefits: and many more besides.
Steve McCabe (Birmingham, Selly Oak) (Lab)
As we have seen with revenue issues on the Irish border, the decision to give control of air passenger duty to the Scottish Parliament, which I well understand, could have massive implications for regional airports in England. What protections will the Secretary of State build in to protect the jobs and the economies involved?
Sajid Javid
The hon. Gentleman makes an important point, and we need to consider such issues carefully. However, the decision to devolve air passenger duty has been made.
I note that the Opposition Benches have adopted an entirely new look since the last Parliament. The SNP enjoyed unprecedented success, and I congratulate it on earning the trust of so many Scottish voters. However, the SNP should enjoy this honeymoon period, because the hard work is about to begin.
I turn to Wales. We will deliver a clearer, stronger and fairer devolution settlement, implementing in full the St David’s day agreement, led by my right hon. Friend the Secretary of State for Wales. The Wales Bill will make devolution clearer by introducing a reserved powers model, which is the system already in place for Scotland. It will make Welsh devolution stronger by devolving more powers to Cardiff, especially those covering energy, transport and the environment. We will also agree the precise level of a funding floor for Wales, and the mechanism to deliver it. That will be done with a clear expectation that the Welsh Government will call a referendum on income tax powers.
Northern Ireland does not fall within the scope of this debate as defined by the party opposite. However, we will take forward legislation to give effect to the Stormont House agreement and we look forward to working with colleagues in Belfast to make the devolution agenda benefit all the people of Northern Ireland, including, of course, Northern Ireland’s First Minister, to whom I wish a full and speedy recovery.
Sammy Wilson
Central to the Stormont House agreement was the implementation of welfare reform. If that proves to be impossible because of the intransigence of both the Social Democratic and Labour party and Sinn Féin, who agree to the Stormont House agreement, will the Government take on responsibility for introducing welfare reform in Northern Ireland?
Sajid Javid
I am aware that there is a very delicate situation in the Northern Ireland Assembly at the moment, but we remain committed to introducing the Stormont House agreement.
Gareth Johnson (Dartford) (Con)
Does my right hon. Friend agree that one of the most significant decisions that the previous Government made in their final year was to devolve corporation tax to Northern Ireland—to ensure that Northern Ireland was able to compete on a far more equal footing with the Republic of Ireland—and that that should be celebrated?
Sajid Javid
My hon. Friend is absolutely right to highlight that decision; as he has alluded to, it took into account the unique situation of Northern Ireland, with its larger neighbour and the tax situation there. It demonstrates what this Government will do to bring about further devolution.
I turn briefly to England. No matter where people live, our intention is that they have a Government that is on their side and that represents their interests. As we have heard, devolution is strengthening the voices of Wales and Northern Ireland, as well as that of Scotland, within our Union. That should be just as true for England.
Sajid Javid
I will give way in a moment.
As a one nation Government, we will revise the Commons rules to make the law-making process fair, bringing about constitutional reform that serves people living in all parts of the United Kingdom. The introduction of English votes for English laws will do just that for England. Our proposals will balance the principle of English consent for English measures with the process of MPs from all parts of the UK continuing to deliberate and vote together.
Mr David Hanson (Delyn) (Lab)
Will the Secretary of State define what he means by an English-only matter, because I represent a seat in Wales that uses hospital services in England, transport in England—[Interruption.] No, it is because of geography. It uses employment in England, airports in Manchester, and it has people employed at Vauxhall in Ellesmere Port. These are big issues. Will he tell me why I cannot speak or vote on them?
Sajid Javid
The right hon. Gentleman should be reassured that he will still be able to speak out on behalf of his constituents on any issue he wishes to speak upon.
I am the MP for Bromsgrove; I was born in Rochdale; I was raised in Bristol; and I went to university in Exeter. I barely set a foot in London until my early twenties.
David T. C. Davies
May I just add to the point that the right hon. Member for Delyn (Mr Hanson) made by suggesting to him that there are many people living in England who rely on getting their health service in Wales, and their MPs are unable to speak about it? Does my right hon. Friend the Secretary of State agree with me—a proud Welshman and a proud British subject—that there is a strong Unionist case for having English votes for English laws?
Sajid Javid
As ever, my hon. Friend makes a very powerful point, and I think that he is referring to the same Welsh NHS that has seen its funding cut by 10% over the last five years and that has some of the worst performance statistics of any part of the NHS in the United Kingdom.
I know all too well that England does not begin and end at the M25. Up and down the country, businesses of all shapes and sizes make an incredible contribution to our nation’s economic growth. All too often, however, they are held back by the age-old regional divides between the north and the south, and between the capital and the rest. For too long, politicians have shrugged their shoulders and claimed that these so-called divides are inescapable realities—an inevitable part of life. We do not accept that; we believe that every corner of the country has the potential to deliver economic growth and personal prosperity. We will take the steps necessary to boost local growth in England, devolving powers to cities, towns and counties, and allowing local people to take control of the economic levers in their areas.
Mr Geoffrey Robinson (Coventry North West) (Lab)
We in the west midlands look forward to the greater devolution the Government are promising, but these are just fine words. The reality is that the Government refused to sanction the multimillion pound gateway project. It was supported fully by our local enterprise partnership, and would have created jobs and growth in Coventry and the west midlands. Can the Secretary of State reconcile the two in his own mind?
Sajid Javid
The hon. Gentleman claims that these are just words, but it is partly because of the devolution measures we have already taken, which I will come on to in a second, that he has seen a more than 50% decline in unemployment in his constituency. I would have thought he would welcome the measures we have already taken.
This work started in the previous Parliament with the creation of 39 local enterprise partnerships, chaired by business leaders and covering the whole of England, and 27 city deals revitalising the English regions by enabling private sector-led growth. This approach is bearing fruit. Last year, more jobs were created in Birmingham than in the whole of France. In the last quarter, the north-west created a new job every three and a half minutes.
The Chancellor has taken the work of economic rebalancing to the next stage by outlining his vision for a northern powerhouse. The cornerstone is the devolution deal already reached with the elected leaders of Greater Manchester. They will elect their own mayor, who will be responsible and accountable for making Greater Manchester greater still.
Andrew Gwynne (Denton and Reddish) (Lab)
Given that the interim Greater Manchester mayor is an equal partner on the Greater Manchester combined authority, will the Secretary of State outline what will be in his cities and devolution Bill, and whether that will place the newly elected mayor of Greater Manchester above the combined authority? What powers will the mayor have that the combined authority currently has as its own?
Sajid Javid
The mayor will become the chair of the combined authority. I hope that helps to answer the hon. Gentleman’s question.
Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)
Does the Secretary of State not accept that the Conservatives’ much trumpeted and heralded idea of English votes for English laws is an irrelevance and a red herring, because the Scottish National party practises that anyway? Rather than tie the House up in constitutional niceties, he should rely on the good judgment of the Scottish National party.
Sajid Javid
It might be an irrelevance to the SNP, but it is not an irrelevance to the people of England.
Manchester is not alone: Sheffield and West Yorkshire agreed deals under the previous Government. We are legislating to let other places elect an executive mayor and allow these cities, too, to raise, spend and save money. This is not simply devolution; it is a revolution in the way England is governed.
Graham Evans
Speaking as a north-west MP, the north-south divide grew in the past 20 or 30 years and accelerated under 13 years of the Labour Government. It is this Government who have done something to rebalance the economy. Under Labour, the City, London and the south-east grew. It is this Government who are rebalancing the economy for the first time. They should be congratulated.
Sajid Javid
My hon. Friend is absolutely right. By 2010 under the previous Labour Government, 33% of the jobs created were in London or the south-east. In the past five years, 60% of the jobs created were outside London and the south-east. The Secretary of State for Communities and Local Government deserves great credit for the progress already made on this agenda and I look forward to hearing his contribution a little later.
Sajid Javid
I want to continue my speech.
Looking at the incredible success that much of the UK is already enjoying, it would be easy to forget just how far we have come. When this House reconvened in 2010 our economy was on the brink, reeling from the deepest recession in almost 100 years and burdened with the largest peacetime deficit in our history. [Interruption.] Labour Members do not want to know. They want the country to forget. We were struggling to pay for the world’s largest bank bail-out. The turnaround achieved in the past five years has, by any measure, been remarkable.
Last year, Britain was the fastest-growing major advanced economy in the world. Just today, the OECD confirmed that in 2015, according to its projections, we will once again be the fastest growing major economy in the advanced world. We have more people in work than at any point in history thanks to 2.2 million private sector jobs created by British business since 2010. In fact, the UK has created more jobs in five years than the rest of the European Union put together, giving us the highest employment rate in our history and the lowest claimant count for 40 years. We have cut the deficit as a percentage of GDP by half. We cut corporation tax to 20% and cut employer national insurance contributions. The British public have endorsed the Conservative’s long-term plan, which has allowed this business-led recovery. They gave us a mandate to continue to implement it and that is exactly what we will do.
Ian C. Lucas (Wrexham) (Lab)
In June 2010, the Conservative-Liberal Democrat Government said they would eliminate the deficit by 2015. Why did they fail?
Sajid Javid
There we have it: a resounding defeat in the election and not a single lesson learned. Labour Members come back to this Chamber and we still have arsonists throwing stones at the firefighters.
Kevin Hollinrake (Thirsk and Malton) (Con)
I welcome the devolution of powers and money to the north of England. We hear about Manchester, we hear about Leeds and we hear about Sheffield. What can the Secretary of State say to the people of North Yorkshire? How will we benefit from devolution to the north?
Sajid Javid
I welcome my hon. Friend to this Chamber and congratulate him on his election victory. We will keep on doing more of the same: more economic measures; more devolution; and more investment in local communities, for example through LEPs. We will help to reduce unemployment throughout Britain, including in his own constituency where, as he will know only too well, it has fallen by 60% in the past five years.
Jake Berry
I thank my right hon. Friend for giving way on this important point. The northern powerhouse ideal, which is hugely popular across the north of England, must not be just about our cities, but our regions. I repeat my call for Lancashire County Council to come forward with a proposal that will see powers devolved to Lancashire, so that our economy can continue to grow in the way that this Government have delivered on in the past five years.
Sajid Javid
My hon. Friend is absolutely right. It is not just a programme for cities; it is for regions. He uses the example of Lancashire. If Lancashire comes forward with proposals, we will absolutely consider them. Our new Bill will allow us to give it more powers.
Richard Fuller (Bedford) (Con)
May I encourage my right hon. Friend, in his one nation approach to growth, to remember that there are towns, such as Bedford and Luton in my county, with above-national levels of unemployment? May I also say how nice it is to have a Secretary of State for Business who understands entrepreneurship and is prepared to put small businesses at the forefront of his policies?
Sajid Javid
The Conservatives are backing business. My hon. Friend is absolutely right. He was no doubt very keen during the election to point out to his constituents that unemployment in his constituency has fallen by more than 40%. We intend to make sure it keeps falling. That will be seen in black and white in some of the Bills we are introducing. Our new full employment Bill will help to create 2 million more jobs in this Parliament—a job for everyone who wants one. We will work with businesses, city regions, devolved Administrations and local enterprise partnerships to ensure that we develop the right skills for today’s economy and for the future. Underpinning these efforts will be our commitment to create 3 million more apprenticeships in the next five years.
Mrs Maria Miller (Basingstoke) (Con)
I congratulate the Secretary of State on his appointment. Can he provide my constituents with some reassurance? We have an excellent local enterprise partnership in Basingstoke, the M3 enterprise partnership. It has done fantastic work in securing investment into our roads locally, but the thing we need now is investment in our rail system. Will he join me in suggesting to the Secretary of State for Transport that he needs to be doing more to support rail in our area, which is key to its growth?
Sajid Javid
I welcome my right hon. Friend back to the House. She is absolutely right that having the right infrastructure is hugely important to maintaining growth and the fall in unemployment. In her constituency, I think she has seen a record fall of 67% in unemployment over the last five years. We intend to continue that, and I am sure that infrastructure will have a big role to play.
Robert Neill (Bromley and Chislehurst) (Con)
I, too, welcome my right hon. Friend to his post. Those of us who know his business background will be delighted by the appointment. Will he consider whether more can be done to encourage the use of tax increment financing for significant infrastructure projects? We have one in London, promoted by the Mayor, but there is scope for more, with a genuinely free market approach to infrastructure provision.
Sajid Javid
I welcome my hon. Friend back to the House, and he again makes a very good point. I will help him to promote that. It is part of some of the city deals, but I think we can benefit from it a lot more.
I was talking about our commitment to 2 million jobs and 3 million more apprenticeships during the lifetime of this Parliament. These are not mere targets; the dignity of a job and the security of a pay packet are the foundations of our individual freedoms—freedoms powered by economic growth, through British business. Equally, British voters have shown their unwillingness to forgive the party responsible for plunging us into a generation-defining crisis—a party that has defined itself by seeking to punish, demonise and destroy business—but this anti-business approach from the Opposition was not a shock. Ultimately, Labour does not understand business; it does not understand enterprise. It never has and it never will.
The task ahead now is to cement Britain’s position as the best place in Europe to start and grow a business. The enterprise Bill is resolutely, unashamedly pro-business. It builds on the clear achievements of the past five years, when we cut red tape and slashed the cost of doing business by £10 billion. We made audits simpler for small businesses, removed pointless hurdles for house builders and exempted thousands of businesses from needless health and safety inspections. As a result, we now have the lowest burden of regulation among G7 nations.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I have been listening carefully to what the right hon. Gentleman has been saying and I have not heard him talk about productivity. Under his Government, British productivity now languishes well behind that of Germany and even France, which he likes to criticise. Is he proud of his record on productivity and does he think it is right that British workers should have to work longer hours and have more jobs to earn less?
Sajid Javid
The hon. Lady will know that productivity has been a challenge in our country for many, many years, and it is this Government who have been doing something about it. Her hon. Friend the Member for Streatham referred to the automotive industry. Productivity in the British automotive industry has grown significantly over the last five years, which has led to record sales both at home and abroad. Productivity is something we will continue to work on, but one thing I am sure of is that had we adopted the policies advocated by her party, productivity would be a lot worse in this country.
Our job is far from done. The enterprise Bill will enable us to save businesses at least £10 billion over this Parliament. Regulators will have to report their own compliance with better regulation requirements—a clear incentive to think carefully about the needs of business. More small businesses will be able to benefit from “primary authority”, stopping the cost and hassle of obeying multiple masters and allowing companies to focus on what matters: serving their customers and growing.
Caroline Lucas
Will the Secretary of State say whether his new enterprise Bill will ensure greater access to affordable credit for small businesses, in particular by setting up a network of local stakeholder banks? That is what works in so many other countries. Instead of flogging off RBS, will he look seriously at transforming it into a network of local banks?
Sajid Javid
The hon. Lady will know that we have taken a number of measures over the last five years to strengthen finance and access to finance, particularly for small companies, through the funding for lending scheme and the investment in credit unions, by relaxing some of the rules around credit unions—something I know she has supported—and through the British Business Bank and the more than £1.8 billion that it has helped to provide to some 40,000 businesses. We will continue to work on these measures, because where she is right is that access to finance is key to continuing to see a fall in unemployment.
Mr David Burrowes (Enfield, Southgate) (Con)
Will the Secretary of State give way?
Sajid Javid
I have to make some progress. A number of Members want to speak.
The Conservatives have always been the party of small business. Our greatest leader grew up in a grocer’s shop. I was raised by parents who juggled the demands of a family life with the stresses of managing a family business. We know first hand how important a successful small business sector is to a healthy, growing economy. We have seen for ourselves the unique struggles faced by sole traders and the owners of small companies, and we will continue to support the sector in every way we can. That is why we are setting up a small business conciliation service to help to resolve disputes between companies, especially over late payment. At the same time, we will improve the business rates system ahead of the 2017 revaluation, including through reform of the appeals system.
A thriving and growing economy must also be underpinned by democratic and fair industrial action. The trade union Bill will guarantee that strikes are the result of clear and positive recent decisions by union members. It will never be right to allow the actions of a few to hurt the hard-working majority. We will introduce a 50% voting threshold for union ballot turnouts. We will also require that, in the key health, education, fire and transport sectors, 40% of those entitled to vote must support strike action. If a union’s members genuinely support a call for strike action, we wholeheartedly support that right, but we will ensure that businesses and the wider public do not suffer widespread, costly disruption when there is no clear backing among members.
Our message could not be clearer: we are putting the interests of business first, second and third. We are dismantling bureaucracy and devolving powers to local leaders. This is how we will rebalance our economy and create opportunity in urban Britain and in rural Britain, in every part of our great nation.