Finance Bill

Debate between Toby Perkins and Lord Hanson of Flint

Tuesday 28th June 2011 Commons Chamber

[Mr Hanson]

I remind the hon. Member for Birmingham, Yardley (John Hemming) that new clause 10 calls for a review of the impact of value added tax on businesses and families over the next three months. Labour Members voted last week for a temporary reduction in VAT. Labour policy is to have a temporary reduction to tackle the real issues that we all face in our constituencies in relation to jobs, living standards and the future of our businesses.

[Toby Perkins]

I am listening to the debate with tremendous interest. There is a determined gaggle of Liberal Democrats here, arguing in the strongest possible terms that the manifesto that they have just fought an election on was totally wrong. Has my right hon. Friend ever known such a passionate rejection of a policy by Members who told us only a year earlier that we should be voting for it?

[Mr Hanson]

The most passionate rejection that I have seen in recent years was in Chesterfield, of my hon. Friend’s predecessor. He stood just next to where I am now before the election, when I was Police Minister, calling for more police and more expenditure. Yet now, the Liberal Democrats are saying that we should have had less expenditure.

I accept that I am going slightly wide of the issue of VAT, Mr Deputy Speaker, so I will return to it. VAT hits not just families or businesses but public services. The national health service in England will be hit by an extra £250 million a year because of the rise in VAT. A CT body scanner that cost £700,000 before the rise in VAT will now cost £17,500 more. A fully equipped ambulance that would have cost £225,000 will cost an extra £5,500. There is about £3 million a year of expenditure by each NHS trust on locum doctors, which will increase by £75,000. A Government who want to cut public spending are levying additional costs on the health service in England.

In my own region, in Wales, the actual cost of the increase in VAT to NHS budgets since 1 January is estimated at £13.2 million. For colleagues in Scotland, I add that Scottish health boards have been saddled with an extra £71 million of costs because of the VAT increase. At a time of decreasing public spending and squeezed budgets, we need to review the matter over the next few months and consider whether the VAT increase is causing even more difficulty.

Savings Accounts and Health in Pregnancy Grant Bill

Debate between Toby Perkins and Lord Hanson of Flint

Tuesday 26th October 2010 Commons Chamber

[Mr Hanson]

I shall come to that point later. The Government have chosen to take a sledgehammer to the funds and not even to consider other options such as that mentioned by my hon. Friend.

[Toby Perkins]

My right hon. Friend is touching on the choices that the Government have made. The number of attacks that they have made on children, families and women is revealing. They seem willing to give money to married couples who do not have children but they are taking money from families with children. Anyone who has been married and had kids knows that it is not getting married that costs money but having kids. When my son was four months old I thought that he was robbing my wallet because I had no money left. Does not the Government’s approach show how out of touch they are with the real lives of families and children?

[Mr Hanson]

I agree. The Government are not in touch with the difficulties of raising a child or of meeting the costs when children reach the age of 18.

The child trust fund is worth £500 to each child over their lifetime, but it is worth £1,000 to the poorest children. The Minister will know that the previous Labour Government also introduced a disability living allowance payment on top of £100 or £200 for those entitled to DLA. That measure was introduced to take into account the significant extra challenges that disabled people face at that important time in their lives. When that measure passed through Parliament earlier this year, under the previous Labour Government, the Conservative party did not oppose that addition. Indeed, the present Financial Secretary said that

“we recognise that additional support is required for children with disabilities, and we have no objections to this statutory instrument.”—[Official Report, Eighth Delegated Legislation Committee, 10 February 2010; c. 4.]

The Liberal Democrats’ spokesperson at the time said they were happy to support the regulations. Quite simply, the Government say one thing in opposition and another in government.

As young people reach 18, the financial challenges—not least those imposed on them by the current Government—will be more difficult. If individuals do not come from a wealthy background, the prospect of stumping up extra money for tuition fees is an eye-watering one. Not everyone will have a trust fund of their own to manage those resources. The children’s trust fund would have provided young people with an extremely welcome lump sum, would have helped people with education and training from the age of 18, and would have helped people to save who had never saved before to supplement their future income.

--- Later in debate ---

[Mr Hanson]

I hope I can assure my right hon. Friend that as we have eight sittings in Committee, I will table amendments on some of those issues. Indeed, I can even offer him a chance to serve, should he so wish, on the Public Bill Committee in due course.

[Toby Perkins]

Teenage pregnancy levels are high in some of our most deprived communities, and the child trust fund at least offered 18-year-olds who were about to have children the chance to take a different track or to receive some support. Does my right hon. Friend agree that the Bill will take away a key tool in the battle against child poverty?

[Mr Hanson]

It will indeed take away a key tool in helping to deal with inequality and poverty at the age of 18. The child trust fund encourages saving, particularly among people from the poorest parts of our communities.