Equitable Life

Alan Reid Excerpts

Thursday 26th February 2015 Commons Chamber

[Mr Weir]

I never had my pension with Equitable Life, but the right hon. Gentleman makes a good point. Many solicitors, accountants and other professionals invested in Equitable Life. It was popular with financial advisers because it was seen as a safe, steady company, but it turned out not to be, and people lost a lot of money because it was not properly regulated.

The Government need to consider future pension provision. Increasingly, we are being urged to invest in pension provision to augment our state pensions, and with the recent revelations that less than half of new pensioners will receive the whole new single-tier pension when it is introduced next year, that is more relevant than ever. The new rules granting much greater freedom for pension holders to access their pensions savings will greatly alter the pensions landscape and the attitude of savers towards pensions, but it might also make it more difficult for company investment strategies. It is imperative in this new environment that there is confidence in the stability and worth of pensions investment—it is not the same as putting money in a bank or building society, where the rate of interest is known, pitiful though it might be at present; it depends on fluctuations in the market and the type of investment made. Admittedly, there is no guaranteed return—there is always an element of risk—but for most people it is a major investment, so the risk should be as small as possible.

[Mr Alan Reid (Argyll and Bute) (LD)]

I agree with the hon. Gentleman. The public need confidence that the pension industry will be regulated properly, and in this case it obviously was not—the Government Actuary’s Department failed. Now that the public finances are in a better state, I think the Government should pay up in full, as recommended by the ombudsman, otherwise people will not have confidence in the future.

[Mr Weir]

I agree with most of what the hon. Gentleman says. We have to grasp the nettle because it is becoming ever more important that we have confidence in our pension provision. If we fail to give people that assurance, we risk them not having the confidence to invest in pensions, or taking their money out at the earliest opportunity, leading to even greater pressure on the public finances. Equitable Life remains a running sore, and so long as that is the case it risks damaging the whole industry and the attempts to encourage future pension savings. It was not simply a bad investment; the regulator failed to do its job, and that led to substantial losses.

We accepted that people were due compensation on the basis that the amount offered would be determined by the state of the public finances, but, as I said, there remains a gulf between the various amounts suggested. Before we come to any agreement, therefore, we must be clear about the amount involved, but it would be unwise to make it a party political issue just because there is an election around the corner—voters base their decision on many issues, including, in some cases, Equitable Life—but if the public finances are improving, of which some of us are less convinced than others, it is right that Equitable Life policyholders be considered anew. I urge the Minister to consider greater compensation.

Scotch Whisky Industry

Alan Reid Excerpts

Thursday 12th February 2015 Commons Chamber

[Mr Alan Reid (Argyll and Bute) (LD)]

I should like to start by thanking Mr Speaker very much for granting this important debate.

With 14 distilleries, the whisky industry is an important employer in my constituency. It provides jobs in remote communities where alternative work would be hard to find. With eight distilleries, whisky is clearly important to the economy of Islay. On Jura, with its small population, the island’s distillery is a vital part of the local economy. There are also distilleries in Campbeltown, Oban and Tobermory which contribute significantly to the economies of those communities. In addition, many of my constituents are employed in the whisky industry or its supply chain in neighbouring West Dunbartonshire and elsewhere in Scotland.

My reason for seeking today’s debate is to draw the House’s attention to the important contribution that Scotch whisky makes to the United Kingdom economy. Whisky distilling began as a cottage industry in Scotland, but its success has meant that it has grown enormously and now contributes significantly to employment and the economy throughout the whole UK. Scotch whisky is the UK’s largest food and drink sector, accounting for a quarter of the UK’s food and drink exports. Scotch whisky adds £3.3 billion directly to UK GDP and, once indirect jobs are taken into account, its total impact is to add almost £5 billion to the UK economy. Every £1 of value added in the industry produces an additional 52p of value in the wider economy.

I should like to give the House an idea of the scale of the Scotch whisky industry in terms of the value added to the UK economy. The industry is bigger than the UK’s iron and steel, textiles, shipbuilding or computer industries, about half the size of our pharmaceutical or aerospace industries and about a third the size of the entire UK car industry. That should give Members an idea of the scale of employment in the industry.

The Scotch whisky industry spends £1.6 billion annually on supplies from within Britain, ranging from cereals and glass to machinery. That economic impact is felt throughout the UK, with 90% of the industry’s operating expenditure being spent with UK suppliers. I am thinking, for example, of packaging from Wales, yeast from Staffordshire, glass from Yorkshire and logistics from Essex. As a result, Scotch whisky supports more than 40,000 jobs directly and indirectly across the UK, many of which are highly skilled. As proof of that, Scotch whisky workers are the third best paid in Scotland, only behind workers in energy and life sciences. Many of those jobs are in rural communities where alternative employment would be hard to find—about 7,400 jobs are in Scotland’s rural communities.

In terms of production, Scotch whisky workers comprise the second most productive sector in Scotland, behind only energy. Scotch whisky exports are worth more than £4 billion annually. Scotch whisky is the second strongest contributor to the UK national trade performance. The 2013 trade deficit would have been 16% higher without the Scotch whisky contribution. As well as those raw statistics, Scotch whisky makes other contributions which cannot be quantified. As an iconic Scottish industry, it helps to put Scotland on the world map and plays a major role in attracting foreign tourists to Scotland. I have reeled off all those statistics to show just what a high-value, high-quality product Scotch whisky is and the very important contribution the industry makes to the whole UK economy.

I also want to put on the record the industry’s thanks to the Government for the great back-up it receives from them on efforts to break down trade barriers throughout the world. Those Government efforts have helped whisky exports enormously and are a very good reason for Scotland to remain in the UK. Having the resources of the UK Government behind the industry results in breaking down trade barriers far more effectively than would be the case were the back-up from a much smaller Scottish Government.

Having praised the Government for the help they give to the industry’s export drive, I have to draw attention to what has become a significant barrier to the industry’s success in the UK market: the level of taxation. A bottle of whisky is taxed at almost 80%. Most people are shocked when they become aware of that statistic and agree that it is far too high. It is important to bear in mind that the UK is the third largest market for Scotch whisky, yet the domestic trade has been in decline in recent years. The taxation is a particular obstacle for the new and small-scale distillers, who rely on a thriving domestic market to grow, and they say that the current duty regime is damaging their prospects. It is important to bear in mind that the cash flow in the whisky industry is very unusual; whisky has to mature in a cask for many years before it can be bottled, so investors in a distillery have to wait for many years to get their money back and must have confidence in the future before they will invest. The many years of the alcohol duty escalator have been very damaging to the Scotch whisky industry. Excise duty on Scottish whisky is now 44% higher than in 2008, and, as a result, the domestic trade declined in recent years.

For reasons lost in the mists of time, whisky is taxed unfairly compared with beers and wines—the tax per unit of alcohol on whisky is far higher. I fail to see the logic in that. Surely a tax in proportion to the amount of alcohol in the drink would be much fairer. The Scotch whisky industry deserves a level playing field. It is important to note that the unfair taxation does not just have an impact on the Scotch whisky industry in the domestic market; the Scotch Whisky Association tells me that when it tries to convince other countries to reduce unfair tax barriers, those countries often highlight the UK’s taxation regime. They say that the UK taxes whisky at a much higher rate than other drinks and use that as a justification for doing the same thing in their own country.

I was delighted when in last year’s Budget the Chancellor announced the abolition of the alcohol duty escalator and froze the duty on whisky—that was a help to the industry, which was seen in a small boost to the volumes of single malt sold at the end of last year. That suggests that the duty freeze resulted in growth in the industry. I hope that the Chancellor will recognise that duty on whisky is too high and will cut it in the Budget. A 2% cut would help to boost the industry and allow it to create more jobs.

As I have set out in this debate, Scotch whisky is a British success story. This industry and its supply chain provide highly skilled jobs throughout the UK and make a significant contribution to reducing our trade deficit. Continuing to tax this industry at 80% will not bring in extra revenue to the Treasury. In fact, it will probably see revenue decline. Such a high level of taxation risks killing the goose that is laying the golden eggs, and will result in lower revenue to the Treasury in the future.

I hope that this afternoon’s debate has shone a light on the unfair treatment of an iconic Scottish and British product and its vital contribution to our economy. I hope that I have convinced the Exchequer Secretary that a 2% cut in the duty on whisky would boost the British economy. I do not expect an announcement this afternoon—that would be a bit much to hope for—but I do hope that, after the debate, she will rush round to No. 11 and convince the Chancellor of the need for a cut in taxation for this British success story. A cut in taxes would boost the industry and help the wider British economy.

Madam Deputy Speaker, the Exchequer Secretary and everyone else present, I say slàinte mhath—good health.

Stamp Duty Land Tax

Alan Reid Excerpts

Thursday 4th December 2014 Commons Chamber

[Mr Speaker]

I am grateful to the hon. Gentleman for his rather adroit piece of time-wasting.

[Mr Alan Reid (Argyll and Bute) (LD)]

On a point of order, Mr Speaker. This is indeed a day on which we are witnessing parliamentary events that are not very common.

One possible reason for the Minister’s not being here on time is that he was caught unexpectedly—surprised—by the fact that only one Member of the Opposition asked a question in response to the statement by the Minister for Pensions. It is the first time in all my years in the House that I have been present when Opposition Members—apart from the Front-Bench spokesman—have had absolutely nothing to say in response to a statement. Is it not possible that the Minister was held up because he expected the statement to last for the normal length of time?

[Mr Speaker]

The hon. Gentleman is not only dexterous in parliamentary terms, but he is, in my experience, an unfailingly loyal man, and he has done his best to rescue those on the Treasury Bench in the current circumstances. All that I will say is that Ministers, in any Government, should not be surprised. They must not allow themselves to be put in a position in which they are surprised, and therefore not present. The Minister has not spoken, and therefore if the Minister turns up—and we are grateful to him or her if he or she does—the Minister will have an opportunity to speak.

Oral Answers to Questions

Alan Reid Excerpts

Thursday 3rd July 2014 Commons Chamber

[Sajid Javid]

The right hon. Gentleman will be pleased to know that superfast coverage in the UK is the highest among the EU5 countries; it is higher than Germany, higher than Spain, five times higher than Italy and three times higher than France.

[Mr Alan Reid (Argyll and Bute) (LD)]

I was pleased when the Government announced the awarding of the contract to look into ways of using satellite to bring superfast broadband to remote areas of Scotland that fibre-optic cables cannot reach. It is very important that that work is done as soon as possible. What time scale does the Minister envisage for bringing superfast broadband to remote areas of the highlands and islands by satellite?

[Sajid Javid]

These pilots began in June, so they are very recent and it will take a number of months before any results are known. We have deliberately picked a number of different companies with different types of technology to ensure that we learn as much as we can. I envisage that we will have more information in six months.

Finance (No. 2) Bill

Alan Reid Excerpts

Tuesday 1st April 2014 Commons Chamber

[Danny Alexander]

I am told from a sedentary position that the Opposition voted against that measure. They voted against the whole Finance Bill, of course.

The Bill also introduces three new tax reliefs to support employee ownership. The Deputy Prime Minister has rightly given a high priority to employee ownership, and the measures in clause 238 will introduce a capital gains tax relief, an inheritance tax relief and an income tax exemption for employee-owned companies. This will make the sale of a business into an employee ownership structure much more attractive. It will give employees of indirectly employee-owned companies an income tax relief of £3,600 a year on their bonuses. That will help to encourage more firms to become employee-owned in the years to come and, therefore, to improve the structure of our economy.

It is also worth reminding hon. Members of some of the other measures this Bill introduces that will support specific UK industries: it legislates to reform the banding of air passenger duty; and it includes a measure that will help make the Glasgow athletics grand prix a success this summer, putting in place a tax relief for athletes competing in that competition, which is an immediate predecessor to the Commonwealth games. Having tax reliefs for both the Glasgow grand prix and the Commonwealth games will help to ensure, as the UK Government rightly should be ensuring, that the world’s best athletes are encouraged to come to compete in the Glasgow 2014 Commonwealth games. Everyone, in all parts of this House, hopes they will be an enormous success for Scotland and for the whole UK.

The Bill also includes a package of measures to support oil and gas exploration in the UK continental shelf; it introduces a new allowance to support early-stage investment in shale gas; and it reduces the tax on beer by a penny a pint and freezes the duty on spirits, rightly offering particular support to the Scotch whisky industry, as Scotch is one of this country’s most successful exports. Those measures will support not only our pubs, but brewers and so on. All those measures, taken together, cut the costs for business, support innovation, boost exports and show that this Bill will help British businesses to help the British economy grow.

[Mr Alan Reid (Argyll and Bute) (LD)]

I wish to congratulate my right hon. Friend on including in the Budget a measure that will help voluntary groups that support the rescue boats on Loch Lomond and Loch Awe. Removing the VAT that such groups have to pay on fuel is a big help to them.

[Danny Alexander]

I am grateful to my hon. Friend for his comments. The House should note that he drew these matters to my attention in the preparation of the Budget, and he has campaigned assiduously to ensure that those important bodies are treated similarly to other emergency services in that respect.

Having set such competitive tax rates—rates designed specifically to support businesses—everyone in this House rightly expects those taxes to be paid, and this Bill continues the Government’s firm action against the persistent minority who continue to seek out unacceptable ways to reduce or delay paying the taxes they owe. We are tackling avoidance by large businesses by taking action in this Bill to close down avoidance schemes involving the transfer of profits among group companies and closing a number of other loopholes.

--- Later in debate ---

[Chris Leslie (Nottingham East) (Lab/Co-op)]

I beg to move,

That this House declines to give the Finance (No. 2) Bill a Second Reading because it fails to address the cost-of-living crisis which will see working people worse off at the end of this Parliament than at the beginning; because while working people are £1,600 a year worse off it prioritises a tax cut for millionaires of on average £100,000; because it offers a marriage tax allowance which will help only a third of married couples, rather than a 10 pence starting rate of tax which would help millions more families; and because it fails to set out measures to tackle rising energy bills, get young people into work, boost housing supply and help families with childcare costs within this Parliament.

You would not know it from hearing the Chief Secretary, Madam Deputy Speaker, but this Finance Bill is a massive missed opportunity when much more is needed. It has so many pages—the document I have in my hands is only half of it—yet it is a minor Bill when we need major reforms to address public concerns. The annuities changes diverted attention from the shortcomings of the rest of the Budget, and that short-term approach reflects the short-term ambitions of the Chancellor and the Government at large.

We will seek to improve the Bill in Committee, but it is important that we reflect on its contents and on those things that ought to have been in it but were not. That is why we propose that the House declines to give the Finance Bill a Second Reading this evening: it fails to address the cost of living crisis that, as my hon. Friends recognise, will leave working people worse off at the end of this Parliament than they were at the beginning, as the Office for Budget Responsibility has predicted. While working people are £1,600 a year worse off, it prioritises a tax cut for millionaires of typically about £100,000 and offers a marriage tax allowance that helps only a third of married couples rather than, for example, a 10p starting rate of income tax that would genuinely help millions more families. It also fails to set out measures to tackle rising energy bills, get young people into work, boost housing supply and help families with child care costs. Those are the priorities that we believe ought to be in the Bill but are not.

[Mr Reid]

The hon. Gentleman refers to the cost of living. Does he not understand that by next year, under his party’s policy, my constituents would have been paying 20p a litre more and those on the islands would have been paying 25p a litre more for their fuel than they are under this Government? That would have been a disaster for the cost of living of my constituents. Will he apologise to them for wanting to make the cost of fuel 25p a litre higher in their area?

[Chris Leslie]

We are not opposed to the measure that the hon. Gentleman mentions, but he ought to be straight with his constituents. That is only one aspect of the tax burden that they face. Of course, his constituents have suffered many other tax rises and cuts in benefits since the general election, and as we start to walk ourselves through the Bill we can explore some of his priorities. We just need to consider the first set of clauses, under which he will be voting to give millionaires—the richest in society—and those who are fortunate enough to earn £150,000 and above, which can of course involve significant amounts of money, a tax cut to 45p from the 50p rate that his Government abolished. He willingly went along with that.

As well as the personal allowance change that Government Members often trumpet, we should have a 10p starting rate of tax. Government Members have supported at least 24 tax rises and principally the change to VAT, which has taken hundreds of pounds from the constituents of the hon. Member for Argyll and Bute (Mr Reid), perhaps by stealth. Perhaps they have not petitioned his constituency office and perhaps, with that little wry smile on his face, he has been counting the coins that he has been taking by stealth from the wallets and purses of his constituents, but that is a significant amount of money and he should be honest with his constituents about the VAT increase, the so-called granny tax, the child benefit reductions, the tax credit cuts and all the other changes.

[Mr Reid]

rose—

[Chris Leslie]

Perhaps the hon. Gentleman would like to take the opportunity to tell the full story.

[Mr Reid]

I am grateful to the hon. Gentleman for giving way again. What is Labour’s policy on VAT? If Labour is elected, is the plan to keep it at 20p or will his party promise to reduce it?

[Chris Leslie]

I love it when Liberal Democrats start talking about VAT. Of course, the hon. Gentleman promised to oppose the VAT bombshell, and my hon. Friends will remember the picture. I do not know whether he was driving the van that went round Parliament square at the time; perhaps the Chief Secretary was in the driving seat. Yet the hon. Gentleman has the temerity to ask what our position is on VAT. I cannot promise to get rid of the VAT increase that they have put in place, contrary to the manifesto on which he stood—yet another Liberal Democrat broken promise. When Labour makes promises in our manifesto at the next general election, we will make sure that they are fully funded and that the sums add up. If we do make promises, everybody will be clear where the money will come from—[Laughter.] Government Members do not like that idea, because it is so foreign to them. They are so used to making promises that they do not recognise the concept of trying to be honest and straight with the electorate.

Tourism (VAT)

Alan Reid Excerpts

Tuesday 11th February 2014 Westminster Hall

[Mr Alan Reid (Argyll and Bute) (LD)]

I congratulate the hon. Member for South Down (Ms Ritchie) on securing the debate.

I am fortunate to represent the beautiful constituency of Argyll and Bute. The scenery is beautiful, but the economy is fragile. “You can’t eat the scenery”, as the old saying goes, but we can sell the scenery to visitors, and that is where tourism plays such a vital role. Tourism provides jobs in remote areas where alternative employment would be difficult to find. It is a labour-intensive industry, so much of the spend goes straight into jobs. This is a very competitive international industry. With many people struggling to make ends meet, price is an important factor in their choice of holiday, and Britain’s tourism businesses have to cope with a VAT rate double, or even more than double, the rate in Spain, Germany, France, Italy and the Republic of Ireland.

The UK is now one of only four EU states with no reduced VAT rate for tourism. In a price-sensitive international market, the high rate of VAT compared with our competitors must be damaging our tourism industry. Reducing tourism VAT would lower prices, attract more visitors to the UK and encourage businesses to invest in Britain’s tourist attractions.

Of course, cutting any tax means reduced revenue in the short term, but surely the key is whether the cut will stimulate the economy to such an extent that the public purse benefits more in the long run from the extra economic activity than is lost in the short term by the tax cut. Stimulating the tourism sector will lead to more people working—so fewer benefit payments and more income tax and national insurance coming into the Treasury.

Many detailed independent studies and analyses have all found that reducing VAT on tourism to a rate of 5% would stimulate both domestic and overseas demand, leading to expansion of the tourism sector, the creation of many jobs and a fiscal return to the Treasury that would reverse the long-term trend of Britain’s worsening tourism balance of payments.

We do not just have to rely on theoretical modelling. The Isle of Man cut VAT on tourism to 5% 20 years ago and that was such a success that the Manx Government have never even considered reversing it. Visitor numbers to the Isle of Man show that, in the nine years before the cut, there was a sharp decline in tourism, but after the VAT cut, visitor numbers recovered strongly and have stayed high since then.

Britain has a vibrant tourism industry. We have a wonderful product to sell, but common sense says that we cannot compete if our VAT rate is double that of our competitors. The experience of the Isle of Man and the independent modelling both indicate that cutting VAT on tourism will bring in more tax revenue than will be lost. Theory and practice are in agreement.

I hope that the Government accept the findings of the independent reports and cut VAT on tourism. I know that the Minister cannot pre-empt the Budget by making an announcement today, but I expect him to say in his winding-up speech that the Treasury is taking the campaign seriously and will study carefully the findings of the independent reports and respond to them.

Scotch Whisky Excise Duty

Alan Reid Excerpts

Wednesday 8th January 2014 Westminster Hall

[Mr Donohoe]

Again, I am grateful for that intervention. I am sure that we have learned a lesson in that respect and that we will make damn sure that our campaign this time is as good as, if not better than, the beer campaign.

[Mr Alan Reid (Argyll and Bute) (LD)]

I am grateful to the hon. Gentleman for giving way and also for what he said earlier about the importance of the whisky industry for jobs in remote communities, such as the Isle of Jura and other places in my constituency. It is very unfair that whisky is taxed far more highly than beers and wines. We must be about the only country in the world that taxes our own product more highly than imported products such as wines.

[Mr Donohoe]

I thank the hon. Gentleman for his intervention; he makes a really good point. It is really ridiculous that people can go into a supermarket in Spain, Italy, Germany or France and buy a bottle of whisky far more cheaply than people in this country can.

--- Later in debate ---

[Nicky Morgan]

I want to make progress and I am keen to get some further points in before the end of the debate, but I will try to take the hon. Gentleman’s intervention if I can.

The hon. Member for Central Ayrshire mentioned that spirit duty had risen by 44% between 2003 and 2013. I should point out that beer duty in that period rose by 56%, while still wine duty rose by 68%. We can trade as many numbers as we want, but I take the overall thrust of the arguments made today.

The hon. Member for Argyll and Bute (Mr Reid) asked about the spirits duty rate having risen by 37%. Duty on Scotch whisky has risen at a slower rate than beer duty over the medium term. The spirits duty rate was frozen between 1998 and 2008, and during that time duty rates on other alcoholic beverages increased. However, between the introduction of the escalator and 2013, the spirits duty rate rose by 37%, while other alcohol duty rates rose by 42%. I just wanted to put that on the record for the benefit of the House.

[Mr Reid]

I want to put it on the record that Islay, not Moray, is the heartland of the Scotch whisky industry.

We can all trade figures, but the point is that under the current duty escalator policy, the duty on spirits will rise in the next few years at a much greater rate than that on beers and will make the already unfair situation even more unfair.

[Nicky Morgan]

I understand that point.

Autumn Statement

Alan Reid Excerpts

Thursday 5th December 2013 Commons Chamber

[Mr Osborne]

I find myself in agreement with the hon. Gentleman. He put his question in a very measured way. We do not want to see a return to the uncontrolled bonus culture. We now have a much tougher regime in respect of the transparency of bonuses and clawback, which means that if things go wrong in trades or for a bank, they can get the money back that they have paid people in bonuses. We will take measures to tackle things such as dual contracts, as I mentioned briefly in my statement and as is set out in the document. People who work in the financial industry often split their contract so that they can claim that they are only working for part of the time in the UK to avoid tax. Where there is egregious tax avoidance, we will take steps. I agree with him that the banking system as a whole must be cognisant of the times in which it lives.

[Mr Alan Reid (Argyll and Bute) (LD)]

I congratulate the Chancellor on the fuel duty freeze which, as he pointed out, will save motorists 20p per litre compared with Labour’s plans. Will he confirm that motorists on the islands and in remote parts of the mainland in my constituency, such as Appin, will save 25p per litre compared with what the Labour party wants to charge them?

[Mr Osborne]

My hon. Friend has been an assiduous campaigner for lower fuel duty for his constituents. Indeed, he lobbied me about it in the Division Lobbies yesterday, although we had already taken the decision by then. He draws attention to the rural fuel rebate. That is an important scheme that we have introduced for some of the remote islands in Scotland and other parts of the United Kingdom. We would like to extend the scheme more widely, but we are constrained by European Union rules, which we are challenging. I am glad that the scheme is benefiting some of his constituents.

Trident Alternatives Review

Alan Reid Excerpts

Wednesday 17th July 2013 Commons Chamber

[Mr Jones]

I did not want to go down this road because obviously the Conservative Government have learned the lessons from the mistake that they made in the 1990s which created the current problems with Astute. We cannot turn these vital skills on and off like a tap when we need them. I have heard various people say, “Is this a justification for Trident?” No, it is not, but we have to take it into consideration when forming policy, and the Liberal Democrats’ position set out in the review document clearly does not do that.

[Mr Alan Reid (Argyll and Bute) (LD)]

The hon. Gentleman said that the Labour party may reduce the number of successor submarines from four to three. What would be the implication of that for Barrow?

[Mr Jones]

I did not say that, actually. I said what the Defence Secretary has said—that in thinking about the new nuclear submarines, we should consider whether it would be viable to have three. That is an option worth looking at. We would then have to bring forward the successor programme for Astute. If we deleted two boats—[Interruption.] The hon. Member for North Devon says, “It’s all right if we do it.” The fact is that if we went down to two we would have a deterrent that is absolutely useless. It would not save the £4 billion that the Chief Secretary suggested because unless we had mass lay-offs in the submarine-building programme, we would have to bring forward more work, including on the successor for Astute.

--- Later in debate ---

[Thomas Docherty]

If the hon. Gentleman is not splitting hairs, he is splitting something or other, because if the option would cost billions of pounds and take decades to develop, the problem is technical. Any solution can be reaped with sufficient money and time.

The hon. Gentleman talked about how money could be circulated back into the MOD programme. We heard from the hon. Member for Moray (Angus Robertson) that the debate ends up being about things such as nurses and welfare, but the idea that the 4% lifetime cost savings as a result of having three boats would somehow be pumped back into the MOD’s conventional programme is not credible. The hon. Member for North Devon talked about how we could solve the challenges on the wider equipment programme, but we will have to do more with allies, whether on the joint strike fighter, interoperability or the remotely piloted air system. Work such as that started by the former Defence Secretary under the Lancaster House agreement is the way forward.

I noticed that the clock froze for two or three minutes while the hon. Member for Moray was speaking, but having listened to his speech, I felt that his argument had been frozen for 25 years. I was conscious that he did not want to use up his time by taking my intervention, so let me say that although he talked about the trade unions that could have been consulted, he could have spoken to the trade unions I met with my hon. Friend the Member for West Dunbartonshire (Gemma Doyle). If he spoke to trade union leaders at Faslane—the hon. Member for Argyll and Bute (Mr Reid) is in the Chamber but, surprisingly, he has not indicated that he wishes to speak—they would say that their future depends on this. I am sure that it was an oversight that the hon. Member for Moray did not suggest that those trade union leaders should have been consulted.

The hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile), who I notice has not shown the usual courtesy by staying to hear the following two speeches before leaving the Chamber, made the rather bizarre claim that CASD could be guaranteed only by having a Conservative Government. If he was here, I would remind him that it was his Conservative Government who signed up to this review in the first place. I think that they need to hang their heads in shame for wasting taxpayers’ money and civil servants’ time—they have not wasted Defence Ministers’ time, because apparently they were not asked for their views—and there is absolutely no guarantee that they would not have a fudge at the next general election. The only way to guarantee a future for Barrow and for the Clyde is to send a clear message at the next general election by voting for my hon. Friend the Member for Barrow and Furness and other hon. Friends.

[Mr Reid]

Labour Members have stated a few times that Labour might go down to three boats, so what would the hon. Gentleman say to workers about the jobs that would be lost as a result?

--- Later in debate ---

[Gemma Doyle (West Dunbartonshire) (Lab/Co-op)]

This has been an important debate. I congratulate all Members who have contributed. A number of strong and passionate opinions have been expressed. It is important that all views are heard in this debate. I agree with the hon. Member for Bournemouth East (Mr Ellwood) that it is a shame that the Chief Secretary to the Treasury was not in the Chamber to listen to the debate. Indeed, I think it was quite discourteous of him to leave his ministerial colleagues from the Conservative party to listen to the debate on their own.

I pay tribute at the outset to the men and women serving in our forces, in particular—in the light of this evening’s debate—the Royal Navy and staff based at Clyde naval base, who work with the deterrent day in, day out. It is somewhat questionable that the Member representing them—the hon. Member for Argyll and Bute (Mr Reid)—chose not to speak in today’s debate. However, many of those men and women are my constituents. I also pay tribute to the civilian and the industrial work force who support the operation. We are all—

[Mr Reid]

Will the hon. Lady give way?

[Gemma Doyle]

I am sorry; I do not have time to. [Interruption.] The hon. Gentleman could have put in to speak and he chose not to.

We are all aware of the important job that the Barrow work force do. [Interruption.] The Chief Secretary has no business calling me discourteous; I have been in the Chamber for the entire debate and he has not. I pay tribute to my hon. Friend the Member for Barrow and Furness (John Woodcock) for speaking up so assiduously for his constituents, but there are companies and workers throughout the UK supply chain who are also integral to the success of the deterrent. I also pay tribute to the naval families who are without their loved ones, sometimes for a very lengthy period, with limited or no contact. It is not an easy position to be in. They, too, deserve our support and recognition.

We live in an uncertain and unpredictable world, as I am sure all hon. Members would agree. New threats emerge, but that is not to say that the traditional threats have disappeared. In response, we must have an equipment programme that enables us to deter, detect and tackle the entire spectrum of threats that we face as a nation. We on the Labour Benches are committed to the minimum, credible independent nuclear deterrent, which we believe is best delivered, both in effectiveness and cost, through a continuous-at-sea deterrent. We have rightly been keen to scrutinise the report on the grounds of capability, cost and disarmament, but absolutely nothing in it suggests that it would be in the UK’s interests to move away from a CASD.

We have heard from some Members that our deterrent is nothing more than a legacy of the cold war. Of course, the old divisions of the cold war have passed, but they have been replaced with new uncertainties. Indeed, the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile) and my hon. Friend the Member for Dunfermline and West Fife (Thomas Docherty) outlined those threats, which are real. They are not imaginary or historic; they are very much present. We cannot predict what will happen. It is this age of uncertainty that is one of the driving reasons why it would be foolish to give up our deterrent now. Important points on that were made by the hon. Members for New Forest East (Dr Lewis) and for Harwich and North Essex (Mr Jenkin).

We support a policy of multilateral disarmament. Like many speakers in the debate, I want to see a world free of nuclear weapons. It should be a cross-party priority for the UK to continue on the path towards multilateral nuclear disarmament, alongside our international allies, as a signatory of the non-proliferation treaty. The last Labour Government made progress towards that, as we have heard. I know that work is ongoing to reduce the number of warheads further. I am sure that we would all appreciate some information from the Minister about that.

Those who were expecting the report to be published with some credible alternatives—they included my hon. Friend the Member for Islington North (Jeremy Corbyn)—will be sorely disappointed, as he pointed out. It was all too clear from the Chief Secretary’s opening remarks that the report offers nothing new. In fact, it showed that the Liberal Democrats have taken two years to review a policy and spent thousands of pounds of taxpayers’ money, only to conclude that their past policy simply does not work. In fact, the only thing that we have learned from the report is that the Liberal Democrats are now well and truly a Trident party.

I am not sure whether to feel sorry for the Chief Secretary or to admire him. He has now reversed his party’s long-standing opposition to Trident, and I certainly do not envy him his job at his party conference this year. There is real concern that the review has been nothing more than an exercise in Lib Dem and Conservative party management, paid for by the taxpayer and taking up the valuable time of civil servants. That is no way to run a country, especially in relation to a decision of such great importance.

We have heard a number of excellent contributions on the importance of the continuous-at-sea posture, including from the right hon. Member for North Somerset (Dr Fox), my right hon. Friend the Member for Coventry North East (Mr Ainsworth) and the hon. Members for Portsmouth North (Penny Mordaunt), for Aldershot (Sir Gerald Howarth) and for Dewsbury (Simon Reevell). It is not just the existence of our nuclear deterrent but its continuous nature that is central to our discussions and to the report. The report makes it clear, for those who were under any illusion to the contrary, that the

“highest level of assurance the UK can attain with a single deterrent system is provided by SSBN submarines operating a continuous at sea deterrence posture.”

That has been the basis of our deterrent for more than 40 years: an assurance that our deterrent operates 24/7, 365 days a year. In short, any move away from CASD will result in a reduced capability. If our deterrent is our ultimate insurance policy, it cannot be taken seriously if it is only part time. If that is what the Liberal Democrats are proposing, it will confirm what a lot of us have suspected for a long time—that they cannot be taken seriously either. They seem to want a part-time deterrent, but that simply would not deter anyone.

We should also remember that, although the future of the deterrent is a decision for this House, that decision should not be taken in isolation from the rest of the world. It would appear, however, that the Chief Secretary did not even bother to consult anyone outside Whitehall, let alone in the rest of the UK. As my hon. Friend the Member for Bridgend (Mrs Moon) said, the UK is a proud member of NATO, alongside our international allies, and any decision to switch to an alternative platform, or even to adopt the Lib Dems’ part-time deterrent, would have consequences for NATO. It would indicate a significant change in our approach to defence across the world.

The hon. Member for Moray (Angus Robertson) and I share a desire to see a world free of nuclear weapons, although our views differ on how that would best be achieved. We are looking to work with our international partners to rid the world of nuclear weapons, but his party’s policy is a uniquely insular one—namely, to remove the deterrent from the Clyde and claim victory because it has moved 100 or so miles south. The hon. Gentleman might also want to check his statistics, because the most recent YouGov poll showed that 52% of the Scots surveyed thought that having our own nuclear deterrent was important, with only 38% against that proposal. That is far from the majority against the proposal that he spoke of earlier. Also, given that not a single poll has ever shown a majority of Scots to be in favour of independence, he should be very careful about wanting to carry out public policy by opinion poll.

In fact, the hon. Gentleman led the way for the Chief Secretary to make his U-turn, because the hon. Gentleman U-turned the Scottish National party’s opposition to nuclear weapons by forcing the party conference to adopt a pro-nuclear alliance position, in line with its ambition to join NATO. So he has no credibility on this issue—[Interruption.] And quoting himself is not going to make him any more credible.

Paragraph 32 of the report states:

“None of the alternative systems and postures offers the same degree of resilience as the current posture of Continuous at Sea Deterrence.”

I thank the Chief Secretary for using the report so effectively to make the case for continuous-at-sea deterrence, and I welcome the conversion of his party to supporting the nuclear deterrent. The report sets out very clearly that CASD is the most efficient and cost-effective deterrent, and I hope that we can all now proceed on that basis.

Investing in Britain’s Future

Alan Reid Excerpts

Thursday 27th June 2013 Commons Chamber

[Danny Alexander]

I think the hon. Lady was giving a back-handed welcome to the commitment that we made to affordable housing today. On rents, the policy that we have set out of CPI plus 1 for 10 years for uprating of rents saves the Government a growing amount of money in housing benefit payments for the simple reason that tenants rents will increase less fast than previously. That is good news for those individuals, and will save the Government money, as was announced in the costings document yesterday.

[Mr Alan Reid (Argyll and Bute) (LD)]

I am delighted by the broadband announcement, but Scottish Government money is also required. In the current round, the Scottish National party Government reduced this Government’s target of 90% to only 75% in Argyll and Bute. Can the Chief Secretary please persuade the Scottish Government to put in their fair share of money so that the new targets can be met in Argyll and Bute?

[Danny Alexander]

I will certainly do my best. I should say that the additional £250 million will need local matching, including in Scotland from the Scottish Government, to get to 95% of my hon. Friend’s constituents and, I hope, to 99% in due course. I remind the House that this is one of the areas in which we are better together as one united kingdom.