Oral Answers to Questions

Andrea Leadsom Excerpts

Tuesday 10th March 2015 Commons Chamber

[Jessica Morden (Newport East) (Lab)]

2. What proportion of recipients of tax credits are in employment.

[The Economic Secretary to the Treasury (Andrea Leadsom)]

In total, 4.5 million households are in receipt of tax credits, and 71% of them are in employment. The Government believe it is right to provide additional support to those in need through the benefits system, but we have been clear throughout that we want to ensure that people are better off in work than on benefits.

[Jessica Morden]

Will the Minister confirm that the Government’s real-terms cuts to tax credits will not only hit more people in work but hit far more women than men?

[Andrea Leadsom]

I am sure the hon. Lady shares my delight at the great news that the gender pay gap is lower than it has ever been, that there are more women in work than ever before and that 1.85 million people are in work who were not in work at the time of the last general election. That is cause for celebration. The Government have strived at every point to support women into work, whether through entrepreneurial allowances, support for women with child care or other measures.

[John Howell (Henley) (Con)]

19. Is my hon. Friend aware of the Institute for Fiscal Studies report on living standards showing that living standards are back to where they were before Labour’s great recession? Does this not help the very people she has mentioned?

[Andrea Leadsom]

Yes, my hon. Friend is exactly right. The IFS report also showed that 200,000 fewer people were in relative poverty in 2014-15 compared with 2009-10, including 100,000 children, and that since 2010 the number of children under 16 in workless households had fallen by about 390,000, taking it to the lowest level since records began. That is very good news.

[Ian Lavery (Wansbeck) (Lab)]

25. The average wage in my constituency is £450, which is £71 per week less than the national average. How can the Minister defend real-terms cuts to tax credits for these hard-working people, particularly the women, in my constituency?

[Andrea Leadsom]

The hon. Gentleman will surely be delighted at the news from the IFS and other forecasters that real wages are now rising at a higher rate than inflation, and it is thanks to our long-term economic plan that inflation is so low. We have had council tax cuts and fuel duty freezes, and we have done everything we can by raising personal tax-free allowances to enable people to benefit from a recovering economy, but we can only do it by sticking to a long-term economic plan.

[Sir Tony Baldry (Banbury) (Con)]

Am I right in thinking that universal credit will replace working tax credits and child tax credits, making 3 million households better off by an average of £177 per month and improving work incentives by allowing people to keep more of their income as they move into work?

[Andrea Leadsom]

Yes, my right hon. Friend is exactly right. Universal credit is a major reform that will transform the welfare state in Britain for the better. It will replace the current complex system of means-tested working-age benefits, including tax credits, and make 3 million households better off by on average £177 a month.

[Jack Lopresti (Filton and Bradley Stoke) (Con)]

3. What steps he is taking to invest in infrastructure.

--- Later in debate ---

[Mary Macleod (Brentford and Isleworth) (Con)]

11. What fiscal steps he has taken to support businesses.

[The Economic Secretary to the Treasury (Andrea Leadsom)]

The Government champion business. We have cut the main rate of corporation tax to 21%, the lowest in the G7, we have allocated more than £460 billion for infrastructure projects, and we have committed to unlock up to £10 billion of business finance through the British Business Bank by 2017-18.

[Mary Macleod]

Businesses in Chiswick, Brentford, Isleworth, Osterley and Hounslow have been hugely helped by the Government through lower business rates, reduced tax, better infrastructure and two new free schools, which were announced yesterday, to help build the skills for the future. Does my hon. Friend agree that only a Conservative Government with a long-term economic plan can help make Britain the most attractive place in the world to start and grow a business?

[Andrea Leadsom]

I completely agree with my hon. Friend. She is right that we want Britain to be the best place to start and grow a business. I am delighted for her that she has 9,600 new start-ups in her constituency, which she has fought for diligently throughout this Parliament, and that, as a result of this success, unemployment is down 38% in her constituency since 2010. I was particularly delighted to pay a visit with her to one of them, My Plumber Ltd, and to meet the wonderful Ollie, who was the apprentice there in charge.

[Kevin Brennan (Cardiff West) (Lab)]

One fiscal measure that affects business a great deal is the rate of VAT, and every Conservative Government put up VAT. In 1979, they put it up from 8% to 15%; in 1991, up to 17.5%; in 1994, on fuel and power; and in 2010, VAT was raised again to 20%. So we know what they will do, but let us give them one more chance. Will the hon. Lady rule out putting up VAT if in power after May?

[Andrea Leadsom]

It is extraordinary. I wonder if the hon. Gentleman would like to admit that every Labour Government when they leave office leave unemployment higher than when they came in. That is the truth of the matter. The Government are sorting out the mess left by the Labour Government, which was the worst financial crisis in British peacetime.

[Angie Bray (Ealing Central and Acton) (Con)]

18. Does my hon. Friend agree that, thanks to our long-term economic plan, the Government have supported businesses through cutting businesses taxes? Does she further agree that the real difference between the Government and the Labour party’s approach is that while we have been cutting taxes on businesses, it wants to put them up?

[Andrea Leadsom]

Yes, my hon. Friend is exactly right. There is the risk under Labour of a return to an anti-business system that has already been recognised by people who are themselves trying to run businesses in the UK that are contributing to our economy. She has been assiduous in her constituency in supporting business. She has more than 8,000 new start-ups, and I was delighted to visit Clare and to meet the Ealing Mums in Business, who are doing everything that they can to build successful businesses from small beginnings, to talk to them about access to finance.

[Dr William McCrea (South Antrim) (DUP)]

One of the steps designed to assist businesses in Northern Ireland is the devolution of corporation tax. In light of the reneging of Sinn Fein on the introduction of welfare reform, what implications does the Minister see in the devolution of corporation tax in Northern Ireland?

[Andrea Leadsom]

As I think the hon. Gentleman will know, we will agree to devolution for Northern Ireland if it is sustainable, and if it is felt by all sides to be a sustainable proposition.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

12. What assessment he has made of recent trends in the level of youth employment.

[The Economic Secretary to the Treasury (Andrea Leadsom)]

This Government have taken decisive action to boost youth employment. We have been a Government who are very much on the side of young people, and the results are clear: youth employment is increasing, up by 110,000 over the past year, and the number of young people claiming jobseeker’s allowance is at its lowest level since the 1970s.

[Mr Stuart]

Youth unemployment in my constituency is down by 53% since 2010. In the city of Hull, it is down by 54%. Does my hon. Friend recognise the opportunity that has been created by the growth in apprenticeships under this Government? Does she agree with the Education Committee that it would be “a mistake” for level 2 apprenticeships to be abolished for young people, as the Labour party proposes? Does she agree, on this occasion, with the TUC, which says it would be “a grave injustice”, or with the Association of Employment and Learning Providers, which says that, on apprenticeships, Labour has “got it all wrong”?

[Andrea Leadsom]

My hon. Friend is right. Under this Government we have seen over 2 million new apprenticeships, and level 2 apprenticeships are absolutely vital in giving young people a chance. Young people have shared in the success of our long-term economic plan, with the UK now having the fourth highest youth employment rate in the EU and the second highest in the G7. Very importantly, young people’s wages are also on the rise, with the latest data showing that the earnings of 18 to 21-year-olds who work full time have increased by 6% over the past three years.

[Mr Russell Brown (Dumfries and Galloway) (Lab)]

Yesterday I had an exchange with the Minister for Employment in which I made it abundantly clear that youth unemployment in my constituency continues to rise. She has said that the recent rise in youth unemployment is just “a tiny blip”. Does this Minister agree with that?

[Andrea Leadsom]

The hon. Gentleman should surely be delighted that since 2010 youth unemployment in his constituency is down by 47%, so I cannot agree with him, and that since 2010 unemployment is down by 34%. In the past 12 months, long-term unemployment is down by 38%. Surely he should be celebrating those numbers.

[Sir Edward Leigh (Gainsborough) (Con)]

13. What his policy is on the future of tax allowances related to marriage.

--- Later in debate ---

[Alistair Burt (North East Bedfordshire) (Con)]

T6. Is my hon. Friend the Economic Secretary aware that in my rural constituency, businesses regard the words “long-term economic plan” with the same degree of comfort and familiarity as evensong in an Anglican church? Will she be good enough to give an assurance that, following the election, those words and the benefits that they bring will continue, not least through the expansion of broadband which is so important for rural business?

[The Economic Secretary to the Treasury (Andrea Leadsom)]

It sounds as though evensong in my right hon. Friend’s constituency is a fabulous occurrence, and hopefully not just on a Sunday. He is right to point out that this Government have sought to ensure that the benefits of the economic plan are felt right across the country and that the growth is balanced, with all three major sectors—services, construction and manufacturing —growing by 2.5% or more for the first time since records began in 1990.

--- Later in debate ---

[John Glen (Salisbury) (Con)]

When considering the allocation of LIBOR fines, will Treasury Ministers consider carefully the submission of Alabaré Christian Care in my constituency? It is seeking to construct a new veterans village in Wilton that will be transformational for veterans across Wiltshire.

[Andrea Leadsom]

I am grateful to my hon. Friend for that question. As he will know, the LIBOR fines imposed on banks for the appalling rigging of LIBOR are being used for mainly military charities, and a few other ideas have been put forward. I shall bear his remarks in mind and mention them to the Chancellor.

[John Cryer (Leyton and Wanstead) (Lab)]

Further to Question 8, what measures is the Chief Secretary taking to tackle the activities of payroll and umbrella companies that promote bogus self-employment which in turn fuels widespread tax evasion?