Deregulation Bill

Debate between Andrew Bridgen and Caroline Lucas

Monday 3rd February 2014 Commons Chamber

[Caroline Lucas]

I thank the Minister for that clarification. That is not as I understood it, but I am pleased to be corrected if that is the case. Certainly the lobby that I have been aware of—which is perhaps looking at broader issues than the question we are currently discussing—has been going on for a long time, but I thank the Minister for his clarification.

My second main objection to the Bill is that, in a sense, it just feels like the latest manifestation of a Government embarking on an evidence-free deregulatory path without due consideration of warnings, including from business. Those warnings say that effective regulation is essential to create jobs and innovation, and that ripping up vital green legislation risks locking the UK into polluting industrial processes for decades to come, jeopardising future competitiveness, damaging the UK’s attractiveness for green investment and undermining new industries. Let us take, for example, the UK Green Building Council, which works daily with more than 400 companies and organisations, from the largest to the smallest, across the built environment industry. In response to the Prime Minister’s comment last week about deregulation, Paul King, its chief executive, said:

“The Prime Minister’s boasts of ‘slashing 80,000 pages’ of environmental guidance is utterly reprehensible. It is the same poisonous political rhetoric from Number 10, devaluing environmental regulation in a slash and burn manner. These words are not only damaging and irresponsible, but misrepresent the wishes of so many modern businesses, both large and small.”

[Andrew Bridgen]

Apart from that one, rather spurious example, can the hon. Lady give the names of other business organisations that are demanding more regulation in the UK?

[Caroline Lucas]

I certainly can. I could talk about the Aldersgate Group as one or the Prince of Wales business trust as another. There are plenty of business organisations out there that make it clear that appropriate regulation is helpful to them. What they want is clarity, which is the very opposite of what they have had from this Government, under whom rules have been changed almost overnight. I am thinking, for example, of the feed-in tariff change, when suddenly the rules were changed retrospectively, more or less overnight, causing huge confusion and complication for many companies.

What those companies want is a level playing field, and clarity and certainty into the future. They are happy to have clear, sensible regulation that applies to all; what they do not want is a Government who simply come out with more and more rhetoric and introduce rules retrospectively or at the last moment. Many businesses in my constituency are tearing their hair out about not being able to plan for the future, because they do not know what the Government’s latest response will be to the UK Independence party or whoever else they are trying to close off.

[Andrew Bridgen]

I ran a business for 22 years, and what small businesses knew under the last Labour Government was that, on average, every working day we would get six more regulations affecting our businesses. Does the hon. Lady think that was very welcome?

[Caroline Lucas]

I am not a spokesperson for the Labour party, but if the hon. Gentleman wants to ask that question of those on the Labour Front Bench, he is very welcome to do so. What I am talking about is my knowledge of small businesses, with which I spend a lot of time in my constituency. What they would love to see is a reduction in VAT or an extension of the threshold, so that more small businesses are caught by the business rate relief. There are all kinds of things that they would like to see, but they are not necessarily telling me about a huge burden of regulation of the kind that the Government think they are trying to solve.

An example of the positive role of regulation is the 2016 zero-carbon target. This set a destination in advance and precipitated a huge amount of innovation from businesses figuring out how to get there—new jobs, new industries and new export markets for UK businesses. Customers are increasingly interested in energy efficiency, and a new home will probably save them £800 on their annual energy bills. Builders have responded to a clear stepwise trajectory towards zero-carbon homes, with uplifts in regulations in 2006 and 2010, and again this year, en route to 2016, from when all new homes are meant to be zero-carbon. The costs of building low-carbon, efficient homes have tumbled—by half in the last two years alone, according to forthcoming research. That example highlights the fact that Government regulation, not deregulation, can be incredibly successful in driving innovation, keeping energy bills down, creating jobs and cutting carbon emissions.

Environmental regulation to manage building in flood-prone areas will protect people from the nightmares that we have witnessed on our TV screens, if not in our own living rooms, over recent weeks. There are plenty of examples of disastrous deregulation, too. The US car industry lobbied and funded both Democrats and Republicans to reduce regulation. The result was that it drove itself to bankruptcy, because it was out-competed by overseas manufacturers that developed more efficient cars to meet tougher regulations elsewhere.

The Government seem to be ignoring business representatives speaking out in favour of strong regulation. I have mentioned the Aldersgate Group a couple of times. In 2011, it warned that the drive to cut regulations on business could threaten the economic recovery. In a report launched here in the House of Commons, it stated that Government initiatives such as the red tape challenge that threaten “to rip up” vital green legislation would lock in polluting industrial processes for decades to come, jeopardise future competitiveness, and damage the UK’s attractiveness to green investors. It questioned whether measures such as one in, one out rule made sense, and would address pressing environmental challenges such as climate change. That is just one example of a market failure that requires more, not less, regulation to safeguard the environment and drive development in new industries.

The Aldersgate Group also highlighted the negative impact of putting sensible environmental regulations at risk with a consequent loss of business confidence. Peter Young, the group’s chairman, said:

“It is a myth that all businesses want less regulation. Effective green laws create a level playing field which drives efficiency, early action and the innovation in UK companies that will be the engine for future growth and jobs.

A crude deregulation drive risks damaging competitiveness and severely threatens the Prime Minister’s commitment to a green industrial revolution. The regulatory framework should encourage a rapid shift to a sustainable economy rather than being held back by vested interests or the lowest common denominator.

The Government’s ‘war on red tape' must not become a crusade that threatens regulatory outcomes such as protecting the environment. Even the threat of deregulation on the Climate Change Act and renewable energy support is massively eroding investment and making growth more difficult.”

There you have it, Madam Deputy Speaker. That is not just the Green party speaking; some of the captains of some of the biggest industries in the country are saying, very clearly, that the idea that all businesses hate all regulation is a myth and a travesty.

Welfare Benefits Up-rating Bill

Debate between Andrew Bridgen and Caroline Lucas

Monday 21st January 2013 Commons Chamber

[Caroline Lucas]

I absolutely agree with the hon. Gentleman and thank him for his intervention. I think that people do want that to happen, partly because it is what they would want if they themselves fell into difficulties, and it is what they would want for their families and friends, who unfortunately and increasingly are in exactly that position.

[Andrew Bridgen]

rose—

--- Later in debate ---

[Caroline Lucas]

I thank the hon. Gentleman, who has encapsulated what I said in my earlier intervention and what I am saying now. Yes, it is strange, and disappointing.

Let me say a few words about RPI and earnings. The right hon. Member for Ross, Skye and Lochaber (Mr Kennedy) and the hon. Member for St Ives (Andrew George) have tabled amendments on earnings that would improve the Bill, and I support them. However, we have a public sector pay freeze, and earnings growth right now is slow; people are experiencing falling living standards as energy bills and food prices rise faster than income. In the longer term, however, earnings are important. Since the second world war, the UK norm has been for earnings to rise faster than prices, with real wages rising in most years, driving living standards higher.

[Andrew Bridgen]

Will the hon. Lady give way?

[Caroline Lucas]

Let me make a bit more progress.

It is worth remembering that benefits were linked to earnings until 1980, when the Thatcher Government changed the link to prices in order to save money. That was a deliberate and aggressive policy to run down benefit levels. In 1980, unemployment benefits were one fifth of average earnings; today, they are one tenth. Earnings are important in the long term, but in the current context, I worry that focusing on earnings when they are so low, without the link to RPI, risks being a smokescreen for existing Government policy. I worry that without the additional protection of a link to prices, the link to earnings will not protect people from inflation risk over the next three years. People must, at the very minimum, be able to keep up with the rising cost of living. My personal view is that benefits should increase either in line with RPI or in line with average earnings, depending on which is higher, but I deliberately tabled a more modest amendment that would just restore the link to RPI because I wanted to press the Committee to provide that minimum protection in the face of this Bill, and hoped that such an amendment would garner more support.

[Andrew Bridgen]

The hon. Lady stated earlier that a 1% increase in benefits is a very small increase on a very small amount of money. Is she aware that the welfare budget is almost a third of all Government spending and is by no stretch of the imagination a small amount of money?

[Caroline Lucas]

If the hon. Gentleman made a distinction between the overall benefits bill and pensions, he might find that he had a rather different set of figures before him.

It is not true that the Government are doing this to be fair. The measure is an unnecessary, spiteful and counter-productive attack on the poor. It is unnecessary because it is ludicrous to blame the unemployed and the low-paid for the deficit and to elicit from them the highest price for paying it off when high earners are receiving tax breaks. As the Government well know but conveniently forget, the culprits behind the entire financial crisis were the bankers on their very high incomes, many of whom do very well from over-generous tax relief on pension contributions and will benefit from the tax cut that is being granted to the highest earners with the abolition of the 50p rate. I welcome the Opposition’s amendment on the latter point.

The measure is spiteful because the Government insist on suggesting that it is somehow unfair that benefits have gone up by 20% when they know very well that 20% of very little is very little, and that in cash terms the average annual increase for those on jobseeker’s allowance over the past five years has been just £2.37—that is hardly the life of Riley that Ministers are pretending. Again and again they frame the debate around misleading percentages instead of the reality of hard cash increases that are far lower for people on benefits than for those in work.