Oral Answers to Questions

Debate between Andrew Bridgen and George Freeman

Tuesday 5th January 2016 Commons Chamber

[George Freeman]

Well—happy new year! Only Labour could take a £3.5 billion commitment to fund social care as “more pressure”. We are leading the way in integration—not before time, after 14 years in which Labour did nothing. We are leading the way on integration and putting in the extra money. I am delighted to say that, through the £3.8 billion for this coming year and the £10 billion funding for the NHS Five Year Forward View for transformation, it is the Conservative party that is investing in a 21st-century NHS. Labour seems to want to take us back to “Call the Midwife”.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does my hon. Friend agree that it is an important step to devolve powers to local authorities, as they are best placed to commission care services for local populations?

[George Freeman]

My hon. Friend makes an excellent point. The key is, of course, more funding and more integration, but crucially more local leadership too, and we are actively making it easier through the devolution programme for local authorities and local health leaders to plan the integrated services that are appropriate for their area. Not all areas are the same.

Post Office Horizon System

Debate between Andrew Bridgen and George Freeman

Monday 29th June 2015 Commons Chamber

[George Freeman]

As I say, if any individuals feel that their conviction is unsafe, they can always explore the legal avenues open to them. Where large numbers feel that that is the case, as is alleged, it is perfectly possible for them to bring a class action together. I do not accept that there is a fundamental injustice in the process that prevents people from bringing claims. I accept, however, that it is absolutely vital, where there is a legitimate claim against the Post Office about how it has treated its sub-postmasters, that those claims must be looked at properly.

In the limited time available, I want to move on to the Post Office’s approach. Both tonight and elsewhere, my hon. Friend the Member for North West Leicestershire and others have raised the very serious dissatisfaction felt about the way in which the Post Office has handled relations with its sub-postmasters. When this debate was called, I spoke to the Post Office to understand the situation. I have received a letter from its chief executive, Paula Vennells, which I shall send to my hon. Friend and others who have spoken and place in the Library. The letter sets out just how seriously the Post Office has taken this matter. Ms Vennells says:

“We have gone to great lengths...because I was determined that, if there were problems with the Horizon system, these had to be identified and resolved.”

I will happily pick up any issues that my hon. Friend or others feel are not addressed in the letter.

As I have already said, the mediation scheme is rightly independent of the Government. It was established jointly by the Post Office and the Justice for Subpostmasters Alliance, working with Second Sight, and it is overseen by an independent chair, a former Court of Appeal judge. It is right that the details of individual cases should be confidential and that the Post Office respects that.

[Andrew Bridgen]

The Minister should be aware that one of the criteria given by the Post Office for removing cases from mediation was if a very large claim was involved. Those sub-postmasters who have suffered the greatest loss and the greatest injustice were therefore immediately excluded from the mediation system.

[George Freeman]

That is a very interesting point, which I will be happy to take up with my hon. Friend, perhaps in the context of what I am about to suggest.

Although it remains the case that there is no evidence that the Horizon system is flawed, if any individual feels that their conviction is unsafe, they can pursue the legal avenues available to them. I do not see any reason for the Government to intervene in this matter by instigating a full judicial inquiry. However, I am struck by the extent of the concern expressed tonight by Members from both sides of the House and during the lead-up to this debate, including some of the specific testimony heard tonight. I will be happy to convene a meeting in the Department, perhaps led by my hon. Friend, with the support of others from across the House—to deal with the point he has just made and one or two others that have been made this evening—and to invite the Post Office to come to that meeting with representatives of sub-postmasters to try to iron out the issues.

My hon. Friend has raised other points that are a matter for the Post Office, rather than for the Government. I have no doubt that the Post Office has listened closely to this debate and will be in touch with him to answer his questions. I agree with him that this matter has gone on for far longer than anyone would wish and, for whatever reason, has been the cause of huge difficulties, trial and unnecessary hardship for a number of the sub-postmasters who have been affected.

The important thing now is for the final cases in the mediation scheme to progress to mediation, and I urge all the parties involved to continue to work together to make that happen. That will help the individuals with cases remaining in the scheme to reach resolution, and it will mean that the Post Office can, working closely and collaboratively with its sub-postmasters, carry on with its essential role of serving communities.

I repeat that some of the points made tonight in the House merit investigation. I will happily convene a meeting in the Department to put those specific points to Post Office Ltd. The system may have generally worked well for the vast majority of users, but that in itself is no reason not to ensure that those who have been legitimately unable to deal with the system should not be penalised unfairly. They certainly should not be made the victim of criminal judgments when their crime is nothing more than being unable to cope with a new IT system. I look forward to raising those points with the Post Office.

Question put and agreed to.

Interest Rate Swap Derivatives

Debate between Andrew Bridgen and George Freeman

Thursday 24th October 2013 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

I am grateful for the opportunity to speak in this important debate, and I want to add my name to those of other colleagues in paying tribute to my hon. Friend the Member for Aberconwy (Guto Bebb) for his leadership and to the Bully-Banks campaign. I commend my hon. Friend the Member for Wyre Forest (Mark Garnier) for enlightening us all on how these mechanisms work, and I am grateful for the work of the all-party group, of which I am happy to be a member.

I want to speak about the context in which we need to view this issue, based on my own experience. I believe that this is the end of a banking boom-and-bust and bail-out, which speaks volumes about the role of banking in the economic crisis that we face. On the basis of my previous career in small businesses in East Anglia, it seems to me that the big bang, along with all the many good things, triggered a major cultural and financial neglect of the real bread and butter economy on the ground. Over the last 15 or 20 years, Norfolk has certainly seen a wave of bank closures, a “computer says no” culture, and a neglect and undermining of what was traditionally viewed as the backbone of our local economy, but what became in recent years, particularly under the last Government, rather unfashionable and, dare I say it, boring for the bankers of today.

Norfolk now sits on the cusp of a major economic renaissance—in life sciences, in engineering and in energy. I thank the Government for investing in the infrastructure but in that sector the banks have largely been irrelevant, in my experience, to such early-stage companies because they are too risky. Those companies usually rely on venture finance from angels, and corporate venturing from customers.

We thus need to ask ourselves some big questions about the banks’ role as our economy goes forward. Of course the banks play a crucial part. America has 20,000 banks and a new one is started nearly every week, and I believe that our banking sector and our financial services sector is one of our greatest and most innovative sectors. We sometimes talk about the City as if it comprised just four or five big banks; in fact, it is a fabulous crucible of financial innovation that should be celebrated and encouraged. The problem lies with the few big banks at the top that were bailed out by the last Government in such a way as to see them sitting on too many real businesses in the real economy that we need to grow and support.

I am going to speak about three of my constituents who have suffered as a result of the problem we are debating. Mr Andy Keats is a local entrepreneur who built up a number of companies—in this case, a successful 13-year-old company with 30 local employees, which is about to be sold for £3.5 million. When Mr Keats decided that he wanted to move his banking from RBS to Barclays, RBS stopped passing on the sales income from credit and debit card sales in the business. The business went insolvent within six weeks, and for the last four years, he has had to deal with RBS and NatWest and has had to face a series of major issues and challenges, to which I have been party. I have seen at first hand banks not responding and when they do, ignoring previous communications, and passing on debts to debt collection companies.

[Andrew Bridgen]

Does my hon. Friend agree that one explanation for the banks’ lack of enthusiasm to get on and pay out compensation is that if businesses that have gone bankrupt have no access to the redress scheme, there is no incentive for the banks to grasp this nettle, so the Government need to do something to force their hand?

[George Freeman]

My hon. Friend makes an excellent point for which I am very grateful.

Mr Keats has also pointed out that the solicitors acting on behalf of the bank sometimes take court action without serving necessary notice.

I cannot name the second constituent because, like so many in these circumstances, he wishes to remain anonymous. He is a leading local business man and something of a pillar of the community. His business was pushed into accepting interest rate derivative products by unscrupulous bank salesmen. He has filed legal action against his bank so that the statute of limitations does not time out on his claim, which is a very real threat.

The third constituent is Paul Adcock, the managing director of Adcock’s of Watton, a great family business on the high street of a great Norfolk town. He was one of the first campaigners to make a complaint and a key leading light in the Bully-Banks campaign. I want to pass on my thanks, on behalf of my constituent, to my hon. Friend the Member for Aberconwy because the campaign has been a huge help to him. Adcock’s, a major local business and a pillar of the local establishment, racked up £175,000-worth of unscheduled charges. In September this year, Barclays finally settled. I want to put on record my constituent’s thanks for doing so.

This is not just a local issue. It is an enormous issue that runs across our economy. The numbers are eye-watering. The Bully-Banks campaign has estimated that this mis-selling scandal has cost small businesses more than 400,000 jobs in our economy, with £1.7 billion a year lost to the Treasury. It has led directly to the loss of 162,000 jobs, and to the inability of SMEs to create 251,000 jobs that they would have been able to create otherwise. More than 30,000 small businesses still face long delays, and fewer than 7% of claims being considered by Royal Bank of Scotland had reached the redress stage by the end of the month, while nearly five times as many—32%—had reached that stage at Barclays. Just 2% of those whose cases have been deemed eligible for review have accepted offers of redress. The banks have, I believe, set aside £3 billion for redress purposes, and less than £2 billion has been paid to just 32 businesses so far.

We need a speedy and fair process for redress and compensation. I urge the Minister to use all the mechanisms at his disposal to encourage the FCA to accelerate its handling of claims, to ensure that the banks are not allowed to kick them down the road, to separate direct and consequential losses, and to ensure that the settlements are fair. We must be careful not to define consequential losses in such a way as to undermine the potential for future SMEs to raise funds from the banks.

We are lucky enough to have a Minister with a glittering career in finance and small business behind him, and, I do not doubt, a glittering career in politics ahead of him. Our group could not have a more doughty and outspoken campaigner and supporter of our cause on the Front Bench. I urge him to bring to this issue the skill that he has brought to other issues with which he has dealt, and to ensure that it is viewed in the context of the wider banking crisis, whose resolution will enable our economy to recover properly.

Air Passenger Duty

Debate between Andrew Bridgen and George Freeman

Wednesday 23rd October 2013 Commons Chamber

[George Freeman (Mid Norfolk) (Con)]

It is a pleasure to follow the hon. Member for South Down (Ms Ritchie) and her colleague the hon. Member for East Antrim (Sammy Wilson). I welcome the new Economic Secretary to the Front Bench; I have no doubt that she will be a huge asset to the Government and the House.

I declare a slight interest, as I have cousins in Northern Ireland and, in my prior career, I spent far too many hours on internal flights, particularly to Scotland. Like many, I have enjoyed city breaks with my family; I shall spare the House the details of our recent trip to Amsterdam.

The democratisation of air travel in recent years has been a force for good, opening up to millions of families opportunities previously denied them. Millions more people are enjoying the thrill and experience of easy air travel and all that it opens up. Air travel does, of course, have a high carbon footprint, but just as the air industry has achieved stunning breakthroughs in safety through the extraordinary application of private sector expertise, investment, innovation and science, I have no doubt that it will be a force in demonstrating potential for energy-efficient air travel as well.

My principal reason for speaking this afternoon is to discuss the business of air travel and the role of air travel in business and in the economic predicament faced by this country. We are rightly—I commend the Government for it—putting an emphasis on the rebalanced economy and unlocking the power of our regions and cities to drive a new model of innovation-led growth, and air travel is an important part of that.

However, let us turn to the charge sheet that the House is presented with this afternoon and the motion, which calls for air passenger duty to be scrapped. The first charge is that it is a green tax, but, as the hon. Member for East Antrim said, it was not introduced and justified on that basis. However, he explained that even if it were, that would be no reason for not getting rid of it. This country, the western world and the whole world face a challenge in increasing energy efficiency and reducing the carbon footprint. Although that would not be a reason for introducing APD, it is worth bearing it in mind that we need to send a signal that rail travel, car-sharing and other forms of energy-efficient transport are to be encouraged.

The second charge is that the tax is regressive. The data in the ONS publication “The Effects of Taxes and Benefits on Household Income, 2011/12”, which I commend to colleagues, make it clear that it is not regressive; in fact, it is no more so than VAT. I think we would all love to get rid of that too—certainly colleagues in the House today would love it; we would like to get rid of most taxes—but we are not in a position where we can afford that luxury.

The third charge, interestingly, is that the tax is disproportionate. In fact, the Government have limited the rise in APD to inflation in the period 2010-11 to 2013-14, and in this year’s Budget they ensured that the rate will remain constant in real terms. This afternoon I looked online and found an air ticket to Berlin for £80, £13 of which is APD. That does not seem to be a prohibitive level of tax that will put people off.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does my hon. Friend share my sentiment that it is good to be on the Benches of a Government who realise the need for tax competition? We realise the need for competitive corporation tax rates and income tax rates; surely APD is a tax and we need to be competitive on that too. We have the highest APD in Europe. Of the 27 countries in the European Union, only six charge APD, and the Republic of Ireland is going to reduce it to zero in April next year. Should my hon. Friend not bear it in mind that we need to compete?

[George Freeman]

My hon. Friend makes a good point. He must have spotted my notes, because my very next point is that we need to view this in the wider context of business and tax competitiveness. I hugely welcome the fact that the Government have committed to reduce corporation tax from 28% to 23% and, in due course, to 20%, meaning we are constantly cited as one of the top three in the G8 on tax competitiveness, as stated in the 2012 KPMG global survey. That is a strong signal to global businesses that we are open for business, and it supports my hon. Friend’s point that we need to view this in the context of wider support for businesses and tax competitiveness.

The fourth charge is that the tax is bad for Northern Ireland. In this respect, I have some sympathy with the case made by colleagues from the Province. The fact that the Republic has cut APD creates a particularly difficult situation in Northern Ireland. The Minister said, encouragingly, that the Northern Ireland economy is not showing signs of suffering as a result, with very high growth and new jobs being created. That is a testament to the creativity and entrepreneurialism of the people of Northern Ireland. The changes made to the tax in November 2011, which reduced long-haul rates to the same as those for short-haul, and the devolution of the matter to the Assembly are important and welcome measures. However, I have a lot of sympathy with the argument that locally, given the situation in the Republic, there is a particular problem that the Government will need to look at.

The truth—an inconvenient truth, to borrow a phrase—consists of three points. As a generation, a Parliament and a Government, we face, and have to deal with, the most massive crisis in our public finances. We inherited from the previous Government £1.2 trillion of debt—£5,000 for every man, woman and child in the country. Debt interest alone is now the fourth biggest item of Government expenditure, and it is set to rise, if the coalition has not acted, to £76 billion a year in interest payments. We have a structural crisis in the public finances—in pensions, in welfare, in health and in debt interest.

Despite the very best efforts of the Government to contain the crisis and make sure that they do not trigger a downward spiral in public confidence in the economy, we still face a huge challenge to restore our public finances. We do not have money to spare. There is no such thing as a free tax cut; the closest thing is a tax cut on wealth creation. That is why I support the steps that the Treasury has taken on corporation tax to put in place a competitive tax environment for our businesses and why, in particular, I support a new deal for start-up businesses—the people who are at the coal face of creating new jobs. The truth is that APD is not a tax on business creation; it is a tax on air travel, which is not the same thing.

Finally, this tax raises £2.8 billion a year, and that figure is set to rise to £3.8 billion in 2016. That is a significant amount of money. Interestingly, it is nearly the same amount as that which the Government have given away in a fuel duty cut, which has caused huge reductions in income at the Exchequer and has a relatively low impact on people’s pockets. Abolishing APD would have a small impact on GDP and hard-working families, but it would lead to a major £4 billion cut in our deficit credibility. I hope Ministers resist it.