Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 12th February 2015 Commons Chamber

[Andrew George (St Ives) (LD)]

I congratulate the Government on the support that they have given to satellite communications and space research companies based at Goonhilly earth station in my constituency, and also on their excellent science and research consultation, which has an excellent section on space research. May I urge Ministers to ensure that Goonhilly is placed at the centre of the development of space research infrastructure in future?

[Vince Cable]

I met my hon. Friend and a delegation yesterday to discuss that. I congratulate him on the stamina he has shown in pursuing the Goonhilly project, which is now part of the regional growth fund. He has raised wider issues about how the space policy can be developed to bring in the private sector, and I shall discuss with my right hon. Friend the Minister for Universities, Science and Cities how we can progress that.

Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 10th April 2014 Commons Chamber

[Vince Cable]

I suspect that it would make relatively little difference. We had a modest experiment at the time of the Olympics. The results did not show a great deal of real economic consequences, but we are always open to new evidence.

[Andrew George (St Ives) (LD)]

Provided that it does not undermine fair trade or UK competitiveness, a significant increase in the minimum wage would clearly be both desirable and the right thing to do. But will my right hon. Friend look particularly at the care sector, where I fear there is a race to the bottom as a result of there simply being a floor where the minimum wage has been set?

[Vince Cable]

I remind my hon. Friend that, based on the recommendations of the Low Pay Commission, the Government announced recently the biggest increase in cash terms since the financial crisis—a 3% increase, which is an increase in real terms. I suspect that with the central problem in the care sector, which is with domiciliary care workers whose travel times are not properly counted, we are dealing with an abuse of the minimum wage system, and it needs to be pursued in that context.

Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 5th December 2013 Commons Chamber

[Vince Cable]

I was well aware that Mr Tomlinson was an RBS customer. He has been very public in his comments about the bank for a long time. He was appointed as entrepreneur in residence at my Department —we seem to have a team of entrepreneurs—and has contributed valuable insights. I have referred his report to the regulator and the bank. Crucially, his accusations are echoed in the report published by Sir Andrew Large, who was appointed by RBS.

There are serious problems in the banking system, and in RBS in particular. Those problems need to be investigated, and I think that Mr Tomlinson has performed a useful service in making them public.

[Andrew George (St Ives) (LD)]

T4. I am grateful to my hon. Friend the Under-Secretary of State for her earlier reply in respect of the review of zero-hours contracts, but does she agree that driving out shady employment practices and improving wages, including the national minimum wage, would have the additional advantage of reducing the welfare benefits budget?

Business and the Economy

Debate between Andrew George and Vince Cable

Monday 14th May 2012 Commons Chamber

[Vince Cable]

Bringing the two organisations together will in itself produce some efficiencies, but I cannot assure the hon. Gentleman that they will be protected from the efficiency savings that the rest of the public sector is having to undergo. We are confident, however, that with the reforms that we are undertaking, competition procedures will be faster, not slower.

The same concerns about competition underpin our decision to bring forward a separate Bill, establishing an independent groceries code adjudicator, which will protect suppliers—small firms and farmers—from unfair treatment. In doing so, we will support investment and innovation in the groceries supply chain, and support British food manufacturing and British farming. The measure has been welcomed by the Food and Drink Federation, the National Farmers Union and the Association of Convenience Stores.

The case of a highly concentrated industry buying from and selling to large numbers of suppliers and customers is a classic, economic textbook case in which intervention is needed to prevent monopoly profits. Retailers should not of course be prevented from securing the best deals and passing on the benefits to consumers, but equally retailers should be required to treat their suppliers fairly and lawfully. An independent adjudicator will ensure that the market is working in the best long-term interest of consumers. It will have the powers to intervene proactively and to name and shame offenders. In such a competitive market we consider that those powers will be an effective tool, but if it appears that they are not adequate, I, as Secretary of State, will be able to grant the adjudicator the power to impose financial penalties.

[Andrew George (St Ives) (LD)]

I must congratulate my right hon. Friend and the Government on bringing forward this important measure, which has all-party support. If supermarkets have nothing to hide, they have nothing to fear from the introduction of the adjudicator. Given that the OFT and the Competition Commission are due to merge, however, may I urge him to introduce the measure as quickly as possible so that the merger does not distract from the important job of getting on with the adjudication that is clearly necessary in the sector?

[Vince Cable]

May I first congratulate my hon. Friend, who I think was one of the prime movers behind the legislation and was very persistent in demanding it? Of course, I have no control over the parliamentary timetable, but given that the Bill is small and there is a consensus, it should go through very quickly.

Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 2nd February 2012 Commons Chamber

[Vince Cable]

I am very surprised that the hon. Lady gives apprenticeships as the central example of failure, given that apprenticeship numbers have risen by 50% and apprenticeships are extremely popular with young people and employers. This is a success story, and I am surprised she is denigrating it.

Perhaps I should also point to the most recent indicators, which were published yesterday. In the manufacturing sector, which is absolutely critical for recovery, the purchasing managers index suggests a significant recovery in the short run.

[Andrew George (St Ives) (LD)]

The Government had the good sense to award a grant under the regional growth fund to the Goonhilly radio astronomy project in my constituency. That is very welcome, but the implementation of the decision seems rather slow. Will the Secretary of State look into the matter and accelerate the implementation of that project, which will generate many jobs in our local community?

Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 14th July 2011 Commons Chamber

[Vince Cable]

The hon. Gentleman is absolutely right that there has to be regional rebalancing of the economy, and that manufacturing and associated industries are at the core of any revival. It happens that the share of manufacturing is particularly high in areas such as the north-east, so they will benefit from a manufacturing recovery. I remind him that in the first round of the regional growth fund there were nine successful bids in the north-west, generating about 7,500 jobs, including at Bruntwood in Manchester, which I think is in his constituency but is certainly in the city.

[Andrew George (St Ives) (LD)]

Will the Secretary of State ensure that in the next round of the regional growth fund, the Government take into account the national benefit of regional growth, particularly in respect of the Goonhilly earth station application, which will provide the opportunity of radio astronomy for the country as a whole? It is an issue not just of regional growth but of national opportunity.

Postal Services Bill

Debate between Andrew George and Vince Cable

Wednesday 27th October 2010 Commons Chamber

[Vince Cable]

We are providing a framework in which a sale could take place and we are not setting timetables or limits. Those are the conditions in which we are most likely to get value for money. This is a framework piece of legislation. That is why we are likely to do better than before. I shall come to the details regarding Royal Mail shares in a moment.

[Andrew George (St Ives) (LD)]

The Secretary of State will be aware that people in west Cornwall and the Isles of Scilly are reassured that the universal service obligation will be retained. However, the access arrangements that were agreed, with regulatory intervention from Postcomm, have left Royal Mail in the very weak position of delivering letters for its competitors at a price that, frankly, undermines its commercial viability. I note that clause 48 addresses this issue, but can he reassure me that Royal Mail will have a far better crack of the whip when those terms are negotiated?

[Vince Cable]

I assure my hon. Friend that will be the case. My colleague the Under-Secretary of State for Business, Innovation and Skills, the hon. Member for Kingston and Surbiton (Mr Davey), who has responsibility for postal services, will spell out later today and in Committee exactly how the process will operate. My hon. Friend is right: at present the deregulation provisions do not give the Royal Mail sufficient protection against unfair competition. We want to make sure that there is more protection in the deregulation process.

--- Later in debate ---

[Vince Cable]

I am not making these commitments as political commitments. They are enshrined in regulation—regulation that will be strengthened and has the force of law. Of course, that is political in the widest sense if one regards this Parliament as political. The protections are going to be legal and regulatory; this is not a matter of political discretion for individual politicians.

We will also be taking other measures to secure the universal postal service. The greatest threat to postal services comes from the decline in mail volumes and the rise of e-mail and the internet. It therefore makes sense for the postal sector to be regulated alongside the broader communications market. For that reason, the Bill will transfer responsibility for the regulation of the postal services sector from Postcomm to Ofcom. Ofcom has a deep understanding of the wider communications markets and will be well placed to take decisions as regulator of postal services. The Bill will also give Ofcom a primary duty to exercise its functions as regulator of postal services in a way that it considers will secure the universal postal service—and it will need to consider the financial viability and efficiency of the universal service in taking its decisions.

We want to ensure that the new regulatory framework is proportionate to the needs of the market. We want to allow for rapid deregulation where there is competition. All mail providers need to be able to operate in a fair and effective market as soon as possible. As an ultimate protection for the universal service, the Bill includes provisions for special arrangements should a universal service provider be at risk of entering into insolvency proceedings—a remote risk but one that we have to consider. The arrangements would allow the appointment of a postal administrator whose objective would be to ensure that the universal service is maintained. We do not expect ever to have to use these provisions, but they provide an additional safeguard for the universal service. These measures mirror those that have been taken in the energy and water sectors.

[Andrew George]

rose—

[Vince Cable]

I will take one more intervention and then move to a conclusion.

[Andrew George]

I am much reassured by what the Secretary of State is saying. Further to my earlier intervention, I am merely seeking reassurance that the access agreements between the new Royal Mail and its competitors will be set in a regulatory framework that gives it a fair crack of the whip when negotiating the terms and the price. Under the present arrangement, Royal Mail is clearly, in effect, subsidising its competitors because it is delivering their mail.

[Vince Cable]

I believe I have given my hon. Friend that reassurance. Royal Mail will not subsidise its competitors, protections will be built in and there will be a genuine regulatory level playing field in a way that has not been quite true in the past.

Previous attempts at legislation on Royal Mail have not had a great history of success. I anticipate that there may be some opposition to the Bill both inside this House and elsewhere, although I believe that after 20 years of false starts, there is now a willingness to do what needs to be done. There is no easy way out, and the problems that Royal Mail faces will not go away. There will be no winners if we fail to act. Royal Mail’s employees will face continued uncertainty over their pensions and their jobs, customers will face a declining service and taxpayers will continue to bear the risks. Ultimately, Richard Hooper was clear that without this action, Royal Mail would fail.

Royal Mail needs this Bill. The company says so, Richard Hooper says so, the previous Government said so and I say so. I therefore strongly commend this Bill to the House.

Oral Answers to Questions

Debate between Andrew George and Vince Cable

Thursday 8th July 2010 Commons Chamber

[Vince Cable]

As the hon. Gentleman knows, there was an announcement in the Budget on commercial rates, which was a big issue for those ports. We are anxious to help the development of green investment and, as he will know, we are studying a proposal for the green investment bank, which could well become a vehicle for good projects in that sector.

[Andrew George (St Ives) (LD)]

T5. I was listening carefully to the Minister’s earlier response to the question on penalty charges applied to personal bank account holders who occasionally stray into unauthorised overdraft. Bearing in mind the Supreme Court’s decision last year, which has resulted in a very unsatisfactory situation, does the Department intend to review the situation and, indeed, intervene to protect those personal account holders who find themselves in difficulty?

[Vince Cable]

There certainly was a problem of serious overcharging, and it was pursued through the courts by the Office of Fair Trading. I am going to meet the director general of fair trading very soon, and I shall try to establish whether any action needs to be taken by the Department, as opposed to through the legal channels that have been pursued so far.

Capital Gains Tax (Rates)

Debate between Andrew George and Vince Cable

Wednesday 23rd June 2010 Commons Chamber

[Vince Cable]

Anybody who read my comments on tax policy over the past year would, I think, hardly imagine that there was a surprise or a bombshell, because I said on many occasions that if taxes had to be increased, it made much more sense to tax expenditure than income or corporate income or employment. That was my view, and I expressed it on many occasions.

[Andrew George (St Ives) (LD)]

I wish to associate myself with many of the measures that we as Liberal Democrats can take pleasure from in the Budget, including the increases in personal allowance and in pensions. On VAT, to what extent does my right hon. Friend accept that we could have explored alternatives, including increasing capital gains tax still further or increasing the bank levy to ensure that the balance of tax increases was more proportionate?

[Vince Cable]

The Government did look at the possibility of raising capital gains tax further. They did serious analysis and the conclusion was that it would not raise any more revenue. That was the problem. It certainly would not have raised anything remotely like £10 billion. That is why we cannot evade this issue.

Let me turn to the central concern about value added tax, which is expressed on both sides of the House: the worry about regressiveness. I checked back on what independent analysts were saying about value added tax and its income distribution effects. It is worth looking at the work of the Institute for Fiscal Studies, which has conducted a distributional analysis based on expenditure. It came to the conclusion—this is its word, not mine—that value added tax was fairly “progressive” because of the exemptions that are given for zero rating, as food, children’s clothing and other essentials are key items in the expenditure patterns of poorer people. [Interruption.] The top 10% of the population pay three times as much in value added tax as the bottom 10%. [Interruption.]

Opposition Members are expressing righteous indignation about what they regard as regressive measures. Let me tell them which is the most regressive tax: it is council tax. Do they remember what happened to council tax under the Labour Government? On average, it went up 70%. Taking into account rebates, for the poorest 10% of the population it rose by 93%. It is the most regressive tax of all, yet they lecture us in this sanctimonious way about regressive taxation. They have no basis for doing that.

Finally, let me turn to the crucial issue of growth, which the shadow Chancellor raised. He is right that growth does not happen automatically; of course it does not. How do we proceed from the austerity that has to happen—from cuts in public spending—to growth in business investment and net exports, which we want to see? That is a genuinely important question, to which there are no simple answers. The perfectly fair point has been made that there are risks involved here, just as there are risks, which we judge to be bigger, in doing nothing, so let me try to answer this question seriously. If we are going to get growth, it will come partly through demand and partly through supply. How do we sustain demand? Essentially, we do so through monetary policy. That is what happened under the last Government. The reason why the economy kept on going through the recession was not Government fiscal stimulus. That was trivial, and it has now been withdrawn anyway. It was not for that reason; it was because we had very low interest rates, the expansion of money through quantitative easing and, of course, a big devaluation.

Those factors drove the economy in terms of demand and they will continue to do so. There is a reason for believing that that is what will happen: the Governor of the Bank of England called for this Budget and has now got it, and he has every reason to understand the need for monetary policy to support recovery.

Industry (Government Support)

Debate between Andrew George and Vince Cable

Wednesday 16th June 2010 Commons Chamber

[Vince Cable]

If I get fewer interventions, I will be able to get to that point shortly. I am trying to develop the argument and respond to the perfectly valid points that the Labour spokesman made.

[Andrew George (St Ives) (LD)]

Will my right hon. Friend give way?

[Vince Cable]

Okay; once more.

[Andrew George]

I am grateful to my right hon. Friend. I appreciate that he is concerned about interventions, but given that he is saying that his response has been rational, as I believe it has been, he will be aware that my part of the world—Cornwall—is the poorest region in the UK. By the Government’s own admission, it receives less than the Government say it deserves in health funding and for many other public services. The Government rightly propose to abolish the RDAs, but what impact will that have on the poorest regions in the UK, if match money is not available for the convergence programme, for example, and those regions—the most impoverished and the most in need of investment—carry a disproportionate burden of the cuts?

[Vince Cable]

I am heartily relieved that my hon. Friend did not ask me an awkward question about the retail ombudsman, but he is right about Cornwall: it has special problems. As it happens, it has not been well served by the RDA. The South West of England Regional Development Agency covered areas such as Bristol and more prosperous parts of the country, which received an undue share of its attention. In the new structure, which I shall describe shortly, his county, and its county council and businesses, will be in a much better position to advance their cause.