LIBOR (FSA Investigation)

Clive Efford Excerpts

Monday 2nd July 2012 Commons Chamber

[Mr Osborne]

The Serious Fraud Office is independent of the Government, but it is pursuing every avenue to see whether it can bring criminal prosecutions in this case. This is, however, a matter for the SFO, which is going to come back to us by the end of the month to tell us whether it can do so, and it will have heard what the House has said today. We also want to ensure that in future the regulators have the criminal sanctions that they need, and that is why we seek these investigations to change the law now, rather than waiting four or five years to do so.

[Clive Efford (Eltham) (Lab)]

How can it be right, and in line with the Government’s credibility on wanting to clean up the banking system, when those who were responsible and in management at the time of these criminal activities—both the Prime Minister and the Chancellor have today accepted that criminal activities were going on—remain in post, such as Mr Bob Diamond?

[Mr Osborne]

As the Prime Minister said and I repeat, Mr Diamond has to account for himself before the Treasury Committee this week, and I congratulate the Committee on doing that. The chairman of Barclays has resigned, but it is not the job of the Chancellor of the Exchequer to hire and fire the bank chiefs at this Dispatch Box. I am not sure that we want to go down that path; it is much better for the shareholders to do it, the board to do it, and they will have the appearance before the Committee of Mr Diamond to go on.

LIBOR (FSA Investigation)

Clive Efford Excerpts

Thursday 28th June 2012 Commons Chamber

[Mr Osborne]

Where I would agree with the hon. Gentleman is that regulation cannot do everything and we need the right culture of management in the banks, but there is also a job for the regulators here. One of the purposes of the Financial Services Bill is to put the Bank of England in charge and allow the regulator to exercise more judgment. As I have said before in the House, the Royal Bank of Scotland ticked every single box when it came to its takeover of ABN AMRO, yet many people were asking at the end of 2007, “Is that a sensible transaction?” We need the regulators to be empowered to make judgment calls, not just to check whether every line of the regulation has been complied with.

[Clive Efford (Eltham) (Lab)]

I agree with everything that the Chancellor said in his statement, but following that, all he has done is try to heap responsibility on the Opposition Front-Bench team, rather than dealing with the bankers who are at the heart of the problem. We all know that lighter-touch regulation would have come in had he been Chancellor at the same time. That is not the point. The point is that people out there are angry. Those people are thieves and criminals, and they have made beggars of many of our constituents, who want to know what this Government are going to do about it. Can the Chancellor say whether the financial regulatory Bill before the House deals with all the issues that have been raised as a result of the report from the FSA yesterday? If not, what is he going to do about it?

[Mr Osborne]

I will tell the hon. Gentleman what this Government are doing. First, we are getting rid of the tripartite system that failed. Secondly, we are changing—[Interruption.] I will tell hon. Members what failed—the regulation of financial services. The hon. Gentleman’s constituents and mine and everyone else are paying a very heavy price for that, so we are changing the regulator, changing the structure of banks in order to have ring-fenced retail banks—

--- Later in debate ---

[Clive Efford]

No. The right hon. Gentleman is doing nothing. It is business as usual.

[Mr Osborne]

The hon. Gentleman voted for 13 years for a Government who failed this country. We are changing the regulation, changing the structure of banking—[Interruption.] and we are dealing with this latest abuse— [Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We have heard the question. The hon. Gentleman should have the courtesy to listen to the answer, even if he does not like it. There is no need to get so excited—

[Clive Efford]

Plenty of people out there are excited.

[Mr Deputy Speaker]

Order. Is the hon. Gentleman questioning me?

[Clive Efford]

I apologise, Mr Deputy Speaker.

[Jeremy Lefroy (Stafford) (Con)]

The prices of many important international commodities are set in London, such as cocoa and robusta coffee, and tens of millions of smallholder farmers and poor people around the world depend on these. Is my right hon. Friend confident that the kind of problems that we have seen with LIBOR are not spreading to such markets, which are so important for people around the world?

Budget Leak Inquiry

Clive Efford Excerpts

Thursday 22nd March 2012 Commons Chamber

[Mr Gauke]

I am interested to learn that this story was apparently briefed before any decision emerged. [Interruption.] I understand that that is incorrect and that it was not announced on Twitter before your decision, Mr Speaker. If it was, I am sure that there will be an internal Labour party inquiry.

[Clive Efford (Eltham) (Lab)]

The reference to Hugh Dalton in 1947 is of course wrong, because he resigned and the leak had been reported in an evening newspaper before he sat down. What we are talking about now is the ministerial code and the accurate and extensive reporting of what was in the Budget across the media the morning before the Budget statement. That is the difference, and that is what we want to be investigated. Are we going to have an investigation or not?

[Mr Gauke]

I have answered the hon. Gentleman’s first point. I should also reiterate that we have a coalition, which means that there are negotiations and discussions involving both sides. It also means that the Budget tends to be finalised some days in advance of the Budget speech. That is quite a contrast to previous years, when revisions were made, documents pulped and decisions taken at the last minute. I think that we have a much better process, thanks to the discussions within the coalition and the involvement of the Office for Budget Responsibility.

Amendment of the Law

Clive Efford Excerpts

Thursday 22nd March 2012 Commons Chamber

[Vince Cable]

I think Mr Blanchard is very firmly on record as endorsing the strategy that we have adopted.

There is, of course, a fundamental dilemma, which any Government in this situation would face. If a deficit is cut very fast, it clearly has an impact on demand; and if it is cut too slowly, we lose the confidence of international creditors and markets. That is what we have not done. Unlike many eurozone countries that are now introducing budgets in panic and under pressure, we have introduced a politically and financially stable approach to deficit reduction. The underlying theme has to be one of financial discipline.

I cannot resist quoting an excellent statement of what this Government are about, and of what any Government should be about. It says that

“we must ensure we pass the test of fiscal credibility. If we don’t get this right, it doesn’t matter what we say about anything else.”

That was the shadow Chief Secretary, the hon. Member for Leeds West (Rachel Reeves). She is absolutely right and has brought fiscal rigour to the Opposition Front Bench for the first time. I just wonder what kind of response she has made privately to some of the commitments that the shadow Chancellor, and indeed the Leader of the Opposition, have been making in the last few weeks. They have been promising to get rid of the fuel duty changes, child benefit changes, child tax credit changes and the changes to public sector pay. I think the total volume of commitments is something in the order of £30 billion. Before we proceed any further with a debate on the Budget, we need to have absolute clarity about which of those measures the Opposition are committed to and to which they are not—and if they are committed, we need to know what else they are going to cut to make way for them.

Let me summarise where we as a Government are proceeding. Unlike many other countries in Europe, we have not introduced our Budget in an environment of panic or under pressure from financial markets. Unlike in the United States, we do not have political paralysis; we have stable government. This is our strategy: we have, and we will retain, fiscal discipline and we will stimulate the economy. There has to be demand—the shadow Chancellor is absolutely right about that—but this is coming through monetary policy. In order to have a monetary policy that stimulates the economy, we need the confidence of the central bank. The central bank has made it absolutely clear that the Government have to be fully committed to fiscal discipline in order to allow that to happen. Thus we have a combination of low interest rates, quantitative easing, now credit easing and a substantial devaluation. This is where the stimulus to demand comes from.

The third element is fundamental: we are dealing with a broken banking system—something we inherited. The banking system was massively expanded under the last Government, but collapsed with disastrous consequences. There is a continuing problem of credit supply. That is a very real problem—and every small and medium-sized enterprise would tell the same story. We have introduced a whole series of initiatives. The Chancellor has taken this forward with credit easing, while my Department has a new programme building on the Breeden report relating to non-bank finance. I have no doubt that we shall have to come back to this, because the banking system is still not functioning, but this is at the heart of the economic crisis that we are trying to manage. For the first time in our lifetimes, the financial system has collapsed—with disastrous consequences—and we are having to put that right.

The fourth and final element in the story is rebalancing the economy and putting it on a proper sustainable basis. That is why the Chancellor underlined in the Budget our commitment to the growth review and to improving infrastructure. We need to recognise that banks have to be properly regulated, which is why we have increased the bank levy, but in addition, we need to give backing to our successful industries, particularly our export industries—aerospace, creative industries, the oil and gas sector, and pharmaceuticals. Over the last few weeks and months, we have been correcting some of the long-standing errors of policy pursued by the Labour Government—the way in which, for example, public procurement took no account of supply chains; we are putting that right. We are beginning to see serious positive commitment by overseas investors—we are seeing it in the car industry and in pharmaceuticals—as a result of this industrial strategy.

[Clive Efford (Eltham) (Lab)]

With all due respect, we have heard it all before. In May last year, the Business Secretary said:

“I will fight, and do fight…for manufacturing industry…It is leading this country out of recession”.—[Official Report, 24 May 2011; Vol. 528, c. 793.]

Will he tell us what went wrong with manufacturing?

[Vince Cable]

Has the hon. Gentleman followed what is happening? The car industry, for example, has grown by approximately 20% over the last year, and all the major producers are investing in the UK.

Pay and Consultants (Public Sector)

Clive Efford Excerpts

Tuesday 13th March 2012 Westminster Hall

[Clive Efford (Eltham) (Lab)]

This is the first time that I have participated in a debate under your chairmanship, Mr Howarth, so I am pleased to be here today. I congratulate my hon. Friend the Member for Hammersmith (Mr Slaughter) on securing this important debate.

In response to concerns about the time, I will make just two quick points to add to the forensic examination by my hon. Friend regarding public sector pay and the use of consultants, and I would like the Minister to consider them.

When my hon. Friend opened the debate, he was intervened on several times, and Members pointed out that some of the problems had existed under the previous Government. I fully accept that. A lot was made of the issue around the time of the general election, and the then Opposition were right to do so. There were concerns in the public about the rates of pay that were paid through public funds—taxpayers’ money. That is a legitimate issue to raise. Having raised the issue, even going as far as to say in the coalition document that the Government would reduce public sector pay, that there would be a cap on pay and that a mechanism would be put in place for agreeing pay that is above the rate of the Prime Minister’s salary, it is legitimate to have a debate such as today’s to examine what progress is being made.

What we have seems to be an approval of a mechanism for avoiding tax and paying higher salaries for the performance of tasks and roles that are paid for out of the public purse. There is a certain irony in that some of the mechanisms seem to allow payments that end up reducing the amount of tax that is available to pay for the services in the first place. We are talking about people who are recognised to be on the payroll, but whose salaries are paid through private companies. An article in The Guardian on 16 February states that many people who are being paid through private companies and who are avoiding paying tax at source

“are listed as full-time legal, IT or human resources consultants. The department said many of them had been employed for a long time, and appear on staff directories.”

Such people are, for all intents and purposes, full-time employees—of the national health service, in this particular case—and yet they are being paid through service companies that allow them to reduce their tax liabilities.

The article says that Departments are complicit in that. It states:

“The arrangement can be tax-efficient both for the individual and for the Whitehall department, including arm’s-length bodies, since the department may not need to pay national insurance in addition to fees.”

My concern here is that Departments, which are paid for by tax and whose revenues are collected by the Exchequer, seem to be colluding to reduce the amount of money paid to the Exchequer. Will the Minister respond to that, or at least look at the issue? When she conducts her review, will she specifically respond to that? Am I alone in thinking that there is something peculiar about a Whitehall Department seemingly colluding with the private sector to reduce the amount of tax payable? Is that practice acceptable? Should we be encouraging such practice?

[Stephen Pound]

My hon. Friend came into the House at the same time as I did. He will remember, as I do, the huge debate on IR35 at the time, which I thought had addressed the issue. Is he as shocked as I am to hear today, and to read in the sheets of that august organ, Private Eye, that a golden carousel fuelled by avarice is spinning chief executives from one fleshpot to another, letting them fill their boots on the public purse without even pausing for breath? Does he agree that that should have been sorted years ago? I thought that it had been by IR35.

[Clive Efford]

My hon. Friend is tempting me along a path that I do not wish to go down because I have limited time. However, he has made his point and put it on the record.

I will quote from another article in The Guardian dated 15 February to illustrate my point further. What is disturbing about that article is that the officers within the Department—whether inadvertently or not—have failed to give the full facts in answer to a Member asking questions specifically about the use of such vehicles for paying permanent members of staff in the NHS. The confusion seems to rest around whether those people are classified as civil servants, or whether they are private sector consultants.

The series of e-mails that The Guardian quotes from in the article suggests that there are attempts within the Department to facilitate that sort of arrangement. I find that alarming. The answer provided failed to give the full facts to the House. The article states:

“The emails handed to the Guardian also show senior civil servants at the department discussing the possible reputational damage to the department and seeking to avoid ways of revealing the nature of the payments sought in a written question last December by Gareth Thomas, the shadow Cabinet Office minister”.

The Guardian goes on to say that the answer to the question from my hon. Friend the Member for Harrow West (Mr Thomas) stated:

“It is not the department's policy to permit payments to civil servants by ways of limited companies.”

That led to the belief that no civil servant was being paid through such a mechanism. However, it transpires that there is an issue surrounding the definition of a civil servant. A civil servant is someone who is on pay-as-you-earn, rather than someone who is being paid through one of those mechanisms. Therefore, the answer was entirely misleading. Whether that was deliberate or not, we need to have some answers to that practice. Do the Government think that that is a satisfactory definition? Alternatively, does it need clarification so that when hon. Members seek answers in the future about how people are being paid, we get accurate answers? We can then be the scrutineers of what is going on with public sector pay and how much public sector money is being used. With that, I conclude my speech.

[Several hon. Members]

rose—

Oral Answers to Questions

Clive Efford Excerpts

Tuesday 6th September 2011 Commons Chamber

The Chancellor of the Exchequer was asked—

[Clive Efford (Eltham) (Lab)]

1. What recent assessment he has made of the level of taxation levied on the banking industry.

[The Chancellor of the Exchequer (Mr George Osborne)]

Her Majesty’s Revenue and Customs published details of total pay-as-you-earn and corporation tax receipts from the banking sector for the first time on 31 August. The official statistics show that tax receipts from the sector increased from £17.3 billion in 2009-10 to £21 billion in 2010-11. A number of other taxes are incurred by the banking sector that the Office for National Statistics did not include in the figures, including the new bank levy introduced by this Government, which we expect will raise an additional £2.5 billion net each year, which is more in each and every year than the previous Government raised in their one-off payroll tax.

[Clive Efford]

I am grateful to the Chancellor for that answer, but the truth is that the High Pay Commission has just published a report demonstrating that high executive pay bears no relation to the performance of companies and that nowhere is this more starkly illustrated than in the banking sector. Meanwhile, youth unemployment is going up. Is it not time we made the banking sector pay its fair share in order to do something for the young unemployed in this country, as advocated by the Opposition?

[Mr Osborne]

That is why we introduced the bank levy, which Labour had 13 years to introduce but did not. It raises £2.5 billion. We are also taking action to clamp down on tax avoidance. We recently proposed a measure to tackle something called disguised remuneration, whereby high earners, often in the financial services sector, disguise their income to avoid tax, but the Labour party voted against the measure.

Finance Bill

Clive Efford Excerpts

Tuesday 28th June 2011 Commons Chamber

[Mr Jones]

I am not saying that at all. I am saying that the hon. Gentleman, his party and, certainly, the more blue-blooded elements of it very strongly argue that the state should not intervene in people’s lives, including, in some cases, motorists’ lives, but what we have in new clause 5 is the right of the Tory party arguing for direct state intervention in something very personal: somebody’s personal relationship.

Earlier, it was said that a tax system would encourage people to get married, but there is no evidence of that at all. In the late 1960s and ’70s, when the old married man’s tax allowance was in place, there was a record rise in divorces, but that was less to do with the tax system and more to do with the change in society and the law that clearly made it easier to get divorced or to choose not to marry at all. Again, the idea that £20 a week will encourage somebody not to divorce is quite ludicrous. All the studies find that we would need to offer a considerable amount of money to prevent people from divorcing.

My hon. Friend the Member for Bishop Auckland (Helen Goodman) raised the issue of international comparisons, somebody else mentioned Denmark and other countries and the hon. Member for Gainsborough mentioned the fact that we are one of the few countries not to recognise marriage in the tax system, but there is no evidence to suggest that taxation as an encouragement to get married does anything to hold the family unit together.

[Clive Efford (Eltham) (Lab)]

I have listened to my hon. Friend’s speech with a great deal of interest. On fiscal incentives for people to stay together, does he agree that the cost of running two separate households is a major financial consideration for people living apart? It far outweighs any fiscal benefit that the taxation system could deliver.

[Mr Jones]

I agree. The changes being made to housing benefit will not do anything to help families stay together. My hon. Friend is a London Member, so he will know that families will be forced to move out of central London because of the Government’s changes to housing benefit rules. That is one of the inconsistencies of this Government. On the one hand they say that a tax break of £150, or £20 a week, will help to keep the social unit together, and on the other they—the same Minister, I hasten to add—pursue policies on housing benefit and other benefit changes that will not help at all to keep families together but will lead to the root cause of most of these issues: the poverty that affects such individuals.

I turn to some of the problems with the Bill as framed, and to what we have before us. New clause 5 is not the measure in the Conservative party’s most recent election manifesto. This proposed change includes married couples but excludes civil partners, who would not be covered by the new clause. When there was an outcry and complaints about what had been proposed at the election, the Prime Minister included civil partners at the last minute.

People would have to opt in to this system and elect to transfer their part of an allowance. That would be very unfair to many people who do not understand tax codes. I have just got my annual tax return and I keep putting it to one side, as most people do, until the deadline arrives. Introducing a system whereby people have to elect to transfer a certain allowance may well help the more articulate middle-class people who can do that when they fill in the form, but I am not sure that some of the people on poor council housing estates in Glasgow whom the Secretary of State for Work and Pensions is trying to address will have the wherewithal or knowledge to do it even if they knew that the option was available.

The Government have told us that they wish to simplify the tax system, but the new clause would make it a lot more complicated. In trying to bolster marriage, it would help certain groups of people but not others. Whenever we do anything with the taxation system, we should try to make it as user-friendly as possible. If someone opted to move their allowance around, that would be quite complicated because people’s incomes change throughout the year, so they might have a certain allowance available in one year but not another. The system would incur not only the £3 billion-plus cost of having it open to everyone but the cost of trying to work out how the tax office would administer it. In that respect, the new clause is not well thought out.

The Government have got themselves into a bit of a logjam on this. The Prime Minister is clearly committed to this policy. His Back Benchers are now worried that it cannot be implemented because of the coalition agreement. Huge amounts of public money would be used, but would it have any effect on child poverty? No, it would not, and neither would it affect most families. Moreover, it would help people without any children, including pensioners.

--- Later in debate ---

[Mr Gauke]

As I sat down to give way to the hon. Member for Dudley North (Ian Austin), the shadow Chancellor said, “You don’t have to be married to benefit from the transferable nil-rate band.” He is absolutely right. As I said, it applies to married couples and those in a civil partnership. That is exactly what I said earlier. As the hon. Member for Dudley North pointed out, it is important that we support widows in the circumstances he mentioned. Does that mean, though, that we should never do anything for married couples? It does not necessarily follow.

I want to put this in the wider context of what we are doing to help strong and stable families. For example, the Department for Education has announced plans to spend £30 million on relationship support to deliver better support for couples in relationship distress. However, as hon. Members will be aware, the Government have made it clear that we intend to introduce proposals to recognise marriage and civil partnerships in the tax system. As the Prime Minister said recently, this will show that as a country we value commitment. I certainly agree, therefore, with the intentions behind the new clause.

Although the Government support the principle behind the new clause, now is not the appropriate time to bring forward such a measure. It would entail significant and immediate costs to the Exchequer, its scope is wider than the Conservative party manifesto pledge and the cost, we estimate, would be more than £4 billion. It would also necessitate substantial implementation costs.

[Clive Efford]

Will the Minister give way?

[Mr Gauke]

I will give way again, but I am keen to make progress.

[Clive Efford]

Will the Minister comment on what message this sends to teachers planning to strike on Thursday? On the day when the Secretary of State for Education was dragged to the House to explain what he was doing to avoid the strike, the priority of Back-Bench Conservative MPs is to propose a motion that would cost more than £4 billion a year, yet teachers are being told that the Government will not negotiate over increases in their pension fund contributions. What message does that send to those teachers?

[Mr Gauke]

We have heard a lot in this debate about single parents. One group that will be affected if teachers go on strike and schools close on Thursday will be single working parents, who will face substantial disruption in dealing with child care. I hope that Members in all parts of the House will strongly urge teachers to go to work on Thursday.

--- Later in debate ---

[Ian Swales]

I thank the hon. Gentleman for his intervention. I just read out a long list of items that are VAT-free; that was the point of what I was saying.

[Clive Efford]

Those items were VAT-free when the hon. Gentleman made his pledge at the general election. When he stood for election, he said that the poorest people in society were affected most by increases in VAT, and that it was therefore a regressive tax. He was right then, and that point is still right now. Why, then, is it correct and appropriate for the poorest people in our communities to pay for the deficit that was run up by the richest bankers in the country?

[Ian Swales]

The hon. Gentleman has strayed off the topic of the new clause, but on my party’s policy on VAT, obviously we are between a rock and a hard place, due to the economic state of the country. We had some very difficult choices to make, and a progressive expenditure tax is the right answer.

--- Later in debate ---

[John Hemming]

We should remember that VAT does not apply. I declare an interest, as a VAT-registered person. People who understand how VAT works will know that people who charge VAT can reclaim it on their inputs. We have to look at the details. On the hon. Gentleman’s further point, yes, there is an economic multiplier that has an effect. As demand is increased, there is a multiplier effect. At the same time, we have to look at the long-term effect on the deficit, the debt and the interest paid. As interest rates go up, wider damage is done to the whole of society.

It is true that in an ideal world we would not have higher rates of VAT. In an ideal world everything would be nice, and there would no problems and no difficult decisions to take. We have to get a balance. It is very pleasing to see that the official Opposition now accept that VAT should be 20% in the long term.

[Clive Efford]

There used to be a time when the hon. Gentleman was fond of quoting the Institute for Fiscal Studies, which called the VAT cut “an effective stimulus”. As for the construction industry, does he not recognise the figures showing a 19% increase in the number of business failures in the construction industry in the first three months of this year—since the increase was imposed?

[John Hemming]

There is no VAT on new build. The hon. Gentleman’s party believes that the VAT rate should be 20% in the long term; I thank him for agreeing with us about that.

The Government, essentially, have to bring the deficit under control to keep interest rates under control—and that is what we are doing.

--- Later in debate ---

[Nia Griffith]

That is precisely the point. There is a huge contrast between an economy that was growing and doing better than the forecasts had predicted, and a situation where there has been no growth since last October. As my hon. Friend pointed out, the Office for Budget Responsibility now predicts that the Government will have to borrow £46 billion more over the coming years than was forecast last autumn after the spending review. Worse, they are failing to get Britain back to work, which is probably pushing up the benefits bill this Parliament by more than £12 billion. That not only makes the deficit worse, but makes the lives of the people involved infinitely more miserable.

[Clive Efford]

My hon. Friend cannot have failed to notice that only one Back-Bench Conservative Member is present—

[Chris Ruane]

No, he is a Parliamentary Private Secretary.

[Clive Efford]

Yes, he is a PPS. By contrast, nearly a dozen Liberal Democrat Members have been present. That is nearly as many Liberal MPs as positions their party has taken on VAT. I have here positions set out by not only the hon. Member for Brecon and Radnorshire (Roger Williams), but the hon. Member for North Cornwall (Dan Rogerson), who called for a review, and a Liberal Democrat activist, who called for a cut in VAT on tourism in that part of the world. Just how many positions do the Liberal Democrats have on VAT?

[Nia Griffith]

The whole point is that our new clause calls for a proper assessment to be made to see what the actual effect of the current VAT rate is on the economy, given the lack of growth and the lack of a plan for growth. The important thing is to carry out that impact assessment and work out the best growth strategy, because nothing is coming from this Government in order to put things right.

What has been happening in the news recently? Everybody must be aware of the crisis we are facing on our high streets and in store after store. This is happening to TJ Hughes and its 57 stores, to Jane Norman’s 90 stores and 100-plus concessions, to Habitat, and to HomeForm, which covers Möben Kitchens and Dolphin Bathrooms. Some 5,300 jobs are in the balance, and now we hear about what is happening to Thorntons and Comet. Judith McKenna, chair of the CBI’s distributive trades panel, has commented:

“After a year of growth, high street sales volumes fizzled out in June….Shoppers are budgeting hard and cutting back on their discretionary spending, such as on clothes and big ticket household goods.”

She is the CBI’s chief financial officer.

The Economy

Clive Efford Excerpts

Wednesday 22nd June 2011 Commons Chamber

[Stephen Williams]

I thank my hon. coalition colleague for her intervention, which reinforces my points.

The Government response to the stark situation that we inherited in May 2010 has been to tackle the deficit—the yawning gap—in our public finances, but also to build a business climate that is conducive to growth, because as several hon. Members have said, it is through growth that the economy will provide the resources to get our finances back on track.

[Clive Efford (Eltham) (Lab)]

Will the hon. Gentleman give way?

[Stephen Williams]

I have taken two interventions, so I will take no more until near the end, perhaps.

This Government do have a growth strategy: we want to rebalance growth, including rebalancing it geographically. We have just heard about the plight of the north-east. Perhaps it was a failure of the last Labour Government not to rebalance the economy sufficiently, away from the south-east of England and towards other regions and nations of the United Kingdom. Perhaps the hon. Member for Hartlepool (Mr Wright) ought to have a stiff word with some of his colleagues. After 13 years, the economies of some of our regions were still very fragile and unable to withstand external shocks. We also wish to rebalance the different sectors of the economy, away from over-dependence on the City of London, important as it is, and the resources that it generates towards more sustainable parts of the economy, in particular growth from digital media. The Government have announced the establishment of a network of enterprise zones around the country. My local enterprise partnership—the West of England Local Enterprise Partnership—has just announced that it will be based around Temple Meads station in my constituency, where we want to build the country’s leading media hub and business growth area, with a particular focus on digital media.

We also want future growth to be sustainable in a green way. This country has a huge economic opportunity to grow a low-carbon economy. In the Energy Bill, which is just completing its passage through the House, we have something quite revolutionary: the green deal, which gives every household in the country a fantastic opportunity to retrofit their houses to reduce energy bills and help us cope with meeting the demanding climate change targets that we have set, on which there is cross-party consensus and agreement. There is also a fantastic opportunity for British business, and for people to be trained in the skills needed to retrofit our housing stock. On a rather larger scale, the Government have also announced—the Chancellor confirmed this in the Budget—the creation of the green investment bank, in order to provide finance for schemes that might otherwise find it difficult to secure funds in the market. As the country’s green capital, the city of Bristol has a good case for being made the future home of the green investment bank.

A further way in which the coalition Government are going to make a fundamental difference in turning the economy around and reducing unemployment is by making work pay. My hon. Friend the Member for Thurrock (Jackie Doyle-Price) mentioned that the coalition agreement would deliver the Liberal Democrat policy of reducing income tax and taking out of income tax completely those people who are earning up to £10,000 a year. That will be achieved before the end of this Parliament. Our programme of welfare reform and the introduction of universal credit was mentioned earlier by the Chancellor in his confrontation with the shadow Chancellor. The Opposition rather recklessly voted against the entire Welfare Reform Bill.

Reform is also needed in the banks. The Opposition motion calls for a reintroduction of the tax on bankers’ bonuses. It is worth pointing out, however, that the people receiving large bonuses will now pay 50% income tax, rather than 40%, that national insurance has doubled for those on the higher rate of tax, and that employers will pay more national insurance on those bonuses as well. The taxation on those bonuses will certainly increase.

Comprehensive Spending Review

Clive Efford Excerpts

Thursday 28th October 2010 Commons Chamber

[Danny Alexander]

No, I do not think it is fair.

[Clive Efford (Eltham) (Lab)]

I have one simple question: will the Minister confirm that the majority of people on housing benefit are in work?

[Danny Alexander]

Yes; many people on housing benefit are in work. The point of our reform is to say that the fairness should be between people on out-of-work housing benefit gaining the maximum amount, which we will cap at £400 a week, so that that amount is equivalent to what people in work could receive in housing benefit.

Oral Answers to Questions

Clive Efford Excerpts

Tuesday 12th October 2010 Commons Chamber

[Mr Osborne]

Unfortunately, the Parliamentary Secretary to the Treasury, the Government Chief Whip, is not here to listen to that question, but as Ministers in the Government Whips have already taken a 5% pay cut and had their salaries frozen during the Parliament, so they have already shown some restraint. If my hon. Friend wants to catch the ear of the Chief Whip in the Aye Lobby tonight, he can do so.

[Clive Efford (Eltham) (Lab)]

Has the Government Whips Office had cause to contact the Secretary of State for Energy and Climate Change, following his comments last week? Has having the Liberal Democrats as part of the Government increased the costs of the Government Whips Office?

[Mr Osborne]

The presence of the Liberal Democrats in the coalition means that two parties are working together to sort out a problem that one party created.