Spending Review

Dan Rogerson Excerpts

Wednesday 26th June 2013 Commons Chamber

[Mr Osborne]

My right hon. Friend the Chief Secretary will set out the regional breakdown tomorrow.

[Dan Rogerson (North Cornwall) (LD)]

In his continuing discussions with the Department for Communities and Local Government, the Department of Health and the Home Office, will the Chancellor urge them to follow the example of my right hon. Friend the Minister for Schools in ensuring that money is spent fairly across the whole country?

[Mr Osborne]

Yes.

Beer Duty Escalator

Dan Rogerson Excerpts

Tuesday 5th March 2013 Westminster Hall

[Andrew Griffiths (Burton) (Con)]

I am grateful to be bringing up the rear in the debate today. I am mindful that time is short; it always frustrates me when I sit in a debate and the Minister has less time to contribute than the others who have spoken, so I will keep my comments brief. Everybody knows that I bang on for Britain about beer.

We are at the culmination of a hard-fought campaign to support British brewing and save the great British pint. I do not think that we can overestimate what a perilous situation our brewers and publicans find themselves in. It is for that reason that so many people have come together in support of the campaign. We all recognise how important it is for the future of British society, as well as being an important part of the economy.

[Dan Rogerson (North Cornwall) (LD)]

I am grateful to the hon. Gentleman for giving way. I wish him a gool Peran lowen—a happy St Piran’s day. In regard to his point about traditional British culture, does he agree that the British brewing industry is looked at by other parts of the world for its innovation and the diversity of its products? There is a huge export market and we need to encourage the growth of the brewing industry.

[Andrew Griffiths]

Gool Peran lowen to my hon. Friend. He has been fantastic in supporting the British brewing industry and the all-party beer group. He is right to say that massive innovation is taking place in British brewing. Only this month, a beer innovation summit organised by The Publican’s Morning Advertiser was held in my constituency at St George’s Park. It showed the depth and breadth of new ideas and the potential for the industry to export a great British product overseas. It is interesting that almost 90% of all the beer brewed in this country is drunk in this country. That is because we recognise brilliance and what a great product it is. We can export it overseas and create jobs as a result.

The campaign has brought together the British Beer and Pub Association, the Society of Independent Brewers and the Campaign for Real Ale, and all those we would expect to support the brewing industry, but it has also brought others together. The TaxPayers Alliance has got on board and put together a fantastic campaign—“Mash Beer Tax.” I encourage hon. Members to go online to www.mashbeertax.org. The TaxPayers Alliance has a reputation for standing up for the British taxpayer and has done a great job in getting behind this important campaign.

Hon. Members will have noticed the support we have from The Sun, which has launched its own campaign to scrap the beer duty escalator and save the great British pint. I am sure that the Minister will have noticed the contribution to the debate yesterday, made by Sabine from London on page 3, “News in Briefs.” She railed against the unfairness of the duty that British beer drinkers pay compared with what Spanish beer drinkers pay, and quoted:

“Beer is proof that God loves us and wants us to be happy.”

The Minister could make a great many people across the country happy at the Budget by scraping the hated beer duty escalator.

Let us look at the impact of the beer duty escalator since it was introduced by the previous Government. Sales are down 17% in the off-trade and sales are down 24% in pubs. That equates to 1.5 billion fewer pints sold in pubs across the country. Those are jobs. Every time we do not sell beer, jobs are lost in my constituency and in constituencies across the country.

I notice that we have had a fantastic game of “brewery bingo” today; hon. Members have named the breweries in their constituencies.

Corporate Tax Avoidance

Dan Rogerson Excerpts

Monday 7th January 2013 Commons Chamber

[Dan Rogerson (North Cornwall) (LD)]

I pay tribute to my hon. Friend the Member for Redcar (Ian Swales) for securing the debate, and for the work that he and his colleagues on the Public Accounts Committee do on our behalf to delve a bit deeper into these issues. It is also a pleasure to follow the hon. Member for Amber Valley (Nigel Mills), who made a lot of sensible points.

The hon. Member for Lincoln (Karl MᶜCartney) was a little strident earlier, when he sought to have some political fun within the coalition. I am sure that hon. Members from Northamptonshire would have been proud of him. I thought he was being rather ideological. The Conservatives used to be the party of pragmatism, but his message was that there should be cuts at all costs, and that implementing cuts was the virtuous thing to do. I disagree with that. I believe that if there is something good to be done and the Government have the money to do it, they should spend that money on behalf of the people to try to achieve that goal. I do not think that there is anything inherently good in cuts, but the Government are trying to cut the deficit that we inherited, because it has burdened the country and future generations with huge interest payments and threatened to destabilise the economy. It is therefore the right thing to do.

Pretty nearly all the parties in the House agree that the deficit needs to be reduced over a certain period, but if we are asking people to contribute to that through cuts or through paying tax elsewhere, they need to know that everyone is making a fair contribution. That is understandable. Even though UK Uncut sometimes takes an extreme position and oversells the contribution that could be made to the economy by dealing with this problem more equitably, there is a core of truth in what it says, which is that some organisations are using expensive advice to ensure that they get away with not paying the same contributions as everyone else. As the hon. Member for Hayes and Harlington (John McDonnell) said, those who pay their taxes on a more straightforward basis want to know that everyone else is making a fair contribution.

We represent a diverse economy here in the UK. I represent a small business economy in which it is incredibly difficult for retailers to survive. The hon. Member for Cities of London and Westminster (Mark Field) talked about not wanting our high streets to be homogenous, but we need to be sure that there will be some sort of high street left. I am sure that most of us will have done some online shopping, because it is convenient and helpful, but it cannot be right for small, local businesses to compete under a completely different set of rules from those used by multinationals such as Amazon. We have heard that this is not just about corporation tax, and that the problem exists in relation to other taxes as well. We need to look at the matter across the piece. My hon. Friend the Member for Redcar made that point very well when he framed the debate.

We know why companies avoid paying tax. It is rational behaviour, and we cannot knock them for doing it. An industry has grown up around it because it is legal, rational behaviour. Governments of all political colours have sought to exploit this and to push behaviour in a certain direction. An example is waste policy and the effect of the landfill tax regime, which was used to push behaviour in a particular way. We all bear some responsibility for how we set the terms of the tax regime, but we can also set the culture. The hon. Member for Bognor Regis and Littlehampton (Mr Gibb) mentioned boardroom culture earlier, but this is about the culture of society as a whole. The fact that we are having this debate today is a positive thing. This is not about populism; it is a genuine response to concerns expressed by people who want us to articulate their views.

The coalition has acted to make corporation tax more reasonable, but that will work only if people actually pay it. The trade-off involves ensuring that we have a tighter regime. I agree that we should not move towards a bargaining system in which the final arbiter is public opinion. That is certainly not the way to run a tax system. I praise my right hon. Friend the Chief Secretary to the Treasury and his colleagues for investing in the areas of Her Majesty’s Revenue and Customs that carry out such work, because that is where the battle must be fought and won. Yes, the solution involves the legal framework, but it is also about HMRC having the resources to implement the measures.

It is no accident that we are in this situation. Previous Governments have preferred not to discuss the matter, because big business has a seat at the top table and has been able to lobby effectively. It has made the case that everything it does is good and everything it touches turns to gold, and that it should therefore be left alone to get on with it. I think the culture has changed at this time of austerity in favour of delving a little deeper and saying, “No, that is not the case. Where you do good, we will be partners in rewarding it and ensuring that our economy works, but where you are trying to pull one over on us, we will invest in the resources through HMRC to get the job done.”

The hon. Member for Hayes and Harlington was absolutely right to highlight the closure of tax offices under the last Government. I lost the battle to save my local office in North Cornwall, even though our compliance officers had a great deal of skill at doing such work. If it had been argued that their work could be done more efficiently so that the bigger corporations could be looked at, we could have retrained those people and they could still have been based out in the regions—as Amazon showed, it does not really matter where people are based; the trade will keep coming if things are managed effectively. It is a great shame that we lost that expertise, but that is now ancient history, as we are where we are.

It is clear that the sums involved are highly significant and that previous Governments have been too timid in tackling the problem. We are now having an open and public debate—both here tonight and out in the country—which I welcome. I look to the Minister to set out his determination to tackle the problem, invest the resources in HMRC and ensure that we tighten up the regulations where possible.

[Karl MᶜCartney]

rose—

[Dan Rogerson]

I am afraid that I cannot give way.

Significantly and finally, we must work with our international partners to set up an international framework for a culture in which companies pay for the profit they make and work effectively and in harmony with Government to achieve prosperity in the way that most people would expect.

Cornwall (Government Funding)

Dan Rogerson Excerpts

Tuesday 18th December 2012 Westminster Hall

[Dan Rogerson (North Cornwall) (LD)]

It is a pleasure to speak under your chairmanship, Mr Gray. I am delighted to see the Minister in the Chamber and am grateful for his presence.

My topic is funding, generally, across Departments for public services in Cornwall and investment in it. The Duchy of Cornwall is peripheral to the rest of the United Kingdom, although it could be argued that the rest of the United Kingdom is peripheral to Cornwall, as I would tend to, in reference to the headline about the continent being cut off by fog. Cornwall has a proud history of independent spirit, resourcefulness and, surprisingly to some, given its rural nature, was one of the early areas in which the industrial revolution took place. Mining in particular and engineering in mining, and ideas from that, were exported—as were the miners—around the world. People of Cornish descent are found in South Africa, south Australia and Mexico, where the links between Cornwall and parts of Mexico where silver mining was undertaken by Cornish miners have recently been rekindled. Hon. Members will be delighted to know that they can buy a pasty in those parts of Mexico, although the fillings are slightly different from those we are used to in the traditional Cornish variety.

The population of Cornwall is just over 500,000. The recent census data show that people were keen to mark their Cornish identity. I am delighted that the Office for National Statistics allowed people to do that last time, although there was no tick box, despite my best efforts. Even though they had to know to tick “Other” and write it, more than 80,000 people, not all of whom were in Cornwall, decided to do that.

There is a significant population in a peripheral location that is, although the history of Cornwall is not just about the rural idyll, in many cases dispersed across the peninsula. There are challenges to providing services that are also experienced by other rural areas. Traditionally, there has been a lot of investment and involvement in primary resource-based industries, such as mining, fishing and farming, and also in engineering and manufacturing. There are still innovative manufacturers. There is now a lot more food processing in the area, which seeks to add value to the food that is grown. The manufacturer Zoeftig, a business in my constituency, makes airport seating that is also used in bus stations, and so on, all over the world, including in Australia. It was recently looking at contracts in the middle east and far east. All hon. Members should welcome the fact that a company in my constituency is exporting to China.

Tourism is important, too. The quality of the tourist offer has improved greatly. The food has changed beyond all recognition from the image of British food generally in the 1970s. The food manufactured in and exported from Cornwall is a strong brand and the restaurants are one of the many reasons that people holiday there.

We seek to benefit from the creative industries. Investment in broadband in Cornwall allows people to undertake such aspects of work far more. People relocate to Cornwall for the quality of life, bringing their businesses and creativity with them, which is all to the good.

Cornwall has received European structural fund money, first, through the objective 1 programme and, more recently, through convergence. That has had an effect and post-2013 we will, potentially, be in line for more of that European funding, although the details will have to be negotiated between the Government and the European Union. That is not something that we are proud of, but it is a stated fact that the European Union recognises the position of Cornwall and the need for extra investment to allow it to catch up with other parts of the United Kingdom. The Government have also recognised that, most recently in the Chancellor’s autumn statement announcement on investment in infrastructure.

We are delighted that the A30 at Temple will be upgraded in the next few years and that the local authority are matching the money invested by Government through the Department for Transport, meaning that that infamous bottleneck, known by those who have visited Cornwall, will be dealt with. This is all to the good. However, a trend across many decades—it is not a new phenomenon; it has been there for a long time—is that various public services in Cornwall have received less public funding than those in other parts of the country. Historically, school per pupil funding, towards the tail end of the previous Parliament, was about £300 to £350 less than the national average.

We have similar problems with the grant from the Department for Communities and Local Government. In theory, we have a fair allocation but, historically, it does not take into account rurality, which is a key element for us across a range of services. The cost of providing services is increased because—as you may be familiar with in Wiltshire, Mr Gray—the dispersed populations mean that we have to replicate some services in a number of small market towns.

In policing, we ought to look at the issue of visitor numbers, which are not taken into account in the policing formula. There have been problems in Newquay—part of my constituency in the previous Parliament, but now in the neighbouring constituency of my hon. Friend the Member for St Austell and Newquay (Stephen Gilbert)—which receives a big influx of young people in the summer. Huge steps have been taken to overcome some of the problems, but the costs of such initiatives are not reflected in the policing grant.

In policing as in other areas, the formula predicts that Cornwall ought to receive a certain amount of money, but it does not get it, so the infamous damping process comes into play. Although a distance from target is recognised, we never quite reach it because it is too difficult to take away money from overfunded areas to give it to underfunded ones. Last week, my hon. Friend the Member for St Ives (Andrew George) secured a debate on the specific aspect of health funding in Cornwall. He pointed out that from 2006 to 2012, according to Government figures, Cornwall was in receipt of £201 million less than the target. The money has gone up and there has been investment, but we are still a distance away from where we should be.

The funding formula is the first port of call for any MP looking at how his or her area is affected and at whether it is disadvantaged in some way. The key elements, which I have referred to in part, are worth exploring.

First, on deprivation, the funding formulas throughout the various Departments tend to look at the high cost of providing services to reach deeper into such communities and to support their people to achieve what they should be achieving and to overcome barriers. Deprivation is readily identified in the larger urban areas so, historically, Governments have tended to put money into those areas—quite rightly—to deal with their problems. In an area such as Cornwall, however, deprivation is sometimes harder to see. People who come on holiday will see the beautiful coast and what they imagine to be an idyllic lifestyle, but they are not as familiar with the low incomes or the high housing costs, in part driven by the large number of second homes. As the census figures revealed, Cornwall is by far the local authority area with the highest number of second homes, and that has a real impact on the housing market.

Historically, peripherality has been an issue with regard to transport costs. Although the level of aspiration might have been low in the past, I am delighted to say that that is changing: most Cornish families aspire hugely to see their young people do well. In many cases that means leaving Cornwall and going to do things elsewhere, which is fine—it is all part of the experience of growing up—but it would be good if there were opportunities for those young people to come back, relocate and bring their skills with them.

The second issue is sparsity. To provide a decent level of service, it must be provided not only in a central, readily accessible location but replicated in several market towns throughout the area, adding to the cost. In difficult times, when the public sector must do things as efficiently as possible, it might retract a little to core areas and expect users to travel greater distances to access services. Some people are in a position to travel those greater distances, but some are not.

The geography of Cornwall is such that on three sides, at three points of the compass, there is water. We cannot call many neighbours across the border to help. If there is an incident or problem, we have the border with Devon and that is it. Cornwall also gives support and help to the neighbouring authority of the Isles of Scilly, whose choices of where to go, what to do and who to call on are even more limited than ours. Peripherality, therefore, has a direct effect, such as for fire and rescue services. The delightful county of Bedfordshire, where I lived for a number of years, is centrally located and so, if there is an incident, it can call on neighbouring forces for help, but we cannot do that in Cornwall, other than for help for those on the rural border with Devon.

The first port of call for a lobbying MP is to consider the funding formula, which is what we are doing. I have been working alongside the hon. Member for Beverley and Holderness (Mr Stuart), the Chair of the Select Committee on Education, in his examination of the issue of rural funding and rurality. We have asked Government, across Departments, about what they might do to reflect better our circumstances on the ground. We have had some success, and I am delighted that the coalition Government have made steps in that direction, looking at school funding to deal with unfairness and at how rurality can be reflected in localisation of business rates. So, success, wonderful, problem solved! However, we then come back to the dreadful damping business.

I accept that when money and investment in the public sector are restricted, it is harder to deal with the issue than at times of more cash being about, when one can ensure that areas that are behind catch up a little more quickly with areas that are ahead of where they should be. Unfortunately, such levelling-off did not happen under the previous Government when money was going in and they seemed to feel that a lot of it was around, so the gap remained. Now the coalition is having to deal with the deficit and to take some difficult funding decisions, so I accept that things are harder. My constituents, and those in other areas of the country with similar problems, expect a direction of travel according to which funding begins to approach where the target says we should be.

I called for the debate and asked for a Treasury Minister to respond because a number of Departments have a similar problem. Rather than have the same debate several times, I was hoping to suggest to the Minister that, when he talks to his hon. Friends in other Departments and has difficult discussions about the amount of money available and using it efficiently to get the most impact from investment in public services, he should say on the issue of damping, “We are giving you this money to deliver services throughout the country. You have quite rightly reviewed the formula by which you allocate that money to ensure that areas are getting what they need, what is fair and what constituents presumably feel entitled to. Also, where there is a gap between that target and the reality, there needs to be a direction of travel.” Over the next few years, therefore, we will be able to see some genuine gains for areas such as Cornwall—a bit late for the current spending review, but perhaps setting out progress towards the next one.

The Government are making capital investment and there is the prospect of a little more investment through European Union structural funds but, in addition, I hope that Cornwall can aspire to get the money to which it is entitled for policing, local government, health and education. Flooding is another, related example, which was mentioned to me by the local authority. Sadly, as elsewhere in the country, we have had some problems with flooding in Cornwall, although not in my constituency. The Bellwin formula used by the Department for Environment, Food and Rural Affairs to give extra support to local areas operates on the basis of local authorities. In an area such as ours, where we now have a unitary authority, we have only one allocation for the council, whereas with two-tier authorities district councils are involved as well, which gives those areas more flexibility and more money per head of population. It is another example of how areas that have sought to be more efficient—unitary authorities, in times of public spending difficulty, have undoubtedly created efficiencies—are penalised when they seek to offer maximum support to communities that have suffered tragic flooding episodes.

I am grateful, Mr Gray, for the opportunity to raise this matter, and I hope that the Minister can address my concerns, particularly on damping, so that we can move towards obtaining the funding to which Cornwall and similar areas are entitled.

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

I am grateful for the opportunity to speak again under your chairmanship, Mr Gray, and to discuss the issues raised by my hon. Friend the Member for North Cornwall (Dan Rogerson). I congratulate him on securing this debate. He has been a vociferous campaigner for all things Cornish—the Cornish economy, the Cornish language and, more recently, the Cornish pasty. I am pleased to discuss Government funding for Cornwall today.

I will turn specifically to funding in my hon. Friend’s region shortly, but first I should like to talk more generally about the way in which Government funding is allocated throughout the UK, and to describe the changes we are making to encourage growth at national and regional levels. The 2010 spending review set out how the Government would carry out the UK’s deficit reduction plan over four years, and included fixed departmental budgets. We protected spending on the NHS, schools, and overseas aid, and we chose to prioritise fairness and social mobility, to focus on spending that promotes long-term economic growth, to reform public services, to shift power away from central Government to local level, and to improve value for money.

Some of those decisions at national level will have a significant impact in Cornwall. Having enjoyed a splendid holiday in my hon. Friend’s constituency a couple of years ago, I know that tourism is of considerable importance to Cornwall, although he is right to point out that its economy is much more than merely tourism; it is more diverse than that. We invested in the “Great” campaign, which was launched to deliver long-term trade and tourism benefits throughout Great Britain, and I am sure that Cornwall will benefit significantly from that.

The most important decisions for Cornwall have been those on local authority expenditure in the region—a point that my hon. Friend raised. Local authority expenditure is split between grants from central Departments, which are set in the spending review, and localised expenditure, which is largely funded by council tax. I am sure my hon. Friend will be pleased to note that during the current settlement period, Cornwall’s reductions in spending power have been smaller than the average in England. Spending power in the county fell by minus 3.3% in 2011-12 and minus 2.9% in 2012-13, compared with an average of minus 4.5% and then minus 3.3% for councils in England. I want to turn to the point my hon. Friend raised about the damping mechanism.

[Dan Rogerson]

I did not use all the time I might have done, so I hope that we can continue our discussion a little further. The problem for some areas such as Cornwall is that historically the council was run by independents who took a firm view on keeping the old rates down, so historically the area has low council tax, compared with counties such as Surrey. The Government are seeking to limit the impact of council tax rises—they have extended proposals for that through the Department for Communities and Local Government—but our base is already low, so there is an impact from that as well as the central grant.

[Mr Gauke]

My hon. Friend raises a fair point, and has put it on the record. I recognise that councils that have, over many years, shown greater determination to control their costs have less fat that can be cut than other authorities where that has not been the case.

On the damping mechanism, it is right that the Government must balance the interests of places with growing and declining needs, and Cornwall is an area with growing needs. Damping has been used to avoid steep jumps in council tax and demands on areas with declining needs. DCLG has consulted on a new funding system from 2013, and the Government have indicated that we want to move away from damping. My hon. Friend referred to rurality, and asked whether that is taken sufficiently into account. Again, DCLG has consulted on changes to the formula, and he will be aware that it will publish the draft local government finance settlement for 2013-14 for consultation shortly. It will set out funding amounts for each authority, and I am sure that my hon. Friend will be interested to read it. It will shed some new light on damping. I hope that he finds that helpful.

The formula exists for a reason—to strike a balance between the needs of areas with growing and declining populations—and it seeks to make an assessment that strikes that balance. We will say more about that shortly.

[Dan Rogerson]

Another area that the National Audit Office highlighted in its report on academy schools, particularly the early academies that were set up under the previous Government, is the generous settlement they were given, perhaps to encourage people to take a new step. However, as the number of academies has risen, there is an issue with that funding, which is perhaps over-generous compared with that for maintained schools. The report acknowledges that gap and the need for convergence, and the Minister’s ministerial colleague, Lord Hill, talked to us about that. The issue is the direction of travel, because the damping effect will be difficult to achieve.

[Mr Gauke]

All I would say about that is that the Department for Education is also looking at the school funding formula in the light of some of those issues, and I am sure that Education Ministers will respond in due course.

Until now, the main local authority grant from central Departments has been a formula grant distributed by DCLG through local government finance settlements. In line with our priority of encouraging growth, from April 2013, we will replace the current fairly complex formula grant regime with a business rates retention scheme to help provide a stronger local growth incentive. Councils that succeed in growing their local economy will have a direct boost to their coffers. Quite simply, the rationale behind the change is that we want to give individual councils, including those in Cornwall, every opportunity to promote growth. We want them to use their influence in planning, their investment in skills and infrastructure, and their relationship with local businesses to create the right conditions for local economic growth. This year’s local government finance settlement from April 2013 will be the first under the new arrangements.

The new scheme incorporates strong protections as well as incentives. There will be a safety net for places that, in any year, see their income from business rates fall by more than 7.5% below their baseline funding level. Following consultation, we have strengthened the incentive by ensuring that the maximum levy will be capped at 50p in the pound. That will mean that at least 25p in every pound of growth will be retained locally, and shared between billing authorities and any major precepting authorities. Recent economic analysis, carried out by DCLG, suggests that the proposals could deliver a £10 billion boost to gross domestic product by 2020. Obviously, that figure covers the whole UK, but the change will, I am sure, mean real benefit in Cornwall.

Having set out how the system works and the improvements that we are making, I shall quickly discuss the measures announced in this year’s autumn statement. Then I shall deal specifically with Cornwall. The autumn statement from my right hon. Friend the Chancellor of the Exchequer contained measures to do three things: first, to protect the economy; secondly, to promote growth; and thirdly, to ensure fairness. As part of that statement, we have had to ask all areas of Government, including local authorities, to go further. For most areas of Government, that means an additional top-slice of 1% in 2013-14 and 2% in 2014-15. However, recognising that local authorities are already receiving a funding reduction from holding down council tax in 2013-14, and to support them in transforming services to meet future reductions, we took the decision to exempt local government from the top-slice in 2013-14.

However, looking towards long-term economic stability, we needed to be wary. Local government spending accounts for about one quarter of all public expenditure, so we have asked local government to join other Departments in absorbing the 2% cut to departmental expenditure limit grants in 2014-15—that is £447 million—and prepare for further reductions. The savings made thus far on administration, property costs and IT services across Whitehall have proven that significant savings can be found, and those savings will have a significant impact for the whole UK, because it was through them that we were able to announce a number of measures that will have positive impacts across the UK, including in Cornwall.

[Dan Rogerson]

I am grateful to the Minister for setting out the approach that the Treasury is taking in negotiation with other Departments. He is right to point out that local government is doing all that it can to achieve the targets, which are quite challenging. He refers to the potential reduction in future years of 2%. In line with the concept of fairness, which is at the heart of what the coalition is trying to do across income levels, is the geographical issue also being considered, so that those local authorities that have been more disadvantaged, as he acknowledged earlier, might feel slightly less of that pain than those that have been over-funded historically?

[Mr Gauke]

Again, I am inclined to refer my hon. Friend to the DCLG announcement to be made very shortly on the local government formula, and the consultation that will follow. I have no doubt that he will look closely at that. I do not think that he will have too long to wait before he has the opportunity to do so.

It is worth pointing out that the difficult decisions that we have made enable us to take a number of steps that will benefit the country as a whole, including Cornwall and the rest of the south-west. For example, the further increase in the personal allowance will benefit 2.1 million people in the south-west, lifting an additional 20,000 people out of income tax entirely; and 1.2 million pensioners will benefit from an additional £2.70 a week increase in the state pension. The significant temporary increase in the annual investment allowance from £25,000 to £250,000 will help businesses across the south-west.

We announced £300 million of additional investment in empty homes and affordable homes across England. I know that housing is an important issue in Cornwall, and my hon. Friend has raised it. That announcement is in addition to more than £150 million of planned investment to build more than 9,000 new affordable homes in the south-west and return about 500 empty homes to use across the south and south-west.

We will invest further in flood defences—another point raised by my hon. Friend—and, significantly for households and businesses in Cornwall, we are cancelling the fuel duty rise planned for January 2013. That will help the owners of the 3.5 million motor vehicles in the south-west, saving a typical driver £40 a year and a haulier £1,200 a year. However, as my hon. Friend mentioned, that is not the only good news for motorists in and around his constituency. The autumn statement announced a number of key infrastructure projects, one of which involves the £30 million that we will contribute towards a 2.6 mile dualling of the single carriageway section of the A30 between Temple and Higher Carblake, which will include changes to junctions.

[Dan Rogerson]

I am grateful to the Minister for giving way again. He is being extremely generous, as was the Treasury with the project that he describes, although I have to acknowledge that half the costs will be funded locally, through local authorities. That is an excellent example of what he was talking about earlier: £30 million is coming from central Government and £30 million from local government. He also raised the issue of fuel duty. Again, I welcome the Government’s decision on that. I understand that they are also having discussions with the European Union in relation to what it has done for islands, such as the Isles of Scilly in the constituency of my hon. Friend the Member for St Ives (Andrew George), and whether rural parts of mainland Britain could also benefit from a further reduction—

[Andrew George (St Ives) (LD)]

Of 5p.

[Dan Rogerson]

A 5p reduction. That would have a huge impact, particularly on small businesses in my constituency. I urge the Minister to redouble his efforts to secure that.

[Mr Gauke]

My hon. Friend is right to say that we are having further discussions with the European Commission about that. Obviously, we will update the House as soon as we are able to do so. However, I do not want to leave the A30 just yet—not a comment that people often make. The scheme to which I referred, and for which I know my hon. Friend has campaigned long and hard, will relieve congestion and improve journey times. It will also attract business growth and inward investment to Cornwall by improving links to the rest of England. The Government welcome the commitment from Cornwall council, to which my hon. Friend alluded, to deliver and part-fund the scheme on behalf of the Secretary of State. Its drive in taking the scheme forward demonstrates how much of a priority it is to the council and to Cornwall generally. Work on the scheme is set to start in 2014-15, subject to the completion of planning processes and funding agreements, and the road is due to be open to traffic in 2016. I am sure that it will bring real benefits to the area.

My hon. Friend may feel that my contribution took a long time to reach Cornwall, and I am sure that is a feeling that many motorists will at times sympathise with. However, it is important for us to look at the national context of spending and the impacts that decisions made at that level will have in each region. I hope that my comments have been useful in laying out the Government’s position.

The Economy

Dan Rogerson Excerpts

Tuesday 11th December 2012 Commons Chamber

[Danny Alexander]

The hon. Lady will know that HMRC has had to make efficiency savings along with the rest of the Government. It had to make savings when the Labour party was in office and it continues to have to do that. We have increased investment specifically in the part of HMRC focused on tackling tax avoidance and evasion—an area that saw underinvestment during Labour’s time in office. As a result, 2,000 extra specialist tax inspectors—[Interruption.] My hon. Friend the Exchequer Secretary to the Treasury brings me up to date and tells me that the figure is 2,500. Those inspectors are specifically focused on tackling tax avoidance in the affluence unit and those units that focus on offshore companies and all other tax avoidance schemes, and on implementing the anti-avoidance rule.

[Dan Rogerson (North Cornwall) (LD)]

Will my hon. Friend give way?

[Danny Alexander]

I will give way one more time and then I will move on.

[Dan Rogerson]

I am grateful to my right hon. Friend, not least for his response to Cornwall’s call for investment in the A30 infrastructure project and his earlier kind words. Does he recall that when in opposition we had to watch the then Labour Government cutting and closing HMRC offices in a lot of regions around the country, and putting on the scrap heap a lot of skilled tax inspectors, the benefit of whose experience we sadly no longer have?

[Danny Alexander]

As always, my hon. Friend makes a good point. We need people with experience in compliance and enforcement, and we are expanding employment in those areas. That is the right thing to do and it should have been done a long time ago.

The previous Government set out plans to increase fuel duty above inflation last year, this year and again in 2013 and 2014. However, as a result of repeated action by this Government, pump prices will remain at least 10p per litre lower for the remainder of this Parliament than they would have been had the Labour party remained in government.

Oral Answers to Questions

Dan Rogerson Excerpts

Tuesday 11th December 2012 Commons Chamber

[Greg Clark]

I welcome the hon. Gentleman to the Chamber. When he organised a day think tank, he and I had some very productive exchanges. I should be happy to meet him to discuss the situation in Corby, which is an enterprising town with the potential to create many jobs. As he will know, under the “city deals” system I am responsible for devolving powers to places throughout the country, and I am keen to receive more applications.

[Dan Rogerson (North Cornwall) (LD)]

A significant factor for young people seeking work in rural areas is the cost of transport and fuel. I therefore welcome last week’s announcement, and also the news that the Treasury is considering extending the rural islands fuel discount to some especially rural parts of the mainland. Such a change would make a huge difference to some of the poorest communities in the United Kingdom, and would encourage growth in employment.

[Greg Clark]

My hon. Friend is absolutely right: that is one of the reasons why we were determined to reverse, and then to cancel, the fuel tax increase proposed by the Labour party. As for the rural scheme that he mentioned, we are having conversations with the European Commission in order to establish whether we can proceed with it.

Fuel Duty

Dan Rogerson Excerpts

Monday 12th November 2012 Commons Chamber

[Sajid Javid]

As always, my hon. Friend is absolutely right. I will come to that later.

In the Budgets of 2009 and 2010, the shadow Chancellor and his colleagues endorsed seven rises in fuel duty between 2010 and 2014.

[Dan Rogerson (North Cornwall) (LD)]

The Minister finds himself in a strange set of circumstances whereby he is having to take the Opposition’s advice to abandon the policy that they pursued in government. What does he think it will be next—returning the top rate of income tax to the 40% that it was for most of their time in office, or perhaps reintroducing the 10p rate?

[Sajid Javid]

My hon. Friend is absolutely right to point out that the Opposition are all over the place.

If we had found a way to halt all the rises that Labour had planned, we would have done so, but if we had gone ahead with its plans, fuel duty would have continued to rise. Fuel would be 10p per litre more expensive by now, costing the average Ford Focus driver £159 extra by April 2013. Let us put to bed once and for all the idea that Labour is the party fighting to support people on the cost of living.

Beer Duty Escalator

Dan Rogerson Excerpts

Thursday 1st November 2012 Commons Chamber

[Mr Wright]

I absolutely agree with the hon. Gentleman. If manufacturing is to be an important part of this country’s economic base, with small and medium-sized enterprises forming a key part of that, the food and drink sector—of which microbreweries have to be an essential and growing component—will be vital to that.

I have listened closely to other hon. Members’ contributions to this debate, which has been fair and balanced. It is unreasonable to suggest that beer duty is the sole reason that the pub and beer trade is facing difficulties. There are long-term social and economic forces at work. Over the past 30 years, people have switched away from beer to wine in their alcohol consumption. That is true not just in Britain, but throughout western Europe and the United States. Significantly—this point has been touched on many times in the debate, but it is worth repeating—people are now consuming alcohol in their homes rather than in pubs. In fact, some 70% of the alcohol purchased in the UK is bought for consumption at home. Traditionally, 30 or 40 years ago, people probably bought alcohol only in a pub; now, it is far more likely that beer will be bought in a supermarket.

[Dan Rogerson (North Cornwall) (LD)]

Will the hon. Gentleman give way?

[Mr Wright]

Just because I went through the Education Bill Committee with the hon. Gentleman—we had nightmares together—I will give way.

[Dan Rogerson]

The hon. Gentleman is making a good point about wine drinking in the home. Does he agree that, because wine has a much higher alcohol content and because people are often drinking not in pub measures but in much larger glasses at home, the health issues are a result more of wine and spirits than of beer, which has a much lower alcohol content?

[Mr Wright]

The hon. Gentleman makes an important point. Among even the strongest beers and ales, Cameron’s 6th Sense, which I mentioned earlier, is only 6%, but some of the bottles of wine that are being consumed in one go at home can be 13% or 14%. That has health implications, as does the departure from responsible and supervised drinking in pubs.

The switch from on-trade to off-trade purchase and consumption via the supermarkets has had major effects on the pub industry. The Treasury’s own analysis of alcohol consumption in the UK, which was published in December 2010, showed enormous price elasticity for off-trade beer. That illustrates the enormous competition between supermarkets, the price wars that are going on and the cutting of margins on beer by supermarkets, all to the detriment of the pub trade.

Pubs have an enormous disadvantage, in that they tend not to have the buying power, or the ability to achieve economies of scale, of the major supermarkets, and the nature of their business model means that they have to pass on increases in prices—whether in the form of additional duty, increased VAT or rises in the cost of raw materials—directly to the consumer. Supermarkets are, by and large, able to cross-subsidise, as the hon. Member for Shipley (Philip Davies) pointed out, and they often have the ability to absorb any price rises. Beers can even be used as loss leaders to encourage shoppers, a practice that the pubs cannot afford to compete with.

These problems arise not just from the beer duty escalator but from rises in raw material prices, and there must be concern that beer prices will rise still further because of the recent wet summer, which has had an impact on barley crops, and the increase in VAT last year by the Government. The rise in VAT must have put an extra 5p or 6p on the price of a pint, which in turn will put additional pressure on the viability of pubs. Has the Minister looked at the impact on pubs of that VAT rise, of the rises in barley prices and of the beer duty escalator?

On the point about raising revenue, it was estimated when the beer duty escalator was introduced in 2008 that it would generate between £500 million and £600 million for the Exchequer. Given the difficulties since then, and the squeeze on household incomes, has it actually generated that much revenue? What cost-benefit analysis has the Treasury put in place to determine whether the escalator is raising revenue for the Exchequer to the detriment of local economies and local pubs?

I appreciate that the duty is, and should be, a source of revenue for the Exchequer—about 2% of all Government receipts. I appreciate that beer has generated revenue for the Treasury for centuries, to the dismay of beer drinkers everywhere, and that it will continue to do so. I also appreciate that, in a free country, the manner in which people wish to consume a legal product is up to them and not up to the Government. If somebody wants to drink beer bought from the supermarket in their front room while watching the football or a film and having a takeaway, without causing any hassle or intimidation to anybody else, that is entirely up to them. However—this is my key point—if we as a country value the social and economic importance of the pub as a focal point for the community and a means of encouraging responsible and supervised drinking, what steps can the Government take to nudge consumers towards drinking beer in pubs?

In responding, will the Minister set out how he proposes to tackle the growing gulf in prices between pints in pubs and beer in supermarkets? I am not suggesting that he attempts to turn back the tide of social trends over the past 30 years, but I hope he will tell us how the Government value the pub as one of the great British institutions and how he will work with his colleagues, using the tax system, beer duty and any other means at his disposal, to ensure that the pubs and brewing industries of Britain have a brighter and longer-term future as part of a revitalised manufacturing base. I think we would all drink to that.

--- Later in debate ---

[Dan Rogerson (North Cornwall) (LD)]

It is a pleasure to follow the hon. Member for Bedford (Richard Fuller). As a Cornish exile in Bedford for a number of years, I am well aware of the great contribution that Charles Wells, and Wells and Young’s, make to the economy. I once saw the Blues beat Newcastle at Goldington Road, and I wish them every success this weekend.

Beer is part of the culture of this country. I do not mean that in the sense that the tabloid press would have us see it in focusing on the sad events we see on streets around the country, when most of the problem is not due to beer but to alcopops and novelty drinks, irresponsible promotions in the night-time economy, and people pre-loading before they go out in the evening. I am talking about the centuries of beer culture that we have in this country in producing an incredible, natural product. When the water was not safe to drink, beer was, and people would brew it at home. In the Victorian era, there was a huge growth in regional and family brewers, which—those that remain—are well- loved institutions in the parts of the country that they inhabit.

The pub is very much at the heart of the community, whether in a village or in an urban neighbourhood. In North Cornwall, they are where charitable events take place and huge amounts of money are raised, where clubs and societies meet, and where the fabric of the local community is stitched together. I was recently at The Bullers Arms in Marhamchurch, where the owner of the pub, having lost his most recent tenant, is concerned about its future and putting forward plans to build housing on part of the site. People in the village are very worried, but I know that by coming together they will guarantee the future of that pub and keep it there.

I am very fortunate to have in my constituency such small, innovative brewers as Penpont and Tintagel, and, more recently, Harbour brewery on the edge of Bodmin, and Frys. That is adding to the diversity of the beers on offer to local people and visitors to the area alike. We also have a great success story in Sharp’s, which was acquired a couple of years ago by Molson Coors. I was apprehensive about that. I feared, as did many local people, that it would buy the brands and shut the brewery down, but it did not. Instead, it has invested in those brands, and Doom Bar is now a fast-growing brand across the country. It has also created jobs for young people who are now getting into a career in brewing. It has brought increasing numbers of skilled jobs to the low-wage economy of North Cornwall. We need to underpin the industry by supporting pubs but supporting brewing too.

We have heard about the growth in wine drinking, which has happened without the need for any economic support. Can you imagine, Mr Deputy Speaker, a similar situation in France or Italy, with the wine industry needing to have a debate to try to get support from its own Government? I cannot imagine such a scenario, so why do we need to have a debate about the urgent need to support our brewing industry, which is the equivalent in this country?

Because our beer industry is so innovative and forward looking, with the growth in craft brewing, many people from across the world are coming here to learn these skills. As a result, we now see craft brewing in places such as Italy, America, Australia and New Zealand, where people look to the styles of beer that we brew—the stouts, the milds, the IPAs, and all those kinds of products. We must be proud of the contribution that our beer is making to the culture of the world, let alone the culture of this country. It would be such a small thing for the Government to take account of that by getting rid of this punitive and unrealistic levy on a core industry that could create many more jobs and do far more to underpin the lives of our towns and villages. I urge the Minister to listen to what everybody has said today.

Infrastructure (Financial Assistance) Bill

Dan Rogerson Excerpts

Monday 17th September 2012 Commons Chamber

[Danny Alexander]

I am advised that that is not correct, but if the hon. Gentleman wishes to enter into correspondence on the matter, I shall gladly follow it up.

[Dan Rogerson (North Cornwall) (LD)]

I am pleased that the Government are doing more to build on the work that they have done to invest in infrastructure and to encourage investment for other projects. I hope that many hon. Members visited Cornwall over the summer. If so, they might well be familiar with the Temple to Higher Carblake stretch of the A30 on Bodmin moor, which is not dualled. The road on both sides of that stretch is dualled. Local proposals have been made to come up with funding that can be put with Government funding to take the dualling scheme forward. I hope the Chief Secretary will ensure that this legislation will help to unlock local sources of funding to take such projects forward.

[Danny Alexander]

I had the pleasure of spending some time in Cornwall earlier this year, and of driving down that stretch of road. I understand the case that my hon. Friend makes. It has been made to me by Cornish colleagues from both coalition parties, and we will of course look sympathetically at any requests that might be made. It is always welcome to see local funding coming forward, and to see a local area taking responsibility for what it wants to do.

Beer Duty Escalator

Dan Rogerson Excerpts

Monday 2nd July 2012 Commons Chamber

[Miss Smith]

I hear the hon. Gentleman’s argument and pay tribute to him for his work with his all-party group. Let me answer his question with the main question posed at the end of the speech made by my hon. Friend: I would of course be happy to meet hon. Members who are present tonight to discuss these matters further.

There are many points to go into—more, I regret to say, than I have time for. The key point that I must make first is that the duty increases that we are talking about—the increases through to 2014-15—form a vital part of the Government’s plan to tackle the debt left by the previous Government. It would be worse for everybody if we did not tackle that debt. When I say “everybody”, I mean beer drinkers, cider drinkers, spirit drinkers, wine drinkers, brewers, publicans and, of course, all those who never touch a drop. The high interest rates that would result if we abandoned our credible plan to tackle the deficit would not help anybody.

[Dan Rogerson (North Cornwall) (LD)]

The Minister will no doubt have seen in the business section of The Times today the piece on the Sharp’s brewery in Rock. Doom Bar is now a famous brand around the country, and is enjoyed, the article tells us, by the Prime Minister. The Minister has rightly set out the situation facing the country. However, the brewing industry is very keen to take on young people, train them up, and give them a career. That is what Sharp’s is doing. Does she agree that being more sympathetic on beer duty might allow companies to invest in taking on more employees?

[Miss Smith]

Again, a fine point is made. I am the first to support the notion of encouraging young people into work and work experience, but we have to be realistic. The Treasury and the Government face a number of proposals from different industries that say, “Ours is the industry that holds the key,” and I am sympathetic to those arguments. There is, of course, much evidence to go into for all such proposals, but it is important to proceed as a responsible Government, and to try to take into account the revenue that is required to fund vital public services and that, as I say, helps everybody.