Danny Alexander
Main Page: Danny Alexander (Liberal Democrat - Inverness, Nairn, Badenoch and Strathspey)Department Debates - View all Danny Alexander's debates with the HM Treasury
(13 years, 9 months ago)
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The Chief Secretary to the Treasury (Danny Alexander)
The structural deficit was 8.8% of GDP in 2009-10. The Office for Budget Responsibility forecast is for it to be 7.6% in 2010-11, falling to 0.3% by 2015-16. More information is in the OBR’s forecast.
Rehman Chishti
OECD figures in November show that Britain entered the financial crisis with the largest structural budget deficit in the G7. Does the Chief Secretary believe that this country entered the crisis led by the biggest deficit deniers in the G7?
Danny Alexander
That is a very good question. The previous Government were running a structural deficit from 2001-02, with a structural deficit of 2.6% in 2007-08, the largest, as the hon. Gentleman says, in the G7 in 2007. They were deficit deniers then, they are deficit deniers now, and that is why they have no answers to the problems of our country today.
John Howell
My right hon. Friend will be aware that Tony Blair has said that
“from 2005 onwards Labour was insufficiently vigorous in limiting or eliminating the potential structural deficit”.
How would my right hon. Friend assess the effect of that failure on the current trend in the structural deficit?
Danny Alexander
Clearly, we as a Government are having to clear up the enormous mess that the previous Government left. That is why we have had to embark on some very difficult decisions on public spending and, indeed, taxation, but it is just worth listening to the OECD, which states that
“the UK was unique in its need for fiscal consolidation, because the deficit had gone completely out of control.
John Cryer (Leyton and Wanstead) (Lab)
On the basis of what the Chief Secretary has just said, why did the current Chancellor promise in 2008 to match Labour’s spending plans?
Danny Alexander
Our country’s key problem—the hon. Gentleman should accept it, not deny it like his Front Benchers—is that we have an enormous budget deficit, which was caused by the previous Government’s failures. We have to clean up that mess if our country is going to get back to prosperity, and, until the Opposition accept that very simple fact, they will have no answers at all.
Mr David Hanson (Delyn) (Lab)
Will the Chief Secretary first confirm that public sector debt was 42.5% in 1997 and 36.5% in 2008, the second-lowest debt of any G7 country? Will he secondly accept that investment during the last two years of the Labour Government was designed to keep people in their jobs and homes, expenditure that he supported at the time? Given the disastrous economic figures and the CBI’s comments before Christmas, will he just admit that what he is missing is a growth strategy, not the cuts that he opposed during the election?
Danny Alexander
What was missing from that was any reference to the subject of the question, which was the deficit. Labour Members seem keen to talk about everything except the deficit, which they left for this Government to clean up. I do not apologise at all for the tough decisions we have had to take to sort out that deficit, to introduce tax rises and to deal with public spending to ensure that this country gets back on track. They maxed out the credit card; we have to pay it off.
Greg Mulholland (Leeds North West) (LD)
6. If he will take steps to allow charities providing services transferred to them by the NHS to recover value added tax.
Jesse Norman (Hereford and South Herefordshire) (Con)
12. What his policy is on transparency in private finance initiative contracts.
The Chief Secretary to the Treasury (Danny Alexander)
The Government are committed to transparency across all areas of public spending, including PFI contracts. All new central Government PFI contracts will be published, and the Treasury website holds PFI statistics that will be updated at the Budget.
Jesse Norman
I thank the Chief Secretary for that answer. Last week, the Ministry of Defence announced that it had chosen three PFI projects as pilots for a wider renegotiation strategy in order to generate a rebate for taxpayers. I and many other Members have warmly welcomed that news. Is my right hon. Friend planning to encourage other Departments to reopen their own PFI contracts to generate future savings?
Danny Alexander
I am grateful for the question, and I certainly support the work that the MOD is doing. We are actively encouraging Departments and local authorities to scrutinise their PFI contracts for savings. As my hon. Friend knows, the Treasury has published draft guidance to help contract managers identify PFI savings, and a pilot will test the savings measures in the contracts, which will help to scope out possible savings and ensure that other Departments can make the same progress as the MOD.
Mr Speaker
Order. I would be grateful if the Chief Secretary could look at the House as he addresses us.
Mr Andrew Love (Edmonton) (Lab/Co-op)
What will the right hon. Gentleman do about the scandal of bunching private finance initiative contracts together and selling them on in the private sector, with no benefit to the public sector? Is he going to take action, and if so, when?
Danny Alexander
As the hon. Gentleman implies, a vast number of PFI contracts were negotiated under the previous Government. If he, in common with any other hon. Members, has examples of low value for money PFI contracts or other concerns, I would be happy to look at them, as I said at the previous Treasury questions. Since then, no hon. Member except my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman) has come forward with such examples. I therefore look forward to hearing from the hon. Gentleman.
Steve Rotheram (Liverpool, Walton) (Lab)
14. What recent assessment he has made of the progress of the work of the Independent Commission on Banking.
James Wharton (Stockton South) (Con)
T4. The 2010 North East Research and Information Partnership annual jobs report shows a net increase in employment in the region of about 1,300 jobs over the past year. What are the Government doing to ensure that the private sector recovery in the regions continues?
The Chief Secretary to the Treasury (Danny Alexander)
The Chancellor announced measures in the Budget on corporation tax and national insurance breaks, particularly for companies in the regions. We have set up local enterprise partnerships, which enable local authorities and businesses to work together to promote their own economic interests, and in due course we will announce the first round of decisions on the regional growth fund, which will help to support exactly the sort of initiatives the hon. Gentleman is concerned about.
Mr William Bain (Glasgow North East) (Lab)
Does the Chancellor agree that any credible strategy for growth must include proposals for a fully capitalised, properly independent green investment bank? Will he assure the House that the Treasury has ceased to act as a roadblock to the creation of such a bank?
Tim Farron (Westmorland and Lonsdale) (LD)
Our mountain rescue teams are staffed by outstanding volunteers doing professional work, but outrageously they have to pay VAT and vehicle excise duty on life-saving equipment. Is it not time that this Government put an end to this and refunded that VAT?
Danny Alexander
My hon. Friend is quite right to celebrate the work of the mountain rescue teams. Of course they face additional equipment costs, and that is why we allocated funds in the spending review to help to support mountain rescue teams with those costs. The Department concerned, the Department for Transport, will make an announcement on this in due course.