David Gauke
Main Page: David Gauke (Independent - South West Hertfordshire)Department Debates - View all David Gauke's debates with the HM Treasury
(8 years ago)
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The Chief Secretary to the Treasury (Mr David Gauke)
I beg to move an amendment, to leave out from “House” to the end of the Question and add:
“affirms that introducing tax-free childcare, increasing the national living wage, increasing investment in affordable housing, reducing the universal credit taper, boosting investment in schools to create more good school places and taking 1.3 million individuals out of paying income tax so far this Parliament will benefit all genders and races; welcomes the fact that there are more women in work than ever before; further welcomes the Government’s publication of distributional analysis along with the Autumn Statement 2016; and welcomes the action the Government is taking to develop a strong economy that works for everyone, regardless of their background.”
It is a great pleasure to move an amendment in the name of a female Prime Minister. It is the Government’s foremost aim to make sure that this is a country that works for everyone in our society, wherever they are from, and whatever their gender, race, age or background. To deliver that objective, we need to build a strong and stable economy by boosting productivity, creating jobs, and bringing our public finances under control. That is how we will be in the best position to create a sustained rise in living standards for all British people. Our entire economic approach is based on a determination to make people better off now and in future, in all parts of the UK, and across the full breadth of our society. That is why we reject the assumptions in the motion and believe instead that the plans that we have set out will deliver a stronger economy that works for everyone.
I want to reflect on the measures that we have taken to strengthen our economy in this way, because people, regardless of their race or gender will benefit from our work to restore the economy to long-term health, which begins with bringing our public finances under control. With UK debt soon reaching a 50-year high of 90.2% of GDP, we must pursue a credible fiscal path to make it fall. Over the past six years, we have cut the deficit by almost two thirds to 4% of GDP, and we confirmed in the recent autumn statement that we will deliver a surplus as soon as possible in the next Parliament, while in the interim bringing cyclically adjusted borrowing below 2% by the end of Parliament, and getting public sector net debt, as a share of GDP, falling in this Parliament too.
People across our society benefit from the business-led recovery that has been at the heart of our economic approach. We have made sure that Britain is open for business with our competitive tax regime, by cutting over £10 billion-worth of red tape, and with our extensive investment in infrastructure, skills and research. The autumn statement took that further with a whole host of measures, including the new national productivity investment fund of £23 billion over the next five years. It is as a result of such measures that over 1 million new businesses have started since 2010, taking us up to a record 5.5 million small businesses at the beginning of the year. By the way, I am pleased to say that about 1.2 million small and medium-sized enterprises in the UK are majority women-led—more than ever before—and they contribute about £115 billion to the economy in total.
Jess Phillips (Birmingham, Yardley) (Lab)
With regard to the infrastructure spending, which the Minister heralds as part of the recovery, how many of the jobs that will be created by that will go to women?
Jess Phillips
I will make a more substantive speech about that shortly, but currently in the construction industry 1% of jobs go to women—1%. I ask the Minister again: what percentage of the jobs created by infrastructure spending does he think will go to women?
Mr Gauke
There are now more women doing science, technology, engineering and maths A-level subjects than ever before, which will ensure that more of them go into such jobs. I am trying to understand the hon. Lady’s point. Is she saying that we should not be spending money on infrastructure because that will have a disproportionate effect, favouring men? The purpose of infrastructure spending is to improve our infrastructure in order to improve our productivity—productivity that helps men and women. That is why we are doing that.
Jess Phillips
I am absolutely not saying that we should not spend money on infrastructure. What are the Government going to do to make sure that all the infrastructure spending set out in the autumn statement is shared equally between men’s and women’s jobs?
David T. C. Davies
I am grateful. My right hon. Friend will surely be aware that Alun Griffiths (Contractors) based in my constituency, which builds motorways, has received a parliamentary award for its commitment to championing women in the construction industry. Perhaps we should look carefully at tenders and make sure that such companies are considered.
Mr Gauke
There is a very important point to be made about how we encourage more women to become involved in engineering and construction. Increasing numbers of employers are taking more steps to do that—Crossrail is another example of where that is happening. The hon. Member for Birmingham, Yardley (Jess Phillips) seems to be objecting to infrastructure spending, which is a strange position—[Interruption.]
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I can hear the hon. Lady—[Interruption]—and she should not be speaking so loudly when she is sitting down, especially when I am speaking. She will have an opportunity to speak soon.
Mr Gauke
Thank you, Madam Deputy Speaker.
The global entrepreneurship and development index has ranked Britain as the best place in Europe for female entrepreneurs, which I am sure everyone in this House will welcome and want to see us build on. Our start-up loans programme is helping entrepreneurs set up a business or become self-employed, not only through a loan, but through access to mentors. By the way, this programme issues a high proportion of loans to black and minority ethnic applicants: BME-led businesses represent 24% of start-up loan recipients, with almost 10,000 loans issued to BME recipients so far.
Our support for business goes hand in hand with the historically high employment rate that we have in the UK, with today’s numbers confirming that the unemployment rate remains at an 11-year low, with employment remaining at near record highs.
Suella Fernandes
Does my right hon. Friend agree that this Government are helping women at work by introducing shared parental leave, flexible working hours and 30 hours of free childcare? Those have been pioneered by this Government, putting women first in the workplace.
Mr Gauke
Indeed. My hon. Friend makes an important point. I will deal with those measures in a moment.
It is worth pointing out that the impressive employment numbers are accompanied by rising living standards, which last year grew at their fastest rate in 14 years and currently stand at their highest-ever level. The benefits of this affect people across our society, but the House should note the evidence of particular benefits for women and people from black and minority ethnic groups. The number of women in work has increased by over 1.2 million since 2010. Indeed, the rate went up more in the previous Parliament than in the previous three Parliaments combined. That comes as the gender pay gap falls to the lowest on record, more women are on the boards or leading businesses than ever before, and there are no longer any all-male boards in the FTSE 100.
James Cartlidge
On the subject of pay, I refer to the excellent intervention my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst) made on the hon. Member for Rotherham (Sarah Champion), who spoke for the Opposition and said that the national living wage was not adequate. Is my right hon. Friend aware that the only international comparator for minimum wage is The Economist Big Mac index, which shows that the only country with a more generous living wage than this country is Luxembourg?
Mr Gauke
My hon. Friend makes an interesting point. I did not know that and I am grateful to him for drawing it to the attention of the House. The national living wage, which was brought in by this Government, disproportionately benefits women.
The number of black and minority ethnic women in work is at a near record high, with nearly 400,000 women finding work since 2010, and the employment rate for people in black and minority ethnic groups is at a record high of 64.5%, its highest level since records began in 2001.
Sarah Champion
I am grateful to the Minister for outlining what companies are doing to help women and the black, Asian and ethnic minorities. That is fabulous, but the debate is about what this Government are doing and how the Government’s austerity is adversely affecting those groups.
Mr Gauke
The logic of the hon. Lady’s point appears to be that there is no link between what happens in the economy and Government policies. What has been demonstrated over the past 10 years is that there is a very clear link between Government policies and what happens in the economy, and it is because of the policies of this—[Interruption.] We are the fastest-growing economy in the G7 at present, so it is going quite well, given that, among the major economies, we were the economy that was most affected by the crash in 2008. We have put in place an environment where we are creating jobs and seeing living standards improving, and that is happening across the economy for men and women.
It is, of course, right that we continue our work to address long-standing barriers to work for BME people, including through Baroness McGregor-Smith’s review, new support in schools, and new guidance for jobcentres and local partners. We have also set a public target to increase the proportion of apprenticeships started by people from BME backgrounds to 20% by 2020, building on good progress since 2010.
So we are strengthening our economy by managing stable public finances, backing our businesses and creating jobs. At the same time, we are helping people regardless of gender or race make their money go further in their day-to-day lives. That is why we confirmed in the autumn statement that we will raise the personal allowance to £12,500 by the end of the Parliament. By 2020, it will have increased by over 90% since 2010, taking millions of the lowest paid out of paying income tax, and representing a tax cut for over 13 million women by 2018, compared to 2015.
We have also introduced the national living wage at £7.20 an hour to help over a million people on the lowest wages, and we announced at the autumn statement that we would raise this to £7.50 in 2017. The national living wage is focused on hard-working, low-paid workers, regardless of their gender or race, and hon. Members should note that women are expected to account for around two thirds of those who will benefit from this, with people from BME communities expected to gain disproportionately.
Kirsty Blackman (Aberdeen North) (SNP)
I understand what the Minister is saying about the national living wage and the increase in the floor, but on the 40% tax rate, only 27% of higher rate taxpayers are women, so the changes to the 40% tax rate disproportionately benefit men, not women. What are the Government doing about that?
Mr Gauke
Income tax in Scotland will be a matter for the Scottish Government. I look forward to seeing what they will do.
From early 2017, we are also introducing tax-free childcare to help working parents with their childcare costs. Parents will be able to receive up to £2,000 childcare support per child each year. We are also helping around 3 million households by reducing the universal credit taper, which will further strengthen the incentives for people to increase the number of hours they work and to earn their way out of financial insecurity and welfare dependency.
That goes hand in hand with our sustained investment in the public services that families value. That includes our focus on quality schools, with the highest-ever recorded proportion of children being taught in good or outstanding schools; the pupil premium, which will be worth £2.5 billion this year alone and will support pupils from disadvantaged backgrounds; and an investment of £23 billion in the school estate over the next five years.
Our investment in infrastructure—from the roads and rails we travel on, to the homes we live in—will help all. The recent autumn statement contributed to tackling our long-standing challenge to deliver more homes, with a further £5.3 billion investment in housing, including a £2.3 billion housing infrastructure fund to deliver infrastructure to unlock up to 100,000 new homes, and £1.4 billion to deliver 40,000 new affordable homes.
So our economic plans are based on delivering an economy that works for everyone, and that means an economy that benefits all races and genders. I note the efforts to analyse the effect of the measures we have taken on women and BME groups. Hon. Members will be aware of the research of the House of Commons Library and the Women’s Budget Group, on which the premise of today’s motion is based, but a cautious approach should be taken when analysing specific impacts on that basis. Their findings should not be considered without first undertaking an honest reflection on the flaws inherent in their research methodologies. Let me provide a few examples.
First, the House of Commons Library analysis looks only at taxes and benefits. That means it overlooks key parts of the broader economic picture, which includes the benefits to women and people from BME groups of a strong economy and rising employment and earnings. It also fails to take into account the public services that families value, such as support for childcare, schools and health services.
Secondly, the analysis has been based on assumptions made about how income is shared in any given household. For example, it is not reasonable to assume that the measure to limit support as part of child tax credits and universal credit to the first two children for new claimants will overwhelmingly affect women merely because women are usually the nominal payee of child tax credits, as the House of Commons Library did in previous analysis. This not only treats women rather than children as the beneficiary of child tax credits, but assumes that other sources of income, such as earnings, are not shared within a household in response to benefit changes.
Thirdly, the analysis makes a comparison with a world where benefits were uprated between 2010 and 2015 by the retail prices index, but RPI is a flawed measure of inflation, and it lost its status as a national statistic in 2013. So there are a range of issues with the methods used to calculate these impacts, and the findings should be seen in that light.
It is, however, right that we assess carefully the effects of any new fiscal measures on groups across our society. We carefully consider the implications of all our measures for protected equality groups, which includes gender, race and disability. That is in line with not only our own guiding principle of a fairer society but our legal responsibilities under the Equality Act 2010. We publish information alongside the autumn statement about the impact of individual tax measures. We also publish a comprehensive distributional analysis to monitor how our decisions on tax, welfare and spending would support households on a range of different incomes.
Our commitment to fairness runs through everything we do. It goes to the heart of the economic approach we have taken since 2010. The Prime Minister could not have been clearer about her determination to keep taking every action to make this a country that works for everyone. That is why, for example, we have launched an audit to look into racial disparities in our public services, which stretches right across Government, covering every area from health to education, and childcare to welfare, employment, skills and justice.
This Government are fully resolved to make this a country that works for all races and genders. That is exactly what we are working to deliver through our work to build a stronger economy and to help people in their day-to-day lives, and that is what last month’s autumn statement continued to support.
Several hon. Members rose—