Oral Answers to Questions

David Mundell Excerpts

Wednesday 4th May 2011 Commons Chamber

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

The Secretary of State for Scotland and I are in regular contact with the Secretary of State for Work and Pensions on a range of issues concerning implementation of universal credit in Scotland.

[Guto Bebb]

In Scotland, the public sector accounts for about 50% of gross domestic product. If we are to succeed in making the country less dependent on the public sector, we need to ensure that the private sector has access to the personnel that it needs to grow. Does the Minister agree that universal credit will help to make work pay, and that it will contribute to the rebalancing of the economy of Scotland and the UK?

[David Mundell]

I do indeed agree with my hon. Friend, who will be pleased to note that already during the incapacity benefit reassessment trial taking place in Aberdeen, a large number of people who not only want to work, but also want the support to help them to work, have been identified and have found opportunities to work in the private sector.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

Will the proposed universal credit in Scotland be affected by the Chancellor’s proposed changes in tax and national insurance, particularly in relation to the tax proposals in the Scotland Bill?

[David Mundell]

The hon. Gentleman has followed the progress of the Scotland Bill in detail, but he will know that in relation to the core aspects of universal credit and benefits, the Government have given an undertaking that no one will be worse off in cash terms when universal credit is introduced.

[Iain Stewart (Milton Keynes South) (Con)]

Does my hon. Friend agree that the current complexity of the benefits system means that too many Scottish claimants do not receive the benefits to which they are entitled, and that universal credit will help to target the right support on the right people?

[David Mundell]

I certainly agree with my hon. Friend. The amount of benefit that goes unclaimed in Scotland is a national disgrace. The system of universal credit will simplify the benefits system, as well as making work pay and combating worklessness and poverty. That is something that hon. Members on both sides of the House should welcome; it is a marked change from the 13 years of inaction from the previous Government.

[Mary Macleod (Brentford and Isleworth) (Con)]

3. What assessment he has made of the likely effect on the Scottish economy of the implementation of “The Plan for Growth”.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

Returning the United Kingdom to sustainable economic growth is the Government’s overriding priority. We are doing everything to create the conditions that enable all businesses in Scotland to be successful and create more jobs. Our plan for growth is a plan for the whole of the UK.

[Mary Macleod]

What views and reactions is my hon. Friend aware of among our colleagues in the Scottish Parliament and the business community in relation to the Government’s proposals to support small and medium-sized businesses?

[David Mundell]

The Government’s proposals for reducing corporation tax and for making changes to national insurance have been widely welcomed by businesses across Scotland. Of course, as my hon. Friend will know, small businesses in Scotland have particularly benefited from small business relief, which was delivered by Conservative MSPs.

[Ann McKechin (Glasgow North) (Lab)]

Inflation is at double the Government’s target, growth has been downgraded for the next two years, retail figures are down and consumer confidence is at rock bottom. Will the Minister for once stand up for Scotland and concede that while the cuts may be hurting, they are not working, and that it is time for the Government to have a plan B for growth?

[David Mundell]

This Government do have a plan for growth—unlike our predecessor. We have set out ambitious objectives to create the most competitive tax system in the G20, to make the UK the best place in Europe to do business, to encourage investment and exports, and to create the most flexible and educated work force in Britain.

I am sure the hon. Lady is good at figures. She will know that her party started the Scottish elections with a 10-point lead, and that today it has an 18-point deficit. That is good work with figures.

[Mr Mike Weir (Angus) (SNP)]

Can the Minister tell us what part of the plan for growth is behind the bright idea of his colleague the Chief Secretary to the Treasury to impose a massive increase in taxation on the oil and gas industry, jeopardising investment and up to 50,000 jobs?

[David Mundell]

The hon. Gentleman would have some credibility in asking that question had he not repeatedly raised in the Chamber the issue of the costs of petrol and fuel oil in his constituency. It is clear that the Chancellor and the Chief Secretary got the balance right in the Budget between the taxation of the oil industry and the taxation of the motorist. If the hon. Gentleman wants to tell his constituents that they should be paying 6p a litre more on their fuel, he is welcome to do so.

[Mr Speaker]

I call Rosie Cooper to ask Question 4. She is not here.

--- Later in debate ---

[Mr Philip Hollobone (Kettering) (Con)]

7. Whether his Department and the Treasury have assessed the potential effect of banking failure on the economy of an independent Scotland.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

Banks and other financial institutions are vital to the functioning of the economy. Although no specific work has been commissioned on the banking bail-out in Scotland, a 2010 National Audit Office report states that the total amount at stake is currently £512 billion. As of December 2010, £124 billion in cash had been invested in Government financial interventions. Based on NAO data, the Scottish Parliament Information Centre, SPICe, has estimated that the Royal Bank of Scotland and the Lloyds Banking Group were provided with £470 billion. SPICe also calculated that this figure was three times the annual Scottish GDP, and that the total UK Government intervention of £751 billion was equivalent to just over half of UK GDP.

[Mr Hollobone]

Do those figures not show that, like Iceland and Ireland, a separate Scotland would simply not have been able to survive the international banking crisis on its own? Is it not the case that Scotland’s economy will always be better off inside, rather than outside, the United Kingdom?

[David Mundell]

I could not agree more with my hon. Friend. It is interesting that as we enter the Scottish Parliament election period, the Scottish National party appears to have forgotten its proclamation about the arc of prosperity and Scotland’s wish to join the economies of Ireland and Iceland. The First Minister, Alex Salmond, also appears to have forgotten saying in the 2007 campaign:

“We are pledging a light-touch regulation suitable to a Scottish financial sector with its outstanding reputation for probity, as opposed to one like that in the UK, which absorbs huge amounts of management time in ‘gold-plated’ regulation.”

[Pete Wishart (Perth and North Perthshire) (SNP)]

That response shows that what has characterised the Scottish election campaign is that positivity wins over negativity. Will the right hon. Gentleman at least acknowledge and recognise that the failure of those so-called Scottish banks was down to UK regulation?

[David Mundell]

I do not think that the hon. Gentleman was listening to my last response. His leader, Alex Salmond, previously described the UK regulation as “gold-plated” and, at the previous Scottish elections, offered the voters “light-touch regulation”. This is the same Alex Salmond who said that the banking crisis was down to “spivs and speculators”.

[John Thurso (Caithness, Sutherland and Easter Ross) (LD)]

One of the most pernicious effects of the banking failure in Scotland at the moment is the withdrawal by nationalised banks at short notice of funding for small businesses, such as TDI Ltd in my constituency. What will the Minister do to hold the moneylenders’ feet to the fire and get Project Merlin properly adhered to?

[David Mundell]

The Secretary of State and I are in regular contact with the banks operating in Scotland to ensure that Merlin goes forward as envisaged. We are also willing to take up individual cases such as the one that my hon. Friend mentions, which, if he refers it to us, we will refer directly to the banks in question. [Interruption.]

[Mr Speaker]

Order. There are far too many private conversations taking place in the Chamber. It is very discourteous, and I am sure that the House wishes to hear Mr Greg Hands.

[Greg Hands (Chelsea and Fulham) (Con)]

Thank you, Mr Speaker. Will the Minister join me in welcoming the report by the Independent Commission on Banking, under Sir John Vickers, and will he remind the House who, in the last Parliament, awarded Sir Fred Goodwin a knighthood for services to banking?

[David Mundell]

My hon. Friend’s interventions at Scottish questions are always welcome. He is quite right to suggest that it was the Labour Government who not only awarded Sir Fred Goodwin his knighthood but involved him in virtually every other initiative that they pursued in Scotland. The Vickers report is to be welcomed in Scotland, as it is elsewhere in the United Kingdom.

[Karl MᶜCartney (Lincoln) (Con)]

11. What progress he has made on measures to prevent the coincidence of elections to the House of Commons and to the Scottish Parliament in May 2015.

[The Parliamentary Under-Secretary of State for Scotland (David Mundell)]

Government amendments to the Fixed-term Parliaments Bill deferring the 2015 Scottish Parliament elections until 5 May 2016 were agreed by the other place on 29 March.

[Karl MᶜCartney]

In addition to outlining those measures, will my right hon. Friend update the House on progress towards the establishment of the commission to examine the West Lothian question, on its membership and on when we might expect to see its conclusions and recommendations?

[David Mundell]

As my hon. Friend knows, the coalition’s programme for government promised to establish a commission to consider the West Lothian question. A commission will be established this year to consider it, and the Government are committed to addressing the issue. We are continuing to give careful consideration to the timing, composition, scope and remit of the commission. It will need to take into account our proposals for reform of the House of Lords to create a wholly or mainly elected second Chamber, the changes in how this House does its business, and amendments to the devolution regimes such as those in the Scotland Bill, which is now before the House.

[Jo Swinson (East Dunbartonshire) (LD)]

12. What discussions he has had with ministerial colleagues on the potential for renewable energy generation in Scotland.