Oral Answers to Questions

Elizabeth Truss Excerpts

Tuesday 3rd July 2018 Commons Chamber

[John Mc Nally (Falkirk) (SNP)]

1. What recent assessment he has made of the financial implications for Scotland of the UK leaving the EU customs union.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

Scotland exports almost £30 billion of goods and services, including its iconic whisky, and we want to make sure we have as frictionless trade as possible with the EU as well as the ability to strike independent trade deals with the rest of the world.

[John Mc Nally]

Alexander Dennis is a strong, world-leading bus-building company employing 1,000 people in my constituency, but its chief executive officer, Colin Robertson, has expressed serious concerns about a hike in costs within the supply chain should the UK leave the customs union. Given that the Chancellor has so far failed to stop the Prime Minister’s hard Brexit, what are we to expect from him at Friday’s Cabinet showdown on Brexit—action or evasion?

[Elizabeth Truss]

Of course we want trade with the EU to be as frictionless as possible, but I point out to the hon. Gentleman that the UK market is worth £46 billion to the Scottish economy, and his party wants to leave that market.

[Stephen Kerr (Stirling) (Con)]

Given that Scottish businesses export more to non-EU countries than to EU countries, does my right hon. Friend agree that the opportunity for Scottish businesses from new trade deals is potentially that much greater?

[Elizabeth Truss]

My hon. Friend is right. Outside the UK, the No. 1 destination for Scottish exports is the US, which accounts for 16% of exports, and of course part of the opportunity of leaving the EU is the ability to negotiate new trade deals, such as with the US.

[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

It is getting completely ridiculous now. When either the Chancellor or the Chief Secretary to the Treasury is finally allowed to have a look at this mythical third customs plan from No. 10, will they at least have the integrity and honesty if it does not deliver the exact same benefits for Scotland—or, for that matter, England, Wales and Northern Ireland—to come to this House and actually say so?

[Elizabeth Truss]

As I have said, we want to secure as frictionless trade as possible with the EU as well as those opportunities with the rest of the world. It would be helpful if the Labour party, rather than trying to reverse the result of the referendum, was instead more positive about the opportunities in the future.

[Andrew Bridgen (North West Leicestershire) (Con)]

Does my right hon. Friend welcome with me the news that foreign direct investment project numbers are up 7% in Scotland compared to last year and have broken records every year for the past three years, and all this despite a Scottish National party Government in Scotland who are constantly talking down the prospects of the Scottish economy?

[Elizabeth Truss]

Those are fantastic figures for Scotland. We have seen good figures across the UK and the lowest unemployment for 40 years. The Labour party wants to overthrow capitalism; we want great businesses that will do well for our economy.

[Owen Smith (Pontypridd) (Lab)]

Could the Chief Secretary to the Treasury reassure the House and the people of Scotland that they will not be paying more in fuel and alcohol duty after Brexit in order to fill the post-Brexit hole in our public finances?

[Elizabeth Truss]

I am afraid to tell the House that the people of Scotland are having to pay more income tax thanks to the SNP Government. Everyone earning more than £26,000 is paying more tax under the SNP.

[Charlie Elphicke (Dover) (Ind)]

Would the Chief Secretary to the Treasury not agree that the people of Scotland and the United Kingdom will be better off if we leave the customs union and invest in state-of-the-art technology to ensure that we have frictionless trade and pursue the trade opportunities that lie ahead of this nation around the globe?

[Elizabeth Truss]

I know that my hon. Friend has done a lot of work at the port of Dover making sure it is ready for all eventualities. We want to have the best possible trade with both the EU and the rest of the world. That is the opportunity we have got.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

22. The Financial Times is reporting that both Ministers and Bank of England officials fear a Brexit assault on the £8 trillion asset management industry, so the stakes at this Friday’s Brexit Cabinet bunfight could not be higher. Will protection of Scottish financial passporting rights be a red line for the Chancellor?

[Elizabeth Truss]

The financial services industry is a very important industry for the whole UK and we want it to do as well as possible, which is why we are working on getting the best possible deal. It is in the interests of EU countries that rely heavily on UK financial services to get a deal that suits both sides.

[Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)]

According to EY’s recently released Brexit Tracker, a third of all financial services companies have confirmed that they will move staff or operations outside the United Kingdom. Most are going to Dublin, Frankfurt and Luxembourg, and they are going because this Government cannot give them the basic assurances for which they, and we, have been asking for 18 months. After eight failed years of Conservative government, we simply cannot afford this. What are the Government going to do to stop it getting any worse?

[Elizabeth Truss]

I am amazed that the hon. Gentleman did not mention the fact that the City has yet again been rated the top financial centre in the world. We hear nothing but doom and gloom from the Labour party about the future of our economy. If the hon. Gentleman thinks that the solution to our problems is calling business the enemy and overthrowing capitalism, he is seriously mistaken.

[Mrs Maria Miller (Basingstoke) (Con)]

2. What fiscal steps his Department is taking to reduce unemployment.

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[The Chief Secretary to the Treasury (Elizabeth Truss)]

It is right that money that is spent locally is raised locally. In 2010, councils were 80% dependent on central Government grants; by 2020, the vast majority of money spent locally will be raised by local councils.

[Afzal Khan]

The County Councils Network warned this week that

“the worst is yet to come”

for local government and that several authorities risk going bust. A survey of its members revealed that two thirds will struggle to balance their budget by 2021 unless more funding is made available, estimating the funding gap at £3.2 billion over the next two years. Is the Chancellor aware of the effect his austerity agenda is having on local services? Will he take responsibility for ending this crisis in our local councils?

[Elizabeth Truss]

As I said, we have moved from a situation in which local councils were majority funded by central Government to one where local councils are accountable for the money they spend and raise locally. We have given councils the extra ability to raise funds. I note that many councils have reinvented themselves, are doing things differently and are saving money, and public satisfaction with local services has held up.

[Mr Philip Hollobone (Kettering) (Con)]

I declare my interest as a member of Kettering Borough Council.

By when do the Government expect to publish the conclusions to their fair funding review of local government?

[Elizabeth Truss]

We are currently considering those responses carefully, and we will publish them shortly.

[Peter Dowd (Bootle) (Lab)]

Eight failed years of austerity have meant poor levels of funding for local government. In fact, today the Local Government Association reports that, by 2020, councils will have had £16 billion of funding cuts. With low pay, woeful productivity, tenuous job security, stubborn inflation, rising national debt, a huge deficit, a sinking pound, creaking public services, decaying infrastructure and chaotic railways, what other wheezes does the Chief Secretary have up her sleeve to wreck the economy further?

[Elizabeth Truss]

We are building. We saw a record number of new businesses started last year. We have record levels of employment across our economy. We have brilliant Conservative Mayors, like Andy Street and Ben Houchen, who are attracting new businesses to their areas and redesigning their port infrastructure, whereas Labour councils across the country are doing things like closing down Airbnb, trying to stop Uber and trying to stop progress.

[Peter Dowd]

Yes, that told me. It gets worse, if that were possible. This year, business investment growth is slowing, annual export growth is slowing, service sector growth is slowing and economic growth is slowing. With Brexit looming and punch-ups in the Cabinet, should the nation’s economic future really rest in the hands of a go-slow Government?

[Elizabeth Truss]

Given that the hon. Gentleman’s stated policy is to have a run on the banks, I suggest that our ideas for bringing in business investment are doing a lot better for Britain.

[Liz Twist (Blaydon) (Lab)]

8. What recent discussions he has had with the Secretary of State for Health and Social Care on changes in the level of funding for public health since 2010.

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[Ruth Cadbury (Brentford and Isleworth) (Lab)]

10. What recent discussions he has had with the Secretary of State for Education on changes in the level of funding per pupil in schools since 2010.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

We have protected schools’ budgets in real terms since 2010, and through our reforms to schools and the curriculum children’s results have improved, particularly in reading.

[Ruth Cadbury]

Will the Minister confirm that the additional £1.3 billion announced a year ago does not address the £1.5 billion shortfall in school budgets? So what advice does she have for the 88% of schools in this country facing real-terms budget cuts, despite the new funding formula?

[Elizabeth Truss]

I suggest the hon. Lady reads last week’s edition of Schools Week, which said that the unions had admitted that they had their sums wrong and in fact per-pupil funding was being protected in real terms in 2018-19 and 2019-20.

[Chris Philp (Croydon South) (Con)]

Will the Chief Secretary confirm that per-pupil spending in this country is higher than that in Japan or Germany? Will she also confirm that this is not just about how much we spend, but about how wisely we spend it, thanks to which 2 million more children are now in good and outstanding schools than there were in 2010?

[Elizabeth Truss]

My hon. Friend is correct. In addition, the real-terms funding per pupil will be 50% higher in 2020 than it was in 2000. This Government’s reforms to reading and mathematics are resulting in students’ scores increasing, whereas under the Labour party we just had grade inflation.

[Wes Streeting (Ilford North) (Lab)]

18. That is fascinating, because compared with last year, England’s schools have 137,000 more pupils but almost 5,500 fewer teachers, 2,800 fewer teaching assistants, 1,400 fewer support staff and 1,200 fewer auxiliary staff. What has gone wrong? Is it that headteachers are not investing in staff, or is it that the Chief Secretary to the Treasury is in denial and thinks that she knows more than they do about how to manage school budgets?

[Elizabeth Truss]

I point out to the hon. Gentleman that 10,000 more teachers are now working in our schools than under the Labour Government. He should look at the results that children are achieving and the improvements that we have seen, particularly in reading. Under Labour, we were among the worst in Europe, whereas we are now among the best.

[Steve Double (St Austell and Newquay) (Con)]

11. What steps he is taking to invest in infrastructure in Cornwall and the south-west.

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[Andrew Selous (South West Bedfordshire) (Con)]

T4. Only 15% of people who start their working lives in entry-level jobs in this country manage to rise above that level. This country would be more prosperous and socially just, and would have a bigger tax base, if we could help them. What more can we do to help that segment of the population?

[The Chief Secretary to the Treasury (Elizabeth Truss)]

My hon. Friend is absolutely right. The way in which we will get higher wages is by improving productivity and skills, which is why we are investing in a record level of apprenticeships and the national training partnership.

[John McDonnell (Hayes and Harlington) (Lab)]

As my hon. Friend the Member for West Bromwich West (Mr Bailey) pointed out, the British Chambers of Commerce has said today that its patience with the Government over Brexit is at “breaking point”. Its sense of frustration reflects accurately what trade unions and businesses across the country feel. All the British Chambers of Commerce wants are answers to some very basic questions, so will the Chancellor and those on the Treasury Bench provide some answers today? Post-Brexit, will goods be subject to new procedures and delayed at border points? Will regulation checks on goods conducted in the UK be recognised in Europe? Will firms be able to transfer staff between the UK and the EU as they do now? Above all else, will Ministers stop squabbling and provide some answers to these vital questions?

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[Ellie Reeves (Lewisham West and Penge) (Lab)]

T2. The Legal Aid, Sentencing and Punishment of Offenders Act 2012 was intended to save £450 million a year on legal aid, but last year’s spending was more than £950 million down from 2010 levels. As we find ourselves in an access to justice crisis, what discussions have Treasury Ministers had with the Ministry of Justice about increasing the money available for legal aid as part of the LASPO review?

[Elizabeth Truss]

We are conducting a review of LASPO at the moment. I have regular discussions with the Secretary of State for Justice, and we are making sure that the Department has the resources it needs.

[Bob Stewart (Beckenham) (Con)]

T9. Fly-tipping is now a major nuisance to my constituents. The cost of dealing with even a single instance can run to thousands of pounds, and that does not include the cost of investigating for hazardous waste and trying to get prosecutions. Will the Minister consider the case for additional funding to enable my local council of Bromley, as well as other councils, to pay for the battle against environmental criminals?

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[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Rail electrification and the Swansea Bay tidal lagoon have both been scrapped by the British Government because they were not deemed good value for money. When it comes to designing the criteria for the proposed UK shared prosperity fund, will an immediate return on investment be the priority, as with every project scrapped in Wales?

[Elizabeth Truss]

We are looking closely at the shared prosperity fund to make sure that it delivers best value for money right across the UK, and I am in discussions with the Welsh Secretary about that.

[Jeremy Quin (Horsham) (Con)]

What is my hon. Friend’s reaction to the FCA report on doorstep lending, and does it go far enough?

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[Martin Vickers (Cleethorpes) (Con)]

I was pleased to welcome the Chief Secretary to the Treasury to my constituency a couple of weeks ago. Does she agree that the enthusiasm that we heard from local businessmen for free ports and free zones could be the way ahead for economic growth in Immingham and the surrounding area?

[Elizabeth Truss]

I was hugely impressed by the enthusiasm in Grimsby, Cleethorpes and Immingham for more development and more opportunities for free zones—and also by the fantastic fish and chips we had on Cleethorpes pier.