Oral Answers to Questions
Gavin Williamson Excerpts(13 years, 4 months ago)
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Danny Alexander
As the question that the hon. Lady is following up on concerns the personal allowance, let me limit my answer to that, Mr Speaker. Her constituents, in common with other Members’ constituents, are benefiting from the fact that the Government have introduced the most radical policy for many years by putting more money back into the pockets of hard-working families across the country. She would do well to accept that.
Gavin Williamson (South Staffordshire) (Con)
15. What steps the Government have taken to reduce the cost of credit to the real economy.
Greg Clark
Goodness. Thank you. I feel like Boris Johnson.
The Government and the Bank of England have launched the funding for lending scheme to enable banks to make loans cheaper and more easily available to households and businesses. In addition, 19,000 cheaper loans have been offered to smaller businesses under the national loan guarantee system.
Gavin Williamson
I welcome my right hon. Friend to his new post and wish him every success. Many businesses in South Staffordshire face a great challenge in raising finance to grow and recruit new workers. Will he explain how the measures that he has outlined will help small and medium-sized businesses in my constituency to grow and expand?
Finance Bill
Gavin Williamson Excerpts(13 years, 6 months ago)
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Catherine McKinnell
I have just answered it. I would be grateful if the Minister could similarly provide detailed costings as to where the Government’s tax reduction for the fuel relief is going to come from. If he were able to do that, we could certainly provide detailed costings of our tax proposal. The point is that the reduction to 17.5% will put money back into people’s pockets, get the economy moving and get growth back into the economy. That will help to bring down borrowing, which is increasing at the moment.
Gavin Williamson (South Staffordshire) (Con)
Can the hon. Lady quantify, for the benefit of those in the Chamber, how much that 2.5% reduction would cost?
Catherine McKinnell
I repeat what I said before: the Government’s current policy of increasing VAT to 20% is taking money out of people’s pockets and is causing a slump in demand. It is very strange that these questions are coming from a Government who are borrowing more than they intended over the spending period, not less.
Catherine McKinnell
I beg to move, That the clause be read a Second time.
In this new clause we call on the Government to consider repeating the bank bonus tax, which raised £3.5 billion in 2010-11, and to use the revenue to create 100,000 jobs for young people. It is an understatement that this has not been a good few weeks for the banks. First, there were the disgraceful mistakes at Royal Bank of Scotland that left thousands of people unable to access their own money for up to a week. I am sure that top bankers there managed to get by for a few days, but for people on low incomes it is no laughing matter to be left without a week’s wages.
Gavin Williamson
Does the hon. Lady think that those who set up the regulatory system that governed the banks, such as the shadow Chancellor, should come to the House to apologise?
Catherine McKinnell
Then came the shocking revelations at Barclays—[Hon. Members: “Oh!”]—of traders fiddling the markets, cheating with mortgage and lending rates.
Catherine McKinnell
I will answer the question, but it was rather an insult to the people who have suffered from the situation at RBS, which was caused by administrative failures and poor management. The question put by the hon. Member for South Staffordshire (Gavin Williamson) does not address the severity of the matters that I am laying before the House.
Then came the shocking revelations at Barclays: of traders fiddling the markets, cheating with mortgage and lending rates—
Catherine McKinnell
It would be more appropriate for the hon. Gentleman to make his intervention now, but I will complete my sentence. Those traders then paid each other for the favours with bottles of Bollinger.
Gavin Williamson
The point that I was trying to ask the hon. Lady to explore was that the regulatory system put in place under the last Labour Government has led to market failure and the recent LIBOR problems. Does she not think that the shadow Chancellor should come to the House to explain why he took no action when he was City Minister? Yes or no?
Catherine McKinnell
I was talking about the situation at RBS, which was caused by a total administrative meltdown and computer failure; it had nothing to do with regulation. On the subject of regulation, Conservative Members called for less regulation. Politicians on both sides of the House need to consider where we go from here.
Catherine McKinnell
My hon. Friend sums up in a nutshell why I am speaking in favour of the new clause.
The shocking revelations from Barclays this week are nothing short of a scandal. Barclays—along with we do not know how many other banks now under investigation —broke the rules to make a profit and put global economic stability at risk. It played fast and loose with rates that affect people’s mortgages and credit cards and, it would appear, gave little thought to how people could be affected.
In another shocking scandal, we found out that thousands of small businesses had been sold expensive insurance products that they did not need and could not use, spending money, which could have been used to protect jobs, to pay for products that never should have been offered to them in the first place. How many businesses have lost out as a result? All those actions on the part of the banks were totally unacceptable. The banks have been taking without giving back. The Government can take action now to put the situation right.
Gavin Williamson
I thank the hon. Lady for being so generous in giving way. I agree that the Government should take action to address some of the issues that have been raised. She mentioned a number of scandals. Will she name, for the record, the years when they occurred and which Government were in power when they occurred?
Catherine McKinnell
Members of the public will find this distasteful. We all share concern about the situation with the banks and the terrible events that have come to light in the past week or so. Government Members should be taking the lead on putting the situation right, but all they are interested in is scoring party political points. They need to be careful if they are not to lose all the public’s trust in their ability to start putting things right.
The Government can take action today. Stephen Hester, chief executive of RBS, has rightly said that he will decline his bonus this year in recognition of the serious damage that his bank has caused. Bob Diamond, chief executive of Barclays, resigned this morning over the currently developing scandal. It is right that those in charge take responsibility.
However, the banking industry as a whole is still benefiting from a tax cut this year—a tax cut, when their incompetence has cost thousands of people days of frustration, inconvenience and hardship. They have a tax cut when champagne swaps and dodgy dealing have been used to fiddle internal lending rates and when small businesses have been ripped off in yet another mis-selling scandal.
Our bank bonus tax would set that right, making the banks pay their fair share in tax instead of letting them get away with it. We want the money to be used to create 100,000 jobs for young people who are at risk of becoming the next victims of this double-dip recession made in Downing street. Labour’s bank payroll tax raised £3.5 billion in 2010-11 but this Government replaced it in 2011-12 with a levy raising just £1.8 million—barely more than half. Those are the Office for Budget Responsibility’s own figures, set out on page 101 of its economic and fiscal outlook paper in March this year.
The autumn statement in November last year had forecast a higher first take, but that turned out to be over-optimistic. That could be the case with future forecasts. The levy is supposed to raise £2.8 billion in 2014-15, but we cannot be sure of getting that. The OBR has had to keep revising all forecasts down and down, apart from those for Government borrowing, which keep going up and up. It is clearly inadequate to introduce a levy on banks with only half the yield of the previous tax. Along with the richest 1% of the country who have benefited from the scrapping of the 50p tax rate, this is one of the only parts of the Budget where the Government have given handouts. What does that tell us about their priorities? It tells us that they are not on the side of working people hit by the banks’ recent malpractice, but on the side of banks and millionaires. That shows just how out of touch this Government are.
We want to take tough measures to make the banks pay their way, and bringing back the bonus tax on top of the new levy is the fairest way to do that. It is clear where that extra money needs to go. We would use our double bank tax to plug the gaping hole in jobs and growth left by the Chancellor’s omnishambles of a Budget, which contained not one mention of the word “jobs”.
Beer Duty Escalator
Gavin Williamson Excerpts(13 years, 6 months ago)
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Gavin Williamson (South Staffordshire) (Con)
It is a great privilege to have secured this debate this evening. It is an even greater pleasure to see so many hon. Members in their places as we start this Adjournment debate at this late hour. One could say that an Adjournment debate is akin to an after-hours lock-in, but probably without so much pleasure or enjoyment. We are all here because we care passionately about both the brewing industry and, of course, our pubs right across our constituencies and across the nation. We care about them because we know they are part of the fabric of our nation. We all have concerns about the beer duty escalator and the impact it is having on the many pubs and breweries across the land.
We have to go back to 2008 to see the introduction by the last Labour Government of the beer duty escalator, which saw beer duty rise by inflation plus 2% each year. This, sadly, has been carried on, and it is having a detrimental impact on our pubs and breweries.
James Wharton (Stockton South) (Con)
My hon. Friend makes a very good point, and I congratulate him on securing this important debate. He will be aware that it has been predicted by the British Beer and Pub Association that the escalator could cost as many as 5,000 jobs. When he talks about a detrimental impact, does he think it important for the House to recognise just how significant that detrimental impact could be on such an important industry?
Gavin Williamson
My hon. Friend makes a valid point about the impact on jobs in the industry of the beer duty escalator, which I was coming on to. In my constituency of South Staffordshire, 1,286 people are employed in breweries and pubs—whether in the fantastic brewery of Enville, the brewery of Kinver, the Morton brewery in Essington, the Marston’s brewery in neighbouring Wolverhampton, or in the 86 pubs scattered across the constituency. Unfortunately, however, these pubs have declined in the last few years, and I am afraid that the beer duty escalator has had an impact in that respect.
Alec Shelbrooke (Elmet and Rothwell) (Con)
Does my hon. Friend agree that a sensible way of helping pubs might be to lower the duty on draught beer but raise it on canned beer?
Gavin Williamson
My hon. Friend is not known as a visionary—I believe that his new wife often refers to him thus—for nothing. I hope that the Minister is noting his ideas eagerly, and will recommend them to the Treasury as a host of examples of radical new thinking that could improve and support our breweries and pubs.
Greg Mulholland (Leeds North West) (LD)
I congratulate my hon. Friend on securing this debate, and assure him that his cause has the full support of the all-party parliamentary save the pub group.
Pubs pay even more tax per pint because of the other forms of tax to which they are subject. I fully support my hon. Friend’s proposal—indeed, I think that a separate duty should apply to real ale, which requires an increased cost of production and increased cellarmanship—but there is also a problem with European legislation. Rather than saying that we should not challenge that legislation, should not Ministers convey to Europe the message that it could do something important that would greatly help not only our brewing industry but our pubs?
Gavin Williamson
It is always welcome when a Liberal Democrat speaks so vociferously against the European Union. I thank the hon. Gentleman, who has fought so hard for pubs not just in his constituency but throughout the country.
Almost 1 million jobs in the United Kingdom are generated by the UK beer and pub industry, which affects all our constituencies, including that of the Economic Secretary to the Treasury, my hon. Friend the Member for Norwich North (Miss Smith). Some 550 people work in the industry there, and I am sure that, like the rest of us, my hon. Friend wants the number to increase.
Mr Andy Slaughter (Hammersmith) (Lab)
I am trying to extend the debate to the Opposition Benches. Although my local brewer, Fuller, Smith and Turner, is internationally famous, it is still a family firm, but last year it paid 37% of its turnover—not its profit—in tax, and beer duty will rise by 27% during the current Parliament. Should not the Government take notice of that?
Gavin Williamson
The hon. Gentleman has made an important point about how difficult it is for many pub and brewing companies to invest more money in generating new jobs and products in a sector in which we are world leaders. We in the United Kingdom are clearly paying far more duty than the European average. Although we consume only 13% of the beer consumed in the European Union, we pay 40% of the tax bill. I do not often talk about the need for European harmonisation, but I should like us to harmonise with the Germans, who only pay a tenth as much beer duty on their pints. Perhaps we should explore that idea further.
Mr Robin Walker (Worcester) (Con)
My hon. Friend mentioned new products a moment ago. The Firefly, a pub in Worcester, recently embarked on the first new brewing venture in the city for 16 years. I am sure that the pub, and Worcestershire, would support my hon. Friend’s campaign.
Gavin Williamson
My hon. Friend has made a valid point. Not only is everyone in South Staffordshire rooting for the ending of the beer duty escalator, but so are those in the great county town of Worcester. Obviously their pubs are not as fantastic as those in South Staffordshire, but we all have our crosses to bear in life.
We recognise that the Government face a great challenge. It is not easy to do what they are doing, and Treasury Ministers carry a burden on their shoulders that I am sure none of us on the Back Benches would wish to carry.
Andrew Griffiths (Burton) (Con)
As chairman of the all-party group on beer, I congratulate my hon. Friend on securing this debate. I am sure he agrees with me that the packed Benches at almost midnight show the strength of feeling in this House in support of Britain’s brewing industry. Does he share my shock that British brewers are paying half their income in tax to the Treasury, yet the future of the industry is at a critical point? Does he agree we can save jobs and pubs if we cut the duty on beer?
Gavin Williamson
As always, my hon. Friend and fellow Staffordshire Member of Parliament makes an excellent point. We want to encourage investment by our brewers into this vital industry and into our pubs.
Gavin Williamson
Over the last eight years there has been a 50% increase in beer duty but only a 10% increase in revenues from that duty. That is a great concern.
Gavin Williamson
My hon. Friend is bobbing up and down, so I had best give way to him.
Neil Carmichael
We are talking here about small and medium-sized businesses—businesses that employ some 1,600 people in my constituency. My four breweries are very successful small businesses, but they could do with some help in respect of this policy.
Gavin Williamson
All the Members who have intervened have made the most wonderful points, and my hon. Friend certainly has not disappointed in that regard. I am a little disappointed, however, that he did not mention his four breweries for a potential future press release.
Richard Fuller (Bedford) (Con)
I, too, congratulate my hon. Friend on securing this important debate. As the Member for Bedford, the home of the largest family-owned brewery, Wells and Young’s, may I ask him whether he agrees that it is also a timely debate? The Treasury recently took action to reduce the fuel duty escalator, and it would be a welcome addition if we were also to eliminate the beer duty escalator and its impact on our economy.
Gavin Williamson
I would never dream of supposing that I knew more than Treasury Ministers, but that would certainly be a good idea to bear in mind for future Budgets. We must look at the economics involved. As I mentioned, there has been a 50% increase in the rate of duty, but only a 10% increase in the amount of revenue.
I have had the great privilege over the past few months of serving on the Finance Bill Committee, where I heard many emotive and brilliant arguments from my hon. Friend the Economic Secretary about the need to get the balance right between the rate of tax and the money it brings in.
Heather Wheeler (South Derbyshire) (Con)
I must declare an interest: for 25 or 26 years, I have been married to a brewery man—and thank goodness for Bass and for Young’s. Many pubs in South Derbyshire are still under threat or are going to close, even though the Shardlow brewery, the John Thompson brewery and in particular the Burton Bridge brewery, which has just opened, are fantastic. I should also mention the Brickmakers in Newton Solney. We are trying to do our best, but the yoke of taxation is too high. Does my hon. Friend agree?
Gavin Williamson
I entirely agree. I think we have gone too far, and it is having a detrimental effect on the amount of tax revenue the Treasury can get from this important potential source. The Exchequer already brings in £8 billion in tax revenue from the beer and pub industry, but my concern is that that amount will go into slow decline. Already, the Office for Budget Responsibility and Her Majesty’s Revenue and Customs have made it clear that the money coming in from the increase in beer duty is not going to increase. It has not done so in the past year and it is not expected to do so in the next year. We therefore need to look at different ideas. One of them is not to keep taxing. We have had many debates about the Laffer curve and its benefits, but the simple reality is that beer duty is getting to the point where it is too high and it is pricing people out of the market.
Nigel Mills (Amber Valley) (Con)
Does my hon. Friend agree that one of the problems of getting the duty rate too high is that it gives a boost to the illicit trade, which now makes up about 10% of the off-sale market? The higher the duty is pushed, the higher the illicit sales go and so no duty at all is received.
Gavin Williamson
The worst thing we could possibly see is the growth of the illicit trade and the Chancellor of the Exchequer getting none of the money whatsoever. We want to make sure that people are paying their taxes and their duty, but we do not want to tax people out of the market.
Richard Drax (South Dorset) (Con)
May I add a slightly solemn note to what has been a light-hearted debate? I had a great friend, David Woodhouse, the chairman of Hall and Woodhouse in Blandford, who died aged 49 of a heart attack, running his company. He said to me on many occasions that he could not understand why Governments, and ours in particular, were proposing this tax every year, given that it is a tax on jobs at a time when we are trying to increase jobs. Surely that must be a point for the Government to take away from this debate.
Gavin Williamson
My hon. Friend touches on an important point: this is not only about jobs, but about British jobs. Some 68% of the drinks that our pubs sell are beers, so this duty is having a detrimental impact on every one of our pubs. Furthermore, 86% of all that beer that is consumed is produced in this country, which compares with a figure of 0.2% for wine.
Julian Sturdy (York Outer) (Con)
I congratulate my hon. Friend on securing this very important debate. He is absolutely right in what he says about the jobs in the pub and brewing industry, but let us also not forget the malting industry, which has a great tradition, especially in Yorkshire. I must declare an interest, because there is also an impact on the farming industry. The job creation that is affected by the beer duty escalator goes right from the grain to the glass.
Gavin Williamson
I would never expect anything other than an intervention from a great colleague of mine, who also is a farmer, to enable us to understand the whole process of the brewing industry and to put it into perspective for us.
Julie Hilling (Bolton West) (Lab)
I congratulate the hon. Gentleman on securing this debate, and he is being extremely generous with his time. Does he agree that it is also ironic that we are increasing the tax on beer, which drives people to drink much more harmful substances—drinks with a much stronger alcoholic volume—so raising the duty all the time is not good for the nation’s health either?
Gavin Williamson
The hon. Lady makes a very valid point. One of the consequences of having a Scotsman as Chancellor for quite a period of time is that the duty on Scotch whisky seemed to be frozen. Perhaps now that we have an English Chancellor what we need is to freeze the duty on English beer. There is so much that we need to be doing. We need to be reviving our pubs. We need to be seeing that vigour and sense of community returning to all our pubs across the country.
Andrew Bingham (High Peak) (Con)
I congratulate my hon. Friend on securing this debate; the number of Members here at this late hour shows its importance. Does he agree that pubs not only sell beer, but provide a great community centre in small and rural communities? So many charity collections and fundraising exercises begin in pubs, where people meet and talk.
Gavin Williamson
My hon. Friend makes a valid point. In addition, pubs are an important part of the economy and employ young people. In my constituency, 50% of those employed in the beer and pub industry are under the age of 25.
We all talk about the beer duty escalator. Just the other day, I was in a department store. I went up an escalator, and then I noticed that I went down one. So I say to the Minister that we could keep a beer duty escalator, but perhaps put it in reverse.
Andrew Jones (Harrogate and Knaresborough) (Con)
My hon. Friend is being very generous and possibly setting a world record in taking interventions. A suggestion that might meet the requirement from the Treasury Bench to raise revenue and which builds on the points made by colleagues about supporting the industry and supporting pubs is to remove the escalator just from cask ales. Those ales are available only in pubs. British pubs are of course part of our heritage and we are talking about a British product with a British supply chain, as my hon. Friend the Member for York Outer (Julian Sturdy) said. We have great pubs, particularly in the Yorkshire area.
Gavin Williamson
Unfortunately, they are not as good as those in the county of Staffordshire—although I am sure the pubs in Yorkshire are not bad.
I would love the Minister to stand at the Dispatch Box and announce to the whole Chamber that the beer duty escalator will be frozen or reversed. I know that she carries many burdens on her shoulders and may not be able to give us that promise, so I ask her to meet me and other colleagues who have such concerns in order to listen to the arguments put forward by the industry and by people who feel passionately not just about our pubs but about our beer and our great breweries—a part of our industrial heritage that is living and breathing today.
I am quite sure that if the Minister can take the arguments to the Chancellor and to all those in the Treasury and convince them that we need either to freeze beer duty or to let it rise only in line with inflation rather than at inflation plus 2%, she will be able to provide an enormous boost not just to British breweries and British beer but to the great British pub. I am quite sure that, if my hon. Friend can achieve that, when she next enters the pub every punter will be raising their glass to the Boadicea of British beer.
Finance Bill
Gavin Williamson Excerpts(13 years, 6 months ago)
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Jacob Rees-Mogg
It would be an impertinence for someone who entered the House in only the past two years to aspire, even hypothetically, to the height of Chancellor of the Exchequer. I leave that question to my hon. Friends on the Government Front Bench, who, having listened carefully to all that is said in this debate, will no doubt advise the Chancellor. They may consider the figure of 36p in the pound to be perfectly suitable—or they may go further and advocate a flat tax, which is a very attractive proposition. Perhaps people could have tabled an amendment to that effect, but sadly they did not. As I understand from my hon. Friend the Member for Amber Valley (Nigel Mills), who is no longer in his place—
Jacob Rees-Mogg
Oh, he is behind me. My hon. Friend the Member for Amber Valley said that the effect of the amendment from our Labour friends would be to bring the tax rate down to 40p. I am not sure that it was wise of him to say that, because those of us who were listening may be tempted to go into the same Lobby as the Opposition later, to help them achieve that objective.
I want to talk about the other great aspect of the Budget, and to give full credit to our Liberal Democrat friends for twisting Conservatives’ arms to get them to do something that they have always wanted to do anyway: get as many people out of taxation as possible by raising the thresholds. As the thresholds are raised, so the incentive to work becomes greater. The hon. Member for Edinburgh East (Sheila Gilmore) said that we wanted to make the out-of-work work harder by cutting their benefits, and the in-work work harder by cutting their taxes, and thought that was illogical. Of course it is not, because a person does not get unemployment benefit for working; if a person works, they lose their benefit, and if we encourage people to work, they have more money. Likewise, if we cut people’s taxes, they have more money, so they are likely to work harder.
When we raise the threshold, we find that many millions of people are able to work more easily. They will be taken out, to some degree, of the poverty trap, which is one of the most crushing and pernicious taxation and benefit traps that anyone has to face. The move, in stages, to a £10,000 threshold is a very bold thing to do in a time of economic difficulty, but it may have some of the greatest social benefits of any of the policies that the Government are following. It really is a noble approach to taxation—an objective that is fundamentally worthy.
Amendment of the Law
Gavin Williamson Excerpts(13 years, 9 months ago)
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Gavin Williamson (South Staffordshire) (Con)
It is a privilege to speak in today’s Budget debate. There has been an interesting contrast in the two speeches made from the Dispatch Box today. One, made by the Chancellor, set out his vision and ideas about bringing growth to our economy, supporting business and families and making things happen in this country. The other speech, by the Leader of the Opposition, had one interest solely—making sure that he stayed the leader of the Labour party. It was not about the national interest or trying to help the country to go forward, but about remaining leader.
Those on the Government side of the House, Conservatives and Liberal Democrats, are here to try to do what is best for our nation. Those on the Opposition side cannot say the same about themselves. If they can—and I hope that they are of that mind—they will march through the Lobbies with us when the Budget vote comes, supporting us and making sure that the country is growing once more.
The Budget helps two principal areas—business and families. Already, this Government have done more for my constituents in our almost two years in power than the previous Government did in 13 years. This Government are already delivering jobs for South Staffordshire, with the £350 million investment by Jaguar Land Rover on the i54 business park, bringing 750 jobs directly into the constituency. I remember Labour Members deriding enterprise zones and saying that they would not work. Well, I am rather proud to have an enterprise zone in my constituency, because it helped to bring in those 750 jobs. I am sure that many Labour Members will now want enterprise zones right across the country, even in the devolved regions.
Mr Marcus Jones (Nuneaton) (Con)
Does my hon. Friend agree that the current situation, with enterprise zones, the regional growth fund and the support that is being given to industry, particularly motor manufacturers in the west midlands, is a complete contrast with what happened with the failed regional development agencies during the period of the Labour Government, when private sector employment in the west midlands fell?
Gavin Williamson
My hon. Friend makes a pertinent point. Although there has been recovery in the automotive sector, unfortunately the supply chain that supports those manufacturing companies was hollowed out over the course of 13 years. I hope that Members on both sides of the House recognise that that is a serious problem. I pay tribute to the previous Government for taking some action at the tail end of their period in office in setting up Automotive Council UK, which has been carried on and strengthened by this Government. That is a positive move, but we need to be doing so much more to support not only manufacturing companies, which I am most passionate about, but many more service companies and other companies across the length and breadth of the country.
The Budget included an announcement on reducing corporation tax. A lot of people say, “That does not matter; it will not make a difference to business.” If that were the case, one might ask why the Republic of Ireland is so determined always to make sure that it keeps its low corporation taxes, but we know that it does that because it knows that it makes a difference in bringing in inward investment. Companies that want to invest in Europe are trying to make sure that they invest in the right place, which, in my view, is the United Kingdom. The moves to reduce corporation tax will have an enormous effect on bringing jobs to the UK—not only to my constituency or the constituencies of Government Members, but to every single constituency in the country.
We must also welcome the moves to simplify our tax system. We see so many people setting up small businesses, giving it a go, and trying to make a difference and do well for themselves, but then being faced with a barrage of bureaucracy and complex regulations that they have to master. It is a shame that anyone could not welcome the moves to make sure that all businesses with a turnover of under £77,000 will be free of many of those regulations. I hope that Labour Members will join us in the Lobby in support of that measure, because it will have an enormous impact on every business.
Another development that we must welcome is enterprise loans for young people. Far too often, young people with great ideas and great ambition do not have the finance to build their own businesses. I think of a constituent of mine, Louis Barnett, who decided against all the odds to set up a business, to go out there and to make a success of it. Finance is not always easy to find, but despite everything being against him, he did it. He has set up an incredibly successful chocolate company, which exports to Mexico, Ireland, China and Korea. He is making a success of it. We need to encourage many more young people to set up businesses across Britain. That is what the Chancellor has done and we should all support it. We need to give our businesses every possible chance.
Some Opposition Members are pouring scorn on somebody who wants to make a successful business by making and selling chocolate and exporting it around the world. Perhaps that is why the previous Government made such a dreadful mess of our manufacturing base and brought this country to its knees.
Mr Marcus Jones
My hon. Friend’s argument is being given a bit of harsh treatment from Opposition Members, who seem to think that all was rosy in manufacturing under the Labour Government. Is it not the case that 1.7 million jobs were lost in manufacturing during the period of the Labour Government?
Gavin Williamson
My hon. Friend makes a valid point. Manufacturing was destroyed under the Labour Government. When the Conservatives were last in power during the 1990s, there was growth in manufacturing. We saw the same amount of gross value added in manufacturing and the industrial sector in the United Kingdom—
Gavin Williamson
No I will not. In the 1990s, there was the same amount of gross value added in manufacturing and the industrial sector in the UK as in Germany. That has now been halved. That is down to the incompetence and neglect of the last Labour Government. I happily give way to the hon. Gentleman.
Mr Bailey
I thank the hon. Gentleman for giving way belatedly. As a fellow west midlands MP, I am slightly surprised by his comments about the record of the previous Conservative Government on manufacturing in the west midlands. Will he list the major employers—employers of thousands of people—that failed during the period of the previous Conservative Government in the black country and the west midlands?
Gavin Williamson
I will happily talk about what happened under the previous Conservative Government, although it is going a little way back. Between 1992 and 1997, exports from the manufacturing base in this country grew and gross value added grew, because we created an environment in which manufacturers could grow. That did not happen under the last Labour Government, when jobs and businesses were destroyed. The Chancellor is committed to reversing that. I can give many examples of businesses that failed under the Labour Administration. This Government are committed to helping businesses grow, which is to be welcomed.
Geraint Davies (Swansea West) (Lab/Co-op)
The hon. Gentleman is being gracious in giving way. I should say that my background is in multi-national companies and in starting my own businesses successfully. Does he accept that after his Government came to office, the growth forecasts reduced massively between the first and the second year? According to the Office for Budget Responsibility, the size of the economy will be down by £50 billion a year for ever because of his Government’s policies.
Gavin Williamson
I thank the hon. Gentleman for making those comments. It is fascinating that the International Monetary Fund has predicted that Britain will grow faster than Germany and France. It is true that the eurozone has had a negative impact on this country, but people see us as a country that is well run, with a Chancellor who is committed to making business growth happen. That is why we will grow faster than Germany and France. I am sure that the hon. Gentleman will welcome that.
I will move on briefly to families. It is often said that raising the personal allowance is a Liberal Democrat idea. Members will be shocked to hear that the matter was raised with me many times during the general election campaign. I told people that if I was elected as their Member of Parliament, I would do all that I could to ensure that personal allowances increased so that the lowest-paid—
Gavin Williamson
I will make some progress, thank you. I told people that I would try to ensure that we made progress on raising the personal allowances for everyone in this country, including the lowest-paid. I am particularly proud to see that the Chancellor has done that, and I am quite sure that every coalition Member will warmly welcome it.
I wish briefly to touch on one thing I would very much have liked the Chancellor to do, which is to tackle the issue of the beer duty escalator. In the Strangers Bar, one of the finest ales, Enville ale, is currently on sale as one of the guest ales. I encourage everyone to ensure that they have a pint of Enville ale, a fine beer but one from which I am quite sure we would raise just as much duty if we got rid of the beer duty escalator. I put in a plea for that, and it would be very much appreciated.
I welcome the news that we are going to have a national centre for aerodynamics. Again, that will support manufacturing, but let us ensure that it is in South Staffordshire. We have an aerospace industry that is highly dynamic and—
Oral Answers to Questions
Gavin Williamson Excerpts(13 years, 10 months ago)
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Gavin Williamson (South Staffordshire) (Con)
11. What fiscal steps he is taking to encourage job creation in the private sector.
The Chancellor of the Exchequer (Mr George Osborne)
We are making businesses more competitive by cutting business taxes, helping work pay by increasing the personal allowance and introducing universal credit, and helping unemployed people into work through our Work programme and work experience.
Mr Osborne
I will not pre-empt any Budget announcements, but I will say that we have extended small business rate relief to 2013. We announced that in November, and it will help more than half a million small businesses, and we have also introduced a deferral scheme to help larger businesses with their cash flow, so we are doing other things as well as reducing corporation tax—a further reduction in corporation tax is planned for April, of course—and cutting the small companies tax rate, which was due to go up under the previous Labour Government.
Gavin Williamson
The recent changes in research and development tax credits will provide a major boost for hi-tech manufacturing businesses based in my constituency and near it, such as Moog and Goodrich. What more can my right hon. Friend do to help generate more high-skilled, well-paid jobs in the manufacturing sector?
Mr Osborne
I have been very encouraged to hear about the success of companies in my hon. Friend’s constituency, including the two that he mentioned. We will provide further details later this year on the R and D “above the line” tax credit, on which we have listened to representations from industry and Members of Parliament. In the vicinity of my hon. Friend’s constituency, we also have the enterprise zone i54, which will start up in April. More generally, this is a week when 20,000 new jobs have been announced by Tesco and we have heard the great news that Nissan will produce a new car in the UK. There are some encouraging developments in the British economy.
Autumn Statement
Gavin Williamson Excerpts(14 years, 1 month ago)
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Mr Osborne
If the hon. Gentleman has specific proposals on credit insurance, I will be very happy to look at them. When it comes to credit easing more broadly, I have set a £40 billion envelope, although I have committed only £21 billion today, as it covers the two schemes that were ready to go: the national loan guarantee scheme and the business finance partnership. We are looking at partnership schemes and other things that might work within the envelope, and of course we are vigilant about conditions in the broader economy—including issues such as trade finance—that might be affected by the eurozone crisis.
Gavin Williamson (South Staffordshire) (Con)
I am sure that the Chancellor is aware that Jaguar Land Rover is currently constructing an engine plant in an enterprise zone in my constituency of South Staffordshire. Does he agree that measures on enterprise zones, R and D tax credits and infrastructure development will help the continued manufacturing revival?
Mr Osborne
Yes, I of course agree with my hon. Friend. Again, another success story at the moment is the car industry. I am absolutely delighted by Jaguar Land Rover’s announcement, which is a real vote of confidence in the UK—the company could have constructed that engine plant elsewhere in the world. The announcements that I have made on R and D above-the-line tax credits will also help larger companies do their R and D in Britain.
Public Service Pensions
Gavin Williamson Excerpts(14 years, 2 months ago)
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Danny Alexander
I think what the hon. Lady has said is total nonsense; that is not an appropriate characterisation of what we have done. I do not regret the way the talks have progressed for the past eight months, and I look forward to reaching agreement on this issue, with or without the support of the Opposition.
Gavin Williamson (South Staffordshire) (Con)
Will my right hon. Friend outline how he thinks the unions should respond to the proposals he has set out today? Does he agree with most Members on the Government Benches, who think the unions should respond by today calling off any planned industrial action?
Jobs and Growth
Gavin Williamson Excerpts(14 years, 3 months ago)
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Gavin Williamson (South Staffordshire) (Con)
It is a pleasure to be able to speak in this debate, but sometimes I listen to Opposition Members and just cannot understand where they have been for the last 10 or 12 years. If my constituents have been listening to some of the Opposition speeches, they will be equally shocked. They will remember a Chancellor who once used to speak of prudence and financial stability creating an economy where the books were balanced. Well, prudence was jettisoned a long time ago and it is certainly not a friend of the new shadow Chancellor. Until Opposition Members understand that they have to have a sensible, balanced economic approach, they will never have credibility with the people of South Staffordshire or, I am sure, the people of this country.
We often hear Opposition Members talk of a lost decade of low growth, low employment and low private sector employment. Well, we had a lost decade—a lost 13 years—in the west midlands between 1997 and 2010. You probably often sit there, Mr Deputy Speaker, wondering how many private sector jobs were created in the west midlands between 1998 and 2008. You were probably thinking it was perhaps 250,000—in those halcyon days, when house prices were booming and the economy was growing—but I am afraid to say that you would be wrong if you thought that. If you thought that the figure was 100,000, I am afraid that you would also be wrong. In fact, there was not a single net private sector job created between 1998 and 2008 in the west midlands. We saw a decline of more than 60,000 private sector jobs in the region.
Chris Leslie
Can the hon. Gentleman tell us whether unemployment has risen or fallen in his constituency since he was elected?
Gavin Williamson
The hon. Gentleman makes an interesting point. Between September 2010 and September 2011, 74 additional people became unemployed in my constituency. That is a tragic situation, but this Government are doing something about it. Unlike the previous Government, who did little or nothing for my constituency, this Government are delivering. I will explain how. We are out there creating and delivering jobs, and making things happen in South Staffordshire. Already, thanks to the actions of this Government, we have been able to save 400 jobs there by ensuring that the investment was delivered for Moog, an important employer in my constituency, which is relocating to a new factory on the i54 business park.
What is more, this Government are committed to delivering more jobs, not only in my constituency but right across the west midlands. Through the Government’s actions, we have secured an enormous investment of £350 million from Jaguar Land Rover to build a new engine plant on the i54, which has been designated an enterprise zone.
Emma Reynolds
I live about 300 metres from the i54 site. Will the hon. Gentleman admit that, were it not for the Labour Government and the regional development agency, which decontaminated the site, invested in it and made it a strategic site, we would never have had that investment in the first place?
Gavin Williamson
I thank the hon. Lady for making that point, but let me explain something. Having run a manufacturing business for many years before entering the House, I quickly discovered that when considering relocating a factory to a new site, two core ingredients are needed. They are electricity and gas, but no funding had been provided by Advantage West Midlands to install either on that site. If that is far-sighted policy from a regional development agency, I do not think it is particularly great.
The investment from Jaguar Land Rover will create 750 jobs in my constituency and the wider area, as well as many thousands more. This country is now investing in manufacturing again. It is no longer a country with a declining manufacturing base, in which manufacturing declined from 21% to 12% of our gross domestic product. We are now ensuring that that percentage will grow, because that is what we need. I believe that this Government will deliver that.
This is not just about encouraging manufacturing; it is about encouraging the service sector and all the other sectors. We are supporting small businesses as well as big ones. We have already seen a massive increase in the research and development tax credits available to small businesses. I recently visited Squire, the makers of some of the finest padlocks in the country. I suggest that Members purchase one for their garden shed. The R and D tax credits introduced at the last Budget for small and medium-sized enterprises are encouraging businesses such as Squire to invest in research and development and in innovation to provide them with a secure, prosperous and healthy future.
Those are the initiatives that South Staffordshire needs, and that the whole country needs. The Government have a difficult legacy to deal with, thanks to Labour, but they are helping Jaguar Land Rover, Moog and all those other businesses through the creation of enterprise zones and the lowering of corporation tax. They are supporting those businesses at every level, and that is what will deliver growth for this country.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
Today we are talking about this Government’s 18 months of turning growth into stagnation and how they are essentially borrowing to cut. “A manufacturing export-led recovery” is the Government’s phrase—something I agree with—but those words sound as hollow as the Tory conference floor during the Prime Minister’s conference speech. The industrial production numbers for August coupled with a quarterly poll from the British Chambers of Commerce point to the reality of long economic stagnation. Industrial output was up 0.2% between July and August, but that was entirely due to volatile energy and utility sector prices. Manufacturing output was down 0.3% month on month—much worse than predicted—with export order prospects at their worst for two years according to the BCC.
In retail, consumers are spending less than a year ago, as domestic spending runs below inflation. For all the talk of an export-led manufacturing policy, the Government are still completely reliant on an ever-falling pound in relation to the dollar. However, that is by no means an industrial strategy, and it is certainly not industrial activism, especially as LEPs—another Government growth policy—still have no discernible powers. Nor do they have budgets or money, making them easy to organise, as they do not need accounts departments. Enterprise zones are vague, while funding for the regional growth fund nationally in England is, as we all know, lower than the pot of cash for the Post Office mutualisation fund. Indeed, we have waited six months for the RGF to be financed, but we have still received no answer from the Government Front Benchers about when that money will come through.
Tom Blenkinsop
I am sorry, but I am not taking any interventions because of the time.
Those on the Government Front Bench talk about an employee having to work for 24 months before being eligible for employment rights, but that might give the Government some difficulty, because it would run counter to the interests of new starters—young people seeking work, as well as apprentices. If the Government elongate the time to 24 months, it will be easier for a company to sack an apprentice.
Today in the north-east, we have seen a reduction in employment of 17,000, an increase in unemployment of 19,000 and a 1,500 increase in those claiming jobseeker’s allowance. We have seen the highest UK unemployment since 1994. What is the cost to the Treasury and the taxpayer in benefits? The situation also damages demand in the economy.
Oral Answers to Questions
Gavin Williamson Excerpts(14 years, 4 months ago)
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Mr Gauke
I am afraid that the hon. Lady might not have listened to my earlier answer. The fact is that the primary cause of the increase in inflation has been global commodity and energy prices. It is also worth pointing out that our currency depreciated in value quite significantly a couple of years or so ago. The VAT increase was necessary in order to reduce the deficit—a policy that was recognised by the previous Chancellor of the Exchequer.
Gavin Williamson (South Staffordshire) (Con)
Did my hon. Friend inherit any work by the previous Government on plans to increase VAT if they had won the general election?