Oral Answers to Questions

George Osborne Excerpts

Tuesday 5th November 2013 Commons Chamber

[Paul Maynard (Blackpool North and Cleveleys) (Con)]

2. What assessment he has made of the effect of freezing fuel duty on the price of petrol.

[The Chancellor of the Exchequer (Mr George Osborne)]

Thanks to this Government’s action, pump prices are 13p a litre lower than they would have been under the previous Government’s plans. Provided we can find the savings to pay for it, my intention is to freeze fuel duty for the rest of this Parliament.

[Paul Maynard]

I thank my right hon. Friend for that reply. The cost of fuel is of great concern to many of my constituents. If he can freeze the price of fuel for the remainder of this Parliament, how much cheaper will petrol be, come the next election?

[Mr Osborne]

If we are able to freeze petrol prices for the rest of this Parliament, the price will 20p a litre lower than it would have been if we had stuck with the plans that the shadow Chancellor advocated at the last general election. That would mean, as my hon. Friend the Economic Secretary was just reminding us, a saving of over £10 every time people filled up their average car. That is what this Government are doing; by fixing the public finances, we are able to help people.

[John Mann (Bassetlaw) (Lab)]

When the Chancellor became Chancellor, unleaded petrol was £1.19 a litre. Can he tell us how much it is today?

[Mr Osborne]

It depends, of course, where you buy it. The last price I saw at a petrol station was around £1.35, but it would have been 20p higher if we had stuck with the last Government’s plans—the hon. Gentleman voted for them—in the last Labour Budget. That is the truth, and it is because we are fixing the public finances and fixing the economy that we can avoid these disastrous Labour tax rises.

[Mr Andrew Tyrie (Chichester) (Con)]

The freeze on duty makes a crucial contribution to improving business competitiveness, and will have been welcomed by all our constituents throughout the country. Will the Chancellor undertake, as part of his work on the autumn statement, to publish the Treasury’s own estimate of the full amount by which both motoring and energy input costs have been increased by climate change-related measures?

[Mr Osborne]

Of course the OBR provides an assessment of the impact of Government policies on the economy, and I will consider my hon. Friend’s specific suggestion that we look into the impact of climate change policies on energy prices. We are currently examining the charges and levies that the last Government, among others, added to energy bills, and seeing what we can do to roll them back in order to provide relief for customers.

[Mr Nigel Dodds (Belfast North) (DUP)]

I welcome the action taken by the Government to freeze fuel duties, but UK taxes on petrol and other fuels remain among the highest in any country in the European Union. What will the Chancellor do to remedy that much unwanted achievement?

[Mr Osborne]

I looked at the plans that this Government inherited, and then cut petrol duty in March 2011. We have frozen the duty ever since, and I intend to continue the freeze for the rest of the current Parliament, provided that we can find the savings to pay for it. That is the crucial point: if we do not sort out the economy, if we are not fixing the public finances, if we do not have an economic plan, we cannot have a living standards plan.

[Robert Halfon (Harlow) (Con)]

Notwithstanding the excellent news of the fuel freeze, petrol pump prices are still under threat from hard-liners at Grangemouth. Does my right hon. Friend agree that extremism in the pursuit of hard-pressed motorists is no virtue?

[Mr Osborne]

My hon. Friend is absolutely right. The greatest threat to fuel supplies recently has been the threat of industrial action from the Unite union, led by the chair of the Falkirk Labour party. We now hear the former Labour Chancellor and the former Labour Foreign Secretary saying that Labour should open its inquiry and publish what it finds, and a Labour Front Bencher saying that Labour does not “publish internal documents”.

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

I shall return to the actual question of duties. Has the Chancellor found the £750 million that is needed to pay for the freeze? At the party conferences, he also promised to spend a further £700 million on school meals, a further £300 million on his Work programme, and a further £600 million on a marriage allowance. That is £2.3 billion of promises. Let us be clear about this. Is the Chancellor going to raise taxes or cut services to pay for those promises, or is he planning simply to borrow even more? Which is it?

[Mr Osborne]

What a question from a Labour Front- Bench team that wants to spend £27 billion more, and to borrow every penny of it. If this is the hon. Gentleman’s debut performance as shadow Chief Secretary, I am afraid that he will have to do a lot better. His job should be to control the promises that he makes. As for our side, we are paying for the commitments that we are making to the hard-working people of this country.

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

How?

[Mr Osborne]

I will tell the right hon. Gentleman how: by sorting out the mess that he created.

[Chris Leslie]

Despite all that hot air, it seems that there are still £2.3 billion of unfunded promises. Would it not be far easier if all those promises were fully costed and funded and independently checked by the Office for Budget Responsibility, just to ensure that the Chancellor’s sums add up?

We have proposed that all the main political parties should be able to submit tax and spending plans to the OBR ahead of the election manifestos. Surely we can all agree that—as the Chair of the Treasury Committee has suggested—an independent audit by the OBR for all the main political parties would be good for the democratic process, so will the Chancellor now join us in a cross-party consensus on that?

[Mr Osborne]

As to a cross-party consensus, I remember when I was speaking from the Opposition Dispatch Box and the hon. Gentleman’s party was in government that it opposed the creation of the OBR—opposed it time and again. I believe it is important that we preserve the independence and integrity of this new body, which is working well but is entrusted with the very important task of providing the economic forecasts for whoever is in government. That should be its primary purpose and the changes to the primary law that the hon. Gentleman is proposing are not very practical.

[Roger Williams (Brecon and Radnorshire) (LD)]

3. What his policy is on the issuing of Government bonds in the form of sukuk; and if he will make a statement.

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[Nigel Adams (Selby and Ainsty) (Con)]

11. What estimate he has made of the number of jobs created in the private sector in the last 12 months; and if he will make a statement. [R]

[The Chancellor of the Exchequer (Mr George Osborne)]

In the past year, employment in the private sector has increased by 380,000, more than offsetting the fall in public sector employment of 104,000. For every public sector job lost, more than three have been created in the private sector. That confounds the predictions of those who thought it could never happen.

[Graham Evans]

Unemployment in my constituency is lower than it was when I became the MP. With the further good news that Waitrose is creating 140 new jobs in Northwich later this month, will my right hon. Friend the Chancellor set out how small and medium-sized enterprises will benefit from a reduction in national insurance contributions?

[Mr Osborne]

I am delighted by the news of the new jobs being created by Waitrose in Northwich; as my hon. Friend well knows, I represent part of that town. That will be good for the people who live in it, and I hope that some of my constituents will find work there. The employment allowance, which we debated in this Parliament this week, is going to take £2,000 off the national insurance bill of every firm, but the biggest benefit will be felt by the smallest companies; 450,000 firms will be taken out of employer NICs altogether. That is a real boost for business, and it shows how we can help to support the recovery.

[Nigel Adams]

Unemployment is down by almost 30% in my constituency since the last election. Given that Selby lost almost 2,000 jobs in 2004 in the mining industry, that is very encouraging. Given UK Coal’s recent troubles and its callous decision to withdraw concessionary fuel from some ex-miners and their widows, what comfort can the Chancellor give to these pensioners, who potentially face fuel poverty this winter?

[Mr Osborne]

I know that this difficult situation has been brought about by the failure of UK Coal. I congratulate my hon. Friend on leading this campaign to do something about the situation, and I know that my hon. Friends the Members for Sherwood (Mr Spencer) and for Nuneaton (Mr Jones) have joined him in coming to see me about it. We are looking very carefully at the case for what we can do to help those who have had their concessionary fuel allowance taken away because of the failure of UK Coal. I am personally looking at this case and I hope to have some good news shortly.

[Anas Sarwar (Glasgow Central) (Lab)]

Evidence shows that it is not just having a job, but having the right job and the right level of pay that lifts someone out of poverty. So can the Chancellor tell us how many of those new jobs that have been created are full-time jobs, how many do not involve zero-hours contracts and how many actually pay the living wage?

[Mr Osborne]

We have 1.4 million new jobs in this economy. To take on the point about part-time work, there has also been an increase in the number of hours worked in the economy, and a lot of the recent increase in employment has come from full-time employment. Let us compare that with the disastrous situation we inherited from the Labour party, where unemployment was rocketing and youth unemployment was rocketing. Unemployment is now lower than it was at the general election, and many thousands—[Interruption.] That is the fact. Many thousands of young people have come off the claimant count for youth unemployment, too.

[Catherine McKinnell (Newcastle upon Tyne North) (Lab)]

Can the right hon. Gentleman now confirm that the number of people working part time because they cannot get a full-time job has risen over the past year to 1.45 million and is now at a record high? With prices rising faster than wages for 39 of the past 40 months, is this not just another reason why so many working people are facing a cost-of-living crisis after three wasted years under this Chancellor?

[Mr Osborne]

The best thing we can do for anyone’s cost of living is make sure that they have a job. Jobs are being created under this Government, after they were destroyed by the Labour Government. I am surprised that the hon. Lady did not thank us for creating an economy in which, in her constituency, unemployment is falling, and has fallen over the past year, and the claimant count is falling, when it was rocketing in the last years of the Labour Government.

[Michael Moore (Berwickshire, Roxburgh and Selkirk) (LD)]

The Chancellor made some important announcements last week about the future of the Royal Bank of Scotland. Although we are absolutely right to keep pressing the bank to improve its poor lending record, will he also put on record the need for us to recognise the hugely important private sector jobs underpinned by RBS in Scotland and elsewhere, and the fact that we see a strong future for that company?

[Mr Osborne]

I have discussed RBS and what we can do to ensure that it supports the Scottish economy with my right hon. Friend on many occasions. The plan that the management has proposed, which we and the Governor of the Bank of England support—it is the first time since RBS collapsed in autumn 2008 that all those groups agree on a single strategy for the bank—will mean a strong, healthy future for RBS as a bank that supports the entire United Kingdom economy and, in particular, the Scottish economy. It is an important part of Scottish economic history and of Scotland’s economic future, too.

[Julie Hilling (Bolton West) (Lab)]

6. What recent assessment he has made of the rate of increase in (a) average earnings and (b) consumer price inflation.

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[Mr Ronnie Campbell (Blyth Valley) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Chancellor of the Exchequer (Mr George Osborne)]

The core purpose of the Treasury is to ensure the stability and prosperity of the economy. Today I can also announce another step in the fight against tax evasion. This afternoon we will sign a tax information-sharing agreement with the Cayman Islands—the first ever with an overseas territory. As a result, information on UK taxpayers held in the Cayman Islands will automatically be provided to Her Majesty’s Revenue and Customs, which will use it to collect the tax that is due.

[Mr Campbell]

Is it still the Chancellor’s intention to withdraw jobseeker’s allowance from all young people under the age of 25?

[Mr Osborne]

That is not part of the Government’s programme. We are seeking to help young people into work through the Work programme and the Youth Contract. The good news is that the youth claimant count has fallen by many tens of thousands. I would have thought that the hon. Gentleman would use this opportunity to get up and point out that unemployment has fallen in his constituency over the last year, and there are—[Interruption.] Unemployment has fallen in his constituency, and every job created is one that he should be celebrating. He should remind his constituents of the enormous damage done to the north-east economy by the previous Labour Government.

[Glyn Davies (Montgomeryshire) (Con)]

T3. The most important financial issue in the lives of many young families is mortgage interest. Does my right hon. Friend the Chancellor agree that the best way—indeed, the only way—to keep mortgage rates low is to stick with the Government’s economic plan of cutting the deficit?

[Mr Osborne]

I completely agree with my hon. Friend. Of course, one of the consequences of the higher borrowing that the Labour party is advocating would be not just higher taxes, but higher interest rates, which would be absolutely disastrous for families. That is precisely why we have to stick with the economic plan that is delivering the recovery.

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

I welcome the Economic Secretary and the shadow Financial Secretary to their new jobs, and let us not forget the former Treasury Whip, the Treasurer of Her Majesty’s Household, the hon. Member for Chelsea and Fulham (Greg Hands), who has finally got the promotion we have been urging him to get for three years.

On this Chancellor’s watch, the UK is experiencing the slowest recovery for more than 100 years, and with prices, including energy prices, rising faster than wages, for millions of people this is no recovery at all. Yet from the Chancellor’s earlier answers to the Chair of the Treasury Committee, he seems to think he can get away with cutting energy bills by simply shifting the burden of his green levies on to the ordinary taxpayer. Let me ask the Chancellor—[Interruption.]

[Ed Balls]

Why will the Chancellor not agree with us and Sir John Major that it is the energy companies that are making the excess profits and that it is they, not the ordinary taxpayer, that should bear the burden?

[Mr Osborne]

First, I join the right hon. Gentleman in welcoming the two hon. Ladies to their new Front-Bench positions, although I think he got the title wrong of his new shadow Exchequer Secretary. By the way, while I am at it, may I welcome the fact that the right hon. Gentleman did not move in the reshuffle, because he is exactly where we want him to be?

Perhaps one of these days the right hon. Gentleman will welcome the fact that GDP is increasing, that unemployment is coming down and that today we had the best services purchasing managers index since May 1997. I believe we should roll back some of the levies and charges that have been imposed on energy bills. I am not clear whether he agrees.

[Ed Balls]

After three years of flatlining, people are worse off because of this Chancellor of the Exchequer. As for ordinary people’s rising energy bills, he just does not give an EDF.

Is it not the case that, over the past year, energy prices in the euro area fell by 1.7% while in the UK they have risen by a staggering 7.7%? Simply switching green levies on to the taxpayer is giving with one hand and taking with the other. Why does this Chancellor always hit ordinary families while standing up for a powerful few?

[Mr Osborne]

With questions like that, the right hon. Gentleman is never going to be npower, is he?

The truth is that the right hon. Gentleman created a situation in our economy whereby living standards were hit hard, because he destroyed jobs and economic prosperity. Like a bonfire on Guy Fawkes night, every single one of his economic predictions has gone up in smoke, and he has nothing credible or serious to say about the British economy.

[Kwasi Kwarteng (Spelthorne) (Con)]

T4. Is it not true that the only way to improve considerably our standard of living is to focus on the economic situation of the country to boost growth and pay down debt?

[Mr Osborne]

I completely agree with my hon. Friend that unless we have a credibly economic plan to grow the economy, deal with public finances and support business rather than tax it, we will get the reaction the shadow Chancellor got from the CBI, whose members said that the hairs on the backs of their necks stood up as they listened to all the terrible things that a Labour Government would do to them. The truth is that we are fixing the economic mess the shadow Chancellor left behind, and that is the best way to improve people’s living standards.

[Toby Perkins (Chesterfield) (Lab)]

T2. The Chancellor was warned that his cuts would choke off the growth that had returned to the UK economy when he took the job in 2010. Of course we welcome the fact that Britain is finally returning to growth, but does he not realise that if he had taken the advice of my right hon. Friend the Member for Morley and Outwood (Ed Balls) earlier, we would not have had three wasted years, the average working person would not be £1,500 worse off, and the talents and potential of 1 million young people would not have been laid to waste?

[Mr Osborne]

I remind the hon. Gentleman that the shadow Chancellor said that our economic policies would choke off the recovery in the spring of this year—the very moment when the recovery was under way. When will a Labour MP welcome the fact that our GDP has grown by 0.8% and unemployment is coming down? When will Labour acknowledge that it is our economic plan that is delivering that?

[Mr David Heath (Somerton and Frome) (LD)]

T5. One of the frustrations of losing ministerial office is that one cannot see through the things that one started. Will the Chancellor look carefully at the recommendations of the independent future of farming review, which I commissioned, because it has made far-reaching suggestions for changes in taxation that will benefit rural areas?

[Mr Osborne]

I pay tribute to the work that my hon. Friend did in government. I will make it a personal priority to ensure that his review sees the light of day and is acted on.

[Chris Ruane (Vale of Clwyd) (Lab)]

T7. Why has the number of the working poor doubled since the Chancellor took office?

[Mr Osborne]

The key thing is that people are getting into work. That is another Labour MP who has not acknowledged the fact that unemployment has fallen in his constituency. When will Labour Members acknowledge that our economic plan is repairing the mess that they left behind?

[Andrew Griffiths (Burton) (Con)]

T6. On behalf of brewers everywhere, I thank the Chancellor for being the man who scrapped Labour’s hated beer duty escalator and who cut beer duty for the first time since 1959. Last month saw the biggest growth in beer sales this century, with 1 million extra pints being sold and £60 million extra going to the Exchequer. I ask him to keep supporting Britain’s pubs and brewers.

[Mr Osborne]

This is a case of teamwork, because my hon. Friend has led a brilliant campaign involving many Members of Parliament in support of the local pub industry in their constituencies and the brewing industry, which is so important in Burton. The work that he has done has been fantastic. It was thanks to his campaign, which drew the evidence to my attention, that we were able to take the action that he has welcomed.

[Mrs Mary Glindon (North Tyneside) (Lab)]

T10. Will the Chancellor make a statement on why the decision has been taken to extend HMRC’s pilot of the new customer service model in the north-east by two months until the end of December?

[Sir Edward Leigh (Gainsborough) (Con)]

T8. As you know, Mr Speaker, I am of a nervous disposition. I was therefore alarmed this year—not three years ago—to hear predictions that 1 million jobs would be lost, there would be a decade of lost growth and the recovery would be choked off as a result of the Government’s plans. Will the Chancellor allay my fears and explain what has happened in the real world?

[Mr George Osborne]

My hon. Friend is right that there were a lot of predictions from the Opposition Dispatch Box. They said that there would be a decade of lost growth, but the economy is now growing and we have had the fastest growth in the G7 this year. They predicted that 1 million jobs would be lost, but 1.4 million jobs have been created in the private sector and unemployment is down. Above all, they advocated—indeed, they continue to advocate, because it was in the speech that the shadow Chancellor made yesterday—increased borrowing, which would lead to higher taxes and higher interest rates. The biggest threat to the British recovery is sitting right opposite me.

[Ms Margaret Ritchie (South Down) (SDLP)]

What progress has been made on the extension to the fuel duty rebate scheme, which is due for further implementation via a submission to the European Commission?

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[Stuart Andrew (Pudsey) (Con)]

T9. I was delighted to welcome my right hon. Friend to Hainsworth mill in my constituency recently. Will he join me in welcoming the news that production output increased by 0.5% in the last quarter, and does he agree that that shows that British business is rising to the challenge of rebalancing the economy after an unsustainable decade under the Labour party?

[Mr George Osborne]

I was very impressed by the work being done at Hainsworth mill, which is one of the oldest textile mills in Britain and has been going for a couple of hundred years. It is now exporting textiles from west Yorkshire to China, which shows that the British economy can achieve remarkable things if we get the investment and economic policy right. My hon. Friend is right: we must stick with the economic plan that is continuing to improve the situation in his constituency and across the country.

[Meg Munn (Sheffield, Heeley) (Lab/Co-op)]

Every newly created job in the private sector is very welcome, but will the Chancellor tell the House how many public sector jobs have been redesignated as private sector jobs in the past three years?

[Mr Osborne]

I am happy to write to the hon. Lady with that number. Let us be clear: the Labour party and the shadow Chancellor said it was a complete fantasy that private sector job creation would outstrip the loss of public sector jobs required by fiscal consolidation. That is complete nonsense and we have not yet had an apology from the shadow Chancellor.

[Ian Swales (Redcar) (LD)]

Companies up and down the country have been investing in manufacturing capacity for the green infrastructure of tomorrow. Those in the north-east Energi Coast consortium have already invested £400 million. Will the Chancellor confirm the Government’s commitment to support the renewable energy industry?

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

The Institute for Fiscal Studies estimates that more than 1 million more children will be living in poverty in 2020, which absolutely wipes out the number of those lifted out of poverty under the previous Labour Government.

[Mr George Osborne]

The best approach to lifting children out of poverty is to ensure that they live in working households. We now have the lowest number of workless households since records began, which is due to the achievements of my right hon. Friend the Secretary of State for Work and Pensions, and of the economic plan that is getting the parents of children into work.

[Mr Peter Bone (Wellingborough) (Con)]

Given that the cost of the EU will double in this Parliament, and the huge current account deficit with the EU, does the Chancellor agree that our current economic relationship with the EU is wrong and that we should renegotiate?

[Mr Osborne]

I certainly agree that we need to reform the European Union so that our entire continent is not priced out of the global economy. We must also make reforms to the European Union, and Britain’s relationship with it, so that British businesses can thrive, compete and create jobs. I point out to my hon. Friend—he knows this anyway—that the cost of the European Union would have been much higher if my right hon. Friend the Prime Minister had not secured a very good deal. [Interruption.] The right hon. Member for Morley and Outwood (Ed Balls) says, “We did it,” but Labour gave up the rebate. The Prime Minister went to the EU battling for Britain and delivered for Britain.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

Over the past six months more than 350,000 people, many of them in work, have accessed emergency food aid from a food bank. When will the Chancellor visit a food bank so that he can see for himself the impact of his cost-of-living crisis on hundreds of thousands of people across the country?

[Mr Osborne]

I have visited a food bank in Northwich in my constituency and seen the excellent work it does. I commend the volunteers at that food bank, and indeed across the whole food bank movement.

[Several hon. Members]

rose—