Spending Review and Autumn Statement

Debate between George Osborne and Baroness Chapman of Darlington

Wednesday 25th November 2015 Commons Chamber

[Mr Osborne]

My hon. Friend is right that we have been able to boost skills in his Yorkshire constituency. We have been able to fund the great national parks of Yorkshire. We have also been able to invest in one of our great British industries, which has not always got a mention in Chancellors’ speeches in the past—farming. The big investment that we are making in agri-tech science with those four centres around the country, including one in York, will be very welcome.

[Jenny Chapman (Darlington) (Lab)]

Can the Chancellor explain why the OBR has just forecast that household debt to income levels are set to rise to above pre-crash levels?

[Mr Osborne]

The OBR is forecasting a rise in household debt which is partly reflected in a rise in house prices and therefore household assets, against which the debt is secured. But of course there is a big difference from the unsecured debt that we found in 2008. The big difference we now have is a Bank of England with a Financial Policy Committee, which is able to step in when it sees debt levels reach worrying levels. The Governor of the Bank of England signalled before the Treasury Committee yesterday concern about buy-to-let prices, for example, and he is receiving the powers to do something about it. That is a big change from the situation five years ago.

Oral Answers to Questions

Debate between George Osborne and Baroness Chapman of Darlington

Tuesday 6th March 2012 Commons Chamber

[Mr Osborne]

Of course we will listen to any proposals put to us. Clauses 69 to 76 include a new requirement on both the new bodies we are creating—the prudential regulator and the financial conduct regulator—to make a report when a regulatory failure has occurred. That trigger will be set out in the legislation, so we are providing additional powers to require reports when things go so badly wrong, as they did a few years ago.

[Mrs Jenny Chapman (Darlington) (Lab)]

The financial service from which my constituents most need protection is high-cost lending. The Chancellor’s remarks so far go nowhere near far enough in protecting consumers. We need a range of caps and we need some properly enforced regulation of advertising. When is the Chancellor going to do something about this?

[Mr Osborne]

I completely understand the concern about excessive and very high interest charges, which have been a problem for many years. I think it is better to tackle the specific abuses. The Government are conducting a review of the cost of credit to consumers, but by tackling very specific abuses such as the roll-over of loans and the use of continuous authority, we think we are getting to the really hard cases and abuses that we want to see ended. I have to say—this was certainly the view of the previous Government, too—that although it could be worth looking at, simply introducing a cap might have the effect of pushing a lot of people into a completely unregulated black economy. I am not sure that any of us would want to see that.