Autumn Statement

Debate between George Osborne and Bob Russell

Wednesday 3rd December 2014 Commons Chamber

[Mr Osborne]

Frankly, the hon. Lady is not being fair to the Government or to those territories and dependencies. There had been no progress at all when we came into office. They have all now committed to the automatic exchange of information; they all attended the conference in Berlin where they made the international commitment to do that; and they are all consulting, right now, on the creation of these registries. They are doing that because my right hon. Friend the Prime Minister put this issue centre stage on the G8 agenda in Lough Erne.

[Sir Bob Russell (Colchester) (LD)]

The Chancellor said that the end of our operations in Afghanistan will allow this country to save an additional £200 million this year from the special military reserve. There is also the sale of surplus Ministry of Defence radio frequencies, which he did not mention. Will he agree to ring-fence both sums to pay to modernise the family homes of the brave men and women of our armed services, whom he says he salutes?

[Mr Osborne]

We do have a programme, which we have extended, to renovate the accommodation of service families. We are all aware of the challenges that many families face with that accommodation. The special military reserve was created to fund overseas military operations—that is what it exists for. When we came into office, this country was spending £4 billion a year on operations in Afghanistan. The special military reserve is now down to about £1 billion; I have been able to reduce it a little today. Despite what the reserve is for, I am always willing to consider specific requests for support. I did not have time in my speech to set out the very many military good causes that we are supporting with the LIBOR money.

Autumn Statement

Debate between George Osborne and Bob Russell

Thursday 5th December 2013 Commons Chamber

[Sir Bob Russell (Colchester) (LD)]

I am delighted that the Chancellor took notice of my speech last week that called for the abolition of business rates on small shops. Now that there is flexibility in the defence budget, is it not time the Government reinstated the modernisation programme for the houses of our brave soldiers and their families?

[Mr Osborne]

My hon. Friend is right that the help for the high street announced today is significant—£1,000 off for shops, pubs, restaurants and cafés. For many shops that will be a lot better than a freeze and will wipe out their rates bill for a couple of years and help them in this difficult time. I know my hon. Friend has campaigned passionately on forces’ houses, and a lot of money is now going to military charities from the LIBOR fines. I know some of the bids being considered specifically involve forces’ housing, so that is one route through which we can ensure they get a better deal.

Oral Answers to Questions

Debate between George Osborne and Bob Russell

Tuesday 10th September 2013 Commons Chamber

[Mr Osborne]

Some 90% of businesses are on real-time information. Of course, the transition to any new system is a challenge, but the new system will be much easier for small businesses, and all businesses, to keep an accurate account of their tax payments, and that will help them. We have phased it in so that small businesses, in particular, have time to prepare. This is a real improvement on a tax system that was many decades old and had not kept up with modern technology.

[Sir Bob Russell (Colchester) (LD)]

Will the Chancellor consider abolishing business rates for small retail establishments, and to make that fiscally neutral by putting a levy on out-of-town car parks?

[Mr Osborne]

I am not sure about the out-of-town car park part of the question, because I want to encourage retail and employment wherever they happen. We are aware of the challenge on our high streets, particularly for small retailers. The Government have, in previous Budgets and autumn statements, extended relief from business rates for small businesses, which has meant that many of the smallest firms do not pay business rates. I will take the suggestion as a good submission for a future fiscal statement.

Spending Review

Debate between George Osborne and Bob Russell

Wednesday 26th June 2013 Commons Chamber

[Sir Bob Russell (Colchester) (LD)]

Previous defence cuts mean that our Army is heading towards being smaller than it was at the battle of Waterloo, so that is hardly a triumph. Will the Chancellor confirm that there is now no need, based on his statement, for any cuts to any Army bands and will he also make a statement on why the family housing lived in by our brave soldiers is not being modernised?

[Mr Osborne]

We did win the battle of Waterloo with that Army, so we were not doing that badly. We are trying to make the choice to have a modern, deployable Army, fully equipped with the latest technology. To address the hon. Gentleman’s specific points, no reduction is required to the uniformed services. I would assume that that would include military bands, but that is for the Defence Secretary to set out. On housing, the Defence Secretary has set out a multi-billion pound plan to improve the housing stock for our brave soldiers and their families.

Oral Answers to Questions

Debate between George Osborne and Bob Russell

Tuesday 25th June 2013 Commons Chamber

[Mr Osborne]

First, the timetable is one that John Vickers and his commission themselves proposed. Secondly, it is not for me to make individual decisions about individual banks; that is for the boards of those banks and, of course, the regulator. But the whole purpose is to insulate the retail bank from things that go wrong in the investment bank and, above all, to make it possible for the person doing my job to be able to resolve the retail bank and keep the retail operations going without having to bail out the investment banking arm. Indeed, that whole problem of “too big to fail” is something we need to deal with.

[Sir Bob Russell (Colchester) (LD)]

It is the Government’s policy that, to cover cutting the Army to its smallest size since the battle of Waterloo, people should be encouraged to join the reserves. Leading by example, will the Chancellor of the Exchequer say how many members of his staff have joined the Territorial Army since January this year?

Oral Answers to Questions

Debate between George Osborne and Bob Russell

Tuesday 6th September 2011 Commons Chamber

[Mr Osborne]

I completely reject the premise of the hon. Gentleman’s question. As I say, green belt and areas of outstanding natural beauty will be protected, but we need to allow economically productive development. I have to say that his question is particularly puzzling as he represents the city of Stoke. Stoke applied for an enterprise zone, and one of the features of such a zone was that we were going to relax the planning rules.

[Bob Russell (Colchester) (LD)]

When the Eurostar is in France it is in a eurozone country, but when it comes through the channel tunnel into England’s green and pleasant land, the euro is not the sovereign currency. Last week, Eurostar refused to accept British money, even on the train in this country. Will the Chancellor make a robust complaint to Eurostar? [Interruption.]

[Mr Osborne]

The Opposition remind me of the very good election slogan that we had—although it was not particularly successful—which was “Save the Pound”. We have managed to save the pound on the Eurostar—or rather, the company itself has anticipated questions such as the one from my hon. Friend. I am glad to hear that, as he travels to and from Brussels and Paris, he will continue to be able to buy his meals in pounds sterling.

Comprehensive Spending Review

Debate between George Osborne and Bob Russell

Wednesday 20th October 2010 Commons Chamber

[Mr Osborne]

The hon. Gentleman is not known for overstatement, but I would say to him that we inherited a situation of rising unemployment, the biggest fall in output in a generation, the biggest banking crisis—thanks to the way in which the previous Government had regulated the banks—and a huge budget deficit. In the next hour—or however long you allow for questions, Mr Speaker—every single Labour Member who gets up should propose an alternative plan. It is very difficult to make choices, but they can attack this plan only if they have an alternative.

[Bob Russell (Colchester) (LD)]

I welcome the Government’s commitment to end child poverty—during this Parliament, we hope—which Labour failed miserably to do, but may I draw the Chancellor’s attention to what the coalition programme says about rented housing? Hundreds of thousands of families will be adversely affected by the removal or cutting of housing benefit. Will he confirm that local authorities have a statutory duty to house homeless families, and that the cost of bed-and-breakfast accommodation is considerably greater than that of housing benefit?

Proposed Public Expenditure Cuts

Debate between George Osborne and Bob Russell

Monday 13th September 2010 Commons Chamber

[Bob Russell (Colchester) (LD)]

(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on his additional proposals for cuts in public expenditure. I am grateful to you, Mr Speaker, for allowing this urgent question.

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

I am grateful for the opportunity to update the House on the progress of the spending review, and to remind people of the context in which we make these difficult decisions.

The previous Government left Britain with the largest budget deficit of any major economy and no credible plan to deal with it. That was a major cause of instability and uncertainty that threatened any prospect of economic recovery. It was reflected in the substantially higher market interest rates that British families and businesses were being charged compared with those for families and businesses in countries that were regarded as less exposed to sovereign credit risk. The new Government had to take urgent steps to restore stability and allay fears about our country’s ability to pay its way in the world. In the words of the previous Labour Prime Minister,

“if we fail to offer a convincing path out of debt, that...will itself plunge us into stagnation”.

Those views were echoed in the comments this weekend from the International Monetary Fund, which said that

“fiscal consolidation remains essential for strong, sustained growth over the medium run”.

That is why in the Budget I announced decisive steps to get the deficit under control. I believe that that Budget has restored stability to the British economy and provided a sound basis for a sustainable recovery. It has helped keep down the market interest rates that Britain pays on its debts, which are today more than half a percentage point lower than at the general election. In other countries, such as Spain, Portugal or Ireland, these same rates have stayed broadly flat or gone up since then.

Because of the measures that we are taking, independent forecasters are increasingly confident about the British economy. Last week the OECD predicted that the UK would see the strongest growth in the G7 this quarter and the second strongest growth next quarter. I can also tell the House that today the EU predicted that the UK will see the strongest recovery in the second half of this year of any major European economy. These, of course, are just forecasts and all this hard-won stability would be put at risk if we did not now implement the components of our Budget plan.

Let me remind the House of the measures that we took at the emergency Budget and the steps that we now have to take. We are set to tighten the public finances by a total of £113 billion by 2014-15. Of this, £29 billion will come from tax measures, including the increase in VAT, higher capital gains tax and a new permanent levy on banks. A further £11 billion will come from the welfare reforms announced at the Budget. Another £10 billion will come as a consequence of paying lower interest charges on the national debt as a result of our plan—£10 billion that those who opposed the Budget plan would have to find to pay the holders of Government debt.

That leaves £61 billion that will come from reductions to departmental expenditure plans. It is worth reminding the House that £44 billion of that £61 billion was assumed in the figures left to us by the previous Government. In other words, for all the synthetic noise and fury that we hear, £3 of every £4 that we are having to cut were cuts that the Opposition were planning to make. Unfortunately, not a single one of those pounds was allocated to a specific programme.

Our job now is to allocate those departmental budgets. That is the purpose of the spending review that is under way, and I will announce the full results to the House of Commons on 20 October. The review is informed by the largest public consultation exercise ever undertaken on public expenditure. More than 100,000 substantive ideas have been received from members of the public. Teams at the Treasury have been sifting through these ideas over the past six weeks and some are already being implemented.

We have also created a mechanism for collective discussion of spending issues across the Cabinet, which is something of an innovation, so the Prime Minister—[Interruption.] Well, there was a Cabinet Committee on life chances, on talent and on democratic renewal under the previous Government, but no permanent committee on public expenditure. The Public Expenditure Committee of the Cabinet has already met twice this month and will meet again this week.

Of course, some decisions that shape the spending review have already been taken. We will protect the budget of the NHS with real increases, we will honour the commitments on international aid that we have made to the poorest in the world, and we will protect capital investment in our economic future. We have not reduced capital spending in future years beyond the plans that we inherited, and as we take further decisions, we will strive to ensure that those support economic growth, promote reform and local control, and are fair—fair between different sections of society and between different generations.

Let me say something about welfare spending—[Interruption.]

[Mr Osborne]

I will heed your injunction, Mr Speaker, but the question was a very general one about an update on the public expenditure review.

I shall say something about welfare, if the Speaker will allow me. The welfare bill has risen by 45% in the past 10 years and almost £1 in £3 that the Government spend goes towards welfare. The current system is not protecting those who genuinely cannot work, nor is it helping those desperately looking for work to find a new job quickly. Close to 5 million people are on out-of-work benefits, more than half of whom have spent at least half of the past 10 years in this situation. Rather than rewarding work and supporting the vulnerable, we are wasting the lives of millions of people. That is why my right hon. Friend the Secretary of State for Work and Pensions is working with me and other Cabinet colleagues to see what we can do fundamentally to reform the welfare system so that it rewards work and supports aspiration, as well as saving the taxpayer on what someone once called the bills for social failure. When we have decisions to announce, we will bring them to the House and, of course, we will want to keep the House informed in other ways.

I have already given the Treasury Committee an unprecedented power to veto my preferred candidate to chair the independent Office for Budget Responsibility, Mr. Robert Chote, and I can tell the House today that I have asked my hon. Friends the Members for Gainsborough (Mr Leigh) and for Southport (Dr Pugh) to draw on their considerable expertise on the Public Accounts Committee in the last Parliament to advise the Government on how to improve the financial management systems that we have inherited, and in turn improve accountability to the House.

We have many difficult choices to make, but one thing is clear: one party created this mess; two parties are working hard to clear it up.

[Bob Russell]

If the Chancellor wished to give a full statement to the House, he could have done so last week rather than giving a cursory one to the BBC and having to be dragged here today. I acknowledge that 75% of the cuts are Labour’s cuts, but we have not as yet had the spending review. Clearly, none of the cuts will affect the quality of life of Members of Parliament, but they will certainly affect the disadvantaged in society. We know that there will be higher food costs in the coming year, and other costs will rise. I have no time for the welfare cheats, but to try to blame this country’s financial ills on that small category of the population is unethical. It would be more ethical to act with equal determination towards those who cheat on tax, whether it be income tax, value added tax or corporation tax. There is now a whole industry of financial experts advising people on tax avoidance.

The turf war between the Chancellor’s office and that of the Secretary of State for Work and Pensions is somewhat immature. Children living below the poverty line and people on low incomes, the disadvantaged in society, do not want these fun and games, they want fairness.

[Mr Osborne]

The position on welfare is exactly as I set out in my Budget speech at this Dispatch Box when I said that if we could find further savings on welfare, we would be able to reduce the pressure on other Departments. That was what we were planning to do over the coming months as part of the spending review, and that is exactly what I said in the television interview to which my hon. Friend refers.

Secondly, it would be impossible to conduct a spending review without looking at the welfare bill. Whether one is looking for £61 billion of savings or £44 billion, welfare spending accounts for a third of the entire Government budget, so one has to look at the welfare budget. That is what we are doing, but we are looking to do it in a way that reforms welfare, to help those millions of people who have been trapped for a decade or more on out-of-work benefits into work, to help those with aspirations to improve their income, to make sure that work is rewarded by the benefit system, and to do that while we are protecting those who cannot work and protecting the most vulnerable in our society. I would argue that the failure on welfare reform over the last decade was one of the greatest failures of the previous Government.

Despite the lurid headlines in some newspapers, the relationship and the co-operation between the Treasury and the DWP is strong. There is a perfectly natural—[Interruption.]

Oral Answers to Questions

Debate between George Osborne and Bob Russell

Tuesday 8th June 2010 Commons Chamber

[Mr Osborne]

I am always very happy to visit Dudley. I have done so many times in the last three or four months—which was half successful.

We have found additional money to support social housing. We discovered that the housing commitments made by the Labour Government just before the general election were completely unfunded. We have found money to fund additional social housing, which during the past 13 years the previous Government almost completely failed to do.

[Bob Russell (Colchester) (LD)]

T9. Further to excellent question of the hon. Member for Bristol East (Kerry McCarthy), can the Minister who was briefed to answer the excellent Question 25, in my name, now give a more substantive answer? What will the Government do to support credit unions such as the excellent one in Colchester?