Surplus Target and Corporation Tax

Debate between George Osborne and Jeremy Quin

Monday 4th July 2016 Commons Chamber

[Mr Osborne]

The British Business Bank—which was created under a policy announced by me at this Dispatch Box—is working successfully, and I pay tribute to Liberal Democrat colleagues in the coalition Government for helping us to deliver it. Of course it has an important role to play in the future. The right hon. Gentleman is right, in the broader sense, to say that we need to look at what we can do to support demand and credit in the economy. The Bank of England has many tools, and the Governor of the Bank has already indicated that, in his personal opinion, we should be looking at monetary easing.

[Jeremy Quin (Horsham) (Con)]

I congratulate the Chancellor on his fiscal response, and also on his comment on Heathrow in the statement. Will he reassure the House about the strength and stability of the UK banking system, given the reforms of the last six years?

[Mr Osborne]

I thank my hon. Friend for his remarks. I should point out that I did not identify where the additional runway should be in the south-east of England, although I cannot but note that his constituency is next to Gatwick, so that may have been a loaded question.

As for my hon. Friend’s broader point, he is right to point to the stability of the banking system. Although we remain vigilant, we are not, today, talking about a banking crisis, despite a very significant adjustment in financial markets. That is because of difficult decisions made by this Government and their coalition predecessor to strengthen the capital requirements, so that banks have 10 times as much capital as they had seven or eight years ago, and to strengthen the oversight of our banking system by putting the Bank of England in charge. I think that those decisions have been justified by what has happened in the last 10 days, but that does not mean that we can ease up; of course we remain vigilant.

The Economy and Work

Debate between George Osborne and Jeremy Quin

Thursday 26th May 2016 Commons Chamber

[Mr Osborne]

The deficit has come down by another £16 billion. When I first stood at the Dispatch Box as Chancellor of the Exchequer we had a budget deficit of close to 11% of our national income, and £1 in every £4 that we spent on everything from hospitals to schools and police had to be borrowed. This year that figure is projected to be below 3%, and we are projected to have a surplus by the end of this Parliament.

[Jeremy Quin (Horsham) (Con)]

Will the Chancellor also remind the House what he has managed to do to employment rates in this country while cutting the deficit?

[Mr Osborne]

A record number of people are in work and we have created almost 2.5 million jobs in this economy. Yesterday at the end of my remarks I referred to a report that the Labour party has produced on its future. This independent inquiry is chaired by the hon. Member for Dagenham and Rainham (Jon Cruddas). Let us see what Labour says about Labour:

“A tsunami of aspirant voters sank Labour…Voters abandoned Labour because they believed Labour lacked economic credibility…the perception was that it would be profligate in government… Labour is losing its working-class support… Labour has marched away from the views of voters… Labour is becoming a toxic brand.”

That is the Labour party’s own verdict on the Labour party. It concludes by saying—

Greece

Debate between George Osborne and Jeremy Quin

Monday 6th July 2015 Commons Chamber

[Mr Osborne]

The sustainability of Greece’s debt payments is clearly a big issue. That is why it failed to meet the IMF payment last week and faces such a big challenge with the ECB repayment later this month. That is one of the challenges, but alongside it—and the IMF draws this to our attention as well—there must be some indication that the Greek Government can undertake the kind of reforms that will modernise the Greek economy, make sure it is a success and ensure a stream of tax revenues in the future. No one is pretending that it is easy, but that is the substance of the negotiation.

[Jeremy Quin (Horsham) (Con)]

I am thinking of what has been going on recently in China, in particular, and know that my right hon. Friend will be well aware that there are always dangers to the global economy. He has always been very alert to the deficiencies of governance within the eurozone. Does he believe that that governance has reformed sufficiently to prevent another similar crisis in the future in another eurozone state?

[Mr Osborne]

My hon. Friend is right to draw the House’s attention to some of the economic issues in China, but if we can stay in the western hemisphere for the purposes of this statement, the eurozone is a much better place than it was in 2012 to deal with any contagion from the Greek crisis. That is reflected in the fact that the bond spreads for the peripheral countries have not gone out today, because the ECB is prepared to do, in its words, “whatever it takes” in its outright monetary transactions policy. We have the European stability mechanism, which is, in other words, a sort of central bail-out fund. We have more of the machinery in place than we did in 2012, which is why we are not seeing quite as much contagion. I would make a general observation I have made before, however. I do not think people should underestimate the medium to long-term impact of a country leaving the euro and showing that it is possible to exit that currency.