Oral Answers to Questions

Graham P Jones Excerpts

Tuesday 14th May 2013 Commons Chamber

[Graham Jones (Hyndburn) (Lab)]

Q4. What discussions he has had with the Secretary of State for Communities and Local Government on levels of construction output.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Q11. What discussions he has had with the Secretary of State for Communities and Local Government on fiscal incentives for the construction of affordable housing.

[The Chief Secretary to the Treasury (Danny Alexander)]

The Government are committed to supporting new housing supply while maximising value for money. The Government committed £4.5 billion to support 170,000 affordable homes over the spending review period, and we have added a further 30,000 to that figure through the guarantee programme that was announced last year and extended in the Budget a few weeks ago.

[Graham Jones]

In my constituency, that would ring hollow. I note that all three insolvency industry associations stated this week that nearly one third of construction companies in the north-west of England were at risk of financial collapse, which is a higher rate than in the non-construction sector of the north-west’s economy. Is not that an indictment of the Government’s record in the north and their failure to get growth going in the regions?

[Danny Alexander]

The hon. Gentleman should recognise that—while the previous Government presided over a decline of more than 400,000 in the number of affordable properties—the Government’s action to increase the numbers by 200,000 is a welcome support to the construction sector, as is the Help to Buy scheme that we announced in the Budget, which will produce a significant additional demand for properties to help the companies to which he refers.

--- Later in debate ---

[Danny Alexander]

I agree wholeheartedly with my hon. Friend. Dealing with the deficit and repairing the mess that the Labour party made in the public finances must remain the No. 1 priority for the Government, and indeed for all Members of the House.

[Graham Jones (Hyndburn) (Lab)]

T7. The Government’s housing policy focuses on new build which is exempt from VAT, but in my constituency one in 13 properties is empty, and building companies tell me that they rely on refurbishments which are not VAT-exempt. They are really struggling. Do the Government recognise that building companies in areas such as mine are being penalised in that way?

[The Exchequer Secretary to the Treasury (Mr David Gauke)]

The difficulty is that if we were to reduce VAT on repairs and refurbishments, that would have a substantial fiscal cost. It would result in more borrowing and that is not something we can afford because of the circumstances we were left.