Public Health: County Durham
Debate between Helen Goodman and Lord Beamish(5 years, 5 months ago)
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Mr Kevan Jones (North Durham) (Lab)
I beg to move,
That this House has considered public health in County Durham.
It is a pleasure to serve under your chairmanship, Mr Owen. I am pleased to have secured this debate, but it is unfortunate that we have to have a debate on public health to highlight the effects that the Government’s cuts have on one of the poorest counties in our nation. I thank the men and women of the NHS, those who work in public health for the county council, and the voluntary and community sectors, which are part of the matrix of support for delivering in County Durham not only general healthcare, but, importantly public health.
In recent years, there has been debate about Government funding not just in health, but in local government and other areas. That debate starts from the premise that everywhere is the same, so a fair funding formula spreads the jam evenly around the country, but I am sorry—that is just not the case. Deprivation and need are factors that must be taken into consideration. In local government funding, fire service funding and police funding, need and poverty have been removed as determinants.
County Durham is a large rural county of 525,000 people. It faces some unique issues on health, partly because of the legacy of the county’s industrial past of coalmining and heavy industry, which means a high incidence of diseases associated with those industries, such as respiratory diseases, which put particular demands on the health service.
We also have a legacy of rapid deindustrialisation in the 1980s, when the hearts of many of the coalmining and steel communities across County Durham were ripped out by the policies of the Thatcher Government. That legacy remains in terms of hopelessness, drug and alcohol abuse, obesity and smoking, as well as the poverty that goes with all that. Previously, I have described County Durham as a rural county with urban problems, but those urban problems are sometimes ignored because of County Durham’s rurality.
We also have a growing elderly population. In the period to 2035, the number of people aged 65-plus will rise by 31%, and the number of people aged 85-plus will rise by 82%. That puts particular demand on the health service at all levels, in both the community and the acute sectors. Life expectancy in Durham is 78.3 years for men and 81.4 years for women. I will mention two other counties, and allude to the reasons for doing that later in my remarks: in Surrey, life expectancy is 81.5 years for men and 84.8 years for women, while in Hertfordshire, it is 81 years for men and 84.2 years for women.
The figures for healthy life expectancy, which indicates the age at which people develop serious health concerns, are even worse. In County Durham, they are 58.9 years for men and 58.7 years for women, whereas in Surrey, they are 68.3 years for men and 68.7 years for women, and in Hertfordshire, 64.9 years for men and 65.9 years for women. People in County Durham who get long-term health issues get them sooner than people in more affluent areas, which leads to demand on our health service. We are always told by the Government that we need to stop people using the health service to reduce the demand placed on it, but unless we tackle some of the underlying causes of the problem that pressure will continue.
Responsibility for public health funding was transferred from the Department of Health and Social Care to local government in 2013-14. I supported that move because public health is best delivered locally. The budget devolved to County Durham in 2013-14 was £40.5 million, based on the assessment of health needs by the primary care trust, which was abolished under the same legislation that introduced the transfer of responsibilities. To give credit to County Durham, it has used that money effectively, with services commissioned both directly by the county council and externally by private and third-sector organisations.
As with many things, however, devolution of responsibility for public health came with a sting in 2016, when the budget was reduced by 12.8%. That was part of George Osborne’s strategy, in a host of areas, to devolve money locally and tell the local authority to decide where the cuts would come. He could then stand back and say, “That decision has to be made locally.” But that misses the point. By sleight of hand, he sought to give the idea that somehow he had no responsibility for the cuts when he had top-sliced the budgets.
To be fair to County Durham, its public health priorities were the right ones to tackle. The funding was directed towards the control of tobacco and cessation of smoking, teenage pregnancies, obesity and weight reduction, mental health—an issue close to my heart—and improved dental services. I do not know whether the Minister is aware of this, but when I was first elected in 2001, certain areas of my constituency had no access to dental services at all. That has changed—not since 2010, I hasten to add, but certainly under the last Labour Government.
County Durham also targeted drug and alcohol addiction. I give it credit for the work that it has done on that. In the light of the recent confessions of the Conservative party leadership contenders, I think that they could take note of the available drug and alcohol services. However, unlike those middle-class people who have confessed to drug use, the young people we are talking about will not go on to glittering careers in the media or elsewhere. They will be pushed into a cycle of poverty and desperation at local level, and will add to our shared tax burden, because their demand on health, police and other services will increase. I always look at public health as an investment in our local communities to ensure not only that we have good public health outcomes, but that we reduce demand elsewhere in the system.
Helen Goodman (Bishop Auckland) (Lab)
Before my right hon. Friend moves on to the next section of his speech, I want to congratulate him on securing this important debate. What shocks me is the fact that in Woodhouse Close in my constituency, the healthy life expectancy is 10 years lower than that in Barnard Castle, yet those two places are only 10 miles apart. The notion of cutting public health funding seems grotesque.
Mr Jones
My hon. Friend is correct. She highlights that example in County Durham, but there are many more between the more affluent areas and the pockets of poverty. They have been there since the 1980s and they need to be addressed. I am passionate about this issue; the idea that where someone lives should determine how long they live, in a wealthy country such as ours, is wrong. We should be able to tackle that in this day and age.
The new funding formula, ironically called the fair funding formula—trades description comes to mind—is based on the premise, pushed mainly by a lot of Conservative Members, that somehow the needs of individuals in health and other areas are the same across the nation. That is just not the case. The methodology put forward by the Ministry of Housing, Communities and Local Government means that County Durham will lose 38% of its existing budget—that is £18 million a year. It is the worst loser in this process, because the dedicated, ring-fenced public health budget is being abolished. It is being pushed in terms of the business rate retention scheme, which concerns me because it means that there will be areas where councils—I will refer to two in a minute—that get a budget increase will have no duty at all to ring fence that money and put it into public health. That is a retrograde step.
County Durham has achieved a lot: smoking is 22% down and teenage pregnancy is down to a level that is no longer statistically different from national averages. That certainly was not the case when I was first elected in 2001. We have made great strides getting cardiac mortality down from 31 deaths per 100,000 in 2001 to 5.7 deaths per 100,000 by 2015. A lot of effort has gone into addressing suicide rates, particularly among men. That is a credit to multi-agency work, including the police, the voluntary community sector and others. We have a good-news story in the sense that we have a good partnership-working approach in County Durham, yet the Government want to take that budget away.
People ask, “Why can’t it be made up from elsewhere in the council budget?” This is a county council that has had its budget slashed by nearly £240 million since 2010. It is due to lose another chunk of funding under the so-called local government funding formula. The scandalous situation, and the reason I mentioned Surrey earlier, is that, while County Durham will have its budget cut by 38%, Surrey County Council’s budget will be increased by £14.4 million a year, and Hertfordshire’s by £12.6 million a year. It cannot be right—I will give some reasons in a minute—that money is being moved from deprived areas such as County Durham in the north-east to some of the most affluent areas in the United Kingdom. The life expectancy and other figures that I mentioned earlier are not comparable. That is not a fair way of distributing that money.
It is not just County Durham that is affected; the north-east loses some £40 million under the proposals, in some of the most deprived parts of this country. Gateshead, for example, loses 12.44% of its budget; Redcar and Cleveland loses more than 27%; South Tyneside, one of the most deprived parts of the region, loses 29%; and Sunderland loses 24%. That will not address health inequalities and stop people going into the health service; the cuts to the most deprived areas cannot be right.
There is a deliberate policy—not just here, but in other areas—of moving the central Government grants or funding formulas to benefit mainly Conservative-voting southern areas. That is the worst example of pork barrel politics. The Conservative party leadership contenders talk about one-nation conservatism. If this is one-nation conservatism, they can keep it. The cuts will have a direct effect on the ability of healthcare professionals to provide services. It is not acceptable to go backwards on smoking cessation and drug treatment.
What has been going on? The county council has lobbied; it has written to the Minister, met Public Health England and worked with other local authorities not just in the north-east but elsewhere, such as Blackpool Council, which is also affected. It has contributed to the fair funding review. It is not just politicians on the Labour county council; the health and wellbeing boards, the police and crime commissioner, and the local NHS trusts have all argued that this is not correct, because they see what is coming down the road. If these short-sighted cuts take place, the demand on local acute services will go up—exactly what the Government and NHS England want to avoid. That disjointed approach beggars belief.
What do we want in County Durham? We want and need a clear commitment to public health. That is referred to in the NHS forward plan, but with no funding commitment or power to ensure that local councils deliver good-quality public health. We need a form of funding that reflects need. We also need a clarification on timetable. I understand that a decision is being kicked right back to the spending review. When the spending review will take place, given the chaos in the Conservative party, I do not know.
There is real pressure on the county council and other bodies because they have to let contracts—the current contracts come to an end in March next year. If there is no clarification by the end of this year, that will not leave much time for those organisations not only to tender but to let those contracts. That will lead to a lot of organisations worrying about their future. A lot of public health is delivered by the local voluntary community sectors. They rely on that, and they do a fantastic job. We cannot have money deliberately moved to areas of prosperity. I challenge the Minister to conduct an impact assessment on the effects of the cuts, to highlight those effects.
It does not surprise me what the Government are doing because they have done it in every other area, particularly local government funding. I do not question the commitment of the Minister to good-quality public health, but there is a disconnect in relation to the funding formula and the Ministry of Housing, Communities and Local Government. On 7 January, I asked the Health Secretary directly about the issues concerning County Durham. He said:
“That is obviously not right. Indeed, there is a whole section of the plan on reducing health inequalities, which is extremely important.”—[Official Report, 7 January 2019; Vol. 652, c. 77.]
He might recognise the importance of public health, but MHCLG does not. That is not a very good example of joined-up government.
This is not charity; it is an investment, not just in the lives and wellbeing of individual constituents in County Durham but in the future of the country. Unless we tackle some of these health inequalities through good public health, our efforts to relieve the pressures on our health service will come to nothing. In a statement on exiting the EU, the Prime Minister, who will not be with us much longer as Prime Minister, said she wanted to work
“across all areas to make this a country that truly works for everyone, and a country where nowhere and nobody is left behind.”—[Official Report, 10 December 2018; Vol. 651, c. 25.]
If these cuts go through, those words will be pretty hollow, because County Durham will be left behind.
Armed Forces Personnel
Debate between Helen Goodman and Lord Beamish(13 years ago)
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Mr Jones
I am absolutely astonished. The Minister had 40 minutes in which to make an announcement, but did not choose to do so. I have to say that he is completely wrong. His written ministerial statement this morning rightly dealt with changes to Army headquarters in the UK—something that I was already on to when I was the Minister. He put out a press release—I have it here with me—that mentions the savings that could be made from the draw-down from Germany. Clearly, The Guardian was briefed last night on the major changes proposed regarding the withdrawal from that country. I am sorry, but I do not accept the Minister’s statement that these are minor movements around. These are major reorganisations that will affect many thousands of armed service personnel, civil servants and their families. The Minister said that some £250 million a year would be saved at the end, but the press release does not say exactly when that will be achieved.
As the Minister who used to be responsible for the defence estates, I know the figure I was given in relation to the rebasing from Germany. It was roughly £3 billion.
Helen Goodman (Bishop Auckland) (Lab)
On a point of order, Madam Deputy Speaker. I have been listening to the evidence given by James Murdoch to the Select Committee. He has admitted that members of the Committee were followed at the point when the Committee was undertaking an inquiry into the phone hacking activities of News International. This is obviously an extremely complex matter, but I wonder whether a breach of privilege might be involved.
Finance Bill
Debate between Helen Goodman and Lord Beamish(13 years, 4 months ago)
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Mr Jones
I actually do not understand why all this is unfair, because the new clause would give an advantage to people who are married but do not have children. I do not know how the new clause does what the hon. Gentleman is proposing in terms of keeping family units together and alleviating child poverty.
The important point relates to what was in the Conservative manifesto. What came out of that Conservative think-tank was the idea that marriage was an important point in keeping the family unit together and ensuring that children and wider society were not disadvantaged by a breakdown in the family unit. The manifesto made a commitment to “recognise marriage” in the tax system. It proposed that couples and civil partners who were basic rate taxpayers should be entitled to transfer just part of their allowance—this was worth, in effect, up to £150 a year. That is very different from what is contained in the new clause, because it makes no mention of civil partnerships. Given the names of the people who are supporting this proposals, I suspect that this has come from the wing that has not quite gone all the way in being the new cuddly Conservative party in terms of even envisaging the idea that civil partnerships, with or without children, could constitute a family unit.
As the hon. Gentleman mentioned briefly, the policy came unstuck in the coalition agreement because this proposal is clearly not supported by the Liberal Democrats. I believe that during a general election television interview, the Deputy Prime Minister called it “Edwardian”.
Mr Jones
That is a bit rich coming from the Liberal Democrats, because most of the things that they come out with are patronising drivel. However, they were clearly not happy about this policy, so in the scramble to get the red boxes and cars they had to reach some type of compromise. Thus, the coalition agreement simply states that there will be a provision whereby the Liberal Democrats can abstain at some point in the future when this policy is introduced.
Mr Jones
Possibly. The 22 June Budget made no announcement on where this policy stood and on what was happening to it. I can understand the annoyance felt by the hon. Member for Gainsborough and others, who clearly think that this is a vital piece of legislation that was promised to the electorate. It was obviously a key point: I am sure that a lot of people went to the ballot box thinking that if they would get an extra £150, they would vote Conservative. That pales into insignificance when set against what has been taken away from them since this Government came into power.
Mr Jones
The hon. Gentleman must be honest with my electorate in North Durham about the fact that although the Government have increased personal allowances they have taken away money in others ways, such as the increase in VAT and the £140 million of cuts that Durham county council will have to impose over the next three years. Those cuts will have a direct effect on many of those poor families. The Liberal Democrats can claim that they have had great success, but if that is their only claim they should be honest with people and tell them what they have lost, as well, through such vicious policies. The hon. Gentleman should remember that this Conservative Government would be doing nothing without the support of him and his Liberal Democrat colleagues.
Helen Goodman
Another problem with raising the tax thresholds—a provision constantly promoted by the Liberal Democrats—is that, as I am sure my hon. Friend has not forgotten, the biggest beneficiaries are those who are highest up the income scale. The biggest value of the change is not to the people at the margins—those who are just caught or just not caught by the tax boundaries—but to the people higher up the income scale.
Mr Jones
My hon. Friend makes a good point. A little later, I shall discuss what our Government did to recognise the fact that if we are to address the issues raised by the hon. Member for Gainsborough about child poverty, the tax system and marriage are not necessarily the way to do it. The way to do it is to ensure that the money goes to the families and children who are affected. That is why the child tax credits and other such provisions were vital in raising people out of poverty. Earlier, my hon. Friend the Member for Alyn and Deeside (Mark Tami) mentioned the minimum wage, which lifted a lot of very poor individuals out of poverty who were getting a pittance. I remember seeing as a trade union official an advertisement in the jobcentre in Newcastle that read, “Night guard, bring your own dog, £1.35 an hour.” That is a thing of the past. I hope that it will remain so, but I do not know, as we hear from Conservative Back Benchers that they might want to change the minimum wage in some way.
Helen Goodman
It was interesting that the hon. Member for Peterborough (Mr Jackson) mentioned the UNICEF report, because Denmark came at the top and Britain came very low down. I want to remind hon. Members that Denmark has the highest rate of lone parenthood and the Danish can combine that with good child well-being because they have a strong welfare state. Does not my hon. Friend think that that is far more important in addressing child poverty and well-being?
Mr Jones
It is. To be fair to the hon. Member for Gainsborough, he did say that being a lone parent does not make someone a bad or unfit parent. My hon. Friend the Member for Denton and Reddish (Andrew Gwynne) had three children before he got married, but that does not make him a bad parent. [Interruption.] He says, “I don’t know,” but I do not think it makes him a bad parent: it is something that he and his partner chose to do. As he said earlier, the offer of a tax break of £150 a year would not make any difference to whether people decide to have children before or after they marry. Indeed, I have many friends who have children and who have never married and have no intention of doing so.
Helen Goodman
My hon. Friend’s description of what happened in the 1990s reminds me of an issue that I do not think the hon. Member for Gainsborough (Mr Leigh) addressed. One of the big debates on this subject was about the fact that transferable allowances reduce any scope for financial privacy within a marriage. A number of people felt very uncomfortable about that. Does my hon. Friend have any comments on that?
Mr Jones
My hon. Friend makes a key point and I understand why she makes it. This goes right back to when income tax was introduced in the 1790s, when a spouse’s income was the property of the husband. That was the basis on which income tax was brought in and it continued for centuries. There was no recognition that even within marriages people might have separate tax affairs or sources of income that needed to be recognised.
It is interesting to look back at the debate that took place about the MCA. Baroness Maddock, who was then a Member of this House, argued that the MCA was
“a relic of the days when a husband was taxed on his wife’s income as well as on his own. It contravenes the principle that marriage should be tax neutral.”—[Official Report, Standing Committee A, 22 February 1994; c. 344.]
Mr Jones
I think this is an important point, Mr Deputy Speaker. The main thrust of the argument that has been made is that marriage, and taxation in marriage, has been consistent throughout history, but it has not. Like a lot of things in this country, it has been looked at through a Victorian prism that seems to bend the reality of what took place way back then. However, I will move on to my next point.
Helen Goodman
I should like to back up what my hon. Friend says. In the major study of marriage in England from 1550 to 1750, Lawrence Stone demonstrated that in a commercial society with a commercial attitude—
Finance (No. 3) Bill
Debate between Helen Goodman and Lord Beamish(13 years, 6 months ago)
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Helen Goodman
I defer to my hon. Friend’s knowledge of poultry-keeping. However, I agree that that is the problem that we face with the Government at the moment. Their approach simply is not serious; it is trivial.
Mr Kevan Jones
Does my hon. Friend not think it incredible that the Treasury officials whom she worked alongside for many years did not work out that there was a difference between oil and gas prices? Does she also not think it remarkable that the Minister, who is a former employee of Centrica and British Gas, did not highlight that problem either?
Helen Goodman
That is absolutely right. It is extremely worrying for the gas industry that the tax is being linked to fluctuations in oil prices, yet gas prices might not only vary from oil prices, but possibly even be going in a different direction. This is an extraordinary approach to take to the taxation of one of our major industries. I hope to hear from Ministers about how they are forecasting oil prices over the period in the Red Book.
Returning to the issue of complexity and why the Government chose such a complex structure, we have to ask ourselves whether they completely misunderstood the debates in the previous Parliament on stabilisers. The Scottish National party and the Liberal Democrats proposed stabilisers on petrol taxation, but that seems to have been translated into the wholesale market. The situation now is not that stability is being provided for the consumer, which was the original objective of a stabiliser, but that the Government are able to hedge their tax revenues, which is a completely different proposition altogether. I hope that in responding to the debate the Minister will be able to explain what a sustainable oil price reduction means, because it is certainly not clear from what we have seen so far.
The other thing that was said at the time of the Budget was that the detail would be agreed with the industry and motoring organisations. I hope that we will get a report from the Minister on what discussions and agreements have been achieved. The initial press reports of her meetings with the industry were very alarming indeed. It sounded as though the industry was furious with what had happened and that Ministers did not have a proper answer to its serious concerns. It would be nice to know whether the negotiations have developed, although it seems from what we have read even today in the newspapers and on the web that they have so far not been fruitful. It would also seem that the Government, in their headlong rush, are not taking account of the fact that further evidence has yet to be given to the Select Committee on Energy and Climate Change. Indeed, that evidence is to be given only tomorrow, yet the Government are ploughing ahead, mindless of what the industry is telling them.
It is particularly worrying that, as my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) has pointed out, Centrica is saying that it might not open up the Morecambe Bay field after the annual shutdown to perform the usual maintenance functions this year. The Morecambe Bay field has been in operation for, I suppose, some 40 years—I think it was the first gas field from which we got natural gas in this country. The Minister is too young to remember the huge investments made in the 1960s to move from town gas to natural gas. Huge investments were made in this country to secure those gas supplies, and yet at the stroke of a pen, this Government are putting them at risk.
When the Government say that they want to rebalance the economy, we have to ask whether they even know that means. I understood rebalancing the economy to mean having fewer resources in financial services and more resources in other sectors.
Mr Kevan Jones
The argument made strongly by the Government is that the north-east economy should rebalance itself away from the public sector and towards the private sector. Does my hon. Friend share the alarm felt by the 380 firms that directly rely on the oil and gas industry in the region about the effect that the Government’s proposals will have on employment in those companies?
Helen Goodman
Of course. I am extremely concerned, as my hon. Friend and neighbour is, about the impact that the proposals will have on the economy of the north-east, and it will not be just a short-term impact, but a long-term impact. When we get investment in the oil and gas industry, we are getting investment in an industry at the cutting edge of technology. There have been many other positive spin-offs from the investments that the oil and gas sector has made.
Helen Goodman
No, Centrica is a gas company. Oil companies, even if they do not have petrol companies within them in the UK, are selling their oil and gas to people who are delivering in the retail market. I would have thought that the hon. Gentleman understood that if something is being done with prices and taxes in one part of the market, it could have an impact on the prices charged in another part of the market. That was my point.
Let me deal now with the drafting of the Bill. Will the Minister explain why the $75 a barrel limit is not specifically mentioned in clause 7? As already mentioned, if we are to make any sense of what is going on here, we will need to look at clauses 61 through to 64 and at schedule 15 alongside clause 7. I would like to pay tribute to Rob Marris, the former Member for Wolverhampton, South West who always enjoined us to read the explanatory notes. The explanatory notes on clause 61, which deals with decommissioning, are particularly interesting. Has the Treasury or Revenue done any analysis of the impact on the environment of the changes to the rate of decommissioning relief?
The amendments in the group are also interesting. As I have said, the amendments tabled by Liberal Democrat Members are clearly aimed at improving stability, predictability and transparency. The amendments tabled by my hon. Friend the Member for Bristol East (Kerry McCarthy) are designed to review and understand the situation better. The most interesting amendment before us, however, is amendment 11, tabled by the Chancellor of the Exchequer. It is designed to insert the following provision into clause 7:
“But if the basis of apportionment in subsection (4)(b) would work unjustly or unreasonably in the company’s case, the company may elect for its profits to be apportioned on another basis that is just and reasonable and specified in the election.”
This is the most extraordinary amendment that I have seen in six years as a Member of Parliament. It seems that every company can say to Her Majesty’s Revenue and Customs, “The impact on another company might be ABC, but in our case it would be XYZ.” Every company will be allowed to negotiate not simply the interpretation of the tax code, but its own tax code.
Mr Kevan Jones
Obviously many other taxpayers would like to be able to negotiate their tax codes with the Inland Revenue, but I am sure that the opportunity will not be open to them. Where will this leave the amount of revenue that the Government will supposedly raise to pay for the reduction in petrol duty?
Helen Goodman
My hon. Friend has hit the nail on the head. This opens a huge hole in front of the Minister’s revenue forecast. There is total uncertainty. Every company will be able to turn up and renegotiate its own tax regime, which is ludicrous. How far will this be taken? Will it be a general principle established in the tax code for the purposes of all corporation tax, or personal tax? I hope that the Minister has a very good explanation for what is going on.
Let me return to the underlying worry that has been exposed in tonight’s debate—that the Government simply have not taken account of the importance of energy security. Everyone knows that the energy market is under a number of different pressures. On the one hand, we must have a market that is environmentally sensitive and reduces our carbon footprint; on the other hand, we must have prices that are affordable for people in this country and that tackle fuel poverty. We must also have security of supply in a world that is particularly uncertain at this time. Wars are taking place in north Africa and there is conflict in the middle east, and it is at this moment that the Government have chosen to impose taxes that are so insensitive that they put the North sea oil and gas regime at risk.
Mr Jones
I have known my hon. Friend for more than 25 years, and I think that this is the first time he has ever been overcome by something I have said—it might be the first time he has ever listened to anything I have said. The idea of leaving oil and gas in the ground and not extracting it is absolutely ludicrous. It makes no sense whatsoever with regard to the investment that has already been made, and it makes no economic sense with regard to security of supply in this country.
Helen Goodman
Does my hon. Friend agree that the problem is that the Government have no strategy? Just as they panicked when they realised that they had a fiscal hole to fill in the few days before the Budget, so they have now panicked with this ridiculous amendment 11.
Mr Jones
My hon. Friend has done the Committee a favour by drawing our attention to amendment 11, and that is something that we will all want to be argued for in the case of individual tax returns. The point of the matter is this: if the results are what has been suggested, how on earth will the Government be able to predict how much they will get from this tax?
Helen Goodman
Does my hon. Friend agree that it is also not clear, when a company negotiates its own tax regime, whether it will be a secret tax regime, or one that everyone will know? If it is secret, does that not open up the possibility of even more unfairness?
Mr Jones
It does, and that leads us to the point about how we would arbitrate in disputes between different companies. My hon. Friend the Member for Aberdeen South (Dame Anne Begg) mentioned the fact that decisions on investment in oil and gas are not taken in this country, but in Houston, Calgary and other parts of the globe, so the North sea and exploration in this country is competing for investment from around the world. If companies have to jump through hoops to negotiate their individual tax liabilities before trying to put an appraisal together, I am sure that decision makers will go for the easier options so that they know what the return on investment will be, rather than the uncertainty that this has left us with.
Mr Kevan Jones
It is, and the north-east has been able to take advantage of the change in, for example, the River Tyne, which was heavily dependent on shipbuilding. Now we have facilities such as the Walker technology park, and the city council was far-sighted when it developed an offshore park for the North sea oil industry.
Helen Goodman
Does my hon. Friend agree, as the hon. Member for Dundee East (Stewart Hosie) said, that there is also—
Helen Goodman
There is also a problem with partnerships between the private sector and the universities.
Mr Jones
There is indeed. There are also new technologies. For example, the development of mine ploughs for mining the North sea bed for the laying of oil pipes was generated from a company that spun out of Newcastle university. Places such as the Walker technology park sustain offshore supply jobs for the North sea, and two companies based there—Duco and Wellstream—produce 90% of the world’s capacity of sub-sea umbilical housing and cords. Those are well-paid jobs. Such companies chose to invest in the north-east of England not only because of the skills base but because of the access to the North sea, and they are now able to export from there across the world.
George Rafferty, the chief executive of NOF Energy, says:
“For the last six to nine months we have been talking about a renaissance in oil and gas especially from the North Sea and the benefit to our members in the North-East as a result of investment being put in. With this announcement by the Government, which was made without consultation with the industry, there is a serious risk those investment decisions will be reversed.”
The industry body Oil & Gas UK said that the tax would not be passed on to consumers after the Chancellor warned that the sector faced a “direct squeeze” from it. That is exactly the uncertainty that exists today. It does not affect only the jobs in the north-east region itself. We have a large travelling population of individuals who travel to work via the North sea; they go across to Morecambe bay to work in the gas fields, and to East Anglia and other parts of the UK. That shows that this is an industry that affects numerous parts of the UK economy as well as the north-east. We have to ensure that any decisions that are taken on taxation do not have a huge detrimental effect.
It is necessary to know what is going to be done when making decisions about where future oil and gas investment will go. Unfortunately, some companies have already invested in oil or gas fields on the basis of what the tax regime was going to be pre-Budget, and they now face a completely different set of circumstances. For example, Total E&P UK has established Laggan-Tormore—the west of Shetland gas development—and that investment of $4 billion is now at risk. Questions will be asked by the individuals who made the decision to invest there. What will be the future of that type of investment?
This is clearly short-termism for reasons of political expediency to do with the Chancellor. In the previous debate, we even got an admission from the Minister that the downturn in the petrol price was 0.8%—and we all know what we can do with 0.8 of a penny in our household budgets! Is it really worth making that type of fix, which will jeopardise not only the investment that has gone in to date but will go in in future? This is a world-class industry of which we should be proud in the UK. It sustains many jobs. Over the years, it has been a leader not only in technology but in safety, as my hon. Friend the Member for Blaydon mentioned.
I take no joy in what I am going to say now. I feel sorry for the right hon. Member for Gordon and the hon. Member for West Aberdeenshire and Kincardine, because I fear that they will feel the political consequences of this in the ballot box. I hope that with their expertise and continued lobbying, they can change the Government’s mind. A short-term decision based on the petrol price will have a huge economic impact on the UK, on the industry as a whole, and on the economy of the north-east. I urge the Government to think again. I do not know whether they will take silly decisions like this in the future, but please can they do a U-turn for the sake of the investment and jobs that they will put in jeopardy if they continue with this ludicrous policy?
Business of the House (Thursday)
Debate between Helen Goodman and Lord Beamish(13 years, 11 months ago)
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Mr Kevan Jones
I think we have seen an historic moment tonight, Mr Speaker. I did not think it was possible for you ever to be wrong. The way in which you handled that is a credit to you.
Helen Goodman (Bishop Auckland) (Lab)
Has my hon. Friend considered this matter in the historical context? The last time we had such a considerable change to the funding system for higher education was in the 1940s. The Education Act 1944 was considered by many people to be the key reform in higher education and it was debated for a full year before the 1945 election. Has my hon. Friend taken that into account in considering his remarks tonight?
Mr Jones
I do not really want to go back to 1945, but I shall make some references to the Higher Education Act 2004 that are relevant to the time that has been allowed.
I want to ask the Leader of the House about the change that happened this week, from allowing three hours to allowing five. The motion was not moved last night and two hours were added to the debate. I think that everyone welcomes that, but it still gives inadequate time to cover the points that we have to make in the debate tomorrow. Whether that was another great concession wheedled out of the coalition by the Liberal Democrats I do not know; I am sure that if it was, we would have heard about it by now.
Helen Goodman
I do not know whether my hon. Friend has calculated this, but had the proposal gone through a normal legislative process, we would probably have had 170 hours’ debate. We are to have precisely 3% of the amount of time that we would have had. Has he also noticed that the motion before the House this evening specifies when the matter will be debated, Thursday 9 December, and has—
Finance Bill
Debate between Helen Goodman and Lord Beamish(14 years, 4 months ago)
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Mr Jones
It will, and I shall refer to that later. It will affect many people in my constituency, including some of the poorest.
In introducing his Budget, the Chancellor said:
“This emergency Budget deals decisively with our country’s record debts. It pays for the past, and it plans for the future. It supports a strong, enterprise-led recovery, it rewards work and it protects the most vulnerable in our society. Yes, it is tough, but it is also fair.”—[Official Report, 22 June 2010; Vol. 512, c. 166.]
His apprentice, in the form of the Chief Secretary to the Treasury, came before us today. He is wheeled out every time the Conservative party wants to do a nasty deed. I would have thought that he would wake up to the fact that the Conservatives use him and the Liberal Democrats as a shield.
Mr Jones
I am not sure that it is, because the Chief Secretary knows what he has signed up to. With his great experience as press officer for the Cairngorms national park, I am sure that he knows danger when he sees it. We need to expose the Liberal Democrats’ rank hypocrisy. They went into the election campaign arguing against most of the things to which they have now signed up. They have abandoned decades of commitment to some of the poorest in our society.
Those actions are predicated on a myth. The hon. Member for Dundee East (Stewart Hosie) identified it earlier when he mentioned Canada. That is a worthwhile example, because if we want to explain what is happening, we need to examine in detail what happened in Canada in the 1990s. The Government are copying not only every single measure that the then Canadian Government introduced but the tactics, including the great consultation with the Canadian people about how to cut the budget.
Helen Goodman
I am sure my hon. Friend is aware that a large proportion of British Government debt is bought by domestic savers rather than overseas savers. That is another reason why the British Government are much less at risk from the international markets.
Mr Jones
The way the Government are going with this Budget, I am not sure that it will be. The hon. Gentleman will have to get used to the fact that we will question the Government on the proposals because they will have a draconian effect on my constituents in North Durham.
I must refer not just to the retail trade or charities, but to the Conservative grass roots. Tim Montgomerie, on his website ConservativeHome, said:
“First, it hurts the poor most of all and, second, both the Conservatives and the Liberal Democrats said they had ‘no plans’ to increase this tax. At a time when trust in politics is so low we don’t need ‘plans’ to emerge tomorrow.”
That was in advance of the announcement that is contained in the Bill.
The other sector that the Bill will have a dramatic effect on is the construction sector. Yesterday, we saw the Building Schools for the Future programme decimated, directly affecting thousands of jobs. I am glad that my hon. Friend the Member for Halton (Derek Twigg) is back. He mentioned the decimation not only of BSF in his constituency but of other projects that have been put forward. Again, business and construction will have to carry the cost of the VAT increase.
Another sector that will be affected will be charities and the work that they do. I know that under the new Conservative approach, as part of the big society, charities are supposed to be stepping up to the mark, but they will be the ones that will be affected.
Helen Goodman
Has my hon. Friend noticed with respect to charities that the Government have now proposed to let welfare-to-work contracts on such a basis that only large companies with a lot of capital will be able to deliver them to unemployed people, thereby ruling out the voluntary sector from being involved in that worthwhile work?
Mr Jones
From a sedentary position, my hon. Friend rightly says that this is a stealth tax, and again, it will affect some of the poorest in our community. Earlier in the debate, we were talking about the level of fuel duty and rural communities where a car is not a luxury but an essential item that enables people to get around. This Budget will increase the insurance premiums for those drivers, with young drivers being particularly affected. Just because of their age, those drivers pay the highest premiums and they will have to pay an extra 1% under this Budget. In some cases, that will stop young drivers being able to get access to insurance.
Helen Goodman
On that point, does my hon. Friend agree that this will inhibit young people from learning to drive? Being able to drive is often an extremely important skill for people to have when looking for a job.