Infrastructure

Henry Smith Excerpts

Tuesday 12th February 2013 Commons Chamber

[Rachel Reeves]

I have already given way to the hon. Members.

[Henry Smith (Crawley) (Con)]

You haven’t given way to me.

[Rachel Reeves]

I will give way to the hon. Gentleman. Perhaps he would like to explain why the Government have cut infrastructure spending by £12.8 billion over three years.

[Henry Smith]

I am grateful to the hon. Lady for allowing me to intervene. Does she welcome the thousands of new houses being built in the Kilnwood Vale neighbourhood in my constituency, in addition to the £26 million upgrade of Three Bridges rail station and the £53 million upgrade of Gatwick rail station, and so on?

[Rachel Reeves]

The problem is that this is just a wish list. Those things are not happening—as John Cridland says, the diggers are not on the ground. As I have said, housing investment is down 8% in just one year, and 129,000 jobs have been lost in the construction sector. I look forward to hearing Government Members explaining why they are supporting those policies.

Oral Answers to Questions

Henry Smith Excerpts

Tuesday 29th January 2013 Commons Chamber

[Greg Clark]

If the apprentices that work in my hon. Friend’s office contribute to her own productivity and innovation in policy production, she is a standing example of the success of the scheme.

[Henry Smith (Crawley) (Con)]

4. What steps he is taking to help people with the cost of living.

[Mr Marcus Jones (Nuneaton) (Con)]

5. What steps he is taking to help people with the cost of living.

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

The Government continue to take steps to support households. The personal allowance will be increased to £9,440 in April 2013 to support hard-working individuals. The cash increase in that year is the largest ever. The 3p fuel duty increase planned for January 2013 has been cancelled, as a result of which fuel duty will have been frozen for two and a half years.

[Henry Smith]

I thank my right hon. Friend for that answer and warmly welcome the fact that more than 1,700 people in my constituency have been taken out of paying income tax altogether by the raising of the threshold, and that more than 42,000 people in my constituency have had their income tax reduced as a result. May I urge him to be bold and go further?

[Danny Alexander]

I am grateful to my hon. Friend for those comments. We are increasing the tax allowance towards the bold and ambitious goal of £10,000, which Conservatives and Liberal Democrats have joined together in coalition to deliver. We will certainly be bold and ambitious, and I will take his comments as a Budget submission.

Fuel Duty

Henry Smith Excerpts

Monday 12th November 2012 Commons Chamber

[Albert Owen (Ynys Môn) (Lab)]

I am disappointed by the Minister’s speech—I have heard it several times before. Whenever he addresses the House he uses the same argument: the previous Government got us into a mess. Today, my constituents are suffering from high petrol and diesel prices, which is why the motion, which I shall support, was tabled.

I have consistently supported the hon. Member for Harlow (Robert Halfon) over a period. Indeed, I opposed the Labour Government increasing fuel duties because I thought the timing was wrong.

[Henry Smith (Crawley) (Con)]

Will the hon. Gentleman give way?

[Albert Owen]

I will in a moment, but given the time limit I do want to make some progress.

I want to raise three issues, the first of which is the impact of fuel duty on businesses, especially those in peripheral areas of the United Kingdom. The Government also chose to impose a VAT increase, despite the Prime Minister having told the country before the election that they had no intention of doing so. Every time constituents throughout the country put petrol or diesel in their cars they pay an extra 3p per litre because of the tax introduced by this Chancellor of the Exchequer.

[Albert Owen]

Scottish National party Members always use that line on fuel duty, and I am not going to waste my time on it—[Interruption.] If the hon. Gentleman had checked the record, he would know that I have been consistent on fuel duty. I have followed SNP Members through the Lobby on that. Previous Labour Chancellors froze the duty following pressure from people. That is on the record. We can play games about previous Governments, but the serious issue is the cost—

[Henry Smith]

Will the hon. Gentleman give way?

[Albert Owen]

No. I want to make progress. The serious problem is that our constituents are paying 15p per litre more for petrol under this Government than they paid under the previous Government. Government Members can use nonsense hypotheticals, and say, “It would be 10p more expensive under a Labour Government,” but the fuel escalator was introduced by the Major Government. We could use the same argument, and say, “Had we stuck to that, fuel would by so many pence more expensive.” The reality is that it is 15% more expensive today.

Air Passenger Duty

Henry Smith Excerpts

Thursday 1st November 2012 Commons Chamber

[Paul Goggins]

My right hon. Friend was a very able Minister for tourism and he did a superb job. He is right: APD is a tax on our constituents who seek to go on holiday, but it is also a tax on those who want to come here to enjoy the wonderful countryside and the great features of our society, with the associated benefit to our economy.

The APD, as hon. Members know, is the highest in Europe. Denmark, Norway and Holland have scrapped it. Ireland, as my hon. Friend the Member for Belfast East (Naomi Long) pointed out, has all but scrapped it—it intends to do so in the near future.

As the hon. Member for Witham argued, we have to look at this in terms of the wider economy. I wish to look at it particularly from the perspective of the Manchester city region, and it is good to see the hon. Member for Altrincham and Sale West (Mr Brady) in his place. I know that he has a great commitment to Manchester airport. I also see my hon. Friend the Member for Blackley and Broughton (Graham Stringer), who is a former chairman of the airport. It now serves more than 200 destinations, has 24 million passengers a year, and employs 19,000 people on the site, with many thousands more provided in the wider economy. It is estimated to bring in around £3 billion to the UK economy as a whole.

One of my principal concerns, which I have already mentioned, is that APD is a tax on our constituents. Let us reflect on that for a second. Hard-working families already paying tax on their hard-earned incomes have to pay tax again if they want to take their children on holiday. We ought to think about that. In particular, let us consider the economic problems that APD creates. There is clear evidence that airlines are not coming to Manchester airport because of APD. In particular, AirAsia X has dropped its plans for a route from Manchester to Kuala Lumpur and routed instead to Paris Orly. The airlines will go where the profits are greatest, and with those profits will go the jobs and all the additional economic value.

[Henry Smith (Crawley) (Con)]

AirAsia X also stopped flying from Gatwick to Kuala Lumpur, and cited exactly the same reason—APD being far too high. The right hon. Gentleman makes a good point.

[Paul Goggins]

The hon. Gentleman makes it clear that this is an issue not only for Manchester but for other airports and therefore the whole economy.

I am particularly concerned about the barrier that APD might pose to Manchester’s ambitious plans for an airport city—a plan that fits squarely with yesterday’s report by Lord Heseltine, which locates the focus for economic development absolutely in the city regions, the ambition, skill and energy of which are the drivers of that development. Manchester is at the forefront of that. The plans would result in major investment in manufacturing, office development, retail, leisure and an ambitious plan for a medipark that would mean major international investment in health and biotech industries. All that would be in the area around the airport and, crucially, would be facilitated by the presence of that international airport. It could become an economic hub drawing in investment from across the world, bringing high-value investment, much-needed jobs and links to destinations throughout the world.

The vision for the airport city has the Government’s full support. They have given it enterprise zone status, which brings with it rate relief and access to superfast broadband. It is utterly contradictory, however, to have that plan in place but then to impose on every business passenger passing through Manchester airport a tax on that business. It is like saying to an investor from north America, “We’re very grateful for your business, and by the way it’s going to cost you an extra £65 every time you want to visit that investment.” It is preposterous, and it is a barrier to the kind of economic growth that we need and want.

We cannot wish APD away. As the hon. Member for Witham said, it brings nearly £3 billion into the Treasury, which of course helps to pay for our schools and hospitals, but one way or another we must think our way out of this creatively. I support—I suspect that not all hon. Members would—a further investigation into regional APD variations, because they could encourage the use of spare capacity at some of our regional airports and facilitate the kind of economic development, such as our ambitions for airport city that I have described.

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[Henry Smith (Crawley) (Con)]

This debate is most important for the well-being of the British economy. I would like sincerely to thank the Backbench Business Committee for allowing time on the Floor of the House for today’s debate, and I particularly pay tribute to my hon. Friend the Member for Witham (Priti Patel) for helping to secure it.

It is perhaps of little surprise that I take a great interest in this subject, as I represent the constituency that contains Gatwick airport—the world’s busiest one-runway, two-terminal airport—and it is also the home of a number of aviation-related companies. We have tour operators, globally renowned companies such as TUI Travel and, of course, British Airways operating from Gatwick. We have the headquarters of Virgin Atlantic, an iconic British company that is innovative in the services it provides, and we also have easyJet, now this country’s largest airline with about 40% of the flights from the area—indeed, 1,078 easyJet flights go out of Gatwick airport every week. I am delighted to say that, from next spring, easyJet is starting a new route to Moscow. It is little surprise, then, that many of my constituents who work locally in the aviation industry are deeply concerned about air passenger duty. Mention was made of the number of e-mails that right hon. and hon. Members received from the fair tax on flying campaign, and I believe I received more than 1,000 such e-mails.

It is not for parochial reasons, however, that I speak in today’s debate and raise my concerns again about the level of APD that we charge. Almost a year ago, I was fortunate enough to be granted an Adjournment debate and warned that if APD were to be increased, as was suggested, we would do some real damage to this country’s economic prospects.

I entirely understand why the Treasury is seeking to bring in revenue. We are all acutely aware of what is happening to the national finances. The deficit that we are sustaining is deeply troubling, and although I warmly congratulate the Government on reducing it by a quarter in just two and a half years, it is little wonder that the Treasury does not view with enthusiasm the prospect of giving up an income of almost £3 billion in APD receipts.

[Adam Afriyie (Windsor) (Con)]

Although the Exchequer may be raising between 2 billion and £3 billion from air passenger duty, it may be losing an equivalent amount, if not more, as a result of the reduction in trade and improved economics. Is it not for that reason that we should demand a forward view of the economic impact?

[Henry Smith]

My hon. Friend has anticipated what I was about to say. The Netherlands scrapped air passenger duty after studies conducted by the Dutch Government established that it was costing the economy more than it was bringing into the Treasury. I think that it is for the same reason that only six European countries charge any form of air passenger duty, and the amounts that they charge are very modest.

[Guy Opperman (Hexham) (Con)]

My hon. Friend is making a very articulate case not only on Gatwick’s behalf but in favour of the change that we all want to see, but does he agree that air passenger duty is not just a London tax? If the Government are interested in supporting the regions of England, at the very least they should bear in mind the fact that a change in APD would make a huge difference to regions such as the north-east and the north-west.

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[Henry Smith]

My hon. Friend is right. Air passenger duty is a bad tax for the UK as a whole, regardless of which nation or region within it Members may happen to represent.

[Michael Connarty]

The hon. Gentleman is making a very good case. It is estimated that air passenger duty raises £2.6 billion, which is nearly £1 billion more than the £1.76 billion that it raises in all the other European countries. It is a tax on tourism and trade, and the Government should act before it does more damage. It is estimated that up to £3 million will be lost in trade by 2016 if the present position continues.

[Henry Smith]

The hon. Gentleman is absolutely right.

Members have suggested that we adopt some form of regional banding, but I think that that would be a mistake. I think that the solution is for us to get rid of air passenger duty altogether over time, or at least reduce it to a very modest level. I do not think that we should pit one part of the United Kingdom against another. We, as a relatively small country, achieved global dominance because we are a trading nation, and we either stand together or fall apart when it comes to trade. I think that we need to view the argument holistically, and to see this as very much a British issue.

In the remaining time available, let me deal with some of the misnomers that have been applied to air passenger duty. First, it is not an environmental tax. If it were I would support it, because I think it important for us to reduce our emissions whenever possible, but it is purely a revenue-raising tax—albeit a misguided one and a false economy, because it costs our economy far more than it raises. In fact, we are subject to double taxation when it comes to air duty. The European emissions trading scheme, which was introduced at the beginning of this year, is an environmental tax, and I have no complaint about it; but air passenger duty is almost certainly not.

I also want to debunk the myth that we need APD because aviation fuel and air tickets are not subject to value added tax. Under the conditions of the Chicago convention, it is impossible to charge VAT on aviation fuel and air tickets, but even if it were possible, the current APD represents a far higher amount than VAT would. We are, therefore, greatly overtaxed.

A year ago I had an Adjournment debate in which I asked the Government not to increase APD. I am sorry that I failed in that, and APD went up. Today, we are not calling for a cut in APD, however; we are simply calling for APD to be frozen at its current level until the Treasury assesses whether it is costing our economy more than it brings into the Exchequer, as I contend. The Treasury conducts surveys and studies all the time, and it is perfectly reasonable to ask it to carry out a study on this matter so that we can have some proper facts and figures and are able to make an informed decision.

The stakes are very high. We are a trading nation with competitors, not only in continental Europe but around the world, who are eager to take our business. We will lose out to them if we do not carry out an assessment so that we can understand APD’s impact on our economy and take action if necessary. I therefore hope the Government will respond positively to this reasonable motion. They should carry out a study of the effects of APD. Until that is done, we must not harm the British economy by increasing APD still further.

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[Sajid Javid]

Absolutely. I can assure the hon. Gentleman that the effects on taxation were taken together and that the Government had determined that the extra 5% was raising hardly any tax whatsoever.

Given that we have recently completed a comprehensive consultation on the subject, we have no plans for further reform at this point.

[Henry Smith]

Would it not be reasonable, though, to have a study, as proposed in the motion, to see the impact on the economy that air passenger duty is having? Surely a study by the Treasury is a reasonable thing to request.

[Sajid Javid]

I thank my hon. Friend. I will come to that point in a moment.

As I said, we have no plans at this point for further consultation, but we are keen to ensure that the aviation sector can continue to enable economic growth and support jobs across the country. APD makes an essential contribution to the public finances and to this Government’s plan to create a stable platform for growth.

This has been an excellent debate that has given me and the Government much food for thought. There have been excellent contributions from Members in all parts of the House, and I assure them that I have been listening very carefully. Should the motion pass; I have a feeling that it might well do so—

Multiannual Financial Framework

Henry Smith Excerpts

Wednesday 31st October 2012 Commons Chamber

[Mike Gapes (Ilford South) (Lab/Co-op)]

You and I, Mr Deputy Speaker, were both Members of this House in 1992-93, when I was one of those pro-Europeans who followed my pro-European party leader, John Smith, and the spokesman for foreign affairs, Lord Robertson, into the Lobby with people whom I would never have described as having the same view as me on Europe and its future. The same thing will happen this evening, but I wish to make it clear that I do so not because I agree with the tenor and tone of the many Europhobic speeches we have heard from Government Members—and some, unfortunately, from this side of the House—but because I believe it is wrong for the European Union to increase its spending at a time when national budgets, not just in this country but in Greece, Spain, Portugal and elsewhere, are being reduced.

This is not the most important debate about the future of Europe that we will face, and we must put it into perspective. Although there is talk of billions of pounds and euros, the EU budget is only 1% of the GDP of all member states. In this country, public spending accounts for more than 40% of our GDP each year, and we must put into perspective the fact that the EU’s total spend is very small.

In his introductory remarks, the Minister referred to the size of the Commission. I was unable to intervene at that point, but let me place it on the record that the European Commission has, in total, between 30,000 and 33,000 employees who serve 27 member states. The Minister’s Department in Her Majesty’s Revenue and Customs alone has about 80,000 employees, and we must get such things into perspective. We do not have a gargantuan European Union bureaucracy hoovering up resources; in fact, the UK Government spend five times as much servicing the interest on the national debt each year than they do in European Union contributions.

[Henry Smith (Crawley) (Con)]

The hon. Gentleman is talking about the administration of the European Commission, which at 30,000 employees I think is still too large. The bulk of the EU budget goes on redistributing money, typically from net contributors such as the United Kingdom to other parts of Europe. Does he feel that we need a little more restraint in that respect as well?

[Mike Gapes]

I agree with that, but I also point out that the UK contribution to the European Union is less than that of Germany. Our net contribution—with the rebate that was retained by the previous Labour Government—is comparable to that made by France, a similar country in terms of size, population and GDP. We are among the net contributors, but the European Union is also about solidarity. One thing that led to the growth of the European Union, and the increased trade and prosperity from which British workers and British companies benefit, is the fact that countries such as Spain and Portugal—and, increasingly, countries such as Slovenia—are growing and benefiting by their membership of the EU.

The EU also makes a contribution to democracy and stability in Europe, for which the Nobel prize committee has rightly—[Interruption.] Oh I see. Here they are; here is the real agenda. The Nobel prize committee has rightly recognised the European Union’s contribution to peace in Europe over the decades. If somebody like Henry Kissinger can get the Nobel peace prize, the European Union certainly deserves it.

Infrastructure (Financial Assistance) Bill

Henry Smith Excerpts

Monday 17th September 2012 Commons Chamber

[Danny Alexander]

The hon. Gentleman is right: there is no sunset clause. That is because we think that it is important to introduce these powers, not just for now but for the future. By circumscribing the financial limit of the extent of the powers and also by establishing strong requirements for reports to be made to Parliament, we can ensure that Members continue to be informed on how they are used. As the hon. Gentleman says, no such proposals are on the table at present, but in principle, should a major infrastructure scheme arise in the transport sector but be unable to attract the necessary finance because of conditions in the funding markets, it could be eligible in the future. However, that would be a decision for the Government of the day.

[Henry Smith (Crawley) (Con)]

Will my right hon. Friend join me in congratulating London Gatwick Airport Ltd on the £2 billion that it is investing in the upgrading of the facility, including the rail infrastructure?

[Danny Alexander]

The hon. Gentleman has cited the airport that I use most, apart from Inverness airport, because it services Inverness. I probably use it a couple of times a week. I have observed the investment programme, and it is certainly improving the facility. We hope that that improvement will continue.

Budget Leak Inquiry

Henry Smith Excerpts

Thursday 22nd March 2012 Commons Chamber

[Mr Speaker]

Order. The hon. Gentleman will resume his seat. I made the position clear. This is a set of exchanges about a specific and narrowly crafted urgent question. It may be about many things within that context, but it is not about 1947. We will leave it there.

[Henry Smith (Crawley) (Con)]

The previous Labour Government leaked worse than the Titanic. Does my hon. Friend agree that, whatever the Labour party’s budgetary policies may be—we are not quite sure—they would be an equal disaster?

[Mr Gauke]

Within the constraints of the question, I will just say yes.

Remuneration of EU Staff

Henry Smith Excerpts

Tuesday 21st February 2012 Commons Chamber

[Cathy Jamieson]

I am happy to accept that correction to the record. However, I want the House to be aware of our concern that what was presented by the UK was done very much at the last minute. I hope that in future we will spend time building alliances, rather than be sidelined.

I want to focus again on the issue of budgetary restraint. The Minister has indicated that there is an intention to be tough on Europe on budgetary restraint, but we have not seen or heard the detail today of how that will happen.

The Conservative party is riven with splits. The Deputy Prime Minister has said that the Prime Minister’s behaviour in Europe risks making the UK

“isolated and marginalised within the European Union”.

The Italian Prime Minister, Mario Monti, has said that Britain will no longer be

“in the heart of Europe”

following the veto and that our “capacity to influence” events will be greatly diminished. The concern of people in the wider world is that the Prime Minister has indicated that he is willing to put appeasing his own party first and the national interest second. Let us be clear about one thing: our place in Europe and our seat at the table are too important for that. To cut ourselves off from a market of 500 million customers would be devastating to British companies. In an era of billion-person countries and trillion-pound economies, we need to find ways to amplify our voice, not dampen it.

[Henry Smith (Crawley) (Con)]

Is the hon. Lady really arguing that we should go headlong into whatever political alliances the European Union wants us to enter, just for the sake of free trade? Is it not the case that we are able to have free trade without surrendering sovereignty?

[Cathy Jamieson]

If the hon. Gentleman had been listening carefully, he would have realised that I am saying nothing of the sort. I am saying that in an era when we have to compete in a global economy, we must ensure that our voice is heard. We therefore have to take our seat at whatever table there is to put the interests of the UK forward. Where we have shared goals, such as in climate change negotiations, tackling cross-border crime and dealing with human trafficking, working together surely makes global agreements more likely. We need a mature and positive approach to Europe from the Government.

Oral Answers to Questions

Henry Smith Excerpts

Tuesday 24th January 2012 Commons Chamber

[Andrea Leadsom (South Northamptonshire) (Con)]

10. What steps he is taking to tackle excessive executive pay.

[Henry Smith (Crawley) (Con)]

14. What steps he is taking to tackle excessive executive pay.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

17. What steps he is taking to tackle excessive executive pay.

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[Danny Alexander]

My hon. Friend makes a good point. That is already part of the Financial Services Authority’s code of practice for banking remuneration. It is particularly important to end the distorting effect of those kinds of incentives in the financial sector, but the additional powers that we are giving to shareholders, which my right hon. Friend the Business Secretary announced yesterday, will allow companies in other sectors to adopt that kind of practice, should they wish to do so.

[Henry Smith]

I welcome yesterday’s announcement by the Government on mitigating excessive executive pay. With regard to the UK honours system, may I seek an assurance from my right hon. Friend that the Government will be more circumspect in regard to the honours that are suggested, unlike the—

[Mr Speaker]

Order. I think that the hon. Gentleman might have been groping his way towards order, but he had not quite arrived. We will have to leave it there for today. We are specifically talking about excessive executive pay.

Eurozone Crisis

Henry Smith Excerpts

Thursday 3rd November 2011 Commons Chamber

[Mr Hoban]

My hon. Friend makes an important point. Stringent conditions are linked to the packages offered to Greece, Ireland and Portugal, to ensure that the money is used well and wisely, and that the structural reforms that are needed to generate growth in those countries are implemented.

[Henry Smith (Crawley) (Con)]

I am very pleased that my hon. Friend has said that Her Majesty’s Government are preparing contingency plans for the possible break-up of the eurozone, but can he confirm that they will not include the possibility of our joining the euro, as seems to be still the official policy of the Labour party?

[Mr Hoban]

I do not think there is any intention for us to join the euro at a time when it is breaking up. The only party in this House that seems to express an interest in joining the euro is Labour, whose leader, when asked when they would join the euro, said:

“It depends how long I’m prime minister for.”