European Council

Jacob Rees-Mogg Excerpts

Monday 17th December 2012 Commons Chamber

[The Prime Minister]

In my defence, my remarks were spontaneous and made in an unwritten speech, whereas the hon. Gentleman actually planned those comments.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I should like to reassure the Prime Minister that for the sake of consistency we had a toast to him in Somerset at the weekend, but I am afraid there is a “but” on this occasion, which is that agreement to the single supervisory mechanism was by unanimity, but the rules for voting on the European Banking Authority can be changed by qualified majority voting. I therefore wonder whether the Prime Minister has got enough from these negotiations, and whether we ought to repatriate financial services regulation powers.

[The Prime Minister]

My hon. Friend makes an important point, but I am not sure that I agree with him. The banking union changes went through under a treaty article that requires unanimity. That was good for Britain, because it gave us the ability to insist on the changes we needed and to get the safeguards we wanted. I believe, however, that the single market, and qualified majority voting on the single market, has helped to deepen and develop that single market. That is why Margaret Thatcher passed the Single European Act through this House. We want to have an effective single market in financial services. This country has 40% of Europe’s financial services industry, and we have to fight for it and build alliances for it. There are often frustrations in doing so, but having a single market in financial services is good for Britain.

Leveson Inquiry

Jacob Rees-Mogg Excerpts

Thursday 29th November 2012 Commons Chamber

[Mr Speaker]

Last but never forgotten, I call Mr Jacob Rees-Mogg.

[Jacob Rees-Mogg (North East Somerset) (Con)]

Thank you, Mr Speaker. May I thank the Prime Minister for standing up for our ancient liberties and refer him to the rather ominous phrase on page 1781 of the report, which states:

“In order to give effect to those incentives I have recommended legislation”?

It is very hard to see how giving incentives by legislation is not licensing. Does the Prime Minister agree with me that it is better ultimately to have an irresponsible but free press than to have a responsible but state-controlled press?

[The Prime Minister]

First, may I commend my hon. Friend for his extraordinary powers of speed-reading in getting to page 1781 quite so quickly? He might also want to look at page 1780, which sets out the first part of the statutory underpinning recommended by Lord Justice Leveson, which is a guarantee of media freedom. It is an attractive idea to write a guarantee of media freedom into the law, but even that needs to be qualified. It is worth while looking at subsection 3 of the suggested example, which states:

“Interference with the activities of the media shall be lawful only insofar as it is for a legitimate purpose”.

We might start writing into the law qualifications and issues that people in this House might want to consider carefully.

European Council

Jacob Rees-Mogg Excerpts

Monday 26th November 2012 Commons Chamber

[The Prime Minister]

The rising tide of unemployment across Europe is clearly a tragedy, but we need to look across Europe and ask why some countries are doing so much better than others at tackling unemployment, and particularly youth unemployment. Youth unemployment is far lower in, for instance, Holland and Germany than in Spain, Italy and—yes—the UK. There is more to learn about welfare reform, apprenticeships and education standards. We can apply those lessons here to ensure that we keep unemployment falling.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I hope the Prime Minister will be pleased to know that he is once again the toast of Somerset for returning from the European summit so successfully, and we look forward to his further success. For as Sir Francis Drake said, it is not the beginning but the continuing of the same until it is thoroughly finished that yieldeth the true glory. We look forward to the true glory of the Prime Minister when he comes back next time with a cut.

[The Prime Minister]

I am grateful to my hon. Friend for his remarks and his support, but I commiserate with him and many in Somerset who will not be toasting anyone today because they are suffering from the appalling floods over the weekend.

European Council

Jacob Rees-Mogg Excerpts

Monday 22nd October 2012 Commons Chamber

[The Prime Minister]

Those are all subjects that were not discussed in any great depth at the European Council.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I am sorry not to be able to follow the humorous line that we had from the hon. Member for Bolsover (Mr Skinner), but in the unanimous negotiations required for a European banking union, will the Prime Minister try and repatriate powers that are currently subject to qualified majority voting?

[The Prime Minister]

My hon. Friend asks an important question. We need to see how the banking union proposals develop. We do not yet know whether it will be a full-on banking union or a restricted banking union. We do not know for certain the treaty base that will be pursued. If it is pursued on a basis of unanimity, it is absolutely key to make sure we safeguard the single market. I am very conscious of the fact, sitting round that table, that I am responsible for 40% of the European Union’s financial services industry. That, I think, must be our focus during these negotiations.

House of Lords Reform Bill

Jacob Rees-Mogg Excerpts

Monday 3rd September 2012 Commons Chamber

[The Deputy Prime Minister]

As I have explained, the primary legislation is as it is, and no one is proposing that we repeal it. My own view—I have made this perfectly public—is that it would be better not to complete the outstanding stages of the Boundary Commission investigations because the end result is now a foregone conclusion, but if that is what is felt necessary then a vote will be held and the boundary changes will not go through before 2015.

[Jacob Rees-Mogg (North East Somerset) (Con)]

May I commend the Deputy Prime Minister on his remarkable statesmanship with regard to the boundary changes? He will be pleased to know that the commission was proposing a North East Somerset that would have been a safe Lib Dem seat, so I am in with a sporting chance of being back after the next election. However, now that he has said that Lib Dem Ministers will vote against Government policy, I wonder what his definition of collective responsibility is within a coalition Government.

[The Deputy Prime Minister]

The hon. Gentleman’s description of the psephological effects in his neck of the woods is the closest anyone has come to possibly changing my mind on the boundary issue, but I will not, and I have made our position very clear. There are conventions, and in time-honoured fashion they mutate and develop over time. Coalition government is clearly a novel thing, and I think that the conventions that govern government will need to adapt to the fact that in this instance the coalition parties will go their separate ways, and I am sure that we will be able to manage that.

House of Lords Reform Bill

Jacob Rees-Mogg Excerpts

Monday 9th July 2012 Commons Chamber

[Tristram Hunt (Stoke-on-Trent Central) (Lab)]

It is a great pleasure to follow the hon. Member for Gosport (Caroline Dinenage). I am in the rather curious position of supporting the coalition Bill, in contrast to the hon. Lady. I am in favour of reform of the House of Lords. The tide of time—[Interruption.] No, I am in favour of it now, which is why I will vote for its Second Reading. The tide of time is in favour of democracy and we need to accept that.

[Jacob Rees-Mogg (North East Somerset) (Con)]

Mr Deputy Speaker, considering the interest that all three of us have, I wonder whether the hon. Gentleman has told his father about his view?

[Tristram Hunt]

I should declare an interest. My father sits in the House of Lords, as do the fathers of other Labour Members of Parliament. He, too, is in favour of reform of the House of Lords, and in favour of democracy in relation to it.

The tide of time is in favour of democracy. Many in the Chamber might find that an uncomfortable reality, but we cannot go around the world preaching democracy to developing and other nations without having that in the second Chamber. I entirely accept that legislative wisdom comes in many forms, and I acknowledge the expertise in the unelected second Chamber, as the hon. Member for Gosport suggested. That is why I am in favour of an 80% elected, 20% appointed upper House. My perfect model would be 75% elected, 25% appointed because when one drills down into the absolute expertise in the upper House, one would probably get to about 25%.

EU Council

Jacob Rees-Mogg Excerpts

Monday 2nd July 2012 Commons Chamber

[The Prime Minister]

The point that I would make to the hon. Gentleman is that because we are outside the euro, as well as having tough fiscal targets, which frankly anyone in my position would have to deliver to deal with the debt and the deficit that we were left, we can have a very accommodating monetary policy, with ultra-low interest rates. Our monetary policy is our own to determine because we are outside the euro. That is the difference between the situation in Britain and the situation in countries that are inside the eurozone.

[Jacob Rees-Mogg (North East Somerset) (Con)]

I completely support the Prime Minister in saying that the answer is less Europe, rather than more Europe. I wonder if I may bring his attention to part (j) of the communiqué, which states that the Commission will work on proposals for a

“common consolidated corporate tax base”.

Can I assume that Her Majesty’s Government will oppose those moves, as we are cutting corporation tax here, not trying to raise it to European levels?

[The Prime Minister]

He can.

Regional Pay

Jacob Rees-Mogg Excerpts

Wednesday 20th June 2012 Commons Chamber

[John Pugh]

That is certainly true, and a lot of UK national firms—building societies, banks and the like—do not have regional pay structures.

No one can dispute that reducing public sector pay in low-wage areas necessarily reduces the money spent, and therefore demand, in those areas. No one can dispute that putting relatively more money into the pockets of public sector workers in high-wage areas increases the money in circulation in those areas, and thus demand. Ultimately, economic division will be cemented in and, frankly, a good reason would be needed for doing that.

[Jacob Rees-Mogg (North East Somerset) (Con)]

The hon. Gentleman said that no one would dispute his points, but I will. If more private sector employment is created, greater total pay is created in the region, thus increasing demand.

[John Pugh]

That is my next point, because the only good reason for taking forward the approach would be if it was thought that it would improve private sector job opportunities in the poor regions on the basis that public sector jobs appear to be relatively well paid and crowd out private sector employment. If that is happening, one piece of essential evidence—one killer fact—is needed to show that, but it is not differences in the rates of pay in the two sectors, because that reflects a range of things such as job profiles and qualifications. We need evidence to show that as the number of public sector jobs increased in such regions, the number of unfilled vacancies for comparable employment in the private sector grew. That would be the clinching fact, but there is no such evidence. In fact, vacancies in the public sector in the north take longer to fill, because 50% of them are out for eight or more weeks compared with 15% in the private sector. Jobs that pay a living wage and for which skills exist get snapped up. Vacancies do not abound in the private sector except where there are definite skills shortages, and that is because of unemployment. There is no parallel difficulty with failing to fill public sector vacancies in better-off areas.

In the absence of that one piece of clinching evidence, which simply is not there, one could take a barrow-boy view that one could none the less get away with paying people less in the public sector in less advantaged areas, and especially get away with lower pay for the less well-paid, thus banking a cash saving for the state. I understand that argument, but it would be a wholly inappropriate way for a state to behave. It would be inappropriate for the state to discriminate simply by doing what can it get away with. We do not pay women or ethnic minorities less because they might be willing to work for less. If it was easy to get people to take the king’s shilling in the north, would we offer them sixpence instead?

--- Later in debate ---

[Jacob Rees-Mogg (North East Somerset) (Con)]

Thank you, Mr Deputy Speaker. I am sorry that you reduced the time limit just before I got up to speak; I will not take it personally.

We have heard that there is no evidence of crowding out, so I thought that I would provide some from Brian Groom’s column in the Financial Times this week. To be fair, I will give both sides of the evidence that he cites, which comes from a man called Henry Overman of the London School of Economics, who found that

“in 2003-07, each extra 100 jobs in the local authority spurred the creation of 50 additional jobs in private sector services, but destroyed 40 jobs in manufacturing.”

Over the longer period of 1999-2007, however, he found that the 100 extra jobs in the local authority destroyed 80 jobs in manufacturing and did not produce any net increase overall through jobs and services. The focus on public service jobs is destroying private sector jobs. I urge Her Majesty’s Government to go much further and to abolish national pay bargaining altogether.

[Ian Swales]

I thank the hon. Gentleman for giving way and I am glad to be giving him an extra minute to speak. We are all familiar with the phenomenon of people connecting two disparate sets of statistics. Can he think of a mechanism by which adding 100 local authority jobs would destroy 80 jobs in manufacturing?

[Jacob Rees-Mogg]

The reason increased employment in the public sector destroys jobs in the private sector is that every public sector job has to be paid for by the private sector. The public sector creates no wealth. It spends wealth that is taxed from the private sector. If it does not come from tax immediately, it comes from delayed taxation through borrowing. That is the connection. Increasing employment in the public sector increases the burden on the private sector and destroys the ability of the private sector to compete globally.

[Andrew Percy]

I usually agree with my hon. Friend, but will he explain why a schoolteacher in Hull or Grimsby, who faces some of the most challenging schoolchildren in the country and even more challenging parents, should be paid less than a schoolteacher doing exactly the same job elsewhere in the country? That is the problem that my constituents have with this proposal.

[Jacob Rees-Mogg]

My hon. Friend makes a mistake in assuming that the policy will automatically lead to lower pay. Pay will be set by market forces. If it was difficult to employ schoolteachers in his constituency, teachers in that area would have to be paid more than the market rate until it had the required number of teachers.

[Andrew Percy]

There is not a bigger pot of money.

[Jacob Rees-Mogg]

Of course there is not a bigger pot of money, but if we allow competition to work, it will increase the local economy, which means that more money will be gathered in through council tax and the area will have the ability to pay more for the public sector that it needs.

The problem with what we are doing at the moment is that it impoverishes the poor. It keeps the poorest areas of the country poor for as long as possible. I know that Opposition Members and some of my hon. Friends are in favour of the current situation not because they want to keep the poorest areas poor, but for the most noble and romantic of motives. However, their noble approach to this issue is fundamentally wrong. They think that it is fair to ensure that everybody is paid the same, but if by doing that we destroy employment in certain areas and make more people dependent on the state, we are not acting in the broader interests of society.

[David Mowat]

My hon. Friend’s analysis would be 100% right if there were proof that higher public sector pay was crowding out private sector growth. I have not heard that argument being made.

[Jacob Rees-Mogg]

I gave a little bit of the evidence earlier, but it is the basic logic of economics that if there is a limited supply of labour and a high price is set for that labour in the public sector, it will be forced into the public sector rather than being available for the private sector.

If we set high wage rates for the public sector in the poorest areas of the country, the most able people will be attracted to the public sector, leaving them unavailable for the private sector, and it will set at an unaffordable level the rate that the private sector must pay to compete. The private sector will therefore move down to the south of England, where it is closer to so much other economic activity. If we want to create employment in areas of high unemployment, we have to make it attractive. It therefore has to be cheap. Otherwise, the magnetic pull of London and the region around it pulls employment down here. Those who really care about creating employment in impoverished areas should be in favour of getting rid of national pay bargaining.

National pay bargaining not only gets rid of competitiveness for the private sector, but pushes up all prices in the area. If there are highly paid public servants in poor areas of the country, the costs of housing and services are pushed up. The money that is spent by those people forces up prices and makes it increasingly difficult for the private sector to compete. That is the basic, unassailable logic of economics, and it will not be overcome by the mush of sentimentalism of those who think it is simply unfair to pay people different amounts. As my hon. Friend the Member for Cannock Chase (Mr Burley) said, we accept that principle in other areas, such as with the London weighting. We need to go much further so that every school and every hospital decides the pay rates that it will give its employees. We should make it as local as it possibly can be, and in that way we will allow the private sector to flourish and bloom, the economy to grow and our overall situation to improve enormously.

Ministerial Code (Culture Secretary)

Jacob Rees-Mogg Excerpts

Monday 30th April 2012 Commons Chamber

[The Prime Minister]

Adam Smith, the special adviser, has made his role absolutely clear. He said:

“While it was part of my role to keep News Corporation informed throughout the BSkyB process, the content and extent of my contact was done without authorisation from the Secretary of State.”

That is what he said and the hon. Gentleman should listen.

[Jacob Rees-Mogg (North East Somerset) (Con)]

Does the Prime Minister recall the words of his noble predecessor, Baroness Thatcher, who said that advisers advise and Ministers decide? Does not a judicious Prime Minister consider things thoughtfully and carefully before making up his mind, and would not only a socialist Yahoo make up his mind in 23 minutes?

[The Prime Minister]

My hon. Friend is quite right. It is the easiest thing in the world to react to any Opposition leader or politician calling for a scalp or asking for a resignation, but one has to take the time and get the issue right. That is exactly what is being done in this case, and people will just have to be patient while the full facts are looked at.

Party Funding

Jacob Rees-Mogg Excerpts

Monday 26th March 2012 Commons Chamber

[Mr Maude]

This Prime Minister has not appointed two Cabinet Ministers twice and had to fire them both twice.

[Jacob Rees-Mogg (North East Somerset) (Con)]

Having had the pleasure of listening to my right hon. Friend for almost an hour, may I ask whether he has drawn the same conclusions as me? Has he, too, concluded that there is a lot of synthetic nonsense about this, that the Labour party has its snout in the trough to a far worse extent than we ever did, and that the Prime Minister is to be commended for his honesty, straightforwardness and transparency in revealing the names of all the people whom he has met?

[Mr Maude]

I could try, but I do not think that I could put it better myself.