Oral Answers to Questions

James Heappey Excerpts

Tuesday 19th January 2016 Commons Chamber

[Harriett Baldwin]

It was good of the hon. Gentleman to turn up for Treasury questions this time—I guess there was not a Stop the War march or a picket line to join today. I can assure him that the Treasury has the power to appoint both the board and the chief executive and to set its remit, but from then on it has operational independence.

[James Heappey (Wells) (Con)]

3. What comparative assessment he has made of the trends in the levels of wage growth and inflation.

[The Exchequer Secretary to the Treasury (Damian Hinds)]

The latest figures from the Office for National Statistics show that real average weekly earnings were up 2.4%, year on year, in the three months to October; wage growth has outstripped inflation for 13 consecutive months—the longest period of real wage growth since before the recession; and the Office for Budget Responsibility forecasts wages to grow faster than inflation over each of the next five years.

[James Heappey]

I welcome the Minister’s reply. Does he agree that the key to delivering further wage growth, particularly in rural areas such as Somerset, is improving productivity, infrastructure and the skills base, all of which underpin the Chancellor’s long-term economic plan for the south-west?

[Damian Hinds]

My hon. Friend is quite right. Last year, the hourly pay of the average Somerset employee grew well in excess of CPI inflation, and of course the south-west has a particularly strong employment rate. To keep on driving real wage growth, however, we must have productivity gains, hence the focus on the “Fixing the Foundations” strategy for skills and infrastructure and on making sure we have an attractive tax regime that encourages investment and brings jobs to that region and the country as a whole.