Youth Unemployment and Bank Bonuses

Julie Hilling Excerpts

Monday 23rd January 2012 Commons Chamber

[Danny Alexander]

The Government have made decisions to improve the benefits available through the enterprise investment scheme precisely to encourage more people to invest in small firms in such a way. The new seed enterprise investment scheme, which we announced in the autumn statement, will further help new businesses to be created through that route.

We have already said that for RBS and Lloyds Banking Group there will be a limit of £2,000 on cash bonuses, as was imposed last year, and let me reiterate that the bonus pool this year must be far, far lower than it was last year, and more transparent too. Tackling bank bonuses and youth unemployment is not just an economic challenge, but a challenge that is at the centre of the coalition’s purpose, which is to promote a sustainable and responsible banking sector that puts consumers’ needs at the centre of the financial system.

[Julie Hilling (Bolton West) (Lab)]

Will the right hon. Gentleman give way?

[Danny Alexander]

I shall give way one last time, and then I shall finish my speech.

--- Later in debate ---

[Julie Hilling]

Is the right hon. Gentleman confirming, then, that the chief executive of RBS will only get a £2,000 bonus?

[Danny Alexander]

I am doing no such thing, because those announcements will be made in due course. I have said that bonuses in the banks that we own will have to be far lower than they were last year. The cash element of bonuses will be limited to £2,000 for all employees, but of course there are other parts to bonuses, too.

Returning our country to prosperity has been the founding purpose of the coalition Government, but in our determination to restore growth, we will put fairness at the very heart of our recovery, tackling gross inequity in senior pay and tackling the perils of youth unemployment to ensure that young people’s prospects are not blighted in the way that those of too many were in the 1980s.

Autumn Statement

Julie Hilling Excerpts

Tuesday 29th November 2011 Commons Chamber

[Mr Osborne]

I certainly give that commitment, and I hope that south Essex will benefit from the commitment that we have already given today to work on a third crossing over the lower Thames. There are a number of possible locations for it, but it will definitely help economic activity both north and south of the Thames.

[Julie Hilling (Bolton West) (Lab)]

Before the general election, growth was increasing, the deficit was being reduced and unemployment was falling. Since the election, growth is down, borrowing is up and unemployment is going through the sky, and ordinary people are feeling the pain. Can the Chancellor truthfully tell us that his plan is working?

[Mr Osborne]

I had probably forgotten that we had inherited a golden economic legacy from the Labour party. What I remember is that we inherited a country that did not have a credible plan to deal with the deficit, which the credit rating agencies had put on negative outlook, and which the CBI, the OECD and all the other international organisations said lacked a credible plan.

Of course, as the OBR has made clear in its independent report, we are dealing with the consequences of the catastrophic failure of the last Labour Government to regulate financial services better, not least during the period when the shadow Chancellor was City Minister. That caused one of the deepest crashes of our country’s history. [Interruption.] We no longer hear the phrase “No more boom and bust” from the shadow Chancellor. He invented that phrase, and he gave us the largest boom and the biggest bust in our entire history.

Finance (No. 3) Bill

Julie Hilling Excerpts

Wednesday 4th May 2011 Commons Chamber

[Grahame M. Morris]

I am grateful for that point. Others have made it, and I have tried to echo its sentiments. The Government have the opportunity to rethink the implications of this decision, because implementation is not until 2013, so I hope that the Minister will address that point at the close of the debate. I am sure that hon. Members will recall that when the measure was proposed, Labour was engaged in a leadership election. Perhaps it was an attempt to steal the headlines.

However, from representations that I have received from expert groups, individuals and constituents—I am sure that other Members have received similar representations—it seems that the policy has been shown to be ill thought out. Whatever one’s views about middle England—whether it exists, whether it should be protected —it is crystal clear that the policy will disproportionately affect families with a single high earner. As someone who considers himself a socialist and something of a champion of the working classes and those at the lower end of the income spectrum, I think that there is a basic issue in this debate about justice and fairness. For families with a single high earner and perhaps no second earner, there is a clear injustice and anomaly when compared with a family with two high earners, as both families would lose the same amount.

[Julie Hilling (Bolton West) (Lab)]

I wonder whether my hon. Friend has come across people in his constituency, as I have in mine, who are talking about giving up work—contrary to the belief shared on both sides of the Committee that work should pay and that the best thing for families is for parents to be in work—because of the effect of everything that is happening, including losing child care and the other benefits that higher earners receive. Does he share my view that that is clearly not the best thing for families or our society when we are trying to grow our economy again?

[Grahame M. Morris]

I am grateful to my hon. Friend: that is a good point well made. There are a number of levels where the Government now have an opportunity to stop, reflect and listen to representations—to steal a phrase from the Health Secretary—about the impact of the policy on the economy. I am sure that that impact was never intended, but it should certainly be taken into account if people now have a perverse incentive not to engage actively in earning a living and making a contribution to society.

Child benefit is a key part of the welfare state, and one that applies the principle of universality to all families in recognition of society’s duty to support not just families, but future generations. I had always assumed that that was a cross-party commitment, irrespective of party political allegiance. However, by taking away £1,000 in child benefit and child tax credits from families earning just over £40,000, the coalition Government are damaging our system of welfare for the future. We know—or at least we suspect—that the measure is more to do with trying to undermine the strong support of middle England and the middle classes for the welfare state. We on the Opposition Benches suspect that the purpose of the measure is to move British politics in a new direction. My concern is that an Americanised system of low taxation with a basic safety net to catch those at the very bottom would be a move in the wrong direction.

Finance (No. 3) Bill

Julie Hilling Excerpts

Tuesday 3rd May 2011 Commons Chamber

[Hugh Bayley]

That could very well be the case, and we will listen with great interest to what the Minister says in reply to the debate. All we are asking for is transparency. We want to know whether the Government are doing this for environmental or revenue-raising reasons, what the implications of the rise will be in environmental and revenue terms and what the impact will be on family budgets. I believe—indeed, I know—that all that information is not known, so I think that the Opposition’s amendment is a sound one.

[Julie Hilling (Bolton West) (Lab)]

Will my hon. Friend give way?

[Hugh Bayley]

I keep trying to sit down, but my hon. Friends are preventing me from doing so.

[Julie Hilling]

My hon. Friend mentions the potential effects on the environment, tax-raising and families. A project has been brought to my attention because it can no longer afford the fuel for the vehicle it uses to take young people with mental disabilities out on trips, so those disabled young people are no longer getting the benefit they used to get from going out. Is he aware of similar issues in his constituency?

[Hugh Bayley]

Yes, I have had third sector organisations coming to me and saying how much more difficult life is getting because sources of funding are drying up.

It is clear from the interventions of my hon. Friends that the point I have raised has wider implications that ought to be studied by the Treasury and other Departments. I know what the process is for tabling amendments that ask for reviews and reports regarding legislation, and they are tabled not just to frustrate or irritate those on the Treasury Bench but to pose serious questions and seek serious answers. The Minister is waving her piece of paper again, and I promise I will read it properly, but what she read out to me did not answer my questions. It is an input—an estimate of one figure—but as we have heard, further study of the environmental and social impacts, the impact on family budget impacts and the overall economic impact is needed. I hope that as a result of that analysis the Government will produce better, more coherent cross-government proposals for the taxation of fuel in future.

--- Later in debate ---

[Justine Greening]

The hon. Gentleman is obviously one of the Labour party’s structural deficit refuseniks. He simply refuses to accept that the deficit exists. I am sure that he would also refuse to accept that his party left unemployment 400,000 higher by the end of its term in office. We understand the problems that our economy faces and the Budget was all about tackling them.

I will turn to the substance of the amendment. For motorists to realise the benefits of the cut in fuel duty, retailers need to pass it on at the forecourt. If the cut in fuel duty had been fully passed on to average pump prices, including VAT, they would have been 1.2p per litre lower. The amendment seeks a published assessment of the degree to which the cut fed through to pump prices. As I said, we have already published a tax information and impact note that sets out our analysis of the impact of the cut. Following the Budget, the website petrolprices.com, which gives independent average daily prices and which the previous Government used to track prices, showed that average pump prices fell by approximately 0.8p per litre between 23 and 28 March. It can be clearly seen that the reduction in fuel duty largely fed through to prices at the pump. Therefore, prices are lower due to our actions and motorists are benefiting from the cut in duty. Let us not forget that average pump prices are approximately 6p per litre lower as a result of the cut in duty and our scrapping of the previous Government’s planned escalator, which they would have gone ahead with.

[Julie Hilling]

I am a little bit confused, because the Economic Secretary is talking about how wonderful the Government’s actions on fuel prices have been, but it seems to me that in the past 12 months, fuel has gone up by something like 25%. I do not see why the Government are saying how brilliant their actions have been when people are paying something like £1.40 a litre instead of £1.10 a litre. A penny off, 3p on, 40p on—it does not make sense to me.

Fuel Prices and the Cost of Living

Julie Hilling Excerpts

Wednesday 16th March 2011 Commons Chamber

[Nigel Mills]

I am grateful for that intervention—I think. The cost incurred in driving to and from work is clearly a factor when people are deciding whether work pays, which is why the increase planned for 1 April really should not go ahead.

Let me return to the topic of nudging. I think we all accept that tax can influence behaviour, and that if we further increase the tax on driving we will see the changes in behaviour that we would expect. People will drive to work less, and businesses will not be able to survive, prosper and grow because they will not be able to cope with the increased cost base. We can all cite small haulage businesses in our constituencies that are struggling to deal with the duty rise. As has been pointed out, reversing the VAT rise will not help those businesses at all; it is the level of duty that we need to consider. If the Government want to find another way of raising some revenue from the haulage industry to help compensate for the loss of fuel duty, I urge them to accelerate their plan to charge foreign road hauliers for using our roads.

[Julie Hilling (Bolton West) (Lab)]

Will the hon. Gentleman give way?

[Nigel Mills]

I am afraid that I have already given way twice.

There is anecdotal evidence that foreign hauliers drive into our country with full tanks of petrol, which in many instances means that they can do all their work here without paying any fuel duty. We are making our haulage industry uncompetitive through the prices that we are charging hauliers to buy diesel in this country and the road taxes that they have to pay. Meanwhile, we are not charging foreign hauliers anything to use our roads. Let us collect that revenue as soon as possible, and use it to help support our own small businesses.

We have heard that, according to the review by the Office for Budget Responsibility, rising prices do not necessarily generate rising tax revenues. As was demonstrated by my hon. Friend the Member for Worcester (Mr Walker), that is because of the damage that increasing fuel prices do to the overall health of the economy, which depresses tax revenues. The Government are looking for tax cuts to try to enhance growth. We have plans to reduce corporation tax, but we should consider the damage that fuel tax rises do to growth. There must be some scope for a reduction in fuel tax. Even if it were not revenue-neutral, it might make a positive contribution to the growth that we need if we are to tackle the deficit.

I cannot support this Labour motion. The fact is that we could not reverse the impact of the VAT rise, because that would be illegal. Even if we could try, it might take six years. I urge the Front-Bench team, and the Chancellor when he delivers his Budget next week, not to go ahead with that planned fuel rise. We need some sort of fuel duty balance, to try to ensure that the shock of oil price rises does not do the real, serious and predictable damage to our economy that it could, and we must also bear in mind that if the middle east situation worsens, the shock could become much more severe than at present. We could be faced with the real damage to jobs that those significant price hikes could do.

--- Later in debate ---

[Claire Perry (Devizes) (Con)]

It is always a pleasure to follow the hon. Member for Na h-Eileanan an Iar (Mr MacNeil). I represent a large, rural constituency in Wiltshire, and when I filled up my car on Monday morning, I found that we, too, are paying £1.40 for diesel and £1.35 for unleaded fuel. The point was very well made by the hon. Member for Bristol West (Stephen Williams) that once one gets out of London and the major metropolitan areas there is a real problem with competition. That problem is shared by many constituencies across the UK.

I am afraid that the Labour motion is breathtakingly cynical. Not one Labour Member bothered to show up at the recent debate on this issue in Westminster Hall, and the Labour Government consistently penalised motorists across the country for 13 years, with unused bus lanes, underinvestment in rural transport and 12 rises in fuel duty over 13 years, of which four were in the last 16 months of their term of office. They also planned, as part of their scorched earth economic policy before the election, six further rises to come into effect over four years, so their cynicism in presenting this motion is breathtaking.

[Julie Hilling]

The hon. Lady is very keen to talk about what the previous Labour Government did, but does she want to think a little about what is happening now? The Road Haulage Association says that in the last week alone £850 was added to the cost per year of running an average-sized lorry—that was under her Government’s watch.

[Claire Perry]

I am grateful for the hon. Lady’s intervention and I will come to my “demand” for something to be done about this problem. I think we both have in our constituencies small haulage businesses that are really suffering from the increases in fuel prices.

I find the motion muddled and inaccurate. This is yet another unfunded spending commitment from the shadow Chancellor and the Opposition. We cannot use a one-off levy of £800 million to fund a permanent reduction in VAT costing several times that amount. The maths just does not add up. I had always thought that the shadow Chancellor, who is not in his place, was a fairly financially literate fellow.