National Insurance Contributions (Rate Ceilings) Bill

Debate between Kwasi Kwarteng and Kelvin Hopkins

Tuesday 15th September 2015 Commons Chamber

[Kelvin Hopkins (Luton North) (Lab)]

I apologise, Madam Deputy Speaker, for having to leave the debate for a short while, but I managed to catch the major part of the speech by my hon. Friend the Member for Bishop Auckland (Helen Goodman). It was an excellent speech and I agree with every word of it, but I did not know that she was half Danish. I want to say something about Denmark, a very sensible country with a more appropriate taxation system than we have. As the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) said, would Members prefer to live in Denmark or Mexico? I know which I would choose; Denmark is clearly a more sensible country.

I have been to Denmark on a couple of occasions and it does two very sensible things. First, the Danes have retained their own currency, which is sensible, but they also seek to manage its value, which we do not, and that is also sensible. One result of the Danes’ sensible taxation system is that they can sustain students without fees but with grants until the age of 25. A few years ago, I understand, the average class size in schools in Denmark was 15. No wonder they have advantages that we do not; they are prepared to pay for them—[Interruption.] I shall talk about national insurance, but I wanted to mention the sensible country of Denmark, which I so admire, before I started.

The lock on the taxation system is a gimmick, as my hon. Friend the Member for Worsley and Eccles South (Barbara Keeley) has said from the Front Bench. Surely a promise from the Chancellor of the Exchequer would be appreciated, understood and believed by the business sector. A Conservative Chancellor making a promise is enough. This Bill is like saying, “I promise not to rob the bank any more, but do put the handcuffs on me.” He is clearly not a bank robber, but does he need to have those handcuffs on him just to do what he believes to be the right thing? He has given away flexibility in any case, and I certainly would not do that, because we cannot foresee what will happen.

There is a real possibility, for example, of another financial crisis coming down the road. I mentioned in my speech on the Budget forecasts that there will be another serious economic crisis in the not-too-distant future. Precisely when that will happen, we do not know, but we ought to retain flexibility with all the economic levers at our disposal to ensure that Britain is protected if that happens.

In the previous crisis, the British Government, led by Gordon Brown, persuaded the world to recapitalise the banks. If we had not done that, the whole financial system might have collapsed and we would have been in a much worse situation. I am not saying that I agree with everything that my former right hon. Friend did, as I was often a critic of our policies. Nevertheless, that had to be done, even though in a sense it rewarded the gamblers who had gambled away our future and made our lives so much more difficult. Those difficulties continue today, but it was the bankers gambling on the free financial markets who caused the problem. It was nothing to do with the Labour Government, and, indeed, all sorts of economists say that Labour did the right thing when the crisis happened.

[Kwasi Kwarteng]

We are wandering rather further from the topic of the debate than I would like, but how would the hon. Gentleman explain the consistent deficits we ran from 2001, as the hon. Member for Na h-Eileanan an Iar (Mr MacNeil) suggested? We were in deficit every single year for the last nine years of the Labour Government.

[Kelvin Hopkins]

I can only refer the hon. Gentleman to the excellent article by the economist Ben Chu, which goes into detail showing why Labour was not to blame and was not responsible. The crisis caused the deficits, but if we had not recapitalised the banks, where would we be now?

Let me go back to the instability mentioned by the hon. Member for North West Hampshire (Kit Malthouse), who is no longer in his place. He talked about businesses wanting stability. Instability arises because of the globalisation of financial markets. Before 1979, we managed financial markets with exchange controls. The breakdown of the Bretton Woods agreement is what caused the problems.

--- Later in debate ---

[Kwasi Kwarteng (Spelthorne) (Con)]

I am pleased to follow the hon. Member for Luton North (Kelvin Hopkins), although I felt as though I was entering a time warp when listening to his speech; it is a long time since I have heard anyone defend exchange controls. I believe that the limit on the amount of money that someone could take out of the country was £50, and they had to declare everything else. Given the current political climate, it is very interesting to hear a Labour Member advocate such a policy.

[Kelvin Hopkins]

rose—

[Kwasi Kwarteng]

I am happy to give way this once.

--- Later in debate ---

[Kelvin Hopkins]

It was a temporary limit imposed on holidaymakers by Harold Wilson, but most had no problem spending money abroad. What we did was ensure that the bankers and international speculators did not have free rein.

[Kwasi Kwarteng]

I am glad to hear that everything was all right because it was Harold Wilson who imposed the limit, which I think was £40.

Of course this is a sensible Bill. Of course it makes sense to limit national insurances contributions, because they are, after all, as has been pointed out, a tax on jobs. My hon. Friend the Member for North West Hampshire (Kit Malthouse), who is no longer in his place, made an excellent point about the things we do here being a signal to people outside, such as investors, potential entrepreneurs and people who want to set up businesses. If the Government get the Bill through, I am confident that it will send a very good signal to people who want to invest in the British economy and in our constituencies and who want to set up small businesses.

My constituency of Spelthorne is very near Heathrow airport and lies on the Thames, and it is a case in point. It is an area where small business and private enterprise is at the core of people’s way of life. It is the basis on which people go to work, save and plan for their retirement. Essentially, they are people who are driven and motivated by small business. Therefore, a Bill that caps national insurance tax is an excellent development that will be warmly appreciated across my constituency.

We have heard a number of arguments this afternoon that simply do not make sense. On the one hand, we have heard from Labour Members that the Bill is a gimmick and that it is wrong. On the other hand, they have said that they will support it. Indeed, we have also heard that they were apparently the first people to come up with that gimmick. It seems very odd. I am still utterly confused about their position.

The hon. Member for Dundee East (Stewart Hosie) made a very good point, but I recall that before the general election his party was the biggest deficit denier—it was even worse than the Labour party in denying the deficit and ranting against austerity. It is a very confused picture. I would be very interested to see what the SNP will do if the House divides on the Bill.

High Speed Rail (Preparation) Bill

Debate between Kwasi Kwarteng and Kelvin Hopkins

Wednesday 26th June 2013 Commons Chamber

[Kwasi Kwarteng]

I am not sure which citizens of that famous French city my hon. Friend has been speaking to, but the ones we met were very enthusiastic, as were people in other cities. Lille, for example, has been transformed by the high-speed rail—of course it has, and that is a good thing. No one in France is suggesting that the high-speed rail network should be closed down and the country should go back to what it had before.

There are clear economic benefits. My hon. Friend the Member for Northampton South (Mr Binley) suggested that freight transport is growing at 10% a year. How on earth can that growth in freight be accommodated without substantial investment in our railway infrastructure and without building a high-speed rail network? As my hon. Friend the Member for Milton Keynes South (Iain Stewart) said, simply building another line that is not a high-speed line will cost just as much and not give the benefits, and no one is suggesting that as an alternative.

[Kelvin Hopkins (Luton North) (Lab)]

I am suggesting precisely that alternative. I have a scheme for a dedicated freight route, capable of carrying lorries on trains, that would cost a fraction of HS2 and take all the freight off the north-south lines, freeing them up for more passengers.

[Kwasi Kwarteng]

I am pleased that we have Members with such fertile imaginations in this House that the hon. Gentleman has his own scheme. I have not looked at it, though, so I could not possibly comment.

What is clear to me, as a Member for a south-east constituency that is very built-up and highly residential, is that disputes about infrastructure spending are inevitable. I suggested that when the Tower of London was built, people objected to it on quite worthy grounds. There have been objections to every piece of infrastructure spending in this country for hundreds of years, but that does not mean that we have not gone ahead and built the railways or the ports. We are a commercial nation with incredible skills in engineering. We have, or we used to have, great architecture and engineering—I am not casting aspersions on current architecture, just suggesting that it was very good in the past—so there is no reason to suggest, as some have, that HS2 will be a blight on the countryside. It will change of course, but as has been pointed out, Isambard Kingdom Brunel and other Victorians completely transformed the landscape of this country, but they did not make it worse in any way.

European Union Bill

Debate between Kwasi Kwarteng and Kelvin Hopkins

Monday 24th January 2011 Commons Chamber

[Kwasi Kwarteng]

What does the hon. Gentleman say to the idea that even if amendment 11 were made, it would not bolster parliamentary sovereignty, because Government Whips will just whip through decisions about what is significant?

[Kelvin Hopkins]

The hon. Gentleman seems to be saying that everybody does what the Whips tell them, but that is not the case. If he looks at the history of the 13 years of Labour Government, he will find that there were rebellions—significant differences of view between certain Back Benchers and the Whips—on many serious votes, the most important of which was perhaps the Iraq war, when 139 Members, including me, voted against the Government, despite the Whips.

[Kwasi Kwarteng]

What was the result?

[Kelvin Hopkins]

The decision in favour of going to war was made with Conservative support. In the end, we are accountable not to the Whips. Clearly, we have a party system, and we are elected as party politicians, which I understand. By and large, on most things, we are guided by the Whips, but on some matters of fundamental principle, such as giving further powers to the EU or going to war, we must say, “What I believe and what I believe my electorate want is more important even than what the Whips advise.” I hesitate to say that while my Front-Bench colleagues are listening, but in the end, we must occasionally take a stand.