Commercial Financial Dispute Resolution Platform

Lindsay Hoyle Excerpts

Thursday 15th December 2016 Commons Chamber

[George Kerevan]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I just want to remind hon. Members that opening speeches are usually up to 15 minutes long—there is some flexibility—and to warn them that I will be applying a formal limit of up to eight minutes so that everyone can get a fair shot.

[George Kerevan]

For that reason, having been reasonably accommodating, I will press on to the nub of my argument.

For a permanent resolution of the problem, we need three different mechanisms. First, we need a shift in the legal onus on banks to provide a duty of care or good faith in how they deal with customers, particularly business customers. That is open for broad debate—over the years, the banks have been unwilling to accept a narrow duty of care—but we need to redress the balance between major banks and small business clients by providing a mechanism around the legal onus on banks. I would even accept it, initially, if the banks collectively were prepared to come forward with a solution themselves. Secondly, given that many small companies end up insolvent, we need a more balanced insolvency practice to remove the possibility of banks or lenders being tempted to force small and medium-sized enterprises into unnecessary or premature insolvency. Finally, we need a new permanent and effective redress system for banks and small businesses in dispute. In effect, putting those three together, we need to change bank culture.

In order, I hope, to build some common ground with the Minister, I should acknowledge that the Government have already moved some way in recognising this issue. The Government’s impact assessment on the establishment of a small business commissioner in the Enterprise Act 2016 reads:

“The Government is concerned that for small firms, negotiating a contract with a larger business can be challenging… Government has been told that small businesses often feel intimidated and accept such terms (rather than walking away from a proposed contract or refusing to agree to a change) and there is concern that larger firms”—

for that, read “banks”—

“sometimes use their market power to impose unfavourable terms.”

That, I think, is what lay behind the issue of the hedging products sold to small businesses during the economic boom in 2006 to 2008. The Government have recognised the general problem, therefore; it is just a matter of how we resolve it.

Just to show that there is a broader political agreement on this, from right and left, I want to quote the Minister of State, Department for Environment, Food and Rural Affairs, the hon. Member for Camborne and Redruth (George Eustice), who wrote a piece for the Free Enterprise Group three years ago, entitled “Defending the rights of those who take risks”, in which he wrote:

“Over the years...the banks have contractually extended their rights through their ‘standard terms and conditions’ to give LPA”—

the Law of Property Act 1925—

“receivers general powers of sale, to set aside the limit on the fees that a receiver may charge and to load all associated costs on to the borrower. They have even moved to grant themselves the right to peaceably re-enter properties over which they have a charge without any recourse to the courts. The contractual extension of power taken by the banks goes well beyond what was originally envisaged in the Law of Property Act 1925.”

In other words, the banks have gradually extended their powers of receivership, making it increasingly difficult for small companies in financial difficulties to get redress, and leading to the situation with RBS’s Global Restructuring Group, which has now re-entered the public domain with the initial report from the Financial Conduct Authority.

I expect the Minister to tell us that ultimately, if there is to be a change in the redress process, it has to come from the FCA. To that end, the all-party group on fair business banking has been consulting the FCA, and subsequent to that, I raised the matter with Mr Andrew Bailey, its new chief executive, when he appeared before the Treasury Committee. I asked if he drew any relevant conclusions from the FCA’s experience with the banks in drawing up ad hoc processes of redress for the various mis-selling schemes, and he said that he did. He said that the problem arose where schemes lay “outside the regulatory perimeter”—much of the mis-selling was of unregulated products—but that the FCA had learnt from the experience, having come late to it, that businesses felt they had not had their day in court. He went on:

“Now, they do not want to have a literal day in court because that is obviously very expensive. However, what I conclude from this is that it”—

the ad hoc procedures—

“is not satisfactory from the point of view of the FCA, because the FCA has been involved in creating a lot of bespoke processes. We discussed this on the board a number of times. Were there to be a mechanism that could substitute for these—let us loosely call it a tribunal, for the sake of argument—rather like the ombudsman but for more complex cases, because corporate cases often are more complex, this would be a big step forward. From the point of view of the things that come out, we are creating a lot of work for ourselves. However, I am very sympathetic to the people involved, so we have to do it. However, if there were to be a process that could substitute for this…I think this would be a big step forward.”

We are proposing the idea of a tribunal. At this stage, it is a generic proposal, and there are issues to be discussed. It would, for example, cross the boundaries of the devolved Administrations, so if we went down this road, there might have to be separate institutional tribunal procedures in Scotland. There are also financial issues, but since we are dealing with redress where the FCA has decided that a bank has been involved in mis-selling—in other words, since we are already in the territory where a bank is going to pay—any permanent tribunal system could be funded by the banks. The all-party group is open to a general discussion with the Government about how to proceed, but the general backing from the FCA is there; it is just a matter of the detail.

This is important because the issue has not gone away. The situation with RBS GRG is coming back into the public domain. RBS has put forward a new ad hoc procedure for dealing with complaints from small businesses put into GRG. We have advance notice of a report, not yet finalised by the FCA, in which, having taken technical advice, it has clearly found a conflict of interest in how RBS handled the cases of companies put into GRG: the part of the bank taking over and reselling properties from the insolvent companies was part of GRG. In effect, therefore, the bank was putting companies into insolvency, taking their property and handing it over to another part of the bank, and generating cash that way.

Given that this issue has reappeared and that there is a public debate over the nature of the redress system, we are not looking at legacy items; we are looking at a future situation in which the Royal Bank of Scotland is creating an ad hoc redress system that we need to ensure is a correct one.

I know that other Members want to participate in the debate. The bottom line for the Minister is that there is now an ongoing process of debate and a general consensus, even from the FCA, that we need a more permanent resolution system and that we need to go beyond just looking at insolvency law. The door is open for the Government to join the rest of us on both sides of the House to ensure that that resolution process is provided.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

As I said, we will have a voluntary limit of up to eight minutes. If it is not voluntary, it will have to be imposed.

Outsourcing and Tax Credits

Lindsay Hoyle Excerpts

Friday 4th November 2016 Commons Chamber

[Simon Kirby]

Clearly, there are lessons to be learned from this—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order.

[Simon Kirby]

I have had the pleasure of responding to debates on this in Westminster Hall and in this Chamber, and this is now the third occasion I have had such an opportunity to respond. There are clearly lessons to be learned. The Financial Secretary has made the Government’s position very clear: Concentrix will not be providing the service in the future. However, there is no change to Government policy on outsourcing, which can be an appropriate way to deliver both quality public services and, importantly, to make savings for the taxpayer. We will have to wait to see what the independent National Audit Office review shows, but I am sure we are all looking forward to it. As I have said, there are many lessons to be learned.

--- Later in debate ---

[Simon Kirby]

I would say three things in response. First, if the hon. Lady feels that her constituent has been wrongly treated, she should write and apply for compensation. Secondly, it is worth saying that the savings to the taxpayer are probably in excess of £200 million —not a small sum. Thirdly, yes, there are lessons to be learned—[Interruption.] I shall have to say that even more often, because it obviously gets a reaction. As a Government, we would be foolish not to learn lessons and not to make sure that the service we provide is as good and appropriate as possible. [Interruption.] The hon. Lady says from a sedentary position that this is turning into a debate, Mr Deputy Speaker. She asks whether we are going to come back and report. We shall have to wait for the independent NAO report.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

The danger is that the Minister is going to keep the debate going.

[Philip Davies (Shipley) (Con)]

Does the Minister agree that there is a great deal of amnesia on the Opposition Benches? I well remember the misery caused to my constituents when 50% of all tax credits were paid incorrectly during the course of the last Labour Government. I welcome what my hon. Friend said about Concentrix. What financial penalties will the Government impose on Concentrix for the cock-ups it has made?

--- Later in debate ---

[Simon Kirby]

What I can say is that the penalties referred to in the contract will be taken from the money paid to Concentrix and will go to HMRC, and that any compensation that is appropriate and due will come from HMRC.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Last but certainly not least, Daniel Zeichner.

[Daniel Zeichner (Cambridge) (Lab)]

I think we have got the message that the Minister wants lessons to be learned. Will he assure us that all that the minutes, recordings and transcripts relating to the process that led up to the tendering of the contract will be published?

[Mr John Spellar (Warley) (Lab)]

On a point of order, Mr Deputy Speaker. In the age of emojis, is there any way in which Hansard will be able to report the look on the Minister’s face when he responded to the question asked by the hon. Member for Manchester, Withington (Jeff Smith)? It said it all.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Absolutely not.

Leaving the EU: Financial Services

Lindsay Hoyle Excerpts

Thursday 3rd November 2016 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

We have two debates to get through in three hours and 20 minutes, so brevity will help everybody.

--- Later in debate ---

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I advise hon. Members that the speaking limit will be five minutes. I hope that we will not have to reduce it, but that might happen as we have very little time left.

House of Lords Reform and Size of the House of Commons

Lindsay Hoyle Excerpts

Wednesday 19th October 2016 Commons Chamber

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I remind Members that we have a six-minute limit on speeches to start with.

--- Later in debate ---

[Richard Arkless]

On a point of order, Mr Deputy Speaker.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I do hope it is a point of order, Mr Arkless.

[Richard Arkless]

I am curious about the right hon. Gentleman’s assertions, Mr Deputy Speaker. The wording of the motion on the Order Paper is clear and I ask you kindly to bring him into line to discuss it.

[Mr Deputy Speaker]

I will make a better suggestion. I will decide who is in order and when. I would not waste any more time on interventions, however, as we are struggling for time and I want to ensure that everyone gets equal time.

[Michael Gove]

Thank you, Mr Deputy Speaker.

We are not hearing about education because the Scottish National party has had to execute a humiliating U-turn and its Education Minister, Mr Swinney, has had to adopt our policies on education by giving funding to schools—

[Mr Deputy Speaker]

Order.

[Michael Gove]

While at the same time adopting our approach to examinations.

[Mr Deputy Speaker]

Order. We allow a little bit of movement, but the right hon. Gentleman is concentrating purely on education when we are discussing the size of the House of Lords, and even I struggle to see the connection. I would have expected a connection by now, and as there is not one coming I am sure, Mr Gove, that you will want to get back to the subject of the size of the House of Lords and what we are debating.

[Michael Gove]

Indeed. One of the challenges, as has been pointed out by those on both Front Benches, is that when SNP Members put forward proposals for the House of Lords, they offer no alternative method of scrutiny. They simply propose unicameralism. Not only that, but they do not observe the basic pragmatic principle of the British constitution that we should preserve what works. Like the monarchy, the House of Lords is an institution that works, despite the fact that it might not succumb to every rational imprint. I speak as a Minister who has been held accountable and who has been cross-questioned—[Interruption.] An ex-Minister, I should say. I have been cross-questioned by Select Committees in the House of Lords with a greater degree of pertinacity and effectiveness than I have found in any other cross-examination I have ever faced.

The logic behind the SNP’s position is that if it objects to any constitutional model that does not fit its own preconceptions, it should object to the monarchy. The real thrust behind the SNP’s position is that it opposes the institutions that bind the United Kingdom together and are a focus for loyalty in this country, such as the monarchy, because of its single-minded pursuit of separation and independence come what may. If SNP Members really object to unelected figures meeting in a fashion that results in democratically elected Members of Parliament finding the will of the people frustrated, why are they so keen to stay in the European Union? If they object to unelected, unaccountable and out-of-touch figures wielding power, why do they not object to the existence of the European Council in its current form? Again, the answer is that they are only interested in separation.

One final point. We scarcely heard anything from the SNP on the vital importance of ensuring that all parliamentary constituencies should be of equal size. Having parliamentary constituencies of equal size was a demand of the Chartists in 1838, yet we still do not have them. I may be a young man in a hurry, and I may be an impetuous radical determined to bring about change at a pace faster than many would account, but surely, after nearly 200 years, the Chartists’ demands should at last be honoured. All votes should be equal, all constituencies should be equal and democracy should be honoured.

--- Later in debate ---

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Just before I bring others in, may I say that we are going to have to drop to a five-minute limit, and I want to try to get everybody in on the same level?

--- Later in debate ---

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I think we will go from one extreme to the other. I call Jacob Rees-Mogg.

--- Later in debate ---

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. There are four Members left to speak. With about 10 minutes available for Back Benchers, may I suggest they have about three minutes each?

--- Later in debate ---

[Margaret Ferrier]

My hon. Friend makes an extremely good point. That is the problem, and that is why there are so many of them.

The efforts of the Members of the House of Lords whom I was talking about do not go unnoticed, and so they should surely have nothing to fear from standing for election to a democratic second Chamber. There have even been occasions when the House of Lords has played an important role in blocking or amending legislation. Imagine how much more important a function our second Chamber could play in shaping legislation if it were fully elected and fully representative. More than half of peers are over 70. I know we are facing an ageing population but to even suggest that that is representative of wider society is absurd. Twice as many peers used to work for the royal family as have worked in skilled or manual labour. That simply is not right and cannot deliver the real-life experience needed in an effective second Chamber.

It simply is not right that the boundary plans proceed. We need plans to vastly reduce the number of peers and a full review of reform of the House of Lords. In the meantime, the Government must discard their plans to reduce the number of democratically elected Members of Parliament.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I apologise to the two speakers who cannot get in, but I have to call the Front Benchers. I am sorry about that, but the interventions have killed us.

--- Later in debate ---

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

On a point of order, Mr Deputy Speaker. On Monday, I asked the Secretary of State for Work and Pensions about the Women Against State Pension Inequality Campaign and whether the Government were going to take mitigating measures to compensate the worst-affected women. He responded that the Scottish Government could use their powers to compensate them. At the end of questions that day, I raised a point of order. I was generous in my choice of language and suggested that perhaps the Secretary of State knew something that we did not—namely, that powers over pensions were coming to Scotland. I asked the Secretary of State, through the Chair, if he would correct the record, knowing full well that section 28 of the Scotland Act 2016 specifically excludes the possibility of the Scottish Parliament having competence over pensions. I was somewhat enraged to receive a letter from the Secretary of State this afternoon which assures me that his statement was correct. We all know that people spin from time to time, but that is disingenuous to say the least, and the Secretary of State should really come clean and recognise that he has misled the House. I ask for your support as to how we can—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. First, we should not say that a Member is disingenuous or that they have misled the House. Let me see if I can be helpful here. Obviously there is a disagreement over the views and the interpretation, and I think that there is a way to deal with this—[Interruption.] Just bear with me. This could be helpful. You know me better than that. Give me a chance. There is a way to deal with this through the Procedure Committee, but it might be better to have a face-to-face debate in Westminster Hall. Why not put in for an Adjournment debate where this can be settled in the best possible way?

[Ian Blackford]

Further to that point of order, Mr Deputy Speaker. I am grateful for your advice, but there is an important issue here. The Secretary of State is giving a level of competence to the Scottish Parliament and the Scottish Government that they do not have, and it is important that we in this House have the opportunity to call him to account. I say clearly that he was wrong and that he should correct the record.

[Mr Deputy Speaker]

I understand that he says he is wrong; the hon. Gentleman has made that point. What I am saying is that a face-to-face debate would be a much better way to put the case and get the answers. That is the way forward. There is also the option of the Procedure Committee, but I think that a face-to-face debate would be a much better way to set out categorically where the answer lies.

Small Charitable Donations and Childcare Payments Bill

Lindsay Hoyle Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons
Tuesday 11th October 2016 Commons Chamber

[Richard Graham (Gloucester) (Con)]

My hon. Friend is making a series of good points about the impact that the Bill could have on small charities. He has mentioned several in Southend, and I suspect that all of us could mention others in our own constituencies. Is he aware that the inability to reclaim through texts is a possible issue for some of those charities, and does he think that the Minister should reflect on that when winding up the debate? May I also ask what he thinks might be the impact on charities such as scouts groups that sometimes, for example, raise funds using buckets outside supermarkets. Under the new provisions, I think that they will be able to—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. I know that the hon. Gentleman is doing a Whip’s job, and I do not mind that, but what we cannot have is the making of speeches rather than interventions. I want to try to help everyone, but I cannot allow myself and the Chamber to be tested by a speech rather than an intervention.

[James Duddridge]

Thank you, Mr Deputy Speaker, My hon. Friend suffers from having far too many ideas, and I look forward to—

[Mr Deputy Speaker]

Order. It might help if we heard them over a period rather than all in one go. That would help the hon. Gentleman, and it would help me.

[James Duddridge]

I am sorry, Mr Deputy Speaker. I in no way meant to challenge your ruling, but I did want to deal with the issue of SMS messages. I have absolute confidence in these two excellent Ministers, and I look forward to what will be said today. I shall go into a fair amount of detail about different payment methods later, but at this juncture, suffice it to say that SMS messages are absolutely right for this purpose. As many people have pointed out, people do not necessarily want to give all their details. There is also a demographic issue. My mother-in-law would be very happy to text a £5 donation, but if you ask her to use a smart phone or contactless payments, she thinks you are speaking a different language. It is discriminatory not to enable her to donate by text.

As for the point about the scouting movement—my eldest is going up to the scouts, and they collect—I understand that it will be included, but I hope that the specialists on the Front Bench will clarify the position. Earlier in the debate the changes involving buildings were welcomed. It will still be possible to collect money outside a building rather than inside.

Quantitative Easing

Lindsay Hoyle Excerpts

Thursday 15th September 2016 Commons Chamber

[Roger Mullin]

The hon. Gentleman must have read the next part of my speech. However, that allows me to haste along and agree precisely with what he has said.

A friend of mine, Dr Jim Walker, wrote to me recently and pointed out that

“interest rates throughout history have not only been the cost of capital (or the reward to thrift) but have also been a signalling mechanism about the future”.

We now know that zero interest rates and QE tell business owners and entrepreneurs that there is little or no growth coming. They therefore encourage businesses to hold cash and be extremely cautious about investment. The signalling mechanisms have had a different effect from those predicted by Friedman. It is again time to review the situation. It would be difficult to argue that QE has therefore led to the increase in confidence and investment that was the argument for it.

We can also see other consequences. Despite eight years of near zero interest rates, UK real gross fixed capital formation is 2.8% lower than its 2007 peak. Therefore, investment in the real economy has not been boosted in the way that was originally thought. A similar phenomenon has being going in other aspects of the economy on the demand side, such as in how households have been afflicted. Zero interest rates and asset purchases were supposed to convince ordinary people to borrow and spend more immediately, but some key groups have reacted to zero interest rates by saving more. Why? In order to provide for old age, they can no longer rely on the positive compounding effect of above zero interest rates; nor can they rely on getting the type of annuity for which they may have planned. Instead of encouraging that group to spend, policies have encouraged them to save more due to fear for the future. Such savers are understandably angry. After years of saving some of their income, many people have zero income from their savings.

I am not somebody who is disadvantaged—I have a well-paid job in this House—but I wonder how people who, like me, have a cash ISA are feeling. Before the crash, it was fairly common to get 6% interest, but I received a letter a few weeks ago to point out that from 1 December the interest rate is going to be reduced yet again to 0.1%. The time has come to undertake a critical review of the policies of recent years.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I say to the Front-Bench spokesmen that there are three of them and we are going to finish at 5 pm.

--- Later in debate ---

[Helen Goodman]

I agree with the hon. Gentleman that the Bank’s definition of “material contribution to the British economy” is inadequate. Like him, I do not think it is very helpful to be investing in fizzy drinks, but we do need to acknowledge that Siemens has a fantastic development in east Yorkshire and that that is good; that is a proper contribution. I do not think he is really arguing against me—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Come on, sit down.

[George Kerevan]

I take the hon. Lady’s point, but underlining what I am saying is the fact that only six British manufacturing export companies are on the list of those 300 bonds that the Bank of England thinks are quality enough to invest in. The whole thing that undermines the trajectory of QE is that it is concentrated on saving a banking system at the expense of our manufacturing system.

What do we do next? We have not said enough about that. We should consider shifting the Bank of England’s targets. The inflation target is the wrong one, and we have spent years ignoring it in any case, which means the Bank has no intellectual anchor, and that raises dangers in respect of the accountability of the Bank of England. We should be looking at nominal GDP targeting, in which case the Bank or the monetary authorities would have to be looking at automatic fiscal buffers, whether we are in a recession or in boom. That brings us back to the whole question of how we rehabilitate the fiscal intervention. At some stage, we are going to have to unwind QE. We have to do that in a controlled fashion, so one thing the Bank should be looking at in any evaluation is what timetable we use. If we have a timetable for the unwinding, that will help the markets to adjust in a better fashion. There is a danger, which we might find when we start to unwind, that the natural rate of interest has fallen so low that monetary policy has been undermined in a historic or generational sense, which again means we have to look seriously at how we combine fiscal policy with monetary policy. It would be unwise to unwind QE in the UK alone. What we should consider is a concerted international approach, which must involve some of the surplus countries such as Germany using their trade surpluses in a controlled fashion to boost consumption.

In the autumn statement, it is incumbent on the Government not to leave all the heavy lifting to the Bank of England. It is time that the Government made an intervention in a strong fiscal policy to allow the transition from QE.

--- Later in debate ---

[Helen Goodman]

On a point of order, Mr Deputy Speaker. Five minutes ago, the Minister said at the Dispatch Box that inequality in this country is lessening. On some measures of income inequality, that is true, but this afternoon we were debating wealth inequality.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

The hon. Lady has been here a long time, and she knows that is not a point of order. I cannot continue the debate because it is now past 5 o’clock. If she had not wasted time when she was trying to make the intervention, she could have got her point across.

--- Later in debate ---

[Richard Arkless (Dumfries and Galloway) (SNP)]

On a point of order, Mr Deputy Speaker. I apologise for the late notice of my point of order, but it is about a situation that has been developing this afternoon. Dozens of my constituents have approached me this afternoon having had their tax credits withdrawn arbitrarily by Her Majesty’s Revenue and Customs through the Concentrix contract. HMRC has designated a team of people to deal with these issues, which are apparently UK-wide. It takes a 45-minute call to deal with one case. I have dozens of constituents this evening who literally have no money to feed themselves or get the kids out of the door tomorrow morning. I am very concerned that the House is rising at this point and I will not be able to bring these matters to the attention of the Department for Work and Pensions or the House today, tomorrow or on Monday, to cajole some action to get this fixed. There are people who are literally about to starve and the House is about to disappear on recess. Is there anything that you could offer me by way of advice?

[Mr Deputy Speaker]

One thing I would say is that you have got it on the record. I think that Ministers are listening and they have got the point. This issue has been debated this week on a couple of occasions; in fact, there was an urgent question on it yesterday. There are still Ministers here, and I would have thought that the message will be going straight back to HMRC. I think there has been an indication from the Minister to say, “Let’s have a conversation,” so if nothing else, at least you have made progress in making him aware now.

Centenary of the Battle of the Somme

Lindsay Hoyle Excerpts

Wednesday 29th June 2016 Commons Chamber

[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. To try to give everyone equal time, because I know how important this debate is, can we try and restrain ourselves to between five and 10 minutes, so we will all manage to have the same amount of time?

--- Later in debate ---

[Dr Murrison]

We have had a debate of superlative quality this evening, with 20 right hon. and hon. Members speaking extremely movingly on this the eve of the centenary of the bloodiest day in British military history.

The 19th century French army officer and author, Alfred de Vigny, spoke in his book “The Servitude and Grandeur of Arms” of military service as the most fearsome of contracts. It was true then; it was true in 1916; it was true in 1982, as my hon. and gallant Friend the Member for Beckenham (Bob Stewart) so movingly reminded us; and it remains true today.

The hon. and gallant Member for Barnsley Central (Dan Jarvis) quoted AJP Taylor and disagreed with him. I think the hon. Gentleman is allowed to disagree with him; I am not sure that I am. Nevertheless, I hope he will allow me the indulgence on this occasion, because I, too, disagree with him. It is certainly the case that idealism did not die on the Somme; neither did the lights entirely go out across Europe.

If we are to avoid the loss of our 21st century lives and loves in the mud and blood of continental Europe, we need to ensure that we have eternal vigilance across all the Parliaments and Assemblies of our continent. I think that should be our tribute to the fallen this evening—lest we forget.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I am sure that the Minister wanted to point out that Chorley’s own celebration will take place at 10 o’clock tomorrow night and Friday morning, and that the 3 Medical Regiment will take the freedom of the town in Chorley, with the dedication of the cenotaph taking place on Saturday.

Question put and agreed to.

Resolved,

That this House has considered the centenary of the Battle of the Somme.

The Economy and Work

Lindsay Hoyle Excerpts

Thursday 26th May 2016 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I inform the House that Mr Speaker has selected amendment (e) in the name of the Leader of the Opposition, and amendments (c) and (d), which will be moved formally at the end of the debate.

--- Later in debate ---

[Geraint Davies (Swansea West) (Lab/Co-op)]

Does my hon. Friend accept that in the 10 years of the Labour Government to 2008—pre-crash—the economy grew by 40% and that, after the banking crash, we left debt at 55% of the economy in 2010, a figure that is now 83%? Does that not show a failure to grow the economy effectively or to manage productivity?

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. May I just say to the hon. Gentleman that he has already tested the patience of the House and should not continue to do so? I care about colleagues on both sides of this House and will make sure that everybody gets in, so—unfortunately—interventions must be very short. The list of speakers is very long, and I do not want any Members to miss out.

[John McDonnell]

I do not want to be discourteous to any Members, but as you suggest, Mr Deputy Speaker, I will take only a limited number of interventions.

On the crash, let us be clear—[Interruption.] Well, let us talk about the crash. The policy of deregulating the banking system, turning the City of London into a casino, was the policy pursued by the Conservative Government for the previous 30 years.

Let us move on to the criterion of growth. Growth has been revised downwards for every year for the rest of this decade, and when the OBR revised its forecasts downwards, the Chancellor’s entire Budget plan was shot to pieces. He has been left with a £4.8 billion black hole of committed spending, but there is no committed funding. It is nonsensical to claim, as the Government’s Queen’s Speech did, that the public finances are being placed on a “secure footing” when there are gaping holes in the Budget and the Institute for Fiscal Studies thinks there is only a 50:50 chance of meeting the Government’s own fiscal surplus target. This is betting the nation’s finances on the equivalent of tossing a coin. There is nothing responsible and there is nothing “secure” in setting unrealistic and politically motivated targets for public spending cuts.

It is useless to preach to us about the need for a “stronger economy” when, by his actions in office for six years, the Chancellor has methodically undermined the economy. This was his choice. Austerity was a political choice, not an economic necessity. We all now live and are still living with its consequences. Because it was the wrong choice to make, the Chancellor has failed, and it is the British people who are bearing the cost.

The Chancellor has piled failure upon failure, but at the centre of it all is the failure to sustain productivity. Productivity is the key to growth in any modern economy, and the surest way to achieve increased productivity is through increased investment. Increased investment means installing new equipment and replacing old infrastructure, yet business investment remains weak. When business investment is weak, the Government should step up to make sure vital, world-class infrastructure is provided—from high-speed rail to high-speed broadband. There is now consensus from the International Monetary Fund to the OECD, and from the CBI to the TUC, in urging Governments—not just in this country but across the world—about the need to invest in the future, but this Government are clinging to their fiscal surplus target, which is set actually to cut real-terms Government investment over the course of this Parliament. Mr Deputy Speaker, you could not imagine a more perverse and inadequate economic policy.

Behind the failure to invest lies the failure of our economic institutions. Too many of them have been captured by special interests or place short-term gain ahead of long-term growth. We have major corporations, which are sitting on a cash pile of up to £700 billion, paying out high salaries to senior executives while failing to invest. It is no wonder that in the past month we have seen a series of shareholders revolts against the remuneration packages of some chief executives.

We have a Business Department that does not actually believe in supporting business and refuses even to mention the words “industrial strategy”. In Her Majesty’s Revenue and Customs, we have a department for tax collection that does not believe in collecting taxes—not, at least, from major corporations. That was demonstrated by the fact that when it struck a deal with Google that reflected an effective tax rate in single digits, the Chancellor calls it a “major success”. I have written to the Chancellor to make sure he urgently contacts the French authorities, so that any information they find during their investigation into Google’s Paris headquarters is shared with us to give us a better understanding of Google’s operations in the UK.

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[John McDonnell]

I would celebrate it if it was a real living wage and if many of those people were not also suffering from cuts to universal credit.

The reality is that after six years of desperate efforts to impose cuts on our economy, against the best available advice from the economics profession itself, the Chancellor is staring an entirely predictable failure in the face. He started out with such high-flown promises. There was going to be a “march of the makers”, yet today, manufacturing is still smaller than in 2008. There was going to be a rebalancing of the economy, yet today for every three jobs created in London just one is created in the rest of the country. There was going to be a modernised tax service, but, as the National Audit Office pointed out in a damning report earlier this week, the quality of service at Her Majesty’s Revenue and Customs has collapsed in the past year as a result of staffing cuts. He promised increased investment, but he cut Government investment spending and now plans to cut it further. In 2010 he forecast the fastest recovery in living memory, but he has delivered the slowest recovery in modern British history.

Let us talk about job creation. The Chancellor and his Government have, perhaps understandably, clung to the job creation figures. Every month they are greeted with rare enthusiasm by Ministers. The reality is that two thirds of those in poverty—nearly 9 million people—are in work. [Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. The Treasury Bench does not need to be echoing all the way along. Can we give it a break? The Chancellor will be speaking soon and you will expect me to treat people in the same way. I expect the shadow Chancellor to be heard, not shouted down. [Interruption.] Now, I have been very good so far, but I do not want to hear any more. I am sure that the Whips Office could do with someone to go and make a cup of tea. If they do not want one, I might later.

[John McDonnell]

Mr Deputy Speaker, you are a class act. The shout was, “Do we welcome the jobs?” Of course we do, but let us be clear: too many of the jobs created since 2010 have been poorly paid and insecure. Some 800,000 people are now on zero-hours contracts. Insecurity at work has been made worse by the undermining of employment rights by the Government. There is no need for that.

HMRC: Building our Future Plan

Lindsay Hoyle Excerpts

Thursday 28th April 2016 Commons Chamber

[Valerie Vaz (Walsall South) (Lab)]

It is a pleasure to follow—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Could I just suggest that we try to aim for between five and six minutes, in order to give everybody the same amount of time?

[Valerie Vaz]

Thank you, Mr Deputy Speaker. I assume that that was an intervention, so I will get an extra minute! I thank the hon. Member for Glasgow South West (Chris Stephens) for securing this Backbench Business debate, and, of course, the Backbench Business Committee.

This is an important debate. The Government can raise money in three ways: create it, borrow it or raise taxes. The main purpose of HMRC, the subject of the debate, is to collect taxes. That enables the Government to take back what they have spent on public services. I want to focus on whether HMRC works, where it is going and what can be done to change it to make it more accountable.

The governance arrangements are quite bizarre, for a democracy. Given HMRC’s importance in collecting taxes, the fact that it is a non-ministerial Department is incongruous. There is no Minister to hold to account on behalf of the people for whom it ostensibly works. It is governed by a board, on which four out of five non-execs are from big business. There is no representation from pay-as-you-earn taxpayers, of which there are 31 million, or even from small businesses. There appears to be no accountability and no acting in the public interest. That needs to change.

From the Occupy movement at St Paul’s in 2011 to the Panama papers, the public are becoming more aware of what happens to the tax people pay—or, in fact, do not pay. They are becoming more aware of the fact that after a few lunches, large corporations can get the light-touch treatment. Google paid the equivalent of 3% in corporation tax. In 2011, Starbucks paid no corporation tax. Mr Deputy Speaker, I do not know whether you know the joke about people who wanted to raise awareness about the fact that Starbucks was not paying tax. They would go in, ask for a coffee and say that their name was “no tax”, so that the barista who came back with their coffee would call out, “Coffee for no tax!” That has had a huge effect on making people aware that Starbucks was not paying any money.

It has been pointed out by the International Business Times that Shell, British American Tobacco, Lloyds banking group and Vodafone all paid nothing in corporation tax. You will remember, Mr Deputy Speaker, that the former head, David Hartnett, had 10 lunches with KPMG, and it had its tax liability reduced. It even has a non-executive representative on the board.

Where is HMRC going now? As the hon. Member for Glasgow South West suggested, the document is called “Building our Future”, but its subtitle should be “Tearing it down”. I concur with him. The future of the country really depends on the amount of tax that is put back into the economy in Britain. Instead of investing in people who have skills, expertise, a commitment to public service and institutional memory, HMRC is reducing that capacity. In 2005, it had 105,000 members of staff, but in 2016 it has only 58,000. That is a reduction of nearly 50%.

HMRC is closing 170 offices, presumably to sell off the public estate to developers, and replacing them with 13 regional tax centres; actually, they are call centres. It plans to save £100 million, but it could recoup that if it closed the tax gap. I do not know whether you know this, Mr Deputy Speaker, but the tax gap is the difference between the tax owed and the tax collected. In 2013-14, it amounted to about £34 billion, and I think the current figure is about £25 billion. That is a lot of money.

Since 2010, only 11 people have been prosecuted by HMRC, despite the fact that it was given a list of 3,600 British people who hid their money in Switzerland. Revenue and Customs has not quite worked out that if it has more staff, it can collect more tax; and that the more people it employs, the more tax they pay and contribute to the economy. No wonder the wealthy—the 1%—are laughing all the way to the Cayman Islands.

The closure of the offices is having a direct impact on my constituency. Walsall faces the closure of its HMRC office, with the loss of 60 staff. My constituent Sahin Kathawala has said that she may not even qualify for one of the relocated jobs. If they are lucky, staff will have to go to Birmingham, where rents are higher so it will be more expensive to live there. It will be more expensive for staff to travel to Birmingham, so they will incur certain costs. My local people in Walsall South will have to telephone a call centre, rather than being lucky enough to have face-to-face contact like that between Dave Hartnett and KPMG. The Public Accounts Committee said in 2013 that the telephone services were absolutely abysmal, and The Telegraph reported that half of all calls to HMRC were not answered. The impact of that could be millions of people paying the wrong amount of tax.

This week in Walsall, we have had the news that BHS might close, and who knows what will happen to our local BHS. With the closure of the HMRC office, nearly £l million will be lost from the local economy, which Walsall cannot afford to lose.

PCS says that the plan is designed not to maximise tax collection, but to reduce spending, which is the opposite of what HMRC’s main objective should be. What can be done? I do not know if you have read “The Joy of Tax” by Richard Murphy, Mr Deputy Speaker, but it is very much worth reading. I think it should be required reading for everyone, including sixth-formers. In his books on making economics easy, which we should all read, Ha-Joon Chang says that people do not need to be economists to understand economics. Richard Murphy has said that HMRC should become a Government Department in its own right, subject to proper parliamentary scrutiny and to independent review.

We need to retain our local tax offices with local staff who have information about the local economy; stop the relocation until an equality impact assessment has been done; and invest in more staff. HMRC must reduce the tax gap, not the workforce. In that way, we can stop the outflow of capital and give back to the public purse all it is owed. After all, it is the Government who put in the investment in education, skills and infrastructure that enable communities, companies and the workforce to thrive.

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[Several hon. Members rose—]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. With three speakers left, if Members stick to exactly five minutes each, we will get everybody in.

Bank of England and Financial Services Bill [Lords]

Lindsay Hoyle Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 19th April 2016 Commons Chamber

[Jonathan Edwards]

I beg to move amendment 4, in clause 36, page 34, line 15, at beginning insert—

“( ) Subject to the provisions of subsection (3A).”

This amendment and amendment 5 would enable Lloyds Banking Group, the holder of the Bank of Wales trademark, to issue banknotes in Wales.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

With this it will be convenient to discuss amendment 5, page 34, line 44, at end insert—

“(3A) Regulations under subsection (1) must make provision authorising Lloyds Banking Group to issue banknotes in Wales”.

See the explanatory statement for amendment 4.

[Jonathan Edwards]

I am delighted that we have reached this group as I feared that our consideration on Report would be concluded prematurely. I therefore have only a very short speech, but luckily this is rather a straightforward and uncomplicated matter. If I had known that I would have far more time than I assumed—a rare privilege in this place—I would have prepared a far lengthier speech, quoting extensively from the masterpiece “A History of Wales” by the late, great John Davies, or John Bwlchllan as he was known to his friends, and from “When was Wales?” by the great historian who was a member of the Labour party and of Plaid Cymru, Gwyn Alf Williams, who retired to Drefach Felindre in my constituency.

I am delighted that my amendments 4 and 5 are being supported by the Labour Front-Bench team. When I was eating my cornflakes in the hotel this morning, it was a nice surprise to receive an email from David Williamson, the Western Mail correspondent, citing a press notice by the shadow Secretary of State for Wales saying that she supported my proposal. Perhaps this is the start of a beautiful new relationship, although I fear that I might be doing my best to scupper those sorts of endeavours after the election. I aim to press amendment 4 to a Division, with your permission, Mr Deputy Speaker.

I have spoken on this issue before in the Chamber, but I will reiterate a few points that I made on Second Reading. The amendment deals with the historical anomaly that prohibits Wales from producing its own distinctive banknotes. Both Scotland and Northern Ireland are allowed to do so, and so to celebrate their respective national figures and landmarks.