Autumn Statement

Debate between Lord Hammond of Runnymede and Lord Clarke of Nottingham

Wednesday 23rd November 2016 Commons Chamber

[Mr Hammond]

Let me begin by associating myself with the right hon. Gentleman’s remarks about the Jo Cox trial and sending my deepest condolences to her family and friends, who will be suffering again today.

I congratulate the right hon. Gentleman on his appointment to the Privy Council. I only wish that I could have been present at the investiture. I remember the procedure quite well: they give you a little red book to hold. [Laughter.]

I listened carefully to the right hon. Gentleman’s response to my statement. His central argument appears to be that the deficit is too high and borrowing is too high. That is a bit of a problem, because, as I have understood it, his central proposal for our economy is to borrow more and spend more. Under his rule, Labour would always be borrowing, in good times as well as bad. His analysis of the problem of the last Labour Government is not that they spent too much money, but that they spent too little. Indeed, his rule has remarkable similarities to Gordon Brown’s “golden rule”, and we all know where that got us. His big idea is to spend an extra £500 billion, without any notion of how he would pay for it.

The right hon. Gentleman welcomed the industrial strategy. I am not sure that I welcome his welcome, but I warn him not to welcome it too quickly, because it will not look anything like an industrial strategy that would come out of his office. What he has heard about today is a responsible set of decisions, such as the decision to borrow £23 billion of tightly targeted investment while paying for every single penny of every other commitment that has been made.

The right hon. Gentleman talked about Brexit, and attacked us over the way in which we are handling the Brexit process. I honestly do not know whether he has ever been involved in a negotiation—I suspect not—but I invite him to look across the continent for a moment and note the admirable discipline that our negotiating counterparts are displaying in their messages, revealing nothing as they prepare to go into this negotiation with us. My advice is this: if we want to secure the best possible deal for Britain, we must keep our cards appropriately close to our chest.

The right hon. Gentleman may have heard “cuts in people’s incomes” in my announcement about universal credit. Let me explain to him how this works. When we cut the taper from 65% to 63%, we allow people to keep an extra 2% of the income they are earning. I would have thought he welcomed that.

This is all about making tough decisions, and I am very happy to debate with the right hon. Gentleman, but I just wish he would be honest enough to accept that we cannot shower money everywhere, proposing to spend money on everything, without having to raise that money, either by taxes on ordinary people or by cutting spending elsewhere. It is simply no good to keep on pretending that we can do that just by taxing the rich. The top 1% of people in this country already contribute 27% of income tax paid, and unfortunately there are just not enough of them to be able to finance all the right hon. Gentleman’s ambitions.

The right hon. Gentleman said he was disappointed by the announcement on the national living wage. I do not remember—perhaps one of my hon. Friends can remind me—the level of the national living wage during the 13 years of Labour’s Government. He might note that the level I have announced today is precisely the level recommended by the Low Pay Commission, the body set up to pronounce on these things.

I wish the right hon. Gentleman would also be honest when he talks about the work-related activity group in the employment and support arrangements. This applies to new claims only, as he very well knows, so nobody is going to have £29 a week taken away from them however many times he says it. He also knows that it is not a stand-alone measure; it is part of a package. The money saved is being reinvested in a £330 million package to get these people into work, with targeted support to help them to be ready for work.

The right hon. Gentleman talks about house building starts. House building starts were 45% down under the last Labour Government.

The right hon. Gentleman and the Leader of the Opposition have spread division and disunity through the Labour party, and that is exactly what they would spread through the country if they ever—God forbid—got into government. The right hon. Gentleman says there are no new ideas; I have to say that he needs to check the opinion polling, because that is not quite what public opinion believes. Instead of carping and opposing every measure we propose, why doesn’t he roll up his sleeves and support us in the hard work of building an economy that works for everyone?

[Mr Kenneth Clarke (Rushcliffe) (Con)]

I congratulate the Chancellor on reverting to the extremely sensible practice of having only one Budget a year, which Gordon Brown abandoned in order to try to buy votes twice a year, with disastrous consequences. I also congratulate him on easing the taper on tax credit, because it is having distorting effects on the labour market at the moment, for example by discouraging part-time workers from working extra hours. I particularly thank him for the money he has spent on the very valuable work rehabilitating the disabled at Stanford Hall in my constituency.

With those notable exceptions, will the Chancellor reassure me he will resist political pressures of all kinds over the coming years to move away from the very sensible fiscal discipline he has set out, because the major risk to his period of office would come—and it would affect every section of our society, including the JAMs that the media have discovered—if he were unable to avoid or mitigate the risk of recession, which global uncertainty undoubtedly poses to us in the real world?

Finally, will he confirm that, wherever he holds his cards, he will continue, inside the Government if necessary, to spell out economic reality and the long-term benefits to this country, if he wants to develop a modern, competitive economy, of retaining access to our most important market, in Europe, by retaining the benefits of the single market and the customs union, and that no amount of short-term political pressure will allow him to be deflected from that?

[Mr Hammond]

I am grateful to my right hon. and learned Friend. I am delighted that we have been able to lower the taper rate of universal credit, because of course it is absolutely in line with our principle that we should be supporting and encouraging people into work. He says the taper rate discourages people, but it is of course a much lower rate of withdrawal than under the old tax credit system it replaces.

Let me reassure my right hon. and learned Friend that I and my right hon. Friend the Prime Minister remain absolutely committed to the sound Tory principle that a country has to live within its means. Of course we have to deal with the realities the world throws at us, and that is why today I have adopted, as an interim measure for the remainder of this Parliament, a cyclically adjusted target which will always allow us to respond to any downturn that occurs. However, I certainly understand the importance of economic reality, and I also understand, as does my right hon. Friend the Prime Minister, the extreme desirability of achieving the very best access to markets in Europe for those who produce our goods and services.

Report of the Iraq Inquiry

Debate between Lord Hammond of Runnymede and Lord Clarke of Nottingham

Wednesday 13th July 2016 Commons Chamber

[Mr Hammond]

The point that I have made already and will make again is that as I understand it Sir John has not identified lack of remit as the reason why he has given no opinion on the legality of the war. He has identified a lack of appropriate skill sets in the inquiry, and he suggested that it should be a matter that is dealt with by a properly constituted and internationally recognised court. As I have said already, the Government in looking at the report of the Iraq inquiry—it will take some time to do that—will consider all these matters, including questions that the right hon. Gentleman is raising about whether any further documents can appropriately be declassified and made available.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

Obviously, John Chilcot’s report is masterful in its description of the formal records and the detail, and in the lessons he very wisely draws. However, will the Foreign Secretary, as a politician, look at the political context for a moment? Does he agree that the background was clearly that the Americans and the Blair Government wished to invade Iraq to change the regime and get rid of Saddam Hussein? However, that would have been illegal regime change, so what my right hon. Friend has just gone through—people’s desperate desire to find evidence and to persuade themselves that there were weapons of mass destruction, that Saddam was not co-operating with the inspectors, that there was a risk of terrorism and so on—was mainly, and no doubt subconsciously, motivated by a desire to give the Attorney General some basis on which he could say that this action was legal?

[Mr Hammond]

My reading of the inquiry report is that it does indeed identify that regime change as an objective would be illegal in UK law, but I think the suggestion is that, through a process of group-think, the people who were involved in this process came to see regime change as a means to deliver the legitimate objective, which was compliance with the UN Security Council resolutions. A fair reading of the report suggests that that is the process of mind that is being spelled out by Sir John.

Europe, Human Rights and Keeping People Safe at Home and Abroad

Debate between Lord Hammond of Runnymede and Lord Clarke of Nottingham

Tuesday 24th May 2016 Commons Chamber

[Mr Hammond]

I agree with a lot of what the hon. Gentleman says. The specific allegation is that British-made cluster munitions, which will have been made and delivered probably 30 years ago, may have been used. We do not believe that that is the case, but the Ministry of Defence—he will have heard a Defence Minister say this from the Dispatch Box today—is carrying out an urgent investigation. It will look at the evidence and then decide how to move forward. We have a high level of confidence that British-made cluster munitions have not been used in this conflict, but we must of course look at the allegation that has been made, and any evidence presented in support of it, and respond appropriately.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

My right hon. Friend mentions Libya. With hindsight, it is clear that after the fall of Gaddafi we did not really give enough support to the Government we then recognised. The place collapsed into anarchy and is a possible base for ISIS. About half an hour ago, the Secretary of State for Defence said we were offering security assistance to the Government we now recognise, if and when they request it. Will the Foreign Secretary tell me whether his Department and other Departments are giving every other possible diplomatic and political support to that Government? Until they can establish themselves as a real Administration capable of delivering services to their public and of winning public support, we run the danger again of having a slightly fictional Government in Tripoli, while the rest of the country falls prey to anarchy or even ISIS.

[Mr Hammond]

As I am sure my right hon. and learned Friend would readily agree, hindsight is indeed a wonderful thing. [Interruption.] The Under-Secretary of State for Foreign and Commonwealth Affairs, my hon. Friend the Member for Bournemouth East (Mr Ellwood), reminds me that elections were held in Libya after the fall of Gaddafi. It is since then that things have gone wrong.

On support to Prime Minister Sarraj and the Government of national accord, yes, we are providing technical, diplomatic and political assistance. My right hon. and learned Friend will recall that I visited Tripoli a few weeks ago. We are working very closely with Prime Minister Sarraj, both bilaterally and through the European Union. Prime Minister Sarraj was at the meeting in Vienna last Monday in which 20-odd countries got together to discuss how we can best support what that Government are doing.

The situation in Libya is complex, but I think Prime Minister Sarraj is approaching it in the right way— a bottom-up approach. He is not trying to create a Government who can rule Libya in some monolithic fashion, because that is not practical. He is trying to create an umbrella Government within which municipalities are empowered to deliver the services and run the structures that people need. We have considerable experience of that approach—including, indeed, in Syria—working with devolved levels of government in small areas to try to establish good governance from the bottom up. I suspect that that will be a more realistic approach than a top-down approach.

European Union Referendum Bill

Debate between Lord Hammond of Runnymede and Lord Clarke of Nottingham

Tuesday 9th June 2015 Commons Chamber

[Mr Hammond]

I am going to make a little progress, bearing in mind Mr Speaker’s exhortation.

It is almost four decades ago to the day that I, along with millions of others in Britain, cast my vote in favour of our membership of the European Communities, and like millions of others I believed then that I was voting for an economic community that would bring significant economic benefits to Britain, but without undermining our national sovereignty. I do not remember anyone saying anything about ever-closer union or a single currency. But the institution that the clear majority of the British people voted to join has changed almost beyond recognition in the decades since then.

[Mr Kenneth Clarke (Rushcliffe) (Con)]

There must have been some strange juxtapositions in the campaign held in the 1970s, in which I took a very active part. Most of the debates I took part in were about the pooling of sovereignty and the direct applicability of European legislation without parliamentary intervention, which was a very controversial subject, and, besides, ever-closer union was in the treaty to which we were acceding.