Oral Answers to Questions

Mary Creagh Excerpts

Tuesday 28th February 2017 Commons Chamber

[Mr Hammond]

The hon. Gentleman understands very well that being a member of the single market was not an option for the UK given the clear views expressed by the electorate in the referendum, but having comprehensive access to the single market will deliver the great majority of the benefits that he seeks from single market membership.

[Mary Creagh (Wakefield) (Lab)]

Some 100,000 UK businesses have already registered companies in the Republic of Ireland to hedge their bets given the policy and regulatory uncertainty caused by the vote to leave the European Union. Will the Chancellor urge his Cabinet colleagues, when they are negotiating around the table, to give policy and regulatory certainty to industries such as the chemical industry, which are not waiting to see what the Government are doing, but are simply haemorrhaging jobs and investment out of this country?

[Mr Hammond]

I agree with the hon. Lady that certainty as soon as possible is important, as are understanding of what implementation arrangements will look like and over what timescale. However, I urge her not to be hysterical about these things. [Interruption.] Many companies are making contingency plans, including setting up and incorporating subsidiaries in other European Union countries. It is another step altogether to be moving jobs and enterprises abroad. Most of the companies that we talk to have made it clear that there is more time yet for them to be reassured during this process before we see irrevocable moves.

[Mary Creagh]

On a point of order, Mr Speaker.

[Mr Speaker]

We will come to points of order.

Oral Answers to Questions

Mary Creagh Excerpts

Tuesday 19th April 2016 Commons Chamber

[Damian Hinds]

My hon. and learned Friend is, of course, right on multiple counts. Solar has been a great British success story: more than 99% of the installed solar PV capacity has happened since May 2010. He is also correct to say that the development of battery technology here and elsewhere is incredibly important for the future.

[Mary Creagh (Wakefield) (Lab)]

I am sure that the Exchequer Secretary will welcome the report published today by the Environmental Audit Committee, which finds that membership of the European Union has been overwhelmingly positive for the UK’s environment. Our Committee is also conducting an inquiry into the Treasury’s approach to sustainability and the environment. Will he encourage his colleague the Chancellor to come before the Committee to discuss the Treasury’s approach to solar power, offshore wind, waste and recycling policy?

[Damian Hinds]

I look forward to reading the hon. Lady’s report. The Treasury takes a balanced approach to making sure that we stay on target to meet our commitments. We are on target to meet our commitment of 15% of renewable energy by 2020, but we must do so in a cost-effective way, recognising that the subsidies to early stage technologies can only be paid for by taxpayers.

Budget Changes

Mary Creagh Excerpts

Monday 21st March 2016 Commons Chamber

[Mr Gauke]

The Government’s record is that, again and again, we have taken steps to improve the life chances of the British people. It also helps, in the long term, the life chances of the British people to have public finances under control. Only a Conservative Government will deliver that.

[Mary Creagh (Wakefield) (Lab)]

Does the Minister agree with the right hon. Member for Chingford and Woodford Green (Mr Duncan Smith) that the cuts to personal independence payments for disabled people were

“not defensible in the way they were placed within a Budget that benefits higher earning taxpayers”?

[Mr Gauke]

Let us be clear about this Government’s record, and let us put this in the context of what the Government have done. As a consequence of the policy changes that we have pursued, it will now be the case that the highest-earning 20% will pay more than half of all taxes. That would not have happened had we stuck with the policies we inherited.

Enterprise Bill [ Lords ] (Seventh sitting)

Mary Creagh Excerpts

Thursday 25th February 2016 Public Bill Committees

[Kevin Brennan]

I congratulate Government Members on voting in the way they intended on that occasion.

Amendment 123 would exclude employees of the companies listed in new schedule 3, which are operated by the private sector, from the scope of the cap proposed in clause 35. Employees of Magnox and similar companies across the nuclear estate and elsewhere are employed by companies that operate in the private sector, so why are they being included in and affected by a measure that the Secretary of State told us on Second Reading is designed to hit public sector fat cats? Those employees never imagined for one second—one can understand why—that they were covered by the Conservative party’s manifesto commitment to cap public sector exit payments.

We raised that issue on Second Reading, and I know the Minister has subsequently met with Members of Parliament to discuss it further. Hopefully, by the end of the debate, we will have a solution and those employees will be excluded from the exit payment cap. These companies are in a unique position: they are mostly engaged in managing the safe closure of nuclear facilities, which is obviously a hugely important task for our country.

[Mary Creagh (Wakefield) (Lab)]

Does my hon. Friend agree that the recent terrible and tragic explosion at Didcot shows just how difficult and dangerous such decommissioning work is? That was a conventional gas-fired power station being demolished. I am sure the sympathies and thoughts of the whole Committee are with those affected and their families. The terrible tragedy that befell workers there shows what a difficult, dangerous and technical job they are doing. A great deal of specialist expertise is required to do it safely. Of course, the risks of a nuclear decommissioning site are exponentially increased because of the risk of anything escaping out into the wider environment.

[Kevin Brennan]

My hon. Friend is right. Exclusions have been made for those who serve our country, and I think these workers also serve our country in what they do—which is, as she said, difficult, technical and sometimes dangerous work.

[Kevin Brennan]

I said earlier in the Committee that Government Whips should be seen but not heard, but of course that convention does not apply to Opposition Whips in Committee, as all Committee members will know. That is particularly useful, as it allows my hon. Friend to raise a constituency issue of such direct importance to what is under discussion. I am sure her constituents will take note of what she is doing in the Committee to defend their interests.

As I said, these companies are in a unique position. They are mostly engaged in managing the safe closure of nuclear facilities, which is a hugely important task that is very difficult to manage. By its nature, it involves working towards a specific end date, at which point the employees will in effect make themselves redundant. They are in a particularly different category. To get someone with the necessary skills to commit to that task when they are in, say, their early or mid-30s, we need to ensure that they know they will be provided for if they successfully complete their task by the time they reach their mid to late 50s, when finding re-employment in a similar role with their skills would be potentially very difficult.

As we have heard, if these companies cannot afford the packages necessary to compensate someone for the loss of their role when their task is completed, the companies will find it extremely difficult to prevent these highly skilled workers, who were mobile in earlier parts of their career, from simply leaving. That, in itself, will ultimately drive up the costs and risks associated with decommissioning and exacerbate an already difficult skills shortage in the industry.

Legislating now, as the Government are doing, to override long-standing arrangements in the nuclear sector where the employees involved have kept their end of the bargain faithfully, is pretty unconscionable in my opinion. How can it be right that workers who have stayed with a company to deliver successfully the safety commissioning of a site see their promised redundancy compensation reneged on by the Government when it is due to be paid?

The Treasury justification for applying the cap to the employees of those companies, as I understand it, is the old chestnut of the Office for National Statistics judging them to be publicly controlled. That technical, statistical designation, however, does not mean that applying the cap to those workers is either fair or necessarily value for money for taxpayers in the long term. It is unfair unilaterally to strike down agreements between companies and their employees. It will drive up overall costs for decommissioning as recruitment and retention in the relevant sectors take a hit. There is also no proof that taxpayers will receive any benefit, as the private operators of the companies often receive higher incentive payments under their contracts as a result.

Unless the Government decide to act on this, and I hope they do, employees in the sector will note that when it comes to pension provision and other issues the Treasury has excluded them from the public sector, but it considers them within scope for the cap in the Bill. Proceeding with imposing the cap on the employees of those companies will store up significant industrial relations issues. One can only guess how they will feel —actually, we do not have to guess, because we know from the evidence that we have received, which I will come on to in a moment. How will they feel when they discover that the Secretary of State considers them to be fat cats requiring legislation to limit their payments, even though they are employed by the private sector, while the Government absolutely reject any limit on anyone working in the banking sector? Why is a privatised banker not given the fat-cat treatment by the Secretary of State, but nuclear decommissioning workers are? Yet again it seems to be up with the bankers and down with the workers with this Government. What a shocking value-free zone the policy is, if the Government stick to it and do not accept that they have got it wrong and should support our amendment.

We have received strong representations from Magnox workers and from the trade unions that have represented them so ably. Other companies in the sector are covered and they are referred to in new schedule 3. For the record and for the sake of inclusivity in my remarks I will name those included in the new schedule: Sellafield Ltd, Westinghouse Springfields Fuels Ltd, Magnox Ltd, National Nuclear Laboratory, International Nuclear Services, Atomic Weapons Establishment Ltd, Low Level Waste Repository Ltd, Dounreay Site Restoration Ltd, RSRL Winfrith and RSRL Harwell. Note that none of those companies is called Fat Cats Ltd.

[Mary Creagh]

My hon. Friend made a good point earlier comparing the workers and the bankers. Does he agree that the list he has just read out is an interesting hangover from the privatisation of the electricity grid and the national nuclear authority? Some risks can only be borne by Government. One of those risks is the premature exit of a skilled, competent workforce equipped to deal with nuclear materials and their safe disposal. There are strong arguments for the Government to continue to bear the redundancy risk, or to allow the workers to be classified—I am not sure whether they are classified as being state or private sector workers, but the point is, when we privatise things, some risks only Government can bear, and that is what the amendment is all about.

[Kevin Brennan]

My hon. Friend is right. I am sure that the Minister will confirm that that is why those companies fall in scope, but that does not stop the Government from deciding actively to exclude them from scope. As I said earlier, they are radiant with the lawful power to do that; we are not, but they can do it. I encourage the Minister to commit to doing so in her response.

The Committee has formally received dozens of letters from Magnox workers. I have some here and I am sure hon. Members have read them. I congratulate the workers on the quality of representations they have made to the Committee as well as the trade unions. Kevin Coyne of Unite, whom I met, has co-ordinated joint union meetings to campaign on the issue. We are reaching the last stages of the Committee so there is not time to read all of the letters out, but they have been entered formally as evidence to the Committee, so they are available for people to read.

--- Later in debate ---

[Anna Soubry]

I am just answering the points that have been made.

I was asked why the banks are not included. There is a good reason for that. During the financial crisis, the then Government ensured that a number of banks were in temporary partial public ownership, and we have already started the process of returning the banks wholly—not partly, but wholly—to private ownership. That is the only reason why they are exempt.

The other important thing to remember—I am particularly explaining this for the Magnox workers—is that it is not the Government who deem that they are working in the public sector; it is the Office for National Statistics. As we debated the other day, the ONS is an independent organisation. It is not for the Government to beat up on the ONS, which decides and determines what is in and what is out of the public sector. By definition, that is the ONS’s job.

[Mary Creagh]

I apologise for the earlier interruption. I have a new app, and I thought I had it on mute, but for some reason it started talking. I recommend it to the Committee, because it is good for beating the London traffic.

The Minister has just said that partially owned state banks are exempt from the cap at the moment. Does that mean that their workers can receive payoffs of more than £100,000 before they are fully privatised? That is at least the next year or year and a half, given our earlier discussions on the current state of the banking share market.

[Anna Soubry]

That is my understanding, because they are in the process of being wholly put back into the private sector. If I am wrong, I am sure I will be corrected. And if I am not corrected in time, I will be more than happy to write to the hon. Lady.

[Mary Creagh]

I am grateful to the Minister for clarifying that point. Does that mean that those banks that are in partial public ownership publish, as the Green Investment Bank currently does, the pay and benefits of all their top executives and their chairperson? We had that debate in relation to the Green Investment Bank, and I seek clarification on the same best practice for financial reporting on executive pay and performance. If the Minister cannot provide an answer now, I would be grateful if she wrote to me on that point.

[Anna Soubry]

I really do not know. The danger is that we are drifting off. Again, I am more than happy to ask my officials to write to the hon. Lady on that point. [Interruption.] Actually, the publication of what people earn, and so on, is not relevant to this clause.

I know that Opposition Members want to concentrate on the issue of the Magnox workers because, understandably, they have written in large numbers to hon. Members. As I have explained, we have been clear about what to do, but in any event we will list in regulation those employees who are not exempt. I also stress the point that the cap of £95,000 is on exit payments. We are not getting rid of all exit payments for Magnox workers, but those who would receive above £95,000 will be capped.

--- Later in debate ---

[Anna Soubry]

I do not think I can give assurances on that. If I am wrong, I will get back to the hon. Gentleman. Forgive me, Ms Buck, I am reading a note that I do not understand. It refers to the hon. Member for Walthamstow (Stella Creasy), although I did not think she was here. Perhaps the hon. Member for Wakefield has been mistaken for the hon. Member for Walthamstow.

[Mary Creagh]

She is blonde.

[Anna Soubry]

Yes, I was going to say that. I nearly said she is also much younger, but that would be exceedingly rude. Actually, it is not true. In any event, the hon. Lady looks the same age.

--- Later in debate ---

[Kevin Brennan]

Indeed. Those people are the definition of strivers; they are hard-working—the beating heart of the working people of this country. It shows in their letters to us. Neither are they swivel-eyed lefty loonies or anything of that kind. Their letters reveal that they are ordinary working people. Often they live in the constituencies of Conservative Members. The one I quoted earlier lives in Maldon, the constituency of the Secretary of State for Culture, Media and Sport, and there are many others in constituencies represented by Members from both sides of the House and all parts of the United Kingdom.

[Mary Creagh]

I do not know how many of those workers cast votes for the Conservatives in the election, but had they been apprised of the facts before the election obviously they might have chosen to vote differently in some of the marginal seats mentioned by my hon. Friend. Also, one of the letters that I have received mentions that the impact assessment says that this course of action will save in the low hundreds of millions of pounds over this Parliament. The woman who wrote the letter contrasts that with the £130 million of back tax that has been paid by Google, which is under the spotlight again, given the news that the French Government are asking for £1.3 billion of back taxes from that company.

[The Chair]

Order. We are in danger of drifting quite a long way from the subject.

--- Later in debate ---

[Kevin Brennan]

Well, the Secretary of State used the term, and the Secretary of State is the Minister’s senior and I presume she agrees with what he says. She is constitutionally obliged to, actually, when she is talking on behalf of the Department.

[Mary Creagh]

Let me attempt to help the Committee. I am sure that the Minister meant, when she referred to payments of up to half a million pounds, that some of those will be making up the pension requirements. Let us say that somebody is made redundant at 50. Their contract states that they can have their pension made up as if they had worked until the state retirement age, which is 65. We are talking about 13 years of pension fund payments on a salary of, I think, £30,000 a year. Thirteen years of payment would amount to £156,000. That is not going into that person’s pocket; it is going into their pension fund, and they have planned for that in order to help to pay their mortgage and to help them save towards their retirement.

[Kevin Brennan]

Indeed. All their life decisions were taken on the basis that they had a good pension fund that they were paying into and that they could expect, under the terms and conditions, to receive. That was contractually promised and, at the time of privatisation, commitments were made and guarantees were given that these people going into the private sector would not be affected in the way they are now being affected. The Government are hiding behind the veil of the argument that the ONS has classed them as public sector. That is irrelevant because the Government have the authority to exclude them if they accept the argument put forward by the Magnox workers.

I know that the Minister has expressed some sympathy—that is why I was quite surprised at her last intervention—privately in relation to Magnox workers. [Interruption.] That has been reported to me. I should explain. I will put it on the record, then. My hon. Friend the Member for Ynys Môn (Albert Owen) told me that in the meeting that he and other Members from across the House had with her that she expressed some sympathy with the case that the workers were putting forward. Nevertheless, she has come to the Committee with nothing for them today and no indication that on Report the Government will come back with something better than they have produced today, which is the square root of very little, to put it politely.

--- Later in debate ---

[Catherine McKinnell]

rose—

[Mary Creagh]

rose—

[Brandon Lewis]

I will give way in one second; I just want to finish the last point. The new schedule updates the obligation on employers to notify shop workers of their rights by specifying in regulations the form and content of the explanatory notice that employers must provide to existing and new shop workers. It also strengthens the consequences for failure to comply in some important ways.

Draft Small Charitable Donations Act (Amendment) Order 2015

Mary Creagh Excerpts

Monday 7th December 2015 General Committees

[Mary Creagh (Wakefield) (Lab)]

The scheme that the Minister is expanding upon today is interesting and is well regarded by charities and the public. In Wakefield we have a number of small charities, as well as the national headquarters of the Penny Appeal—its name sounds like a small amount, but it is actually a large and fast-growing charity—and some local churches that collect for the Suzy Fund. A lot of people are interested in the scheme, although I am not clear whether some of the micro-charities in my constituency are aware of it, so I will write to them.

We politicians underestimate how difficult form filling and excessive bureaucracy—particularly HMRC bureaucracy —are for our constituents and people who run small charities. For example, they might be running food banks, as my hon. Friend the Member for Salford and Eccles said, brass bands or small football or rugby league teams, or even doing a small bake sale, such as the people who feed into the larger Comic Relief. There are all sorts of ways in which the scheme can be spread out. The example that springs to mind is the poppy appeal, although I am sure that the Royal British Legion has mechanisms in place to maximise the revenue from it. Will the Minister let us know what the legion’s approach is? The appeal involves a lot of very small cash donations, and it would be absurd to be filling in a gift aid form for £1 or however much people give.

I want to follow on from the question about the 7,200 charities that claim the full amount. The Minister said that 19,000 charities claim £21 million. According to his figures, therefore, 12,000 of the claiming charities are not claiming the full amount. That prompts the question, what is the median and the smallest amount claimed? Perhaps he will send me and other Committee members the figures for the average amount claimed, which would be interesting, and explain why the full amount is being increased. I am sure it is a good reason.

The suggestion about food bank donations was interesting. Although large retail companies do good work with food banks, I would be reluctant to see Tesco or Ocado—I must not forget Sainsbury’s or Asda—

[Robert Flello (Stoke-on-Trent South) (Lab)]

All of them.

[Mary Creagh]

Yes, all those large companies have done amazing work with food banks. I know that from my constituency and from my time on the Front Bench as shadow Secretary of State for Environment, Food and Rural Affairs.

For small charities, such as St Vincent de Paul in my local church and other Catholic churches, or for people donating to the Sainsbury’s appeal—a packet of cereal, a four-pack of beans or whatever it might be—there should be a mechanism to enable small donations to be match-funded or gift-aided. That would be interesting and innovative, given that so many people are now choosing to donate in kind rather than in cash. Will the Minister tell us how he plans to take things forward?

Finance Bill

Mary Creagh Excerpts

Tuesday 20th July 2010 Commons Chamber

[Mary Creagh (Wakefield) (Lab)]

I want to look at three areas of this Finance Bill. The first is the economic impact of the fiscal conservatism contained therein, and particularly how, in tandem with the fiscal consolidation taking place across Europe, it threatens a double-dip recession not just here but Europe-wide. Secondly, I want to look at the social and labour market consequences of the double whammy of the VAT bombshell and the deep spending cuts. Thirdly, I shall focus on the political implications of the Liberal Democrats making the wrong choices by voting in favour of this Bill this evening.

On the economic impact of the Bill, we see the pursuit of the Goldilocks economy—one in which neither too much nor too little is spent, but the spending is somehow just right. We all know that fairy tales are fine for little children, but it is a dangerous metaphor because it over-simplifies a complex economy still in a fragile state of recovery. How do we know that it is dangerous? Well, because the Office for Budget Responsibility tells us that growth will be lower and unemployment higher in future years, with 1.3 million jobs set to be lost over the next four years as a result of the measures in this Finance Bill.

I tabled a parliamentary question a week or so ago about the contact between the Office for Budget Responsibility and the Treasury on 29 and 30 June and 1 July—and in the aftermath of those sticky Prime Minister’s questions debates. So far, I have had no reply from the Economic Secretary. I would have thought that it was a fairly simple thing to look into officials’ diaries, ministerial diaries and phone records and to give the House a reply on the important question of whether pressure was put on the Office for Budget Responsibility.

The pre-eminent question raised by this Finance Bill, but left unanswered by those on the Treasury Bench, is: how does taking money out of the economy increase confidence, boost growth and secure the recovery? The answer is, quite simply, that it does not.

There seems to be an insistence that Government spending is somehow crowding out private sector investment. That is ludicrous. The United Kingdom’s output gap—the gap between what it produces and what it has the potential to produce—is somewhere between 4% and 6%, depending on whose estimate we accept. The Chancellor expects the private sector to take over demand from a shrinking public sector, but is silent on where that private demand will come from. It is clear from what has been said in the debate that there are no real answers to that question.

The Government say that 2. 5 million jobs will be created—

[Mr Redwood]

Will the hon. Lady give way?

[Mary Creagh]

I will not, because we have only one hour left, and eight Members wish to speak. The Front-Bench spokesmen took their time, and I intend to take my time.

The labour economist David Blanchflower, a former member of the Monetary Policy Committee, has said that the Government’s prediction on jobs is wildly over-optimistic, given that the Labour Government created only 1.6 million jobs between 2000 and 2008, when the economy was, by consensus, booming.

The VAT increase for which the House voted will raise £12.1 billion in 2011-12, but will reduce the amount of goods and services that people can buy. It will depress demand and delay the recovery. It will increase prices permanently by 1%, thereby permanently reducing the value of future earnings and—one of the hot topics in the Bill—future pensions. It will also disadvantage the poorest, who spend the biggest proportion of their income.

Let me say something about the social impact of the Bill. It was difficult to hear the details of that as the Minister raced through his speech. We have heard from the Prime Minister that children need warmth, not wealth, and they will certainly miss out on the wealth part as a result of this Bill. Poor families in Wakefield will lose up to £1,200 as a result of changes in working families tax credit. From April 2011 the Sure Start maternity grant will be available only for the first child in a family. That means a £500 cut for low-income pregnant mothers who already have a child.

[Charlie Elphicke (Dover) (Con)]

Will the hon. Lady give way?

[Mary Creagh]

No. I am going to take my time. As I have said, I am not going to take interventions.

Nappies, prams, babygros, bottles, dummies and high chairs will all be more expensive for families in our constituencies as a result of the VAT increase, but the grants to help the poorest women in our society to afford them will be cut. When I asked the Secretary of State for Work and Pensions how he expected families to cope, he said that he wanted them to recycle prams, but if someone has a child one year younger than another child, where is the second baby supposed to sleep? In the same cot? The parent of a second child will still need to buy a new car seat and a double buggy. It will be more difficult for low-income families to buy all those items. We are losing the baby element of child tax credit, and we are losing Labour’s proposed toddler tax credit, which would have meant another £208—

[Matthew Hancock]

Will the hon. Lady give way to an intervention on the increase in tax credit?

--- Later in debate ---

[Mary Creagh]

I know that there is to be an increase of £150. I will come to that if the hon. Gentleman will show a little patience and allow me to make progress with my speech. He spoke for 13 minutes, and I hope to take less time than that.

As I was saying, the toddler tax credit would have provided an extra £208 a year for families with children aged one or two. Moreover, child benefit has been frozen for three years, which means a real-terms cut.

[Kwasi Kwarteng]

Will the hon. Lady give way?

[Mary Creagh]

I have already said that I am not going to give way to Opposition Members. It is true that child tax credit will rise by £150 above inflation for one year—

[Matthew Hancock]

rose—

[Mary Creagh]

I am dealing with the hon. Gentleman’s point. Perhaps he would acknowledge that. Families on low incomes, however, will see their costs rise as a result of the VAT increase—

[Matthew Hancock]

rose—

[Mary Creagh]

I know what the hon. Gentleman wants to ask, and I am happy to answer his question without his having to spend a minute asking it.

[Matthew Hancock]

On a point of order, Mr Deputy Speaker. I am new to the House. Could you possibly advise me whether it is appropriate for a Member to make an entire speech having stated in advance that he or she will take no interventions whatever?

--- Later in debate ---

[Mr Deputy Speaker]

Funnily enough, I was waiting for that point of order to be made earlier. The Order Paper is always correct, and this debate could indeed go on until any time.

[Mary Creagh]

In that case, Mr Deputy Speaker, I am happy to take all interventions, even though I have spent three minutes clarifying those points.

[Andrea Leadsom]

Will the hon. Lady give way?

[Mary Creagh]

I will happily give way.

[Andrea Leadsom]

That is the sisterhood.

I want to make a point about pushchairs, prams, car seats and cots. To my certain knowledge, from having been involved for a long time with a charity that works closely with families and their babies, there is a surplus of those items in charity shops. People refuse to purchase or even to accept them, and I was interested to learn that the hon. Lady believes that part of the definition of poverty is if someone cannot have all those items new.

[Mary Creagh]

I am not saying people should buy everything new, but I am certainly not telling families in my constituency that when they have a second baby they should trawl around to the local hospice shop or British Heart Foundation shop in a desperate quest to get a car seat so as to take their child home from hospital without breaking the law. The hon. Lady says that those goods are in abundant supply. One of the important things about car seats is that if we buy them second hand, we have absolutely no idea whether they have been involved in a car accident. I am certain that no Member of this House has bought a car seat for their child—for their new baby—from a charity shop. What we ask for ourselves we should also stand up for in this House, and ask for our constituents.

[Chris Leslie]

When listening to interventions from the Government Benches, it comes as a shocking revelation to hear the notion expressed that those who are in financial difficulties can go round the charity shops looking for cots and prams. I do not quite see how they can do that for sanitary products or teething equipment, for instance: perhaps the hon. Member for South Northamptonshire (Andrea Leadsom) would suggest buying recycled baby bottles and so forth, too. All such products attract the higher rate of VAT at 17.5%, which will go up to 20% as a result of the Bill. Does not all this show a degree of condescension in the Conservative party’s attitude to those in the greatest need?

[Mary Creagh]

I think it does, and I also think it is indicative of the idea that the poor are no better than they should be, and that they should aspire to nothing better than charity shop purchases.

[Andrea Leadsom]

Will the hon. Lady give way?

[Mary Creagh]

No, I want to finish my point. There is an important point to make about cots. No matter where people get their cot from, they should never put a baby to sleep on another child’s mattress, because they do not know what has happened to that mattress—whether it has been vomited or urinated on, for instance.

We talk about putting babies “back to sleep”, and about cutting the rate of sudden infant death—which predominantly happens in lower income households. There are issues here to do with families living in overcrowded housing and babies sharing beds with their parents, yet the hon. Lady is saying that new mums and expectant mums are supposed to go round hauling cots home in their eighth and ninth month of pregnancy and then putting them up. Frankly, she ought to think a little more about what she wishes for her constituents.

[Alun Cairns]

On a point of order, Mr Deputy Speaker. I seek your guidance on what cots have to do with the Finance Bill, and on the relevance of the points that have just been made.

--- Later in debate ---

[Mr Deputy Speaker]

The relevance is the subject of VAT, which is addressed in the Bill, but I would reiterate the guidance given before I took the Chair, which is that people must, please, keep to the contents of the Bill and show some restraint, as many Members wish to speak.

[Mary Creagh]

We have had a debate on the higher-rated goods, which will be permanently more expensive following the votes that we will have this evening, but I also want to talk about the cuts to Labour’s child trust fund.

[Andrew George]

Will the hon. Lady give way on VAT?

[Mary Creagh]

Yes, I give way.

[Andrew George]

I agree with many of the points that the hon. Lady has made on child care issues, but I wish to put something on the record for her. I understand that on children’s car seats, which have been mentioned, the VAT rate is limited to 5%.

[Mary Creagh]

I thank the hon. Gentleman for that clarification.

I now want to discuss the child trust fund, which is also being cut. When I visited Greenhill school in my constituency to talk about financial education, I asked 10 and 11-year-olds how much money they had saved up in their bank accounts and the answers given by those little 10-year-olds ranged from £50 to £80; that was their life savings. But those children knew that their little brothers and sisters had got £250, and in some cases £500, from the Government through the child trust fund.

[George Freeman (Mid Norfolk) (Con)]

Will the hon. Lady give way?

[Mary Creagh]

I will make my point first. I bet that there is not a single Member sitting on those green Government Benches whose children’s life savings amount to £50. I shall happily give way to any hon. Member for whom that is the case.

[Andrea Leadsom]

Will the hon. Lady explain whether those children also knew that they had about £23,000 of debt each?

[Mary Creagh]

That is one of the figures put about by the Conservatives during the election as a way of frightening people about the level of debt. Labour Front Benchers have comprehensively set out that the best way to reduce the debt is by growth, and not by frightening people. Most people who have a mortgage understand that they have tens of thousands of pounds of debt—but the point is that when someone is paying off their mortgage they do not stop feeding their children, and they do not stop running their car. In effect, the Government are paying off the mortgage much more quickly than they need, and the consequences of the political choices that they are making will have huge impacts on every constituency.

For Members on the Government Benches, £500—the amount of the Sure Start maternity grant—may be what they spend on a good meal at the Fat Duck in Bray. We debated that before in the House in relation to one newspaper columnist, Stephen Pollard, when the matter was raised by a Conservative Member—I believe it was the hon. Member for Kettering (Mr Hollobone). For children on the Eastmoor estate in Wakefield, however, that £500 is a life-changing sum, and will change some of the life choices that they make.

[Charlie Elphicke]

I just point out to the hon. Lady that child poverty has risen by 300,000 since 2004, whereas under this Budget it will be frozen for two years. Does she not welcome that very positive fact?

[Mary Creagh]

Interestingly, when the Red Book refers to the effects on child poverty it talks about the next couple of years but does not mention 2013 and 2014. Thanks to the work being done by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the shadow Secretary of State for Work and Pensions, we are finding that this Budget’s impact on women—in particular on poor women, low-paid women and public sector worker women, and therefore on their children—is likely to hit disproportionately hard. I leave the hon. Gentleman with that thought.

What is absent from the Budget and the Finance Bill is any mention of the poor. The changes to the disability living allowance gateway are to save £1 billion by 2014, but we need clarity about which groups of disabled people are going to be affected. The housing benefit move to the 30th percentile of average housing will have an impact on families across the country. Stringent changes are being made to the housing benefit rules to say that anyone who has been on jobseeker’s allowance for more than a year will automatically lose 10% of their housing benefit.

If that is done to people, there are three possible outcomes. The first is that the people involved find jobs—and good luck to them. I am sure that that is the stated aim of the Government’s policy. The second possible outcome is that those people cannot find jobs because a further 1.3 million people are on the dole as the public sector and private sector job losses kick in, so they are forced to borrow the money. However, we are talking about people with a low income or no income, so they will, in effect, be forced into the arms of loan sharks and will fall into debt. The third possible outcome is that these people will spend £10 a week less feeding their children, so their children will be pushed back into poverty. The arguments being made about child poverty will not wash with Labour Members, because both the second and the third possible outcomes will tip those families back into poverty.

[George Freeman]

The hon. Lady mentioned the child trust fund, and I think that all hon. Members would agree that establishing a culture of saving is a commendable thing. In principle, does she think it is better for children to learn to work and to save, or to learn that the way to acquire money is to be given it by the Government?

[Mary Creagh]

The beauty of the child trust fund is that both those things happened; this involved people who would never have thought of opening a trust fund. I count myself among them, because I had no idea what a trust fund was until I was “given it by the Government” when my son was born, but now that I understand what it is and I understand the secrets of how people save for their children in a tax-efficient way, it has enabled me to think carefully about how I plan for my children’s future. It enables families to do both those things.

Most families are using the child trust funds to put a little bit extra by. The parents who scrimp and save to put into the child trust fund will not let their children waste the money. The straw man that has been held up is that they will blow it all on their 18th birthday party, on buying fast cars and all the other things that 18-year-olds do—[Interruption.] That is certainly what has been stated by some Government Members as a reason for cutting the child trust fund; they have said, “You can’t give it to 18-year-olds because they won’t know what to do with it.” When their parents have paid into the fund they will make absolutely sure that that money, which for them is a life-changing sum, will be used wisely by their children.

[Charlie Elphicke]

rose—

[Mary Creagh]

I have taken one intervention from the hon. Gentleman, and I am aware that other hon. Members wish to speak.

The VAT rise in the Finance Bill will cost the NHS an extra £250 million each year, and it will be very bad for public health, too. Recent research by David Stuckler and his colleagues published in the British Medical Journal shows that social spending—housing benefit, disability living allowance and other such benefits—has more impact on tackling health inequalities than spending on the NHS. They studied 20 European countries over two decades, finding that mortality rates increased when social spending was cut. So the public health impact of cutting the housing, disability and incapacity benefit budgets will be felt by the poorest in our society in the reduction in their life expectancy.

In concluding, I wish to discuss what has happened in the past 10 weeks and the political impact that voting for this Budget will have on the Liberal Democrats. The past 10 weeks have been like a very dark episode of Doctor Who, with the Conservatives as the evil Cybermen. The Cybermen were originally a wholly organic species of humanoids that implanted more and more artificial parts into their bodies as a means of self-preservation. This led to the race becoming coldly logical and calculating, with every emotion all but deleted from their minds. They use human pawns and seek to further their number by conversion. The Liberal Democrats are the Conservatives’ hapless victims. The Cybermen have to assimilate their victims in order to drain their energy and live, but we all know that when the Cybermen have assimilated, they have only one further aim: they say to their victims, “You will be deleted.”

These are not progressive cuts. There is nothing progressive about slashing the extension of free school meals to the children of the working poor and thrusting 50,000 children back into poverty. There is nothing progressive about freezing the pay of dinner ladies, hospital cleaners and nursery workers. Why should low-paid women pay for the fiscal hysteria of markets and central banks, which presided over such colossal market failure? Why is corporation tax being cut by 1% a year for the banks when everyone in Wakefield is seeing their VAT increasing by 2.5%? Why is the annual exempt amount for capital gains tax rising each year with the retail prices index when housing benefit and occupational pensions in Wakefield will increase only by the consumer prices index?

Those are political choices. They are the wrong choices for my constituents and for those of other hon. Members. Economically, this is a deflationary Budget. It is wrong for Britain, wrong for families, wrong for pensioners and wrong for the poor. Politically, supporting this Budget will be the wrong thing for the Liberal Democrats. I urge all Liberal Democrat Members to think before they vote tonight, and before they throw away 120 years of Liberal tradition as the Tories’ new poodles. You are being assimilated. You will be deleted.

[Several hon. Members]

rose—

Budget Resolutions and Economic Situation

Mary Creagh Excerpts

Tuesday 22nd June 2010 Commons Chamber

[Barry Gardiner]

I entirely endorse my hon. Friend’s remarks. The only thing that I find more smug than the comments that have been made was the fact that, during the entirety of oral questions to the Deputy Prime Minister, he refused to answer any of the questions that he would have found difficult to answer. One wonders why they are called oral questions to the Deputy Prime Minister if he is not going to bother to answer them.

[Mary Creagh (Wakefield) (Lab)]

How does my hon. Friend feel that the Budget will impact on the poorest of his constituents in Brent? The impact will be felt by the poorest people across the country, but does he agree that, with this Budget, we have finally seen the Liberal Democrats for what they are: the real wolves in sheep’s clothing?

[Barry Gardiner]

My hon. Friend is absolutely right. It is very clear that the Liberal Democrats vary not just what they say from doorstep to doorstep, but what they say before the election from what they do after the election, and many of us have bitter experience of that.

Today, it was interesting to hear the Chancellor say that council taxes will be frozen. I thought to myself, “Yes, I’ve heard that mantra before.” My hon. Friend prompts me. That is exactly what the Liberal Democrats promised in the run-up to the 2006 local elections in Brent. Strangely, after that local election, they went into a coalition with the Conservatives, who had promised not just a freeze on council tax but a reduction in council tax. When they got into power, what did they do? They raised council tax for three years in a row.

Moreover, before the election, the Minister of State, Department for Education, the hon. Member for Brent Central (Sarah Teather), was photographed with the elderly—I have a copy of it here—and appeared on a leaflet that said, “Free Personal Care for the elderly say Lib Dems”, but when they got into office on Brent council, they raised the personal care charges from £5 an hour to £16.50 an hour.

When the Chancellor talked today about how the Government would freeze council tax, I thought, “Yes, I know how they will manage to do that.” All the charges that councils make people, such as elderly residents in Brent, pay will be bumped up. The increase will be imposed not on council tax, but on those who have the very least ability to pay—the most vulnerable people in our community.

Last week, I was invited to the Brent Teachers Association meeting to debate the future of education in the borough with the Minister of State, Department for Education, the hon. Member for Brent Central. As she had promised in her election literature an extra £2.5 billion towards education and smaller class sizes, but subsequently approved a £1.88 million cut to the borough’s education area-based grant, I was looking forward to that debate. However, I understand that, half an hour before the start of it, her office phoned to indicate that she was indisposed and could not attend. If I had been in her position, I would have been indisposed and unable to attend, too. To cut one’s education department in the borough, having promised such a vast increase in the education spending, is typical of how the Liberal Democrats have proceeded around the country, and we now see that what they do in national government is absolutely no different. The disillusion of those who believed the Liberal Democrat promises before the election can be only further deepened by the Budget statement that they have heard today.

Financial Services Regulation

Mary Creagh Excerpts

Wednesday 16th June 2010 Commons Chamber

[Mr Osborne]

Indeed, my hon. Friend is right: certainly, if the accounts are true, that was the approach taken by the former Prime Minister. I am not sure whether he did so with the knowledge of the former Chancellor, but I guess that we have to wait for the flurry of memoirs to find out.

[Mary Creagh (Wakefield) (Lab)]

This weekend, there was an advertisement for a pay-day cheque service that had an interest rate at the bottom of the screen of 236%. Given that the Chancellor is about to make changes to the FSA’s consumer protection function, does he think that 236% interest is fair, and if it is not, what will he do about it?

[Mr Osborne]

The OFT will shortly publish a report on high-cost credit that will address some of these issues, and the hon. Lady is absolutely right to be concerned about them. One of the things that I hope will flow from the institutional arrangements that we are putting in place is a stronger voice for the consumer to ensure that particularly the most vulnerable people in our society are protected from exploitation.