Public Sector Pay Cap

Mike Wood Excerpts

Wednesday 5th July 2017 Commons Chamber

[Elizabeth Truss]

My hon. Friend is right to draw attention to the macroeconomic picture, and to point out that if we do not have a confident deficit reduction plan such as the one that the Government have pursued for the last seven years, the financial markets will lose confidence, and the effect on working people will be a rise in interest rates, a rise in housing costs, and problems for the Government in respect of our borrowing.

[Mike Wood (Dudley South) (Con)]

I declare an interest: my wife is a primary school teacher who is currently working as a teaching assistant.

Will the Chief Secretary ensure that both the rising cost of living and recommendations of the independent pay review bodies are properly taken into consideration in the setting of public pay policy for next year’s settlements?

[Elizabeth Truss]

That is one of the factors that the pay review bodies consider, along with issues such as recruitment and retention and ensuring that the pay settlement is affordable. They have the responsibility of speaking to people like my hon. Friend’s wife who work in the public services, hearing what they have to say, and making a determination. There are different issues in different public services, and I think it wrong to suggest that there is a “one size fits all” solution.

Oral Answers to Questions

Mike Wood Excerpts

Tuesday 17th January 2017 Commons Chamber

[Simon Kirby]

The UK and US financial sectors have significantly increased their resilience since the crisis, and the PRA has the powers it needs to regulate overseas firms operating in the UK to ensure the stability of the UK financial system.

[Mike Wood (Dudley South) (Con)]

What steps are the Government taking to ensure that banks meet the 2019 deadline for separating retail banking from riskier investment banking activity?

[Simon Kirby]

That is well under way and we are keeping a close eye on it.

Christmas Adjournment

Mike Wood Excerpts

Tuesday 20th December 2016 Commons Chamber

[Mike Wood (Dudley South) (Con)]

It is a pleasure to follow so many distinguished speakers this afternoon. In particular, I would like to add my agreement to the arguments put forward by my hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) and my hon. and gallant Friend the Member for Beckenham (Bob Stewart) about the concern that some of our servicemen seem to be being treated more adversely than some suspected and, indeed, convicted terrorists. I hope those concerns are heard not only by the Government but by the devolved Administration in Northern Ireland.

One of the joys of our role as Members of Parliament is being able to work with so many community organisations that, all year round, do such valuable work for people who are often the most vulnerable in our society. During a public service and volunteering week I held earlier in the autumn, I had the pleasure of spending some time with a range of organisations, including Age UK, the Springboard Centre, Black Country Food Bank, the dementia unit and A&E volunteers at Russells Hall hospital and the West Midlands police.

At Christmas in particular we value the role of our community organisations, but they do such work all year round. It is very difficult to pick out any one individual example above any other but it would be remiss of me not to highlight Wordsley community centre in my constituency, led by the formidable Janet Blakeway, and its work to improve the centre’s accessibility. I recently launched its new stair lift, which had been made possible by Janet’s work to bring in local firms, CE Solutions and Handicare, to do the work for the local community, really transforming the services that are on offer.

The big society may have passed into political history as a buzzword, but the work that so many unheralded volunteers and community organisations do—every day of the week, every week of the year—continues regardless of passing fads in our political lexicon. Some argue that, in the selfish age in which we are supposed to live, people are no longer interested in working for a community, giving up their time or supporting good causes. That is certainly not my experience from the support for the Macmillan coffee morning or the community clean-ups we have held in Dudley South, which have been extremely well supported by the community. I hope that the Deputy Leader of the House will ensure that the Government continue to look at how they can make it easier for people to give up their time and for businesses to donate resources and skills to help the communities around them.

I am particularly pleased to see a growing number of friends’ groups supporting our local parks and green spaces; at a time when local authorities are having to look at how and where they can dedicate resources, communities are saying that these things are important to them and going out and taking practical action. Most recently in Dudley South, the Friends of Cot Lane Park group was formed a month or so ago on a wet Wednesday evening, but still attracted 60 people from local estates. The group was formed in response to damage and disruption caused following an unauthorised Traveller camp at the park.

The Black country has seen an unusual number of unauthorised Traveller camps over the summer and into the early autumn. Many have been responsible and considerate to local neighbours, but sadly some have behaved criminally. There has been disruption and criminal damage and police have reported not only robberies but violent crimes. While local authorities in my own borough of Dudley and neighbouring boroughs have pursued successive magistrates court orders, those who seek to take advantage of the system know that that means that they have at least seven days before they have to worry about it. As a result, some of the less responsible and considerate groups have merely gone from one park or play area to the next, causing the same damage and disruption at each.

I hope that the Government will look again at practical questions such as whether authorised land for Traveller camps can be pooled so that local authorities can come together to make adequate provision across a wider area rather than in a single authority area, and whether it is time to allow local authorities to designate particular land or categories of land as sites where unauthorised camps attract criminal penalties and the realities that go with that. Of course we must always consider the genuine human rights of Traveller communities, but they must always be balanced with the legitimate rights of settled communities.

I was pleased that the then Chancellor was able to announce in the Budget in March this year the approval of the enterprise zone in my constituency. We are still waiting for the final approval of the business case, and I hope that the Deputy Leader of the House will make inquiries about it so that the new jobs, investment and increased prosperity can come into my constituency and benefit not only those whom I represent but those in neighbouring constituencies.

Similarly, the Government have signed off the extension to the metro network between Wednesbury and Brierley Hill in my constituency. It is being underwritten by the new West Midlands combined authority, meaning that it can go ahead sooner than expected. I hope that the Government will give serious consideration to extending it further to Stourbridge so that the tram link can connect back in with the main-line rail network and people can enjoy some of the benefits of HS2 connectivity.

The final theme I want to raise before the House adjourns for the Christmas recess is the need to work to ensure that everyone in our communities has the skills and knowledge that they need to succeed. I have been lucky enough to visit every school in my constituency since I was elected last May. Clearly, there is much excellent teaching and school management around Dudley and the wider Black country. It is important that I make that point because my wife has recently returned to the classroom and I know that she is listening; it could be a cold Christmas if I forget to emphasise that.

Invictus Education Trust and Windsor Academy Trust in my constituency are showing the power of schools working in partnership to drive up standards. However, across the wider Black Country, Ofsted has raised serious concerns with the four local authorities. Children in those areas start below the national average, but sadly they slip further behind across key stages 1 to 4. The performance, sadly, is less good than similar local authorities elsewhere in the country with similar levels of deprivation, so we really need to consider how we can ensure no child is left behind, whichever part of the country they live in. High-performing schools and academy trusts must be able to innovate, so we can have more diversity and tailored education provision in state schools. The Invictus Trust, which has one school in my constituency, is preparing plans for a specialist secondary school that incorporates part of an almost military-style curriculum, together with core EBacc subjects, to really target those in danger of becoming disengaged with the education system. I hope the Government will give that serious consideration when the application is submitted.

As I said, we have a lot of talent in our schools. I saw that recently when I received a letter from India, Thea and Jasmine from Belle Vue primary school about the scourge of modern slavery. I have taken up this issue with Ministers, and I know the Deputy Leader of the House has done a lot of work on it in the past. The quality of the letter and the depth of understanding it demonstrated, not only of the slave trade in the early 19th century and the abolition of slavery in the United States but how it affects our communities now, was remarkable for primary school children.

You will be aware of the talent of some of my constituents, Mr Speaker, from the Christmas card I hope you received, which showcased the artistic talents of Alex Maher and Lucy Hannon of Maidensbridge primary school, William Hetheridge of Glynne primary school, Millie Millard of Ashwood Park primary school, Tia Worrell of St Mary’s Church of England primary school, Thomas Pinches of The Brier school and Reggie of Netherton Church of England primary school. I am delighted that the seven excellent entries were all able to go on the Christmas card. Merry Hill shopping centre in my constituency was so impressed with the standard of the entries that it has put them on display, so that people doing their last-minute Christmas shopping can see just how many talented artists we have in Dudley South.

I think that that is a good point on which to finish. I again wish you a very merry Christmas, Mr Speaker, and best wishes for the new year.

Multiannual Financial Framework

Mike Wood Excerpts

Wednesday 7th December 2016 General Committees

[Mike Wood (Dudley South) (Con)]

It is a pleasure to serve under your chairmanship, Mr Hanson. It might be helpful to the Committee if I take a few minutes to briefly explain the background to the documents and the reasons why the European Scrutiny Committee recommended them for debate.

The multiannual financial framework sets out annual ceilings for the six headings of EU budgetary expenditure. The Commission has presented a mid-term review of the multiannual financial framework for 2014-20, and that is the first document in the motion. The Commission’s communication covers three matters: the multiannual financial framework at mid-term and its state of implementation and challenges; strengthening the EU budget’s focus and flexibility to deliver on priorities and new challenges; and issues for preparation of the next multiannual financial framework.

Consequent to the mid-term review, the Commission sets out a financial package of €13 billion or £11 billion of additional EU funding in 2017-20 for jobs, growth, migration and security. The inter-institutional agreement between the Council, the European Parliament and the Commission on budgetary matters provides for the contingency margin, among other matters, which is a mechanism to react to unforeseen circumstances as a last resort instrument and allows for a maximum of 0.03% of EU GNI to be redeployed between budget headings.

The Commission’s financial revision package is underpinned by the next four documents in the motion, which are: a proposed Council regulation to amend the 2013 regulation establishing the multiannual financial framework for 2014-20; a proposed amendment to the 2013 inter-institutional agreement on budgetary matters and financial management; a proposed decision concerning the contingency margin; and a proposed regulation on the financial rules applicable to the EU budget, which amends 14 regulations and one decision concerning the financial management of a range of multiannual EU programmes.

The remaining two documents in the motion are a letter of amendment to update the Commission’s draft budget for 2017 and a revised proposal for use of the contingency margin in 2017, in support of the migration and security section of the amending letter. The amending letter has taken into account technical adjustments on expenditure that had occurred within the course of the year and the proposals accompanying the Commission’s mid-term review of the multiannual financial framework. The amending letter increased the draft budget’s commitment appropriations from €157.7 billion— £136 billion—to €159 billion—£136.8 billion—and payment appropriations from €134.9 billion to €135.4 billion, an increase from £116.2 billion to £116.6 billion.

The changes fall into four areas: agriculture and fisheries, technical adjustments, growth and jobs, and migration and security. The first two are annual features of amending letters; the second two were particular to the budget proposals for 2017. In recommending the first five documents for debate, the European Scrutiny Committee noted that they represent an important stage in the adoption and management of annual EU budgets. The Committee suggested that among the matters Members might wish to explore today are the Government’s view of the individual budgetary upratings suggested by the Commission; whether they see any difficulties in the implementing proposals that the Commission presents; what the financial implications for the UK are likely to be prior to Brexit; and what post-Brexit financial liabilities there might be for the UK as a result of these proposals.

The Committee recognised that the remaining two documents were relevant primarily to the negotiation of the 2017 EU general budget. Given that the Commission had also linked them to the mid-term review of the multiannual financial framework, we recommended that they be included in this debate.

[The Chair]

I now call the Minister to make an opening statement. I remind the Committee that, as in the House, no interventions are allowed during the Minister’s statement, but there will be opportunities for questions following the statement.

Concentrix: Tax Credit Claimants

Mike Wood Excerpts

Tuesday 18th October 2016 Westminster Hall

[Mike Wood (Dudley South) (Con)]

Like many colleagues, I have seen a substantial spike in the number of tax credit inquiries following the letters from Concentrix. Our constituents expect action to be taken to ensure that benefits and tax credits are paid to the right people, and not to people who should not qualify for them. They also expect that process to be fair and sensitive. It is clear, however, that that has not been the case with Concentrix. So I am relieved—indeed, delighted—that the contract with Concentrix will not be renewed. However, we need to consider a number of questions, many of which were raised by the right hon. Member for Slough (Fiona Mactaggart), about whatever contract or system replaces the current Concentrix contract.

The first question is about the letters coming from Concentrix, including the form and style of those letters. In addition to letters that a number of my constituents have shown me, I have seen one of the letters that a member of my family received. Frankly, I would not have assumed that that letter came on behalf of the Government. It was of very poor quality; the letterhead looked as if it had been scanned in or computer-generated; and to all extents and purposes it looked like a scam, and I would have been very reluctant to responded officially to it.

We have spoken about the burden of proof and where it should lie. We also must consider the standard of proof. Concentrix has been treating the standard as beyond the realm of possibilities instead of on the balance of probabilities, and that is entirely inappropriate, particularly given what it calls the evidence. Data from credit searches and the like may be useful intelligence for starting further investigations, but they are not, in themselves, evidence. I am pleased that the contract is not being renewed, and I hope that the Minister will be able to give us some reassurance.

Finance Bill

Mike Wood Excerpts

Monday 5th September 2016 Commons Chamber

[Charlie Elphicke]

That is a very powerful point. This is why transparency matters. If people know that they are being taken for a ride, they do not have to use an organisation that uses a Luxembourg structure, which is a common kind of intermediate structure for pan-European tax planning to organise things so that no tax need be paid.

This is not just about Avis. I had a look at the accounts of Hertz, another large US car rental company that also does not seem to have paid any tax in the past few years. It is hard to tell how it is doing that, and I had to look at the accounts in very great detail. It has some let-out whereby the company does not have to report related-party transactions. One would think that it may well be renting its car fleets through the Luxembourg company or the Netherlands BV that it uses. Hertz uses a Netherlands BV and Avis uses a Luxembourg company to get money out of the UK tax net so that it is not subject to tax on any profit. However, I cannot tell, because we do not have that level of reporting. That is why country-by-country reporting is important, not just as a tax concept but as an accounting concept, so that one can see where the money has gone. Similarly, inter-company loans and borrowings are often at the much higher rate. That is certainly the case with Avis, which was paying more in its inter-company loans than in its borrowings to the bank. That, too, caused me a level of concern. There seemed perhaps to be some trademark royalties in there, or some royalties to do with its internal IT and computer systems, but it was hard to tell because we do not have that granularity in the accounts.

We ought to have a greater level of knowledge, a greater level of reporting, and a greater level of understanding of how money is being paid, the taxes that are due, and the nature of the planning that is being undertaken so that our laws are more robust and we can make sure that everyone in this nation pays a fair share of tax, be they the cleaner or the largest enterprise that is trading. It matters for the rule of law, for a fair and open market, and for a level competitive playing field that all businesses and enterprises are treated the same.

[Mike Wood (Dudley South) (Con)]

As a Conservative, I believe that taxes, whether direct or indirect, need to be kept as low as possible, consistent with the need to raise finances for our vital public services and for our national security. Unnecessarily high taxation not only strangles growth and development but means Government taking from those who have earned money, whether through labour, innovation, or capital.

However, the flipside of keeping tax levels low is that everybody must pay their fair share. Aggressive tax avoidance, bending the rules of the tax system to gain an advantage that Parliament never intended, means that a heavier burden falls on others, who are able to keep less of the money that they have earned. This Government are rightly committed to supporting businesses through low taxes—that is why corporation tax is being cut again to 17%—but those taxes do have to be paid.

This Bill therefore addresses many of the ways that companies use to avoid paying their fair level of tax. That includes the amendments that we are debating, tabled by the Government, to reform hybrid mismatches. The amendments will reduce aggressive tax planning, typically involving a multinational group. The introduction of these rules will, in essence, remove the tax advantage arising from the use of hybrid entities and instruments, and ought to encourage more businesses to adopt less complicated, more transparent cross-border investment structures. I look forward to similar rules being introduced by other jurisdictions. However, in line with OECD regulations, the Bill contains provisions for counteraction in the UK where the other country does not counteract the mismatch within its own hybrid mismatch rules. The Bill introduces the new penalty of 60% of tax due that was announced in the Budget, to be charged in all cases successfully tackled by the general anti-avoidance rule.

Government amendments 136 and 137 help to ensure that the changes announced in the Budget work as intended, cracking down further on unscrupulous and aggressive tax avoidance. I agree with the comments made by my hon. Friend the Member for Dover (Charlie Elphicke) on country-by-country reporting, as well as those raised so regularly by the right hon. Member for Don Valley (Caroline Flint). There is widespread and growing agreement that there is a need to move to country-by-country reporting so that the information is out there and available both to national tax authorities and to the wider public. That brings us back to the question of whether the best way to achieve that is for individual countries to act unilaterally or for the UK to move in partnership with our international allies and through a range of international organisations both within and beyond Europe.

[Rob Marris]

Of course, the Opposition want international action, we want international co-operation and we want our international friends to copy the amendment tabled by my right hon. Friend the Member for Don Valley (Caroline Flint), which we hope will be successful tonight. However, we also need to bear it in mind that half the tax havens in the world are British overseas territories. We have a particular responsibility in this regard worldwide. It is not about some sort of moral responsibility—to use the old-fashioned phrase, the white man’s burden—or any of that nonsense. It is to do with the fact that British overseas territories are responsible for half of these shenanigans.

[Mike Wood]

The hon. Gentleman makes a valid point, but we should also recognise, as I am sure he will, the progress that has been made in recent years to insist on those overseas territories moving into the 21st century so that their tax arrangements comply with what we would expect for international standards. In a globalised world, we must be clear that concerted international effort is needed to stop continued cross-border tax avoidance, evasion or plain old-fashioned aggressive but unscrupulous planning.

The UK Government have done more than any previous Government and more than most of our international allies and competitors to eradicate these practices, and they continue to do so, but of course more must be done and I welcome the reassurances we have heard from the Government that this remains a priority. I am pleased that the Government are now pursuing country-by-country reporting and that it will be discussed at the forthcoming G20 Finance Ministers meeting. This measure will by itself help to increase transparency across multinationals, supporting not only our tax authorities but, perhaps more importantly, those of the developing countries of which we have heard, which are almost literally being robbed of vital sources of income.

In conclusion, the Finance Bill and the amendments tabled to it include both pioneering and bold measures. It will ensure that taxes are paid and that everybody pays their fair share, and I look forward to supporting it this evening.

[John Redwood]

I remind the House that I have declared in the register of interests that I am a registered investment adviser, but obviously I am not speaking on their behalf in this debate.

It seems to me that there is common ground among all parties in this House that we need to collect a decent amount of tax revenue and that we want to ensure that those who are rich, particularly companies that seem to generate a lot of turnover and possibly profit, pay their fair share. We recognise, I think, that we have to operate in a global market. We are talking about what are usually large corporations that genuinely make different levels of profit and generate different amounts of turnover in different jurisdictions, and that have genuinely complicated arrangements when they switch components, technology, ideas and work between different centres. Even in a service business that does that through electronic communication and digital activity, there may be different people in different centres around the world who contribute to servicing the client and to dealing with the particular product. There are, therefore, genuine issues for the honest company in trying to define and measure precisely where work is done, where added value is greatest and what is a fair attribution.

We as legislators have to understand that complexity and try to come up with a good judgment, collectively and globally between the main jurisdictions, on what is a fair way to instruct those global companies to report in our different jurisdictions so that sensible amounts of tax are captured.

Oral Answers to Questions

Mike Wood Excerpts

Tuesday 19th July 2016 Commons Chamber

[Mr Gauke]

As my right hon. Friend the Chancellor has made clear, and as, indeed, the previous Chancellor made clear, in circumstances where there is a projection of growth less than 1% over a 12-month period, that fiscal rule does not apply. The fact is that we inherited a very high deficit, and we have shown very strong determination over the past six years to bring that deficit down. As we face the challenges that we now face in terms of Brexit, had we not taken the tough decisions on public spending over the past six years, we would be in a much more vulnerable position than we are now.

[Mike Wood (Dudley South) (Con)]

The previous Chancellor announced a new light rail link between the midland metro and the new enterprise zone in Brierley Hill in my constituency. Will my right hon. Friend meet me to discuss how we can extend that to the main line rail link at Stourbridge so that we can support businesses, communities and jobs in my constituency?

[Mr Gauke]

I note that my prediction that I would receive further representations and diary request appears to be holding true. I am happy also to meet my hon. Friend to discuss the project that he mentioned.

Surplus Target and Corporation Tax

Mike Wood Excerpts

Monday 4th July 2016 Commons Chamber

[Mr Osborne]

I am always happy to consider any good proposals to make further investment in our transport infrastructure. We of course support the electrification of railway lines both into south Wales and through the valleys. The Cardiff city deal has just been signed for the wider Cardiff city region, but if the hon. Gentleman has further proposals, I am happy to look at them.

[Mike Wood (Dudley South) (Con)]

When the Chancellor cut corporation tax in the Budget, he reduced the losses that banks could offset against corporation tax liabilities. Will he consider extending that to ensure that while we have the lowest possible rates, everyone pays their fair share of corporation tax?

[Mr Osborne]

My hon. Friend rightly says that as well as reducing corporation tax rates, we did a lot to reduce some of the reliefs that have been used—and some that have been abused. Broadly speaking, that is the right direction of travel for our tax system.

Bank Branch Closures

Mike Wood Excerpts

Thursday 30th June 2016 Commons Chamber

[Chris Evans]

I totally agree. When I go to a bank that is about to close, I want to know the exact figure. I want to know what the footfall is even if that means just clicking the numbers as people walk through the door. At least then there would be some raw data that could be used to justify a branch being closed.

There is also a social impact. Risca once had several banks and building societies, including branches of Lloyds, HSBC and Barclays. Lloyds and HSBC have now closed, leaving the town with one remaining bank, which is fortunate because people still have the option of moving to Barclays if they want to continue to bank locally. What happens if, as in so many communities up and down the country, Risca or Newbridge lose their last remaining bank as the long trend of bank branch closures continues, as predicted by fintech companies?

I say to my hon. Friends the Members for Ynys Môn and for Clwyd South and the hon. Member for Ceredigion that I am lucky in Islwyn because we have good transport links. We have a trunk road that goes right through the constituency, the bus service is good, and there is a new train service. People can get from town to town. However, Ceredigion, which is a huge constituency that I know quite well, Anglesey and Clwyd South all have country lanes and one-track roads. How can people get from one branch to another? It is a major outing for many people.

Before a bank closes, it is imperative that a full assessment is carried out of the impact that the closure will have on the local community and that local stakeholders are consulted. Steps have been taken. In March 2015, banks published their access to banking protocol, which laid out their commitment to ensure financial inclusion and to undertake an impact assessment through community engagement when a branch closure was planned. I look forward to the publication of the independent review led by Professor Russel Griggs of how banks have implemented the protocol. In my anecdotal experience, however, they have not. They have been found absolutely wanting.

It is very clear that some banks provide a better service than others. For example, I compare the closure of Barclays in Newbridge with the way that HSBC was closed in Risca. When I see something good, I say so. The way that Barclays managed that closure was far better than what happened at Risca. Barclays had the raw data, there was a point of contact, it spoke to all the customers, and I pay tribute to its community relations manager, Jonathan Brenchley, who was fantastic all the way through that process. The great thing about him is that if customers have a problem, they can pick up the phone to him and he will deal with it. It is an example that many other banks should look into.

In May 2013 Barclays launched its Digital Eagles programme, which is designed to support and educate customers to help them feel comfortable with using digital channels not only for their banking, but in all aspects of their lives. So far it has trained over 16,000 Digital Eagles across the country and has held 5,200 learning sessions. The expansion of such programmes among other banks would be a very important step towards ensuring that nobody was left behind as banking changes.

However, switching to online or telephone banking alone will not be enough to ensure that nobody is badly affected by branch closures. The parents of my constituent, who have no computer or internet, should not be expected to buy a computer, and their hearing problems make telephone banking an obstacle. If they are to keep their independence as more bank branches close, banks must move towards a model whereby the bank will go to the customer if the customer cannot get to the bank physically, digitally or otherwise.

I pay tribute to NatWest for its service, which is akin to a mobile library. Its van turns up once a week in hard-to-reach communities so that people can do their banking there. A promising solution might be a vast expansion of mobile banks which, although they are not perfect, could at least dampen the impact of bank closures. Customers who seek the kind of banking and financial advice they would otherwise receive at a branch should have the option to request one-to-one meetings with bank staff, either at home or in a nearby public space, such as a library.

It is important to remember that among the biggest customers of local bank branches are small businesses, with regular trips to their local branches to make deposits. The closure of branches means that they have to go further and further and waste precious time when they could be chasing sales and business. If time is money, they are certainly losing out. As in the case of personal banking, I believe banks must change their approach so that they are the ones to come to the customer. In January 2016 Barclays introduced a Barclays Collect service, which will travel directly to business and corporate customers to collect deposits directly from their door. I welcome that news. Barclays plans to roll out the scheme more widely next month. I hope the scheme is successful and that other banks follow suit.

We have to consider other options, and credit unions must be part of the mix. Earlier my hon. Friend the Member for Harrow West (Mr Thomas) said that in the new banking world credit unions must play a role. They will bring people to banking. I know that the Minister has been a champion of credit unions in the past. They bring people to banking, but very often they are the victims of their own success. Because they are voluntary organisations, when they get huge they get even more difficult to manage, as people do not have the necessary skills and experience.

Credit unions do not know where to go as they get bigger. I think building societies have a role and should offer back-up to credit unions, as should post office credit unions. There is much work to be done in credit unions, but there needs to be a next step for them, such as the opportunity to become a community bank, a post office-style credit union, or even a building society. I urge the Minister to look into this. Legislation is needed to enable huge credit unions run by voluntary staff to become the new banks or smaller community banks or building societies. I hope she and her officials will give some thought to that.

We need to start thinking about the social impact when a bank closes. The premises usually remain vacant or become a pub, for example, which is a waste.

[Mike Wood (Dudley South) (Con)]

In my constituency, rather like in the hon. Gentleman’s, Lloyds Banking Group announced two further bank closures yesterday. He is speaking movingly about the impact of bank closures on our communities, but that impact also extends to the staff. Does he agree that banks need to do far more to redeploy staff, and, where redeployment cannot take place, to make sure that retraining and support are in place so that staff are treated fairly?

[Chris Evans]

As a former employee of Lloyds TSB, as it was in those days, I have every sympathy with any member of a bank’s staff who is made redundant.

To go back to my earlier point, I hope the Minister will think about a piece of social legislation that says that banks should offer members of staff to credit unions, to give those organisations the expertise and professionalism they need to manage once they get bigger. There is a real space there for some action.

Banking is changing, but banks have to change with the times; they have to reach out to the customer and to find new ways of delivering their services. I come from a banking background, and I know that things are not perfect, but today’s debate has given me hope that all of us in the House want the best deal we can get for our constituents and for the customers of banks.

UK Economy

Mike Wood Excerpts

Wednesday 29th June 2016 Commons Chamber

[Stewart Hosie]

The Government have made it clear that it will be for the next Government to bring forward such a vote. I think we have got until September or October at the earliest before we need to decide whether to do that.

We are disappointed that the UK voted to leave. That is not what we wanted. The priority must be, as others have said, to stabilise markets and to protect the economy. That is why our First Minister is in Brussels today, and it is why she has said that our Government are exploring each and every potential avenue to maintain Scotland’s EU status, because that is where the instability is coming from.

Let me say one more thing about the previous referendum, and then I will move on to the economic consequences. It is democratically unacceptable for Scotland to be removed from the EU against its will. The irony is that we were told time after time before our independence referendum that the threat to our position in the EU came from independence. Alistair Darling told us that in November 2012. Ruth Davidson told us that on 2 September 2014:

“It is disingenuous…to say that no means out and yes means in, when actually the opposite is true. No means we stay in,”

she said. Even the Better Together campaign tweeted the same day:

“What is process for removing our EU citizenship? Voting yes.”

How wrong, and how misleading that all was. Our place in the EU was never under threat from independence; it was, and it is now, very much in jeopardy only because of the UK decision to leave.

I will move on from that. Now is the time for calm, measured reflection, with our First Minister and Government doing everything they can, including talking directly to Brussels today, to secure our European status and to provide as much reassurance and certainty as we can over the next days and weeks. It is the time for being reassuring, as we all should and must, to individuals from the EU and further afield, because we believe—as most in this House believe—that they remain welcome and appreciated here.

We must also do all we can to help to restore financial stability, to reassure the business community and to emphasise that, of now, we remain members of the EU and we are firmly in the EU; that trade and business should continue; and that we should all do everything we can to say to those planning inward investment, “This remains a place where one should invest one’s capital with confidence.”

Why is this important? Because the FTSE 100 dropped by 8.4% on the morning of 24 June. On 27 June the downward trend continued; by late afternoon, the FTSE was down another 150 points, or 2.5%. Friday morning’s sudden drop meant that £137 billion was wiped off UK blue chip stocks within minutes of the markets opening. As the Chancellor said earlier, banks, house builders and others were the biggest fallers. Taylor Wimpey was down 42%, Persimmon 40% and RBS 34%. During Monday morning, trading in the shares of Barclays and RBS was briefly halted as the sharp losses exceeded 10% of their stock value. After trading was restarted, the share price of both companies continued to fall and move wildly because of the uncertainty. The FTSE 250 index, which has more businesses in it that are exposed to the domestic market, fell even further—by 7.2%, or 1,200 points. Those were extraordinary falls and changes in both markets. PageGroup led the fall; there was a 58% slump in the value of its stock.

[Mike Wood (Dudley South) (Con)]

While I recognise the figures the hon. Gentleman quotes, does he accept that the FTSE 100 is currently trading at around 6,300, which is higher than it has been for most of the last six months?

[Stewart Hosie]

Indeed, and I will come to the recovery in certain areas in just a moment. The hon. Gentleman is right when it comes to the FTSE 100, but let me come to all the other indices, and we will see the real damage and how it is being played out.

It was not simply stock prices that were affected. Sterling was trading at $1.45 before the referendum. The value of the pound against the dollar fell by almost 8% on Friday the 24th—almost twice the fall in 1992, when the UK was forced out of the exchange rate mechanism on Black Wednesday.