Oral Answers to Questions
Rishi Sunak Excerpts(4 years, 5 months ago)
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Tracy Brabin (Batley and Spen) (Lab/Co-op)
The Chancellor of the Exchequer (Rishi Sunak)
The self-employment support scheme opened last week ahead of schedule and provides support worth up to £7,500 to millions of individuals. I am pleased to tell the House that, at the end of yesterday, there had been more than 2 million claims, with grants worth £6 billion in total being claimed for. Those people will have the money in their bank accounts within six working days of their claim, and of course, I will keep the scheme under review.
Tracy Brabin [V]
I thank the Chancellor for his response. Despite him saying that the self-employment scheme is one of the most generous in the world, tens of thousands are still missing out—new starters, pay-as-you-earn freelancers, those paid through dividends and those earning over £50,000. I have three simple questions for the Chancellor. Will the self-employed income support scheme be extended in line with the job retention scheme? Are there plans to lift the cap on profits? And will he please look again at supporting new starters?
Rishi Sunak
We have discussed these things before, but I do not believe that removing the cap would be the right or socially just thing to do. The average income of those above the cap is £200,000, and 95% of those who are self-employed fall underneath the cap.
Owen Thompson (Midlothian) (SNP)
The Chancellor of the Exchequer (Rishi Sunak)
Our plan to support businesses and individuals is one of the most comprehensive in the world. We have provided tens of billions of pounds in cash grants, tax cuts and discounted loans for businesses; deferred taxes for those who are self-employed, employed and in business; a world-leading job retention scheme to keep as many people in employment as possible; income protection for the self-employed; and a strengthened safety net to protect the most vulnerable in our society.
Owen Thompson [V]
Successful businesses in the tourism and hospitality industries before the lockdown will face a very different reality at the end of it, with overseas visitors gone for the foreseeable future and social distancing in place. These businesses need time to reinvent themselves for the new post-covid environment. What measures will the Chancellor introduce to enable much greater flexibility in the furlough scheme to support them as they prepare for this new reality?
Rishi Sunak
It is precisely because of the time it takes for businesses to ramp up that last week, I announced an extension to the furlough scheme all the way through to October, to provide that runway for growth—in particular, for those who will open later in tourism and hospitality. As I said, we will introduce flexible furloughing in the extension period of that scheme.
Amy Callaghan [V]
Those on fixed-term contracts are in a particularly difficult situation where employers have placed them on furlough but are unwilling to extend it past their contract end date. One employer highlighted to me that that is because they are concerned that if they continue to furlough an employee without formally extending the contract, Her Majesty’s Revenue and Customs will deem the furlough frivolous and seek reimbursement. Can the Chancellor confirm that employers can continue to furlough those whose fixed-term contracts have ended without any financial repercussion?
Rishi Sunak
I am happy to look at the specific example mentioned. It is important for us—and to protect the taxpayer—that we are paying furlough payments to those who are genuinely in employment and have a formal employment contract, but I am happy to look at that example.
Mr Speaker
I welcome the right hon. Member for Wolverhampton South East (Mr McFadden) back to the shadow Front Bench.
Rishi Sunak
The right hon. Member is absolutely right: finance should flow to the industrial base of our country. The investment grade rating, which relates to the corporate financing facility that the Bank of England runs, is important. Because that money is accessed by companies without any additional credit check by the Government, it is right that an investment grade rating is used, to protect the taxpayer. We have taken a flexible and generous interpretation of that, providing companies with the ability to use their bank rating to get access. For those companies for which commercial paper is not the right approach—many of the industrial companies he mentioned—we have a larger coronavirus business interruption loan scheme programme, and I am in conversations with various industry stakeholders to ensure that that is appropriately sized to provide finance to every part of our industrial base.
Alison Thewliss (Glasgow Central) (SNP) [V]
Research by the Chartered Institute of Personnel and Development today released today has found that participants in the furlough scheme would otherwise have made up to 35% of their workforce redundant, rising to half the workers in hospitality, where the uptake of the scheme is particularly high at about 80%. Hospitality and tourism were first out and will be last back. Many of these companies have no income and are building up debt, and may feel compelled to sack workers if they are asked to pay more by the Government at the end of July. How does the Chancellor intend to prevent this and to support this part of the economy in the months ahead?
Rishi Sunak
It is precisely the retail, hospitality and leisure sector that has received the most direct fiscal support from the Government through cash grants of £10,000 or £25,000 and a business rate holiday for the entire year—well beyond the point of reopening. That represents significant support, and the extension of the furlough scheme through to October gives those companies enough of a runway to grow back into a safe space.
Mary Glindon (North Tyneside) (Lab)
The Chancellor of the Exchequer (Rishi Sunak)
As I announced last week, the coronavirus job retention scheme has been extended by four months until the end of October.
Mary Glindon [V]
New starters not registered with HMRC before 19 March and agency staff workers are some of those who currently find they are in limbo when it comes to accessing the job retention scheme. What more can the Chancellor do to help these workers now facing hardship?
Rishi Sunak
When I announced the scheme, we said that those who were on real time information and had notified HMRC on 28 February would be eligible. That covers 29.5 million workers in this country. We found a way to extend that to 19 March—the day before the announcement was made. That protects the taxpayer against fraud and enables as many of those people to be included as possible. It brought another 230,000 people into the scheme. It is important to remember that this scheme now covers close to 30 million workers. As of the end of last week, 8 million people from about 1 million businesses are covered by the scheme and having their wages paid by the Government to protect their jobs and their future security.
Mr Speaker
We now head down to the south-west and the Chair of the Select Committee, Mel Stride.
Mel Stride (Central Devon) (Con) [V]
Thank you, Mr Speaker.
The future fund will provide venture capital-backed businesses with vital support, but of course it excludes investments made through the enterprise investment scheme and the seed enterprise investment scheme. It is certainly the case that there is significant public subsidy within those two schemes. However, businesses supported by them still face the challenges of the virus and, where successful, still go on to generate significant numbers of jobs. Will my right hon. Friend therefore take a second look at the qualification requirements for the future fund to see whether EIS and SEIS might be accommodated in some way?
Rishi Sunak
As my right hon. Friend will know well, EIS is a notified EU state aid, and that is what presents the challenge to providing EIS relief for convertible loan instruments into the future fund. That said, guidance was published today, and the fund will be open for applications on Wednesday. I have been crystal clear that should applications exceed the initial £250 million provided, I will be more than happy to expand the scheme. I think this will be a vital part of fuelling our recovery, because, as he said, these companies provide the growth of tomorrow and they deserve our support.
Anneliese Dodds (Oxford East) (Lab/Co-op)
Labour supported the introduction of the furlough scheme, and we have consistently called for it to become more flexible. We recognise that it cannot persist forever. However, according to press reports, the Treasury is considering asking all employers to pay 40% of employee wages on the JRS from 1 August, which risks a massive spike in job losses.
Rishi Sunak
As I think the shadow Chancellor has acknowledged previously, we are in deep consultation with both unions and business groups to ensure that we get the design right for the second part of this scheme. It is right both for the economy and, indeed, for the taxpayer to ask employers to make a contribution to paying the wages of their employees. They will have the benefit of flexibility in furloughing to help offset that. I cannot comment now on this, but I did say that details will be provided by the end of the month.
Anneliese Dodds
I appreciate the Chancellor’s comments, but we really need clarity around whether he is considering evidence from other countries, which, in many cases, are calibrating changes to their salary backfill schemes with the lifting of the lockdown. Is he looking at that evidence, particularly on the potential impact of unemployment, or is he only looking at potentially the introduction of a uniform contribution from 1 August?
Rishi Sunak
As I said, there will be details at the end of the month, but the hon. Lady can rest assured that I speak regularly with my counterparts in countries across the world to learn from their experience and will make sure that our scheme continues to be one of the most generous, comprehensive and effective anywhere in the world.
Dehenna Davison (Bishop Auckland) (Con)
Transport in the North
Rishi Sunak Excerpts(7 years ago)
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Rishi Sunak (Richmond (Yorks)) (Con)
The average commute into London begins 40 miles outside of the city. If we could make that the case for Manchester, we could create an urban network with a population larger than that of New York, and with a GDP the size of Sweden. That is the scale of the prize for getting northern transport right.
Tonight I would like to make three quick points: first, I want to celebrate the powerhouse that the north already is; secondly, I want to talk about the role that transport will play in shaping the north’s future; and lastly, I want to suggest a few key projects that will ensure that the future is bright.
When I hear the phrase “northern powerhouse”, I must admit that my heart sometimes sinks, because I know that too often I am about to hear a story of the past—the north as the land of the spinning jenny—or I am to be told about a far too distant future of hyperloops across the Yorkshire dales. Instead of talking about the past or the far future, let us not forget today that Britain’s 16 million northerners are already the nation’s economic engine. Last year, it was not London or the south-east that saw the highest growth; it was the north-west. Thanks to Nissan’s Sunderland car plant, Britain is, for the first time since England won the World cup, producing more cars than the French. Off Yorkshire’s east coast, Hull-made turbines are creating the world’s largest offshore wind farm. In science, the north’s 29 universities—including world-class institutions like Durham, York and Newcastle —are at the forefront of our cutting-edge research. And, in Manchester United, the north is home to the most successful sporting franchise anywhere in the world.
But in the area of transport, we are still selling the north’s potential short. The cities and towns of the north are individually strong, but collectively are not strong enough. The only way to get the north to punch beyond the collective sum of its parts is to connect those parts. That is why better transport is key to unlocking the north’s true potential.
Today, converted buses known as Pacer trains, a technology phased out more than 12 years ago by Iran’s national railway, are still in use across the north. Today, it is quicker to travel 283 miles from London to Paris than to travel less than half that distance between Hull and Liverpool. And today, too often bright, young entrepreneurial minds forged in northern schools and universities find it easier to come 200 miles to London to find a job than to look in a northern city just 40 miles away.
But it does not have to be like this. After all, the distance between Manchester and Leeds is shorter than the length of the London underground’s central line. The Government, to their credit, recognise the need for investment—and in my constituency upgrades to the A1 and A66 are welcome—but there is much more to do.
The northern powerhouse is a wonderful phrase, but the people of northern England deserve more than a slogan; they need action. How do we make the aspiration a reality? There is no doubt that there has been a substantial funding gap between London transport and northern transport under successive Governments.
Kevin Hollinrake
I asked this question of the hon. Member for Kingston upon Hull North (Diana Johnson), but does my hon. Friend agree with me that this lack of investment has been happening for generations, and that it is not a party political issue? We should be working cross-party to deliver the solutions we all know we need.
Rishi Sunak
My hon. Friend has done excellent work analysing these numbers, and I completely agree with his point that it is multigenerational. The point is that, from now on, that gap needs to start closing.
Secondly, London has Crossrail, the midlands is getting HS2, and now we in the north need the Government to back Northern Powerhouse Rail. The Government’s £300 million down-payment is certainly welcome, but we will need a lot more to show the people of the north that the Government mean business.
Thirdly, in my own area, the new Tees Valley Mayor has campaigned to upgrade Darlington station, to vastly improve its capacity and connectivity. It is an excellent proposal and the Government should get behind it.
Fourthly, from Teesside to Merseyside, and from Tyneside to the Humber, one of the north’s many strengths are its great ports. As I set out last year, after we leave the EU we should create a new generation of US-style free ports to turbocharge manufacturing, trade and employment in our great northern port cities.
Finally, we must make sure that the rural north is not left behind. Advances like autonomous vehicles will have their biggest impact in sparsely populated rural areas like mine—for example, by allowing elderly constituents to access distant health services more easily, or stimulating our local economies by allowing people to head to the pub without worrying about who will drive home.
It might seem strange to hear all this from a boy born in Southampton, but I am deeply proud to now call the north my home. So as long as I have a voice in this House, I will speak up loudly and forcefully for my home’s bright future, and for an economy that, with the right investment, can be the powerhouse not just of Britain but of the world.
Rishi Sunak
Does my hon. Friend agree with the point made by the hon. Member for Bradford South (Judith Cummins) that the Treasury and the Department for Transport need to consider economic development and the rebalancing of the economy as criteria for the allocation of new money, so that it does not go only to the places that are already economically vibrant?
Kevin Hollinrake
I absolutely agree. I have looked at the figures in detail and, as my hon. Friend said in his speech, the distribution of central Government spending is much more level before other factors are added in. In London, the money allocated by central Government per person per year is about £40 per person, but if other investment is added in—from the European Investment Bank, local authorities and private finance—that is when the disparity occurs. We have to find mechanisms to make sure that the north gets a fair deal. It is not just about central Government distributing money unfairly; other factors are at work, which is why we need to work across party lines to make sure we can deliver a solution.
As I said earlier, the way things are now is how they have been for decades—for generations—so we all need to work together. It is not just north versus south; it is principally London versus the rest of the country. We have a big constituency of MPs and businesses right across the country who have a stake in making sure that we get a fair deal, but we need to look behind the broad, headline figures, because it is simply not right that the Chancellor is allocating lots of money to London and not to the rest of the country. Other factors are at work that we need to take into account and find solutions for.
Once we have found those solutions, there are so many projects that we need to support. It is absolutely right that we should look at northern powerhouse rail or HS3. As my hon. Friend the Member for Cleethorpes (Martin Vickers) said, we need to look at extending the M11 up to the Humber bridge. We need a tunnel across the Pennines. We also need to look at the small regional roads, such as the A59 and the A1079 in my constituency, and particularly the A64, on which a journey of around 40 miles from York to Scarborough can take two hours. We need more funding for the smaller, less high-profile projects that are so critical to our local economies. If we can get the money—if the people holding the purse strings will give us the tools—we can do the job.