Oral Answers to Questions

Robert Jenrick Excerpts

Tuesday 22nd May 2018 Commons Chamber

[Liz Twist (Blaydon) (Lab)]

4. What recent assessment he has made of the adequacy of his Department’s procedure for authorising and monitoring private finance initiative contracts.

[The Exchequer Secretary to the Treasury (Robert Jenrick)]

The vast majority of PFI projects—86%—were signed off under the last Labour Government. Since 2010, we have reformed the approach so that PF2—private finance 2—contracts, in the selective circumstances in which they are used, now deliver better value for money for the taxpayer, so far delivering over £2 billion of savings.

[Liz Twist]

Recent research from the University of Greenwich suggests that bringing existing PFI contracts back in house could pay for itself within two years. The National Audit Office has noted that Government Departments reported the “operational inflexibility” of PFI, so can the Chancellor explain why his Department is still pushing the increasingly discredited and scandal-ridden PFI model under the disguise of PF2?

[Robert Jenrick]

Under the last Labour Government, the average number of PFI contracts signed per year was 55. In the last two years, the Treasury has signed off none. We will use this approach selectively when it delivers a genuine transfer of risk and provides value for money for the taxpayer, not as the last Labour Government did.

[Andrew Bridgen (North West Leicestershire) (Con)]

As the Minister said, PFI was hugely popular under the last Labour Government. Will he confirm whether PFI stands for “private finance initiative” or “pay for indefinitely”?

[Robert Jenrick]

My hon. Friend highlights the cost and legacy of the PFI projects signed off under the last Labour Government. Hon. Members can be assured that we will use this approach wisely and selectively, in particular for the most complex infrastructure projects requiring a transfer of risk and the expertise of the private sector.

[Eleanor Smith (Wolverhampton South West) (Lab)]

On PFI hospitals, the National Audit Office report recently found

“no evidence of operational efficiency”,

and that in the NHS,

“the cost of services, like cleaning…hospitals is higher under PFI contracts.”

Will the Chancellor explain why his Government persist with imposing higher costs than necessary on local health budgets instead of ensuring value for money for the taxpayer?

[Robert Jenrick]

I think that the hon. Lady is having amnesia. These contracts—86% of the contracts and 91% by value—were signed under the last Labour Government. In respect of some of the items that she mentioned, such as cleaning and security services, we have reformed PFI contracts under PF2 so that those items are not included in the standard contract.

[Michael Fabricant (Lichfield) (Con)]

Would my hon. Friend be interested to learn that when I was a lowly Parliamentary Private Secretary in the Treasury in 1996 and 1997, John Major was constantly trying to make us finalise PFI contracts, but we in the Treasury refused because they were bad deals? As soon as Labour got in, they went straight ahead and entered into those bad deals.

[Robert Jenrick]

My hon. Friend is absolutely right. The initial intention of PFI was to transfer risk, when appropriate, to the private sector, and to drive up innovation and quality in a very small number of selective cases. That was perverted under the last Labour Government by Gordon Brown.

[Anneliese Dodds (Oxford East) (Lab/Co-op)]

We have learned from the experience of PFI; this Government—[Interruption.]

[Anneliese Dodds]

Thank you, Mr Speaker.

This Government have not. In the light of last week’s report on Carillion, we want to know whether the Minister can indicate which PFI contracts are being delivered by contractors that are deemed to be actually or potentially high risk. Following last week’s reports that failed bidders for PFI contracts will be compensated, can he rule out bailing out firms that fail even to win contracts? We need answers on these questions now, not a history lesson.

[Robert Jenrick]

As I have indicated, this Government’s approach to PFI is entirely different from that of the last Labour Government. The hon. Lady says that she has learnt the lessons. Well, it is a pity for the taxpayer, and for our children and grandchildren, that they were learnt so late.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

5. How many people have paid a 25% withdrawal charge to use their lifetime ISA savings since that scheme was established.

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[Mike Amesbury (Weaver Vale) (Lab)]

7. What fiscal steps his Department is taking to increase regional productivity.

[The Exchequer Secretary to the Treasury (Robert Jenrick)]

The Budget showed our determination to improve productivity, increasing the national productivity investment fund by £8 billion to £31 billion. With substantial investment in the regions of the UK, such as the £1.7 billion transforming cities fund, we want to help all parts of the country achieve their potential.

[Andrew Bowie]

I am sure the House will be united in rejoicing that the UK’s productivity last year grew by 0.7% and in the last quarter increased at its quickest pace in six years. Does my hon. Friend agree that raising our productivity is the only way to deliver higher-paid and better jobs for the future?

[Robert Jenrick]

I entirely agree with my hon. Friend. Raising productivity is the only sustainable way to grow the economy, boost wages and improve living standards, which is why we have given it such a clear and determined focus. With respect to Aberdeenshire, the North sea oil and gas industry is one of those sectors that have seen the greatest productivity increases in recent years. We will continue to support that with a highly competitive tax rate.

[Mike Amesbury]

Given that average UK productivity is 30% below German levels, does the Minister agree it is now time to rebalance our economy and support further devolution for areas such as Cheshire and Warrington?

[Robert Jenrick]

It was of course this Government who one year ago created the Mayors across the UK, including in Greater Manchester, and several of them, including Andy Street, have had a great impact on their local economies. I have had conversations with the leader of the Cheshire and Warrington local enterprise partnership and the Minister responsible at the Ministry of Housing, Communities and Local Government to take such matters forward.

[Theresa Villiers (Chipping Barnet) (Con)]

23. May I challenge the Government to maintain a strong emphasis on sound management of the public finances so we can invest in skills and apprenticeships to boost productivity and living standards?

[Robert Jenrick]

My right hon. Friend is absolutely right. It is only with sound management of the public finances that we can continue to invest in the skills required to grow productivity, and that is exactly what we are doing with increasing investment in apprenticeships, through the apprenticeship levy, and with the T-levels, which will be largest change to our secondary education system since the introduction of A-levels and which we will be seeing in the coming years.

[Ian C. Lucas (Wrexham) (Lab)]

15. The unique cross-border region of north Wales and Cheshire is one of the most dynamic economies in the United Kingdom. Will the Treasury—which has promised a north Wales growth deal in, I think, at least three Budgets, but has yet to deliver a penny—please stop marking our homework, and give us the freedom to invest in the economy that we believe in?

[Robert Jenrick]

We have had numerous conversations with local partners in north Wales, and with the Welsh Government. I urge the hon. Gentleman to take the message to the Welsh Government, but they also need to engage with the UK Government to secure that important deal, which, as he says, will link the economy of north Wales with the north-west and the northern powerhouse to drive productivity.

[Chris Philp (Croydon South) (Con)]

Does the Minister agree that cutting corporation tax to 19% has encouraged business investment, boosting productivity as well as encouraging the creation of 3 million new jobs?

[Robert Jenrick]

My hon. Friend is absolutely right. When we reduce the tax to 17%, we will see those productivity gains increase—and, contrary to what the Opposition have claimed, revenues have increased.

[Preet Kaur Gill (Birmingham, Edgbaston) (Lab/Co-op)]

Eurostat figures show regional inequality in the United Kingdom, measured by output per hour, to be the worst in Europe, and the Government have failed to close the gap since 2010. When will the Chancellor commit himself to making the investment that is needed to end regional imbalances that have seen the north of England set to receive just one fifth of the transport investment per capita in London?

[Robert Jenrick]

The Infrastructure and Projects Authority, which has conducted the most rigorous analysis of Government spending on infrastructure, has made clear that the north of England will receive more funds from the present Government than any other region in the United Kingdom, including London and the south-east.

[Alan Mak (Havant) (Con)]

8. What fiscal steps he is taking to support firms harnessing new technologies.

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[Trudy Harrison (Copeland) (Con)]

T5. I welcomed the Treasury’s recently closed consultation on single-use plastics. Will my hon. Friend update the House on what his Department intends to do next to tackle this problem?

[The Exchequer Secretary to the Treasury (Robert Jenrick)]

Sadly, it is a rare day on which a Treasury call for evidence on tax stirs the enthusiasm of the general public, but this one has. We received a record 130,000 submissions from throughout the country. We are determined to take the issue seriously and to tackle the scourge of single-use plastics. The Chancellor has been clear that we want to do so in a way that both tackles the environmental issues and drives innovation to support the jobs of the future.

[Wes Streeting (Ilford North) (Lab)]

I am sure that Ministers will be just as concerned as the rest of us about the startling revelations about the conduct of Lloyds and HBOS outlined in the Project Turnbull report. Will the Treasury now demand that, after three years, the Financial Conduct Authority pulls its finger out to expedite its investigation into this matter? Has the Treasury received any requests from police authorities to fund appropriate investigations into criminal activities? If so, will it look favourably on them?

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[Jessica Morden (Newport East) (Lab)]

What will ministers do to support the “Great Western Cities” initiative, which promotes collaboration between Bristol, Newport and Cardiff and has enormous potential for the wider region?

[Robert Jenrick]

We are already engaging with that important initiative. We continue to support the Mayor of the West of England in Bristol, and we are investing over £600 million through the Swansea and Cardiff city deals.

[Michael Fabricant (Lichfield) (Con)]

Manufacturing accounts for 24% of the west midlands economy but, as others pointed out earlier, there are skills shortages. Will the Chancellor therefore support any bid from the Mayor of the West Midlands for a devolution deal to take over responsibility for skills from the Department for Education?