Local Government Finance Settlement

Debate between Sajid Javid and Chris Williamson

Tuesday 19th December 2017 Commons Chamber

[Sajid Javid]

Trafford is a very well run council, which can set examples for many others in that area, but, like many, it is having to deal with added pressures, including on social care. I know that it has certainly welcomed the additional funding that we announced earlier this year, and the flexibility that I announced this time last year.

[Chris Williamson (Derby North) (Lab)]

In his statement, the Secretary of State said that local government is at the frontline of the country’s democracy, yet he is systematically dismantling council services. The spending power of my own local authority of Derby has been reduced by £161 per head since 2010. The latest iteration of that is that it is giving its libraries to the voluntary sector to run. Is the Secretary of State trying to finish the job that was started in the 1980s by his predecessor, Nick Ridley, who said that his idea of a good council was one that met once a year to dish out the contracts to the private sector?

[Sajid Javid]

Derby, like many local authorities, will be welcoming—I hope—the part of the settlement where we have announced additional funding. In the case of the hon. Gentleman’s local authority, Derby will be getting an additional 1.5% increase in its core spending power, which will lead to £2.7 million of additional spending, and it can use that on libraries as it wishes to look after local people’s needs.

Budget Resolutions

Debate between Sajid Javid and Chris Williamson

Thursday 23rd November 2017 Commons Chamber

[The Secretary of State for Communities and Local Government (Sajid Javid)]

It is a pleasure to respond to the Shadow Chancellor, although I am grateful that, for everything we have heard in the past half hour, he did not literally throw the book at me.

On Saturday, it will be exactly two years since the right hon. Gentleman cited one of history’s worst mass murderers in defence of his own economic policies. So let us take a look at some of the great leaps forward our economy has taken in those two years. Employment: up. House building: up. Inward investment: up. Borrowing: down. Last year, the British economy grew faster than that of any other G7 nation. This week, the CBI said that manufacturing order books have not been this full for almost 30 years. Siemens has said that it is cutting jobs on the continent, but expanding its UK operation, investing more money and creating even more jobs.

Whatever way we look at it, this is a Government that are getting things done—a Government that are growing the economy, and a Government that are building a Britain fit for the future. Yesterday’s Budget builds on that success and lays the way for much more to come. It is a Budget that will lead to us building more homes in the right places and at the right prices, a Budget that will protect and enhance our precious public services, and a Budget that will tackle the burning injustices that still plague too many people in this country.

First among those injustices is the state of the housing market. As I have said before, our home is so much more than just the place we go to sleep at night. It shapes who we are, provides stability and security and shapes our life chances, opening up or closing off all kinds of opportunities. A fair, affordable housing market builds strong families and strong communities. A broken one is, of course, a barrier to social mobility and a root cause of intergenerational unfairness.

The way to fix the broken housing market is to build more homes, and that is exactly what we are doing. Last year there were 217,000 net additions to the housing stock—the highest such figure in almost a decade. But we are under no illusions about the fact that there is much, much more to be done.

Labour’s answer to the housing crisis—in fact, Labour’s answer to everything—is simply to throw more of someone else’s money at the problem and hope that it goes away. The last time Labour tried that, we ended up with house building at its lowest level since the 1920s and an economy on its knees. This country needs at least 300,000 new homes a year. Do you know how many Labour started in its last full year in office, Madam Deputy Speaker? It was 75,000—the lowest number of starts in peacetime since the 1920s.

[Chris Williamson (Derby North) (Lab)]

I am delighted that the Secretary of State says there will be a renaissance in house building. Can we therefore look forward to an announcement of a renaissance in council house building? Does he accept that the cost of building council houses is in large measure covered by the income generated from the rental stream? It is basically a free hit, so why will he not admit that it is important that we start to build the council houses that we need to tackle the housing crisis?

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[Sajid Javid]

My hon. Friend is absolutely right. It is not just about building homes; it is about building communities. That means, among other things, supplying the infrastructure that is required, and I will come on to that.

[Chris Williamson]

The Secretary of State is being generous in giving way. Can he give us an indication of how many additional council houses will be built as a consequence of the lifting of the debt cap to the proposed level? I do not think it is very many—fewer than 10,000.

[Sajid Javid]

The hon. Gentleman keeps making that point, and I welcome it. I thank him for giving me another opportunity to remind the House that under the Conservatives, more council houses have already been built than were built during 13 years of Labour rule. How many more houses are built will depend on how ambitious local authorities are, but the objective is to ensure that thousands more are built each year by increasing the cap.

We have set out measures to support the workforce in this industry by providing an additional £34 million to develop vital construction skills such as plastering and bricklaying. As I have said, getting the country building will require more than just money. Planning reform is also required. We will focus on getting homes built in urban areas, where people want to live and where the most jobs are created. That will include making the best use of our urban land while continuing the protection of our green belt. We will focus on creating high-quality, high-density homes in city centres and around transport hubs.

To put the needs of our young people first, we will ensure that councils in high-demand areas permit more homes for local first-time buyers and renters. We are also launching an independent inquiry into so-called land-banking, with the promise of serious action if developers are shown to be holding back supply for financial rather than practical reasons. I am pleased that my right hon. Friend the Member for West Dorset (Sir Oliver Letwin) has agreed to lead that work.

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[Sajid Javid]

I say gently to the hon. Lady that if this country had taken Labour’s approach to the economy, we would be heading for bankruptcy again, and there would be no new money for the NHS. I hope that she will join Members on both sides of the House in welcoming the additional £2.8 billion going to the NHS in resource spending next year and the additional £3.5 billion that has been made available for capital spending over the next five years.[Official Report, 27 November 2017, Vol. 632, c. 1MC.]

[Chris Williamson]

On the point about the country becoming bankrupt, will the Secretary of State remind the House how much extra this Government have borrowed since they came to power?

[Sajid Javid]

This is a timely point at which to remind the hon. Gentleman that when a Government leave this country with the biggest budget deficit of any industrialised country, there are consequences, and Labour Members have not once—I repeat, not once—got up at the Opposition Dispatch Box to apologise for what they did to this country in their 13 years in office.

The Chancellor has also promised to provide additional funding for a future NHS pay settlement, so that our nurses are properly rewarded without taking money out of patient services. We are investing more in our schools: they will get £600 extra for every pupil who takes A-level or core maths; £27 million will help to improve how maths is taught in 3,000 schools; £49 million will go towards helping students resitting GCSE maths; and £350,000 of extra funding a year will be given to every specialist maths school that has been set up across the country. That is a massive investment in numeracy—sadly, it comes too late for the shadow Treasury team—that will help to ensure our young people have the skills they need to compete in the future high-tech jobs of the 21st century.

Not all public services are the responsibility of central Government; many are delivered by our brilliant local councils, whether parishes, districts, counties, metropolitans or unitary authorities. I am well aware of the pressure that local authority budgets are under, particularly with regard to social care. That is why this year’s spring Budget provided an extra £2 billion to help to meet the immediate needs in this vital area. I remain totally committed to delivering fair, effective funding for councils at all levels, and we will obviously return to this in next month’s local government finance settlement.

In the meantime, we are pushing ahead with our pilot schemes for 100% local business rate retention, including in London, and we are reforming business rates themselves. Revaluations will switch from every five years to every three years, avoiding the cliff edge that currently confronts many businesses, particularly smaller ones. We are changing the law so that businesses affected by the so-called staircase tax decision can have their original bills reinstated and backdated. We are bringing forward the change in uprating from RPI to CPI, which will now take effect from next April, saving businesses £2.3 billion over the next five years.

One council, the Royal Borough of Kensington and Chelsea, has had to deal with an unprecedented tragedy this year. The fire at Grenfell Tower should not have happened, and it should not have been possible. Since the blaze, the people of north Kensington have shown themselves to be remarkably resilient, courageous and proactive, and they deserve the full support of this Government and this House. We have already provided financial support for the victims of this terrible tragedy. This Budget sets aside a further £28 million to pay for community mental health support and to provide regeneration support for the area around Grenfell Tower and a new space for the local community to come together.

Grenfell Tower Fire/Fire Safety

Debate between Sajid Javid and Chris Williamson

Monday 26th June 2017 Commons Chamber

[Sajid Javid]

The hon. Lady raises a very important point. This is often the case, although not exclusively. Many leaseholders have removed fire doors, which is clearly not acceptable. I believe that all the legal powers are in place. Certainly, one of the lessons of this tragedy—this is certainly what we have seen in Camden—is to make sure we take a much greater interest in enforcement.

[Chris Williamson (Derby North) (Lab)]

The Secretary of State said in his statement, “Landlords must keep residential buildings safe for their tenants.” The experts all agree that sprinklers save lives. Sympathetic words are simply not good enough. Fitting sprinklers would cost far less than the deal the Government have stitched together with the DUP. Let us have no more excuses. What is more important to the Secretary of State: clinging to power or preventing fire deaths?

[Sajid Javid]

When the local fire and rescue service recommends sprinklers, they should be installed.

Banking

Debate between Sajid Javid and Chris Williamson

Wednesday 15th January 2014 Commons Chamber

[Sajid Javid]

Part of the answer might be that manufacturing was decimated under the last Government. Its share of the economy fell from about 17% to the 10% to which the hon. Gentleman referred, and, of course, lending fell with it. If the hon. Gentleman were honest and recognised the damage that his party did to the manufacturing sector, perhaps what he says would be taken more seriously.

We need a more stable, resilient, efficient banking sector, and it is on that requirement that we have focused our reforms. As Members will know, back in June 2010 my right hon. Friend the Chancellor announced the establishment of an Independent Commission on Banking, chaired by Sir John Vickers, to explore how the sector should be reformed in the wake of the financial crisis. Last year the House passed the Financial Services (Banking Reform) Act 2013, which has enabled us to implement the commission’s recommendations. The changes will mean that banks must ring-fence the deposits of individuals and small businesses, so that everyday banking can be separated from volatile investment banking.

As all Members, and, indeed. all members of the public will know, the financial crisis saw taxpayers bailing out the banks that got into trouble, but we have taken steps to ensure that that will not be repeated. Our banking reform Act introduces a bail-in tool, as a result of which shareholders and creditors, not taxpayers, will be first in line to bear the costs of future bank failures.

[Chris Williamson]

I think that the Minister should admit that the Government have watered down the Vickers commission. Will he now come clean with the House, and tell us that that is what they have done?

[Sajid Javid]

That is exactly what we have not done. We have accepted the central recommendations of the Vickers commission.

We have not just been working to prevent a repeat of the crisis. Many Members on both sides of the House have been rightly appalled by the revelations of poor behaviour on the part of some in the industry, such as payment protection insurance, interest rate swap mis-selling, and LIBOR manipulation. Those practices were going on right under the noses of Labour Treasury Ministers, including the current shadow Chancellor, who did nothing at all to stop it.

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[Sajid Javid]

That is exactly what I was coming on to next. It is important for taxpayers that any proposals by RBS are considered fully and properly. The Government have not yet received a proposal from RBS on bonuses; once we do, we shall be in a position to judge whether it represents value for taxpayers.

The Government do not support the EU cap on bonuses. The Government have fought against it and we are currently challenging it in court. The bonus cap creates perverse incentives by removing the link to performance. It is damaging to financial stability; it is opposed by the PRA and the Bank of England; and, indeed, the cross-party Parliamentary Commission on Banking Standards rejected crude bonus caps as unworkable.

Let me turn finally to the bank levy.

[Chris Williamson]

Will the Minister give way?

[Andrew Gwynne]

Will the Minister give way?

Budget Resolutions and Economic Situation

Debate between Sajid Javid and Chris Williamson

Thursday 24th June 2010 Commons Chamber

[Sajid Javid]

Personally speaking, on my own behalf, I would not have carried out the bail-out in such a way. I think that the true consequences and costs of that bail-out are yet to be borne out.

I know from my own experience of the bond markets that they take no hostages. We now depend on them utterly for the nation’s finances. My right hon. Friend the Secretary of State was absolutely right to point out that we face a major sovereign crisis unless we take serious action. Some Labour Members have said that it does not look as though we have had problems with financing our budget deficit to date. We borrowed about £225 billion in gilts in the last financial year, but at the same time, the previous Government, through the process of quantitative easing, printed about £225 billion of new money. It is therefore not difficult to work out how, in effect, much of that borrowing was paid for.

The United States was the only other major economy that went through a process of quantitative easing, and we cannot use it as an example to compare with ourselves because, as we know, it has a reserve currency and we do not. That makes its situation entirely different when it comes to such an economic policy. The only other country in the world that I can think of without a reserve currency that went ahead and printed money at about the same time as us—indeed, before—was Zimbabwe. It is rumoured that the Finance Minister of Zimbabwe sent a note in 2008 to the then Chancellor of the Exchequer offering him his economic advice in exchange for lifting visa restrictions on him and his family. I think the then Chancellor took the advice but did not give anything in return.

The bond markets are picking off grossly indebted nations one by one with rising bond yields and falling prices. We have heard today about Greece, and we have seen what has happened in Ireland, Portugal, Spain and Italy. Those who observe the markets carefully need only look at what has happened, to a lesser extent, in France in recent weeks, where problems have started. That is why France, too, recently announced an austerity package. We have no choice but to reduce the record budget deficit, or else we will face an economic crisis of cataclysmic proportions.

[Chris Williamson (Derby North) (Lab)]

I would be interested to hear what the hon. Gentleman has to say about Professor David Blanchflower’s comments yesterday. He said that the Budget made him more certain that there would now be a double-dip recession, with no room for manoeuvre because interest rates are already so low. Would the hon. Gentleman comment on that?

[Sajid Javid]

Yes; Professor Blanchflower has been consistently wrong for the past three years since the crisis started, and he was wrong in what he said yesterday.

We have no choice but to cut the deficit, and that requires both cuts in spending and the raising of taxes. As we have heard today, we have to a strike a balance between the two, and the burden must fall on public spending. We have no choice about that, because if we raise taxes too much we will destroy the very incentives that we need to create the growth that will get us out of this economic mess.

As we go through that process, we must naturally try to protect the most vulnerable as much as we possibly can. Opposition Members have accused us of being ideological about the matter, but how can we be anything else? They are absolutely right, and there is no shame in it, because there is an ideological difference between what they believe and what we believe about how to get our country back on track and our economy going.

The Opposition believe in some kind of Alice in Wonderland economics in which we can go on living beyond our means year after year. We believe in the real world, where we have to pay our way. They believe that the state has the answer to all society’s problems, but we believe that individuals, helped by the state, have the answers. They believe in an ever increasing welfare state, in which people are tied down and not allowed to profit from their own industry, and we believe in helping the most vulnerable in society—those who cannot help themselves—but freeing those who can work for themselves and earn an income, and giving them the incentives to do just that. Because of that, we believe that we can get more out of our constrained budget, repair our economy and create a fairer and more responsible society.