Oral Answers to Questions

John Bercow Excerpts

Tuesday 10th May 2011 Commons Chamber

[Ms Angela Eagle (Wallasey) (Lab)]

I would like to thank you, Mr Speaker, and the Chancellor for your tributes to David Cairns, our colleague, and to add our tributes from the Opposition side of the House. David was one of those very rare people who caused a change in the law in order for him to be able to take his seat in this place, and when he arrived his presence was not a disappointment to anyone. He was a great colleague and friend, and our hearts go out to his family and friends. We would like to add our deepest condolences at the shocking news of his untimely and very early death today.

Before the last election, both parties now in government pledged no rise in VAT, but with inflation running at double the Bank of England target, people are facing the biggest and longest squeeze in their living standards for 80 years. How does the Chancellor think that increasing VAT by 2.5% has helped them to cope with this issue?

[Mr Speaker]

Order. Whatever may be said about the question, I am sure that the Chancellor will focus on the monetary policy framework. That is what he can be relied upon to do.

[Mr Osborne]

Actually, monetary policy is the thing that I am not directly in charge of, but the point I would make is that the VAT rise is part of a credible fiscal policy. The person who was Chancellor of the Exchequer before me has made it pretty clear in interviews since the election that he, too, was considering a VAT rise, and he would probably have gone ahead with one if Labour had been re-elected.

--- Later in debate ---

[Claire Perry (Devizes) (Con)]

May I return to the topic of VAT on fuel? I have just come from a business session in my constituency of Devizes, where I know that despite the decrease, high fuel prices continue to be a real drag on growth for small businesses across the economy. I have a letter from the EU commissioner saying that the recent motion we debated—that a derogation should be made specifically for motoring fuel—is almost certainly illegal and definitely unworkable under EU legislation. May I ask Ministers what proposals we can suggest to help motorists in the real world now that the Labour party’s suggestion has been revealed as yet another—

[Mr Speaker]

We are grateful to the hon. Lady.

[Mr Gauke]

It is striking that the first line of Labour’s blank sheet of paper on the economy is a proposal that we now know does not work, is illegal, would not help and would leave tax on fuel just as high as it was—whereas we are cutting fuel duty.

--- Later in debate ---

[Mr Osborne]

The answer is that we have not had discussions about a second Greek bail-out and we have not been asked to make a contribution. The question for Greece is whether it lives up to the commitments that it has entered into. There is currently an International Monetary Fund, European Commission and European Central Bank team in Athens assessing Greece’s progress against the plan that it committed to, and we should await the results of that assessment.

[Mr Speaker]

Jonathan Reynolds is not here, so I call Stephen Timms.

--- Later in debate ---

[Several hon. Members]

rose—

[Mr Speaker]

Order. We must move on.