RBS Global Restructuring Group and SMEs

Stephen Kerr Excerpts

Thursday 18th January 2018 Commons Chamber

[Stephen Kerr (Stirling) (Con)]

What are my hon. Friend’s conclusions about the culture that prevailed in RBS at that time? Does that culture continue to this day?

[Mr Jack]

I do not know whether it continues to this day because I no longer deal with RBS, and I would not deal with it again on principle. The culture at the time was disgraceful. My business was making a profit when RBS came in, and it has made a profit every single month since. That is a good example of how RBS tried it on.

I was lucky to be in a robust enough position to send RBS packing. None the less, it was a very stressful and unpleasant experience. For a variety of reasons, countless thousands were not as fortunate, and many lives were needlessly ruined by the disgraceful and unscrupulous behaviour of RBS bank managers across the country. Those customers deserve proper redress. I support the motion.

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[Stephen Kerr (Stirling) (Con)]

I congratulate the hon. Member for Norwich South (Clive Lewis) and the right hon. Member for North Norfolk (Norman Lamb) on securing this important debate. I wish to be associated with their remarks and with those of my right hon. Friend the Chair of the Treasury Committee.

Little did I know, when I left school at 16 to join the Royal Bank of Scotland as a junior bank officer, that all these years later I would be standing in the House of Commons talking, I am afraid, in negative terms about the Royal Bank of Scotland, which, as one of my colleagues said, was one of Scotland’s finest institutions and now badly needs to be restored.

Little did I know, either, that I would end up speaking so often in this place about the Royal Bank of Scotland, most recently about the branch closures in my constituency. There is a theme here. The Royal Bank of Scotland is going to leave small businesses in Stirling, especially in Bridge of Allan, Dunblane and Bannockburn, with no branch to interact with to transact their cash management. I think, as we look through the issues today, we will see a theme of casual disregard and contempt for small and medium businesses, and that, I am afraid, pervades RBS’s approach to business customers.

On the activities of the GRG, the FCA’s October 2017 report makes depressing reading. I lost count of the number of times the words “inadequate”, “inappropriate”, “systemic” and “failure” were linked to a wide range of activities. Many Members from all parties have examples of how these systemic failures have affected individuals. I am no different. However, I am mindful of ongoing investigations involving cases in my constituency and I have no wish to prejudice or jeopardise their progress by making reference to them. I shall simply say that, in the cases that have been brought to my attention, there remain many unanswered questions for the Royal Bank of Scotland to address and many injustices to be put right.

[Eddie Hughes (Walsall North) (Con)]

My hon. Friend mentions that he was employed by that bank, of which he was once very proud. Could he make any comment on what has brought us to the position where he is now embarrassed, perhaps, about his previous employment?

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[Stephen Kerr]

I am not sure I am embarrassed about my previous employment, but what has brought us to this situation is a culture—a culture that, I am afraid, is institutionalised and industry-wide. That culture is captured in the document in my hand, which, thanks to the offices of the Treasury Committee, is now publicly available. The document, entitled “Just Hit Budget!” contains many sentiments that betray the culture of the Royal Bank of Scotland of that era, but I sincerely hope not of this era, although I remain unconvinced.

Interestingly enough, the chief executive of RBS, in correspondence to my right hon. Friend the Chair of the Treasury Committee, in my eyes justifies the letter by saying that

“it was written in 2009 by a junior”

bank

“manager”.

Frankly, a junior bank manager would not have written that document without understanding that it conformed to the culture of the business that they were operating in. I am afraid that the chief executive is condemned by his own justification, which does not wash.

In the time that I have left, I will not try to rehash many of the things that have been said, but simply say this. There is a gap in funding support for small and medium-sized businesses in this country, and it is holding us back as an economy. These companies are the lifeblood—the engine room—of our economy, and it is not acceptable that they do not have recourse to an independent mechanism to which they can bring their complaints of unfair and unreasonable practices when dealing with our financial institutions.

Given the appalling conduct uncovered in many reports—not just the report that I referenced earlier—there is obviously a failure to comply with the voluntary code, however much the banking lobby may continue to stand by it. In fact, ironically, the stronger that lobby—funded, in part, by the inappropriate gains that have been made through the immoral practices in relation to small and medium-sized businesses—the stronger is the case for an independent body. They had their chance, in my eyes, and I am sure in others’ eyes, and have failed. It is time, and it is right, for this Parliament to take responsibility—to step in and to act to ensure that an independent body, as described by me and others, is created, and as quickly as possible, because enough is enough.

Finance (No. 2) Bill (Sixth sitting)

Stephen Kerr Excerpts

Tuesday 16th January 2018 Public Bill Committees

[Alison Thewliss]

The hon. Gentleman knows that we have been arguing this case in this House since we got here. I was in this very room—in this very spot—when my colleague Roger Mullin made this argument in July 2015. We tabled amendments to the Finance Bill 2015 and to each subsequent Finance Bill, and we have made this argument on numerous occasions here and in the Chamber. We are glad about the change, but we think it is only good, right and fair that it is backdated to reflect the fact that the argument has stood all along.

It is interesting that the Scottish Conservatives have tried to claim that this is some great victory, but the Government’s Red Book, at the top of page 39, speaks of combined authorities in England and Wales being eligible for VAT refund, so I would contend that the Government were almost caught out by this. They had to make the change for Scotland because they were going to make the change for England and Wales, whereupon the argument became utterly compelling and there was no other way for them to get themselves out of the hole. I am very glad indeed that they are doing it.

[Stephen Kerr (Stirling) (Con)]

I interrupt the hon. Lady in her flow only to congratulate her on the convolutions of her argument. Frankly, it could be easily argued the other way round.

[Alison Thewliss]

The arguments are as compelling today as they were in 2015, in 2012, or at any other point. The coincidence of it having to be done for certain fire services in certain combined authorities in England and Wales makes the case that this should have been done all along.

We welcome this measure. We tabled our new clause, which we will press to a vote at the appropriate stage, because we would like to see some more detail about the administrative consequences and the impact on revenue of allowing retrospective claims. We know that the Government will do things in retrospect—other parts of the Bill enable them to enforce regulations relating to tax avoidance and claim money back in retrospect—so there is no argument that moneys cannot be claimed back if people should have known about them before. The Government are willing to make allowances and make changes if there are things that people might or might not have reasonably known. They have made such changes in other parts of the Finance Bill. We have received lots of correspondence from people who feel as though they have been hard done by a measure the Government are introducing now, which they see as retrospective and unfair. If the Government are allowing retrospective measures elsewhere, why will they not allow it here so that the Scottish Fire and Rescue Service and Police Scotland get the money they have been due all along?

Banks and Communities

Stephen Kerr Excerpts

Thursday 11th January 2018 Westminster Hall

[Martin Whitfield (East Lothian) (Lab)]

I beg to move,

That this House has considered the role of banks and their responsibility to the communities they serve.

As always, it is a pleasure to serve under your chairmanship, Mr Gapes. I thank the Backbench Business Committee for giving us this time to discuss a profoundly important matter. I also thank all the right hon. and hon. Members across the House who have supported the debate, and I welcome the new Minister to his place.

The debate is, in part, a product of the Royal Bank of Scotland’s disappointing decision towards the end of last year to close 259 branches. Those closures will start to come into effect, and communities in my constituency will be cut adrift from the face-to-face banking that is so essential. The towns of Dunbar and North Berwick are to be hit, which have high streets with diverse mixes of independent and chain businesses. The impact has been succinctly described to me by a constituent, who said:

“Dunbar supports many small businesses, not just on the High Street. How and where will they bank their cash takings? Online banking does not work for cash. Many older people in the town are dependent on the bank local branch, especially those who have no computer, or are wary of internet banking. Dunbar whose population is rapidly expanding, and the nearest RBS branch is 12 miles away.”

All Members here may have in their constituencies banks that are closing, in some cases leaving towns with no banks at all.

[Stephen Kerr (Stirling) (Con)]

I thank the hon. Gentleman for securing this debate. It is important to note that the branch closures that he refers to are only the latest tranche of branch closures; they come on top of a series of branch closures, and that is even more devastating to what they used to call the branch network.

[Martin Whitfield]

Indeed, I will come on to the statistics about the existence of branches in the United Kingdom.

My hon. Friend the Member for Ogmore (Chris Elmore) tells me that when the branches close in his constituency towns, one town will be left with no bank and the other town with just one. That one bank will serve 58,000 people. This debate is more encompassing than just a recent set of closures. It seeks to ask a very pertinent question about the responsibility and the relationship between retail banking and the communities they should be so proud to serve.

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[Stephen Kerr]

The hon. Gentleman made a strong point, made much stronger by the fact that we are talking about the Royal Bank of Scotland, more than 70% of which is owned by the British taxpayer, who bailed it out in the first place.

[Martin Whitfield]

Hear, hear.

Physical money is the most symbolic representation of trust, but there is strong evidence that banks want to move as quickly as possible away from the physical movement of cash on to online and electronic transfer. Any transition from face-to-face banking to online services must take place at a similar rate to a drive to remove cash from society. Significant numbers of our constituents rely on cash to facilitate their budgeting, and those who do must not be abandoned in the rush by banks to change.

Last year it was suggested that 10,000 free-to-use cashpoint machines are at risk of closure. Some 2.7 million people in the UK still rely entirely on cash. The free-to-withdraw cashpoints will vanish first from communities where the individuals who rely most on cash for budgeting are based. Additionally, among the small and medium-sized businesses that make up our high streets, the challenge of banking cash is increasing. I have examples of constituents in Prestonpans who now have to travel, sometimes by public transport, with their daily take to the nearest bank where they queue for up to 30 minutes to pay the money in.

Insurance and safety issues prevent them from storing cash on their premises, and the cost of contracting the deposit to security companies is prohibitively high. When the issue was raised with the banks, they said, “The money can be paid in at the post office,” but the post office will not take larger sums of money because it does not want to have the problem of transporting the cash either. In the constituency of my hon. Friend the Member for Bridgend (Mrs Moon), where tourism is a major industry, she has a business that banks more than £2 million a year but, following a bank closure, it has the responsibility for taking the cash elsewhere.

The closure of cash machines and the continued closure of high street branches are alienating business owners and older customers, fracturing still further their trust.

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[Stephen Kerr (Stirling) (Con)]

It is a privilege to serve under your chairmanship, Mr Gapes. I compliment the hon. Member for East Lothian (Martin Whitfield) on obtaining the debate. It was my privilege to accompany him to the Backbench Business Committee and I was delighted when permission to hold the debate was granted.

If anyone should be aware of how important banking is to people in their daily lives, it is the banks themselves. They know that people need banking services to get paid, pay their bills, save and, usually, buy a house. They know that keeping a pile of cash under the bed is not an option in our society, so they should recognise that it is their responsibility to ensure that rural communities in particular have reasonable access to banking services. Unfortunately, as a Member who represents a largely rural constituency, I have to tell the House that many rural communities are losing that access and their connection with banking.

I am going say something now that might be seen as something of an article of apostasy in my party, because I am going to agree with the Scottish National party council leader in Stirling. He wrote to me just before Christmas making some valuable points that I can only agree with. In fact, I think I may have said them first, which justifies me in agreeing with him. He makes the point in his letter about the Royal Bank of Scotland closing its Bannockburn branch, which means there will be no banks at all there. I want to use this opportunity to commend the people of Bannockburn ward, more than 2,000 of whom signed a petition asking the Royal Bank of Scotland to review its decision. I want to make a point that is also made by the leader of Stirling council:

“This closure will have a disproportionate impact on some of our most vulnerable citizens”—

as was mentioned earlier—

“within the Bannockburn and Eastern Villages area with many reliant on high street banking.”

The letter continues:

“I have been approached by concerned constituents many who are elderly and neither have the access or ability to engage with on-line banking. Many are distrustful and indeed fearful of using the internet for such transactions.”

That point was also made by the hon. Member for East Lothian. I have also been approached by hundreds of my constituents—I do not exaggerate—who tell me that it is a fundamental act of injustice to remove the banking services from the communities that, as he said, need them most.

In my constituency, RBS plans to close three branches—in Dunblane, Bannockburn, and Bridge of Allan—leaving one RBS branch in the entire constituency. By the way, that branch is in the centre of Stirling and access to it is impossible for anyone with any form of mobility challenge. It is not the best locality—either for car parking or for getting to—for the single remaining RBS bank in my constituency. That is bad news for small businesses, which benefit from having a local branch, as the hon. Member for East Lothian explained well. It is bad news for the staff who work in the branches, and for elderly people and people who are less well off, who are less able to make the journey to a branch several towns away.

I should make it clear that the Royal Bank of Scotland is not the only offender. I should also make it clear that I used to work for RBS, when I was a callow youth, on leaving school.

[Angus Brendan MacNeil]

Last week.

[Stephen Kerr]

Thank you very much. The hon. Gentleman has become my hon. Friend suddenly.

I have a fondness and affection for the Royal Bank of Scotland. It is a grand old Scottish institution, which has been ruined by the mismanagement of the directors of a decade ago.

I ask the Minister to look at what the banks propose. They are saying, “We are going to close the branch. Go to the post office.” That is not practical.

[Luke Graham (Ochil and South Perthshire) (Con)]

My constituency faces closures in Alloa, Kinross and Comrie. In Comrie, we face exactly the issues that my hon. Friend has mentioned, with customers being referred from the bank branch, in a place where there is weak broadband, weak infrastructure and a post office in the newsagent. That is not acceptable to my constituents, and it is pathetic customer service from the Royal Bank of Scotland.

[Stephen Kerr]

The reality is that there are limitations on the amount of cash that can be taken and given out over the counter, and that must be confronted. The irony of all the closures, as has been mentioned twice in the debate, is that they affect the communities that have the weakest broadband connection. They are going to have to go digital without a broadband service. It is ridiculous and I call on the Minister to call on the Royal Bank of Scotland to conduct a proper review of and consultation on the branch closures.

Taxation (Cross-border Trade) Bill

Stephen Kerr Excerpts

2nd reading: House of Commons
Monday 8th January 2018 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

I am grateful for the opportunity to speak on the Taxation (Cross-border Trade) Bill, which I will call the customs Bill for ease during my speech. I am particularly delighted that we are considering it at the same time as the Finance Bill—that is excellent. I am not sure whether Hansard can capture my sarcasm there.

Is the Minister as concerned as I am about the issues that so many different organisations have raised? Perhaps the Minister and the teams in Her Majesty’s Revenue and Customs have been meeting the organisations that are raising concerns, but I do not think that they have been listening. Part of the problem for me is the wide range of organisations that are raising a wide range of issues. As many hon. Members have said, they include UK Steel, the Manufacturing Trade Remedies Alliance, the British Ceramic Confederation, the GMB and the TUC, but also the British Chambers of Commerce, the British Retail Consortium and the Law Society of Scotland. All those organisations have raised issues, which are not all specifically about trade remedies. There are therefore several problems with the Bill, not just with one aspect but across the measure.

The Bill has 166 pages and creates so many delegated authorities that the Government have had to produce an 174-page document detailing them. The majority relate to the negative procedure, though some relate to the affirmative procedure. In four instances, the UK Government create Henry VIII powers—the power to amend or repeal an Act of Parliament—which are particularly concerning. We have consistently raised concerns about Henry VIII powers, and we will continue to do that. The Chartered Institute of Taxation said:

“The Bill will, we understand, have the powers to amend primary legislation using secondary legislation; raising similar concerns around delegated powers as with the EU (Withdrawal) Bill.”

UK Steel said that

“key aspects of the UK’s trade legislation will evade proper parliamentary scrutiny”.

It is a major concern when UK Steel, a trade body that represents important manufacturers, makes such comments.

The number of organisations that are raising concerns is worrying for Members, as is the fact that so much of the Bill will dodge proper parliamentary scrutiny. Those who supported Brexit as a means to strengthen parliamentary sovereignty are being incredibly badly served yet again by the UK Government. Sovereignty for the Government is very different from sovereignty for Parliament. I urge the Minister to read the Law Society of Scotland briefing on the Bill. It suggests several amendments, and much of its concern is about the lack of requirement for Ministers to consult when making secondary legislation.

[Stephen Kerr (Stirling) (Con)]

The hon. Lady has mentioned at least twice the Law Society of Scotland briefing document, which I have in my hand. It is a very useful and positive contribution to informing Members of all parties about the Bill. I will quote from it so that we are all clear about the context. In its general remarks, the Law Society of Scotland says:

“We recognise the necessity for this Bill”.

That conclusively states that the Bill is a necessity. Does the hon. Lady accept that?

[Kirsty Blackman]

Because the UK Government decided that we are leaving the customs union and we will therefore need our own customs procedures, it is sensible, given that it was an entirely EU competence, for the UK to create its own customs framework. However, if the UK Government had done what we suggested and remained part of the customs union, the Bill would not be necessary. Although the Law Society of Scotland says that the Bill is necessary because of the decisions of the UK Government, it raises several concerns. I ask the Minister to read the briefing, which suggests a number of amendments, particularly on consultation.

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[Damian Collins]

The hon. Gentleman makes an important point. Manufacturing is such an important part of the economy of Coventry, where his constituency is. Tariffs are important. Of course, we want a free trading environment among the countries with which we trade, not only in Europe but around the world. I looked back at one of Margaret Thatcher’s speeches—I am sure the hon. Gentleman is just as keen a student of those speeches as I am—to see how she made the case for the single market to businesses before it was created. She rightly highlighted that, although trade without tariffs is obviously important, what is much more important is getting rid of artificial barriers to trade, such as the restriction of goods from markets because they are not seen to comply with certain standards or the creation of artificial delays that can make trade in goods that need to be moved quickly uneconomic. It is just as important to get trading agreements and the flow of trade right as it is to get the tariff situation right.

[Stephen Kerr]

My hon. Friend is making a powerful speech in favour of frictionless, free and fair trade. I hope he agrees that, as we go through the Brexit process, it is important that nothing is done to create any barriers to the internal operation of the UK market, by which I mean Great Britain and Northern Ireland.

[Damian Collins]

My hon. Friend makes an important point. Frictionless trade is just as important between Northern Ireland and Great Britain as it is on the island of Ireland. It is vital to the economies of the island of Ireland and Great Britain and to everyone who lives and works on the island of Ireland and in Great Britain. As I said earlier, because of our proximity and the integrated nature of so many of our businesses, that trade is so important, and it is vital to the protection of so many jobs. There should be no artificial borders in the Irish sea, and nor should there be borders that create friction on the island of Ireland or with the continent of Europe across the English channel.

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[Richard Graham (Gloucester) (Con)]

In following the hon. Member for Redcar (Anna Turley), I can only applaud her support for her local port.

I support this Bill. Above all else, as I said earlier and the Minister confirmed, it is an enabling Bill to create a post-Brexit functioning customs, VAT and excise regime. Because this is being done well ahead of the results of the negotiation, it does not predetermine the result. That necessarily disappoints those in this House who want the predetermined detail in order to see the extent to which the Bill suits their own vision of what our post-Brexit relationship should look like. In so doing, the Bill satisfies those for whom the Bill is intended—not politicians, but traders, exporters of goods and services, businesses and organisations, including universities and hospitals, with cross-border business in a wider sense—for we and, above all, they need to have in place the mechanisms for setting import duties, regulations, protections, dispute resolution procedures and so on, whatever the final trade and customs arrangements with the EU turn out to be.

That should be uncontroversial, but because the details are not in the Bill, Members are finding all their concerns and worries in their own imaginations. After a speech of some half an hour, for the hon. Member for Aberdeen North (Kirsty Blackman) it all boils down to the fact that she wants to stay in the current customs union with the European Union. For the hon. Member for Stoke-on-Trent Central (Gareth Snell), it is about protecting the ceramics industry. With respect to him and to Stoke-on-Trent, however, no customs Bill can do that, for the customs Bill is about making arrangements for future import duties, not about defining the new technology and brilliant designs that the world admires and wants to own, which is what will determine the future of the ceramics industry there.

[Stephen Kerr]

My hon. Friend is making a powerful speech. Does he agree that without this Bill we will have the archetypal cliff edge that the Opposition parties go on and on about? By not supporting Second Reading, they risk creating the cliff edge that they are always going on about.

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[Mr Chris Leslie (Nottingham East) (Lab/Co-op)]

The Bill has profound implications for our economy, for many of our constituents, and for businesses that operate in our constituencies. It gives the Government considerable powers to levy customs duties on goods coming from the European Union, which would be an incredibly damaging spiral for the British economy to enter into as it would not only affect employment opportunities and business costs, but put in jeopardy the stability of the border between Northern Ireland and the Republic of Ireland. The notion that the proposed duties will apply and that we will somehow also retain frictionless, uninspected borders is oxymoronic—it is not possible. Despite a rather cleverly worded phase 1 agreement between the Government and the European Union, in which they basically decided to kick the issue into the long grass to be determined later on, the question has not yet been resolved and the situation is incredibly serious.

The referendum ballot paper did not mention customs duties or VAT, and it certainly did not mention the customs union. That was not the subject of the question that the British public were asked. Perhaps some Government Members read something between the lines, or perhaps when they squinted in a particular way and stood on one foot they read something on the ballot paper that the rest of the country did not. The country has not voted to leave the customs union, yet the Government and the Prime Minister take it totally for granted that we should all naturally accept that outcome.

[Stephen Kerr]

I am sure that the hon. Gentleman was conscious during the entirety of the referendum campaign. I certainly was and I can assure him and the House that there were frequent references to the definition of the European Union as a single marketplace and a customs union. In fact, that was how the EU came to be defined on television and in the debates. I do not know where the hon. Gentleman was, but it was very clear that the British people knew exactly what leaving the European Union meant. To say otherwise is, frankly, to turn one’s back on the common sense of the British people.

[Mr Leslie]

Just because the hon. Gentleman asserts that it was very clear does not mean that that was the case. In fact, his own friend and colleague, Daniel Hannan, a Member of the European Parliament, was very clear that the single market was incredibly important and that no one proposed leaving it. Many other hon. Members said similar.

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[Bill Grant (Ayr, Carrick and Cumnock) (Con)]

I am delighted to speak in favour of the Bill as it provides the next pillar to support the UK’s exit from the European Union. Free and fair trade is fundamental to the growth and prosperity of the United Kingdom and the world economy. Trade with our neighbours near and far is intrinsically linked with jobs, wage growth, productivity and innovation. Trade ensures that more people can access a wider choice of goods and services, hopefully at a lower and competitive cost, and can make household incomes go that bit further.

As we prepare to leave the EU, we are beginning to chart our new course, remaining—as we have always been proud to be—an outward-looking, internationalist nation, and identifying new opportunities with potential trading partners around the world. The UK’s trade with the world is equivalent to over half our GDP. We must therefore do everything that we can to ensure that trade can continue and that all the necessary arrangements are in place after we have left the EU. We need customs, VAT and excise arrangements to support us in both our existing and future trading missions.

Let us be absolutely clear: the decision by the British people in 2016 to leave the EU was one to remove us from all aspects of the EU, not to cherry-pick the ones we want. Indeed, 27 other countries would have a say about any cherry-picking we indulged in. Our departure from the EU includes leaving the customs union. Opposition Members would ignore or put aside the decision by the people of the UK and claim that the country could somehow magically retain its membership of the customs union. This Government have made it crystal clear that the UK will leave the customs union. Anything less would be viewed as a betrayal of the millions of people across the country who voted leave—I am not one of them; I voted to remain—and now expect us in this place to carry out that decision. I hope that those voters will be encouraged by the Government’s steps to implement our own independent arrangements, including on trade, and will feel that real progress is being made towards our exit from the EU.

I would like to deal briefly with an issue of huge importance to businesses in Ayr, Carrick and Cumnock, and indeed beyond—throughout the whole United Kingdom. Business after business in my constituency stresses the same thing: the need for clarity and certainty so that they can begin the process of planning for their futures, and the futures of their staff, suppliers and customers. This Bill takes steps to address their concerns.

Customs and excise are complex issues, and I am not an expert in them, but I understand that more than 17,000 types of goods must be classified, and I am sure there will be sub-classifications as well. It will take time for businesses—and, I dare say, the Government—to adapt to any new changes. I therefore welcome the provisions that facilitate an interim customs arrangement with the EU, remaining true to the Prime Minister’s promise of an implementation period. During such a period, I would like close association with the EU customs union, in much the same manner as we proceed currently, so that we avoid a cliff edge for businesses, which no one wants.

[Stephen Kerr]

My hon. Friend talks about cliff edges. Does he, like me, find it ironic that the Opposition parties that will vote against the Bill’s Second Reading are creating the very cliff edge that our constituents—business operators, directors and entrepreneurs—do not want? That is exactly what Labour and the SNP will be doing by voting against Second Reading.

[Bill Grant]

I share my hon. Friend’s view about the pessimism of some Opposition Members, albeit not all. The last thing that we need is to talk down the United Kingdom and our business communities. At this time, they need our support. We do not need a cliff edge for business in the UK, as well as those in the EU with which we trade.

The next few months will be crucial, and I am sure that the UK’s negotiating team in Brussels will do all it can to agree to the principle of an implementation period. The one thing this Bill must not do is limit our ability to negotiate a future trade agreement with the EU. All options must be on the table for our negotiating team to secure a future trade agreement.

Whatever the future arrangements—we do not know what they are; no deal has been struck and the die has not been cast—at the heart of the UK’s trade policy must be a continued commitment to rules-based free trade. The UK has long led the world in this area, from early trading days with sailing ships such as cutters—[Interruption.] I was thinking more of the Cutty Sark.

We have played a leading role in organisations such as the International Monetary Fund and the World Bank. We in Scotland have made an immense contribution to the UK’s trade across the world, for instance with our shipbuilding. We have done very well. We have sailed the world—I shall never forget it—and our most successful days are ahead as we remain part of the United Kingdom.

Our future trading arrangements with Europe have immense possibility. The UK starts from an unprecedented point of alignment, and I would like both sides to take this opportunity to design a customs arrangement that is both ambitious and innovative. This is not a one-way street; it is a two-way street with many movements on it. Let us imagine the Prosecco producer in Italy, the wine producers in France and Spain, the flower growers in Holland—[Interruption.] Yes, there is whisky, but we are leaving; I am thinking of the ones who remain, such as the car manufacturers in Germany and Spain. They will want a frictionless, seamless arrangement. Let us never forget that the United Kingdom is a good country to do business with. These people, among many others I could mention, will want to continue to do good business with us.

Finance (No. 2) Bill

Stephen Kerr Excerpts

Committee: 1st sitting: House of Commons
Monday 18th December 2017 Commons Chamber

[Peter Dowd]

No matter how many times Government Members ask rather tangential questions, I will not be drawn down that particular avenue, much as I would love to have that debate with the hon. Gentleman. The bottom line is that we have always stood against this Government introducing austerity measures at the same time as giving banks a tax cut. That is what it comes down to.

[Stephen Kerr (Stirling) (Con)]

Will the shadow Minister give way?

[Peter Dowd]

No, I will push on for a moment.

It is worth pointing out that the bank levy was not the brainchild of a Conservative Government. It was not introduced by the previous Chancellor after he had listened to the clear public outrage aimed at the reckless decisions made by some in the banking sector, who plunged the world into one of the greatest economic crises in modern times. As much as Government Members would like to blame the Labour Government for a world financial crisis, that is stretching credibility a little too far. [Interruption.] It is nice to see that the Chief Secretary to the Treasury is shouting across the Chamber, but I cannot quite hear her, so if she wants to intervene—or shout a little louder—so that I can actually hear her question, I will be more than happy to answer. It is nice to see her in the Chamber.

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[Stephen Kerr]

It is all well and good for the hon. Gentleman to say what he is saying, but he is neglecting a simple fact. The financial sector is paying 35% more in tax today than it did in 2010 under a Labour Government.

[Peter Dowd]

Yes, because the sector returned to profitability after a Labour Government supported it throughout. That is why the sector has returned to profitability. Ultimately, if a Labour Government had not gone in and supported the sector, there would have been no banks, no profits and no tax whatsoever. I remind the hon. Gentleman of that one.

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[Peter Dowd]

Huge amounts of support from the European Union have revolutionised the Irish economy. My forebears came from Ireland, but I do not think even the Irish would compare themselves as a small country of 3.5 million people or thereabouts with the United Kingdom with its 60 million—this is chalk and cheese. The hon. Gentleman will appreciate that that is a ridiculous comparison to make in the debate.

Our amendment will finally help to demonstrate the true cost to the public purse of the Government’s favourable approach to some. In that way, we can understand exactly what the cost in revenue is. This should be all the evidence the Government need to change course—things simply are not working. Productivity is low, inflation is up, wages are stagnating, public services are in absolute decline and the NHS is under strain, as is social care, yet the Government just do not get it. They seem to think that we live in Shangri-la, but, unfortunately, we do not. We know that the Conservative party relies on support from vested interests for its own survival, but the question we must ask ourselves is: should the survival of a clapped out, atrophying, self-centred, out-of-touch, diminished Tory party take precedence over the needs of children? I know the answer, so I will simply leave Conservative Members to answer it in the silence and solitude of their own consciences.

[Stephen Kerr]

It is my great privilege to follow the hon. Member for Bootle (Peter Dowd), whose speech was greatly entertaining, if a little devoid of something approaching accurate history. We were treated to a festival of revisionism on this country’s economic history over the past 10 years. I did agree with one thing he said—it was almost the first thing he said—which was that it is wrong to create a single category to describe bankers. He alluded to the fact that some may be called saints and others may be called sinners—he may have said that, but I cannot recall exactly the term he used—and that is undoubtedly the case, so to generalise about banking and bankers, as we often hear Opposition Members do, is extremely rash.

As for culpability for the events from the end of 2007 to 2009, the hon. Gentleman may wriggle on the issue, but the fact is that the Labour Government were indeed culpable, as were other politicians of that time who were holding senior office in this country, including the then First Minister of Scotland, Alex Salmond, who positively encouraged the Royal Bank of Scotland to engage in some of the more reckless initiatives that the leadership of that bank were engaged in. The result was that not only did they upend a great Scottish institution, but they nearly upended the whole United Kingdom economy.

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

Does the hon. Gentleman recall the shadow Chancellor at that time, the then Member for Tatton, calling repeatedly for the relaxation of what he described as the strict regulation that the Labour Government were imposing?

[Stephen Kerr]

The important thing to remember is who was in government and whose hand was on the tiller at the time, and it was a Labour Government’s.

[Stephen McPartland (Stevenage) (Con)]

Does my hon. Friend remember the City Minister, Ed Balls, saying in 2006 that nothing could endanger the light-touch regulation of the banking system?

[Stephen Kerr]

I thank my hon. Friend for that useful intervention because I absolutely do remember that. The reason why those words might linger in mind longer is that they came from someone holding an office of state. Cabinet members at the time were positively encouraging those whom they considered their friends in the City to become increasingly reckless, as was the First Minister of Scotland, as I have mentioned.

[Gareth Snell]

Now that the hon. Gentleman has demonstrated that his memory is fully functioning, will he answer the question asked by my hon. Friend the Member for Wrexham (Ian C. Lucas)? Does he recall the comments made by the former Chancellor, who was shadow Chancellor at the time? It appears that the views of shadow Chancellors are quite important to Conservative Members.

[Stephen Kerr]

It might be a function of my age, but I must confess that I have no recollection of anything to which the hon. Member for Wrexham (Ian C. Lucas) referred. I apologise to the House for the lapse in my memory, but I am of an advanced age and it is perhaps a senior moment—I do not know.

I support the Bill and the plan that goes with the banking levy, which is a fair way to ensure that banks make a fair contribution to the tax system and that they make the right contribution to society. The changes proposed in the Bill are fair. They provide for a level playing field for all banks, whether domiciled in the UK or based outside it.

[Sandy Martin (Ipswich) (Lab)]

Will the hon. Gentleman explain how we can know there is a level playing field and that such levies are fair if there is not complete transparency?

[Stephen Kerr]

I was about to describe the level playing field as I see it. The Bill will remove any disincentive there might have been for banks to base themselves in the UK, which is important. I remind all Members of the reputation that our country and particularly the City has. I think we would all agree that the City is the financial capital of the world.

With respect to the bank levy, the banks’ contribution must go beyond the paying of taxes, as outlined in the Bill. Given the banking sector’s behaviour—I referred to the comments by the hon. Member for Bootle about saints and sinners earlier, but I am generalising now—the banking industry does have a responsibility to make a fairer contribution to society, which is what the measures taken by the Government since 2010 and 2015 have made happen.

Let me mention in passing the Financial Conduct Authority’s report on the Royal Bank of Scotland and its treatment of small and medium-sized business customers.

[James Cartlidge]

I do not want to distract my hon. Friend from his excellent speech, but he referred earlier to the former First Minister, Alex Salmond; does he recall the encouragement that Mr Salmond gave to RBS with respect to ABN AMRO and anything related to that purchase, which many people thought at the time was a risky investment?

[Stephen Kerr]

I have a very bright recollection of that. There is a famous document that shows the First Minister wrote to the chief executive of RBS and added at the end some personal notes that went above and beyond encouragement.

Given recent history, it is right that the banks make a more-than-fair contribution, and that is what they have been doing. I return to the FCA’s report on the RBS and its treatment of small and medium-sized business customers. I refer specifically to the conduct of RBS’s global restructuring group, about which the FCA’s report makes depressing reading. When I looked at the report, I lost count of the number of times the words “inadequate”, “inappropriate”, “systematic” and “failure” were linked repeatedly to a wide range of RBS’s activities, and particularly the global restructuring group’s conduct towards small and medium-sized businesses. The words I highlighted were appended to the description of how the group laid charges and managed loans and communications and to the description of its valuation practices. There is also the fact that the complaint procedures were completely ignored.

Many Members from all parties will know of examples of how the systematic failings in RBS’s global restructuring group affected constituents and their businesses. My constituency is no different. I am mindful of ongoing investigations involving cases in my constituency and have no desire to jeopardise their progress as I address the issue of bank levies. I shall simply say that from the cases I have seen there remain many unanswered questions that RBS needs to address.

Many Members present will be aware of RBS and the Bank of Scotland having closed their bank branches.

[James Cartlidge]

My hon. Friend reminds us that, what with Royal Bank of Scotland and Bank of Scotland, there is clearly a theme among these great institutions that failed. Has he considered the fact that the bank levy is one function of a system in which ultimately the lender of last resort is the most important function? That system would simply not exist had Scotland gone independent and been left with massive liabilities to pick up. It would not have been able to cope.

[Stephen Kerr]

My hon. Friend makes a first-class point. He provides me with an opportunity to remind the House that, thankfully, in September 2014, Scotland had the good sense to vote overwhelmingly to remain part of the United Kingdom. Part of the reason for that was, I am sure, the lessons we had learned as a country from our experiences between 2007 and 2009, particularly the recklessness of the Scottish National party Government and the First Minister at the time, Alex Salmond, in the way he conducted himself with respect to RBS.

Just so that the hon. Member for Glasgow North (Patrick Grady) is aware, I am talking about the bank levy in relation to bank closures. It is my firm belief that having bank branches in communities is part of the covenant between the public and their financial institutions, but that covenant that is clearly broken. People should expect the banking sector to keep businesses going with cash flow, loans, financial planning and so forth. People should also expect that bank branches are close by and serve the communities in which they live. Earlier, the hon. Member for Liverpool, Walton (Dan Carden) reminded us that high street banking is particularly important for people in our constituencies who are elderly or whose mobility is challenged in other ways.

In Bannockburn, Dunblane, Bridge of Allan and the Springkerse estate in Stirling, RBS and the Bank of Scotland are leaving communities without adequate access to banking. It is important to state these things in the context of our consideration of the bank levy.

[Ian C. Lucas]

The hon. Gentleman is making a powerful argument about local banking. Does he therefore support the Labour party proposals for the introduction of regional banks? A nation such as Scotland could have its own banking system to serve local communities, rather than the incredibly centralised system we have now.

[Stephen Kerr]

I am in favour of some fair competition in retail banking. We need to consider many important issues in the context of the future of retail banking, especially how it appears in the heart of our communities.

RBS is closing its branch in Bridge of Allan, which happens where I live. In the past eight months alone, the Clydesdale bank, the Bank of Scotland and the TSB have all closed their branches, and now RBS is, too. That leaves the post office on Fountain Road as the only place where anyone will be able to do any over-the-counter banking.

[Gareth Snell]

Given that the Government are the major shareholder in one of the banks to which the hon. Gentleman referred that has closed and left his community devoid of proper facilities, does he not agree that it is time for the Government to step in and use their shareholder clout to ensure that bank branches stay open?

--- Later in debate ---

[Stephen Kerr]

I thank the hon. Gentleman for his comment. In fact, I have made representations to Ministers—as have my colleagues on the Government Benches—because of the impact that the closure of the bank branches, particularly the recent announced closures of the Royal Bank of Scotland branches, will have on communities such as the one from which I come in Bridge of Allan. I do have concerns about the capabilities of the Post Office branches to be able to deal with the kinds of cash amounts that they will now have to handle. It is a different scale of operations that they will have to be prepared to lift themselves to. Yes, I have made representations, and I will continue to do so. In fact, there is an Adjournment debate on the subject following these debates.

[Peter Dowd]

Does the hon. Gentleman agree that using state money to keep banks open in local communities amounts to Marxism?

[Stephen Kerr]

Well, I have mentioned what I did in my earlier years. In all those years, I was never accused of being a Marxist. I am concerned when communities become devoid of a basic service, such as a bank branch of any description. Frankly, I consider it to be unacceptable. These banks have had so much money from the British people and have been bailed out by them. I have already mentioned the recklessness of the banks, particularly of the Royal Bank of Scotland, for which I do not apologise.

I should say that I did actually work for the Royal Bank of Scotland when I left school. Perhaps I should have mentioned that earlier. [Hon. Members: “Yes, you should.”] I was 16 at the time. I was a junior bank officer for RBS at the East High Street branch in Forfar. The Royal Bank of Scotland is a great institution. I just pause to pay tribute to its staff because they do a great job, and they have done a great job over these past 10 years in particular in very great difficulties. I pay them my compliments for that. Nevertheless, it does not excuse the Royal Bank of Scotland. In addressing the bank levy, it is important to remember that the greed and the calumny that they were guilty of means that they owe the British people something more. I fully acknowledge that that something more has been extracted and is being extracted, but I also think that there is a case for them having the social responsibility to maintain a presence in the communities of my constituency, such as in Bannockburn, Dunblane, Bridge of Allan and the rural parts of the constituency. I am afraid that a mobile bank does not quite meet the need.

The other consequence is that many more empty units are appearing on our high streets. That is on top of the units that have been left empty by the Scottish Government and their inaction on business rates. I was about to say, Sir Roger, that I wish that I could show you the picture of King Street in Stirling, but, in retrospect, I am glad that I cannot, because there are so many empty units and so many “to let” and “for sale” boards. That is a situation that leaves someone such as me, who loves Stirling and the great history of my constituency and everything that it stands for, more than a little concerned. There is a feeling that we need to see a change in this respect. Certainly, when the banks, which are 72% owned by the taxpayer, decide to vacate these prime sites, it leaves a big hole at the heart of these shopping centres and communities.

[Karin Smyth (Bristol South) (Lab)]

I just want to be clear: is the hon. Gentleman asking for a further Government subsidy from either the Scottish Government or the UK Government for those institutions?

[Stephen Kerr]

I do not think that I have mentioned the word “subsidy”. I am talking about corporate social responsibility. [Interruption.] Corporate social responsibility has nothing to do with subsidy.

[The Temporary Chair (Sir Roger Gale)]

I am listening with interest to the hon. Gentleman. He is talking about social responsibility, but I need to remind him that he should be talking about the bank levy.

[Stephen Kerr]

I appreciate that reminder, Sir Roger. My comments about social responsibility are in the context of why we have a bank levy at all and why it has been an important part of the Government’s focus in, quite rightly, raising the billions of extra revenue.

I promise that I will take only a few seconds more. There was some comment earlier about the effect of taxation. Someone mentioned the Laffer curve, which is well known to Members. It was certainly well known to the former Member for Gordon and the former First Minister of Scotland, Alex Salmond, who used to regularly quote the Laffer curve in his models. He argued with great eloquence in many places—perhaps he even did so here, I cannot be sure—for lower corporation tax. That was one of the things that Alex Salmond absolutely stood for. The lack of any intervention on me means that I am obviously not going to be corrected on that score.

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[Rachel Maclean]

My hon. Friend is talking about Scotland, but is he aware that, in the whole UK, while we reduced corporation tax from 28% to 19%, the amount collected has increased from £37 billion to £50 billion during the period 2010 to 2017. Will he comment on that as well?

[Stephen Kerr]

I am delighted to offer a comment on that, because that is exactly in line with the point that I am trying to make, which is that the Laffer curve is exactly that—we increase revenue as we reduce taxation rates. It is very much at the core of what we believe on the Government Benches. At one time, it was what the SNP also stood by, but now the Financial Secretary in the Scottish Government has not even heard of Laffer. He told a Select Committee in Holyrood that he had never heard of the Laffer curve. That is where we are at in Scotland. When it comes to incentive, hard work and industry—I am referring this to the bank levy and the bankers’ bonuses that were mentioned by Opposition Front Benchers—we are now at a point where £33,000 a year is classified in Scotland as “rich”. I think that that is dismal. We are talking not about people with yachts in the marina bays of the west of Scotland, but doctors, teachers and middle managers—the working men and women of Scotland. Therefore, when it comes to the bank levy and to bankers’ bonuses, and we talk about incentives to work hard, to exercise initiative and to take a few risks, it is just not on in Scotland now. The Scottish Government are sending out a clear message, which I find dismal and dismaying, that that is not the kind of Scotland that they want. It is the kind of Scotland that I want. It is the kind of United Kingdom that I want, which is why I unreservedly stand to support the Bill.

[Kirsty Blackman (Aberdeen North) (SNP)]

You will be delighted to know, Sir Roger, that I will be talking about the bank levy and the new clauses that have been tabled both by the Opposition and by our party. I wish to start by saying that I have rarely been more embarrassed to be part of this House than I am this evening. This debate followed hot on the heels of a statement on bullying and harassment and we ended up in a situation in which there was a ping-pong between Government Back Benchers and the Opposition Front-Bench team. It just was not acceptable. I appreciate the fact, Sir Roger, that you intervened and brought Members back to the matter under discussion.

Finance (No. 2) Bill

Stephen Kerr Excerpts

2nd reading: House of Commons
Monday 11th December 2017 Commons Chamber

[Stephen Kerr (Stirling) (Con)]

Does my hon. Friend think that the banks’ lack of willingness to lend to small and medium-sized businesses—there are several in my constituency that suffer from chronic lack of availability of capital from banks—is killing the nursery of burgeoning businesses that we need in this country?

[Kit Malthouse]

Small-ticket debt definitely has its place in starting businesses, but they need—the Government are trying to propel this into the economy—patient capital: money that will be invested and sit as a shareholder in the company for some years. In truth, while it is wonderful to build a company like Instagram—I think it was built in 14 months, went from zero to a valuation of more than $1 billion and then was sold—such things happen rarely. Most businesses are built over a much longer period, often over many generations. That is why, certainly in my youth, all those businesses had family names—Marks and Spencer, Reckitt Benckiser. They were family businesses that had come together over two, three, four or five generations to take on the world. We need to create an atmosphere in which people do exactly that—invest for the long term.

I hope that Ministers will monitor the scheme carefully and, if we are not getting the kind of capital flowing through that we need, we can tweak it. If we see an overall reduction, as we may, as capital that was previously going into protection schemes now does not immediately transfer to risky schemes, we might need to look at this on an emergency basis.

My second, related point is on the general availability of shares and assets. The Government are doing a lot in the Bill to help the housing market and have rightly identified that home ownership has fallen relatively significantly over the last few years. They should be commended for the action that they are taking, certainly with regard to young people, but housing is not the only asset class available. The solution to the housing market will be a long-term one. We are trying to build as many houses as we possibly can—we need 250,000 to 300,000 houses a year to bridge the demand and supply problem—but that will take some time to do. It is possible, however, to get assets into the hands of people, particularly young people, much sooner than that, through employee share ownership plans.

I have said before in the House that it is my view that as well as creating a pool of dynamic private capital, we must democratise capital. That means spreading the ownership of British business as far and wide as we can. I urge the Government, as part of the patient capital review, to look at how they can improve the employee share ownership options for companies, to make it easier and even favourable through the tax system for employees to be gifted shares in their businesses. We know that employees who own part of their business are much more productive, and companies that have employees as shareholders are much more stable and tend to be much more successful in the longer term. It creates a much better environment and relationship between management and the employed. Just ask the postal worker wandering up the front path to deliver Christmas cards what the price is of their shares; I bet that they can tell you, with a big, broad grin. British Steel recently rewarded its workers for the company’s turnaround by giving away 5% or 10% of the equity in the business to them. The way forward is for everybody, young and old, to participate in the balance sheet of UK plc.

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[Kirsty Blackman (Aberdeen North) (SNP)]

I am really pleased to have the opportunity to stand here on behalf of the Scottish National party for the Second Reading debate of this year’s third Finance Bill.

First, I would like to tackle the issue of the amendment of the law motion, which I have already raised with the Financial Secretary. I am particularly concerned that the Government are doing their best to use the rules of the House to dodge proper scrutiny and transparency. It is not the normal state of play to have no amendment of the law motion after a substantive Budget. I get that it is not easy for Ministers to try to hold a minority Government together when their Members are simultaneously pointing in about 300 different directions. Even so, they should be keen to come before the House, stand up for what they believe in, and allow proper scrutiny.

I would like to take the opportunity again to highlight deficiencies in the Budget process. The “Better Budgets” report, published by the Chartered Institute of Taxation, the IFS and the Institute for Government, pointed out several ways in which scrutiny could be improved. One suggestion is for the Finance Public Bill Committee to take evidence in public. I am firmly of the opinion that such a change would improve scrutiny and increase Committee members’ understanding of a Budget’s measures. This will be my third Finance Bill Committee, so I feel that I can now speak with some expertise on the subject. I urge the Minister to consider this request once more, given that the previous two Finance Bill Committees I served on sat for only six sittings each. We have extra time in the legislative timetable before us, and two hearings on the first day, for example, would not stretch that. That has been the Government’s main objection, so I push the Minister to consider the proposal again.

Let me turn to economic impact assessments on particular tax measures. The Minister will be pleased to know that my point is not about Brexit, but the fact that the Government failed to carry out impact assessments on Brexit is not particularly surprising given that the tax measures that come forward in Budgets do not have economic impact assessments attached to them either. Whenever Ministers are asked about reviewing tax reliefs, we are told that they are regularly kept under review and that reviews consistently happen. Last year, however, I asked parliamentary questions on this matter, and the answers I received on the Government’s scrutiny of the tax reliefs that they had put in place were not very satisfactory. The Government were not particularly clear about whether the tax reliefs had achieved their aims. They were also not able to tell me how much money they had cost or gained for the Exchequer. If the Government are going to put forward tax reliefs—I agree that they should in certain circumstances, as they can be a good thing to encourage investment—they need to explain to the House whether they have worked. What is the point of having an absolutely massive tax code with a huge number of tax reliefs if we do not know whether they are incentivising people to do good things?

[Stephen Kerr]

Will the hon. Lady share with the House the economic and revenue impact of the SNP Scottish Government’s land and buildings transaction tax?

[Kirsty Blackman]

The hon. Gentleman has spoken to me before about the land and buildings transaction tax. I refer him to my earlier answer: 93% of people who have paid the tax in Scotland on properties over £40,000 paid either less than they would have done in England, or no tax at all.

[Stephen Kerr]

Will the hon. Lady give way?

[Kirsty Blackman]

I will not let the hon. Gentleman intervene again. He is becoming one of my more regular commentators. I appreciate his interest, but I am going to make some progress.

On scrutiny and the amendment of the law motion, the SNP and the Labour party have been clear that the Government have not gone far enough on tax avoidance, so we would like the opportunity to table amendments. I am sure the Minister does not imagine that he and his team have a monopoly on good ideas. An amendment of the law resolution would have allowed the Opposition to put forward what the Government might consider to be good ideas to reduce the amount of tax avoidance. That would be a better situation for everybody. There are 650 Members of the House, many of whom have a lot of expertise and do not sit on the Government Benches. An amendment of the law resolution would allow better amendments to come forward to make better law.

The Budget and the Bill can be criticised for what they do not include, as well as for what they do. First, there is still no acceptance of the economic impact of Brexit and there are no taxation measures to fix that. In the 12 months to June, real household disposable income shrank by 1.1%. That is the longest period of falling living standards in six years. The increase in the price of food means that families are £7.74 a week worse off, and that is before we leave the European Union, the single market and the customs union. Coupled with what the IFS says about there now being two decades of wage stagnation instead of one, and the threat of 80,000 jobs being lost in Scotland, things are looking pretty bleak. The Minister and various Members have already spoken about the public sector pay cap. That does no good for increasing incomes. I would like the Government to change their mind on the public sector pay cap and to fund changes to it.

I have already called for the Chancellor to bring forward an emergency Budget and I have no hesitation in doing so again. Given that the UK and the EU have now come up with a deal on the payment of billions of pounds by the UK to the EU, the Chancellor needs to tell us how that will be paid for. We have already had two Budgets this year, but I would have no aversion to seeing another one to take that payment into account and explain where the money will come from.

We cannot continue to have the Chancellor pulling rabbits out of hats on Budget day. I believe firmly that there must be more openness and transparency, and better scrutiny. I would welcome it if the Opposition parties could move meaningful amendments on the Floor of this House, if nothing else to show how much better we could do things. Every time that the shadow Minister took an intervention from Conservative Members, they asked how his party would pay for things. If he had the opportunity to move meaningful amendments, he would be able to set out tax measures that he and his party thought appropriate. That would avoid the accusation about the magic money tree. The Government have chosen their route so that they can avoid scrutiny, but they then criticise the Opposition for not carrying out proper scrutiny. That is not a good way to run things.

I welcome the UK Government’s change to VAT liabilities for the Scottish police and fire services. My colleagues and I have raised this matter inside and outside the House over 140 times. It is particularly convenient that the Chancellor should suddenly U-turn and fix this inconsistency for Scotland’s services at exactly the same time as he should need to do so for combined authorities, police and crime commissioners and the London fire commissioner. If he now agrees that these liabilities should not apply, surely they should not have applied in the first place. Our police and fire services would very much like the £140 million in VAT that they have paid so far to be returned. I eagerly await Scottish Tory Members, using all the power they apparently have, joining us to convince the Chancellor to pay back that £140 million. If they do not do so, they will have to explain why to police and fire services in Scotland.

[Stephen Kerr]

Will the hon. Lady give way?

[Kirsty Blackman]

I will not.

On transferable tax history, I am pleased that the UK Government have committed to changing the tax regime for late-life oil and gas assets. The Minister nods, because he has heard me go on about this on a number of occasions. I welcome the change. I ask him to work with stakeholder groups on a deal for the oil and gas sector. Given the changes to the oil price, there is still a feeling of pessimism around Aberdeen on some days. I would like the UK Government to commit to supporting the Oil and Gas Authority’s “Vision 2035” for the sector, which I think has cross-party support. This is incredibly important. It is critical to the future of the north-east of Scotland in particular, but also that of the United Kingdom as a whole, for the oil and gas sector to be supported and for our supply chain to be anchored in the UK so that it can continue to pay taxes even when North sea oil has run out. “Vision 2035” is key, and it is part of the sector deal that Oil & Gas UK and other stakeholder groups are seeking. I hope very much that the Minister will sit at the table with those groups and ensure that what they need for the future—what they need to ensure that they continue to pay tax—is realised in a sector deal.

As we have heard, the Bill makes changes to allow first-time buyers to get on to the housing ladder. I have already made clear my concerns about the changes to land and buildings taxation that are proposed, which echo concerns that have been raised by the Office for Budget Responsibility, as well as a number of experts. To improve access to the housing market, the UK Government should follow Scotland’s lead and commit themselves to more social housing.

I spent eight years as a local authority councillor. By far the biggest part of my casework was presented by people who came through the door and said that they were unable to obtain a secure tenancy in a social house in the knowledge that the landlord would not chuck them out in a year provided that they continued to pay rent. The fact that that problem still exists, in Scotland and throughout England, is due to Margaret Thatcher’s right to buy. Unlike us in Scotland, the UK Government have not made any reductions in the scheme, and council housing stock has been decimated as a result. We in Scotland are trying to right the damage that has been done. We are focusing on social housing and will continue to do so, and I urge the UK Government to do the same.

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[Mr Jack]

This House made it clear at the time that if the Scottish Government went ahead with the centralisation, they would not be able to reclaim the VAT. It is no good the SNP having a grievance and looking back to claim that £140 million when Budgets are clearly forward-looking and we have to be responsible for the public finances. However, we have now sorted that problem out.

[Stephen Kerr]

Does my hon. Friend agree that this was all designed in order to create a grievance—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. I do not like to interrupt the hon. Gentleman, and I let him do this earlier, but if he faces away from the Chair, no one can hear him. I certainly cannot hear him. He has to speak to the Chair, and not to the Member upon whom he is intervening. But I am sorry—I interrupted him, so I will allow him to finish his intervention.

[Stephen Kerr]

Thank you, Madam Deputy Speaker. I had in fact finished my intervention, in which I asked my hon. Friend whether he felt that this was a designed grievance-manufacturing moment for the SNP.

[Mr Jack]

Clearly I agree. I would like my hon. Friend the Member for Stirling (Stephen Kerr) not to make too many more interventions, however. He is very keen on them, but we have to crack on.

That centralising dogma cost those services £140 million. The hon. Member for Kilmarnock and Loudoun (Alan Brown) referred to that money as having been stolen, but I can assure him that it was not stolen by anybody. It was, however, wasted by his party and his fellow nationalists in the Scottish Government, who cost the police and the fire services the option to reclaim that VAT. As I have said, the Conservatives have acted to clear up the Scottish Government’s mess. That is one of many cases in the Budget that prove that 13 Scottish Conservative MPs can deliver much more for the Scottish people in six months than 56 nationalist MPs could deliver in two whole years.

The Scots are used to the SNP putting confrontation and grievance ahead of public services, as my hon. Friend the Member for Stirling has just said, and we in Scotland are sick and tired of it. If the SNP would like to turn over a new leaf this evening and take a more collaborative approach, I suggest they join us in voting for the Bill. It would be the height of pettiness for the nationalists to vote against a Bill that rectifies their own mistake and ensures that Scotland’s police and fire services finally get the funding that they deserve.

On a wider note, the Bill brings into effect many of the positive measures that were announced in last month’s excellent Budget, such as the additional measures to tackle aggressive tax avoidance. When someone does not pay their fair share of tax, the rest of us have to pay instead through higher taxes, less funding for public services or higher borrowing. I am therefore pleased that this Government have such a strong record on reducing tax evasion and aggressive tax avoidance. The UK tax gap is now just 6%—down from 6.7% in the final year of the last Labour Government—and the measures that this Government have put in place to reduce the gap have saved £12.5 billion in the past year alone, meaning billions of pounds of extra funding for public services, billions of pounds in lower taxes, and billions of pounds in less borrowing.

The Budget is good for Scotland and specifically for Dumfries and Galloway with the Borderlands growth deal. In fact, it is a good Budget for the entire United Kingdom, with provisions that lay the groundwork for future growth and a fairer country. I will therefore be proud to vote for this Bill, which is an integral and positive step in putting the Budget into effect.

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[Luke Graham]

Not just now. I wish to make more progress.

That decision was made in the face of warnings. It was an entirely political decision, fuelled by the SNP’s central belt bias and obsessive power-grabbing in Edinburgh. It therefore fell to the Scottish Conservative group to fight for Scotland and to the Conservative Chancellor to rectify those extremely damaging errors inflicted on Scotland by the SNP.

Having been shown who is truly “stronger for Scotland”, the SNP has made it its mission to undermine the hard-won successes for Scotland and to dismiss the efforts of the Conservative group here in Westminster and the Conservative Government, who have helped to deliver so much for Scotland. We all know why it has done so: it does not fit in with its narrative of grievance for the Conservatives not only to act in the best interests of their constituents and to have them at heart, but to deliver on those interests.

Ahead of Thursday’s Scottish Budget, we can all safely expect the SNP Administration in Edinburgh to carry on with their shameless Westminster finger-pointing, blaming Westminster for giving them the exemption on VAT; chastising Westminster for giving them the “wrong” money; and demanding even more from the Scottish people in the form of tax increases imposed by Holyrood.

Those are all significant broad-brush statements, but I wish to go into some detail about what the measures in the Budget mean for our constituencies in Scotland. For those who are not familiar with the hugely beneficial impact of the Barnett formula in Scotland, let me explain that Scotland benefits to the tune of £1,750 per head by remaining a part of the United Kingdom. It is also worth reminding Members that, in practice, that represents a higher rate of spending per head than England and Wales. Before we get into a dispute about figures, let me tell the House that those statistics are from the SNP’s own Government expenditure and Revenue Scotland figures. In addition, we very much welcome the £600 million more that will be spent on rail, which is an increase on the last spending period.

[Stephen Kerr]

Does my hon. Friend agree that those are indeed the dividends of the Union?

[Luke Graham]

I could not agree more, and I will go further into those dividends shortly.

The Government have delivered an additional £2 billion to Scotland in the Budget, which should be a reason to rejoice. However, they are being criticised by SNP Members. [Interruption.] The House can hear them trying to talk me down now, which is not a surprise, because no matter how high the price or how good the deal, the SNP is not satisfied. It reminds me of the Roald Dahl story, “Charlie and the Chocolate Factory”. We have the political manifestation of Veruca Salt sat just across from us; SNP Members go from room to room, shouting what they want and demanding more and more, yet they are never satisfied. Conservative Members have heard the interests of our constituents and we have delivered for them.

--- Later in debate ---

[Dr Johnson]

I thank the hon. Gentleman for his intervention.

Finally, I welcome the £668,000 the Government have given through LIBOR grant to the International Bomber Command Centre in my constituency. Bomber Command No. 166 Squadron suffered the highest losses of any allied forces unit during world war two, with an attrition rate of 44%. The centre will open next year, the year of RAF100, which is a good time for it to open in terms of remembrance. It will serve as a point for the recognition and remembrance of the sacrifice of people from 62 nations around the globe, 57,861 of whom lost their lives saving the future for us and our children and grandchildren.

The International Bomber Command Centre will record for the future the memories of those who served in Bomber Command. They include people such as 92-year-old William Leslie Anderson, my constituent and relative through marriage. He served as a flight engineer in No. 166 Squadron. A flight engineer works not only on the planes on the ground to ensure that they are fit for take-off, but with the pilot throughout the flight and then again preparing the aeroplane once it is back on the ground. People such as Mr Anderson worked hard to secure our future, and it is important that we think about the future of those who will go ahead. That is why I reject completely the Labour party’s plans to spend, spend, spend. It is our children, our children’s children, and our children’s children’s children who would pay the debt interest on such ever-increasing spending plans.

We have asked Labour Members so many times today—perhaps 25 or 26 times—how much their plans would cost, but still we have had no answer—[Interruption.] I appreciate that we have had an answer. We have been told that we can look it up on the internet, but I would like to know which page and document to look at, please, because I have not been able to find it.

[Stephen Kerr]

My hon. Friend will be aware that the Opposition’s position is that it will cost what it will cost. Sounds horrific, doesn’t it?

[Dr Johnson]

It certainly does sound horrific. Spending money might sound lovely now, but we would be spending the money of our children, and it is they who would suffer for it.

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[Rachel Maclean]

I thank my hon. Friend for his characteristically direct and pertinent intervention. In my previous career I was a member of the Chartered Institute of Personnel and Development, the industry expert on the world of work. The CIPD has carried out many studies on zero-hours contracts, and it recognises that the vast majority of people on such contracts have taken them by choice.

[Stephen Kerr]

Is my hon. Friend aware that, in their report on employment practices in the modern economy, Matthew Taylor and his distinguished group of independent thinkers came out firmly against the Labour party’s policy of outlawing zero-hours contracts?

[Rachel Maclean]

My hon. Friend is absolutely correct. Matthew Taylor has clearly stated that banning zero-hours contracts is completely the wrong thing to do. The Conservative party wants everybody to have good work in a decent job with secure working conditions, which is why we commissioned Matthew Taylor to carry out his report. As my hon. Friend, a fellow member of the Business, Energy and Industrial Strategy Committee, says, this is an incredibly important issue. The Taylor report is a detailed piece of work that looks at the rights of employees, the self-employed and workers to make sure that everybody’s rights are protected, because no business should be afraid of treating people well and giving people a decent job. That is what this Government are doing.

--- Later in debate ---

[Alex Chalk]

Does my hon. Friend, like me, welcome the fact that at the same time as the economy has been growing the tax system has been made more progressive so that the top 1% now pay 27% of the entire tax revenue—

[Stephen Kerr]

Twenty-eight per cent.

[Alex Chalk]

I am corrected: they pay 28%, which is a higher proportion than ever before.

[Robert Courts]

My hon. Friend makes an extremely good point that we have not heard often enough. We should absolutely keep making the point that although we hear talk of a progressive tax system from the Opposition, we see action from the Government. The 1% of highest earners now pay 28% of tax. That proportion is higher than it ever was under Labour. That is a record to be proud of. It is real progressive, practical politics from the Conservative Government.

[Stephen Kerr]

My hon. Friend quite rightly talks about the progressive nature of the tax regime that has been very carefully fostered by this Conservative Government. Is he aware that, for the Scottish Budget this Thursday, the Liberal Democrats in Scotland are proposing to increase income tax on people who earn £18,000 a year? Can he tell me what he thinks about the progressive nature of such a suggestion from the Liberal Democrats in Scotland?

[Robert Courts]

That is a horrifying suggestion. I am not surprised that that is the attitude of the Liberal Democrats in Scotland, because it is one that we see in many parts of this House—from those who do not understand that when we raise taxation on the lowest paid, it means that those people have less money in their pockets, which reduces their ability to make the decisions that they need to make with regard to themselves, their family and their life chances. When we take money away from people, we remove their freedom of action, their freedom of manoeuvre and the investment choices that they may make for their children. It is a totally unprogressive attitude.

--- Later in debate ---

[Stephen Kerr (Stirling) (Con)]

I rise to make a few remarks in support of the Bill, which addresses fundamental issues on which the Government are doing the right things. The public finances are not in a state where we can take them for granted. Although much progress has been made on the deficit, there is still much to be done and there is certainly no room for complacency.

I turn briefly to the subject that I mentioned in an intervention a little earlier: the need to keep taxes low. By doing so, we allow people to spend more of their hard-earned money as they wish. That is something that the Scottish Government should learn as they put the final touches to their Budget on Thursday. If they raise taxes, they hurt people’s ability to make decisions for themselves, and we all know that people are capable of making decisions for themselves. The Scottish Chambers of Commerce as recently as last Thursday told the First Minister to her face that the last thing that Scotland’s businesses and economy need is a reputation for being the highest taxed part of the United Kingdom. She will ignore the voice of Scotland’s businesses at her peril and at the peril of Scotland’s economic future.

Budget Resolutions

Stephen Kerr Excerpts

Thursday 23rd November 2017 Commons Chamber

[Kirsty Blackman (Aberdeen North) (SNP)]

It is an honour to speak on behalf of the Scottish National party on this second day of debate on the second 2017 Budget.

This Budget is no better than the last one. The UK Government are in chaos. Cabinet infighting means that they are hamstrung and unable to take even the most basic decisions. Brexit, and the likely economic fall-out, is set to have a dramatic impact on the household budgets of very many people. Unlike the Government, the Office for Budget Responsibility has taken that threat seriously and downgraded our GDP figures accordingly. That is the worst downgrade in the OBR’s projections since its creation seven years ago.

The outlook for GDP growth is worse on all counts than even the OBR’s projections in spring. GDP might seem like an ethereal concept to people, and unrelated to their daily lives, but here are the ramifications of this drastic downgrading. The Resolution Foundation has said that it equates to £1,000 a year in wages, which is £19 a week less to spend on essentials such as food and electricity. How will low-income families cope if their spending is slashed by an extra £19 a week? The TUC has pointed out that that is an £800 decrease in wages even from the prediction in March. The Fraser of Allander Institute reported that the GDP damage of a hard Brexit could cost Scotland 80,000 jobs. That is 80,000 people not paying tax to the Treasury; 80,000 folk having to struggle through the jobcentre system, and whose journey back to employment has been made even more painful and less dignified by the number of jobcentres closed by this UK Government.

The Scottish Government estimate that a hard Brexit could reduce GDP in Scotland by £11 billion a year by 2030. That is up to £3.7 billion a year less to spend on public services—£3.7 billion would pay the salary of 185,000 new police officers, 161,000 new teachers, or 168,000 new nurses, and that is only the impact in Scotland.

On the block grant, the Chancellor announced largesse for Scotland—£2 billion—but that is smoke and mirrors because £1.1 billion of that is financial transaction money. It cannot be used to pay for vital frontline public services, and it has to be paid back. If the Chancellor was going to make an announcement for Scotland, he should have made an actual announcement of real money that could be spent by the Scottish Government at their discretion on frontline services.

Between 2010-11 and 2019-20, Scotland’s budget has seen a cut of £2.6 billion in real terms. Next year, the Scottish Government will have more than £200 million less to spend on frontline public services. Over the next two years, the Scottish block grant for day-to-day services has been reduced by £531 million. Is this £2 billion more for the Scottish Government to spend? Is it tatties!

The Chancellor has announced that VAT for Scottish police and fire services will not apply as of April next year. He agreed that it was unfair to charge VAT on those services, but he has not agreed to give us the rebate that we are owed—£140 million is owed to Scotland.

[Stephen Kerr (Stirling) (Con)]

Is it not a fact that the SNP Government were given good notice and warning that the impact of their centralisation of the Scottish police and the Scottish fire and rescue services would create this situation? Was it not Scottish Conservative Members who lobbied Ministers to get the SNP Government out of the mess they created?

[Kirsty Blackman]

Not long ago, Murdo Fraser, a Scottish Conservative MSP, said in the Scottish Parliament that Scotland should not have the money paid back because it was the SNP’s fault for centralising the services. The Scottish Tories supported that centralisation—it was in their manifesto. The Chancellor has agreed that the VAT was unfair and that it was taking money from front-line public services, yet he is refusing to refund it. We have raised the issue and called for the change to be made 140 times. As far as I am aware, the Scottish Tories have raised it once in this House—once! It is ridiculous for them to suggest that pressure from them has twisted the Chancellor’s arm. In fact, it that were true and if the Chancellor was willing to listen only to representations from Conservative Members of Parliament, what does that say about the Chancellor’s honour?

On money for Scotland—[Interruption.]

[Kirsty Blackman]

Thank you, Madam Deputy Speaker. I will not push it any further than that.

The other thing that the SNP has been calling for—the Scottish Tories have so far been unwilling to do so, it seems—is £190 million convergence uplift that is owed to our farmers. That money should go to Scottish farmers and we will continue to push for that.

If the UK Government were not in such chaos, they would have recognised the folly of Brexit. Even if they do decide to proceed with this incredibly damaging policy, there is certainty they could give now that would reduce, slightly, the economic harm we will see. They could abandon their net migration cap of 100,000 people. That would help to keep our public services fully staffed. Earlier this year, the Nursing and Midwifery Council produced its annual report on the number of registered nurses and midwives. Compared with the period from 2012 to 2016, registrations in the last year were down 46% from Ireland, 86% from Italy, 87% from Romania and 95% from Spain. These are trained nurses and midwives registered to work in the UK in our NHS, to work in our frontline services and to work to provide nursing and midwifery care for people who are in incredibly vulnerable states, and the Government are closing the door on them. They are ensuring that fewer people come. They are ensuring that our public services will be worse staffed as a result.

On housing, we need workers from the EU. In London alone, a third of construction workers are from the EU. The Government cannot say they intend to build more housing, while at the same time shutting the door to many skilled construction workers.

The Chancellor has announced a wonderful new policy of no stamp duty for first-time buyers who are buying a house for less than £300,000 in England and Wales. In time-honoured tradition, one of the Chancellor’s biggest Budget commitments has fallen apart in less than 24 hours. The OBR confirms that it expects the policy to increase house prices. Implementing the policy is costing £3.2 billion, but the OBR expects 3,500 houses to change hands as a result. That means the Government are subsidising each house by £924,000 each. One tax expert I follow on Twitter said that virtually every tax expert thinks that this policy sucks.

[Stephen Kerr]

Would the hon. Lady care to share with the House the effects of the SNP Government’s land and buildings transaction tax, which has been an unmitigated disaster and caused untold turmoil in the Scottish property market? Perhaps she should be fuller in her disclosure to the House of the effect her Scottish Government have had on the Scottish property market.

[Kirsty Blackman]

You know what, Madam Deputy Speaker? I was just about to talk about the Scottish land and buildings transaction tax. I was just about to talk about the fact that it is way more progressive than the position put forward by the UK Government. Before I get on to that, however, I want to make it clear that the Scottish Government are investing £3 billion in affordable housing. Fifty thousand affordable homes will be built over the course of the Scottish Parliament, 35,000 of which will be for social rent—something sadly missing from the UK Government’s proposals. We are incredibly supportive of social housing, council housing and housing association housing. It is very important that there are more properties for social rent.

On the land and buildings transaction tax, those buying a house for less than £145,000 in Scotland pay no stamp duty. Buying a house for £180,000 attracts a stamp duty charge of only £600. It is possible to buy a fairly reasonable three-bedroom semi-detached house in many places in Scotland for less than £180,000. First-time buyers will pay only £600 in stamp duty and that has been in place for the past two years. Actually, £180,000 is much more realistic for a first-time buyer than £300,000. How many first-time buyers, without inherited wealth, have got £30,000 in the bank to put down for a deposit? The effect of the LBTT in Scotland was that over the first two years 93% of those buying a house in Scotland worth more than £40,000 paid either no stamp duty at all or less than they would have in England. The hon. Member for Stirling (Stephen Kerr) said that that was an unmitigated disaster. Clearly, he has not read the figures. Some 93%—a significant portion—of those buying a house over £40,000 paid less than they would down here.

The action our Government have taken was thought through, unlike the piecemeal approach the UK Government take. Successive Chancellors have insisted on the right to pull rabbits out of hats at Budgets. This has led to the drastic unravelling that occurs after almost every Budget. If the Chancellor was collegiate and consulted on measures, and if he approached issues such as stamp duty, small business taxation or income tax with the intention to review the whole system, we would see much better policy decisions being made. We need more coherence and less drama from Chancellors. They should not be trying to pull rabbits out of hats. They should be trying to create a system that works, rather than a system that will give them a big headline the day after Budget day.

Mr Deputy Speaker, if you were to ask someone under 30 whether they expect to have a pension, they will likely tell you that they do not. If you ask them whether they will be able to afford to buy a house, they will likely laugh at you. But, most importantly, if you ask them about their security, how precarious their current housing situation is and how precarious their current work situation is, they will tell you how difficult it is to save for the future. They will tell you how difficult it is to build a stable life when their landlords move them on every year and when they have to share with other people. They will tell you how difficult it is to save for the future when they are working on zero-hours contracts. The Chancellor’s pretendy national living wage is not enough to live on—it does not even apply to under-26s—and what they need is not a cut in stamp duty or to be able to save £20,000 in an ISA tax free, but for their income to be consistently and substantially higher than their expenditure. They need an increase in the minimum wage. They need a decrease in rents and a decrease in the cost of living. In the past year, the price of vegetables has gone up 2%, the price of fish has gone up 10%, the price of electricity has gone up 11%, the price of butter has gone up 12% and the price of kids’ clothes has gone up 3%. When we have wage stagnation, how do we expect people to be able to afford the most basic of essentials?

Millennials, people under 30, need a decrease in rents. The typical millennial has actually earned £8,000 less during their twenties than those in the preceding generation. An economic time bomb is ticking. Household debts continue to rise. Interest rates are going up—a major problem, given the increase in household debt. Increasing the personal allowance is welcome news from the Chancellor, but it is not enough. He is increasing it by £350. That is £350 that people will not pay 20% tax on. That is pennies in the grand scheme of things. That will not make the difference we would see with a real living wage. I have already mentioned the issues raised by the IFS, which is predicting two decades of lost wage growth.

The UK Government continue to fail. The Budget did not help. This Government are in chaos and the Chancellor has taken no real action to undo the years of austerity and wage stagnation that punishes our most vulnerable. The Government should tear this Budget up and start again: with spending commitments that increase wages and help our most vulnerable; with fairness for the WASPI women; with a U-turn on the benefits freeze; and with the devolution of powers on tax avoidance to Scotland, so we can tackle it properly. Mr Chancellor, I have a message for you: you are harming the whole of the UK, and the SNP will fight you every step of the way.

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[Stephen Kerr (Stirling) (Con)]

I am delighted to have this opportunity to speak in the Budget debate. I am quietly satisfied to have been found guilty by no less a personage than the Chancellor of bending his ear. I have no hesitation in saying that my Scottish Conservative colleagues and I have indeed been bending his ear, and we will continue to bend the ears of any and all colleagues in the best interests of Scotland and the people of Scotland. Further, I have no hesitation in saying that we on these Benches have achieved more for Scotland in the five months since we entered this House than Scottish National party Members have achieved in the past two and a half years, if not longer.

I wanted to hear a responsible and measured Budget that will continue to tackle the deficit and the debt while making properly considered investment decisions that will create the right conditions to produce prosperity in our country. The cost of servicing the national debt is now an extraordinary burden on the public finances, and it is surely immoral to pile up such a debt and leave it to our children and grandchildren to pay it down later. I hope that all seven—it is soon to be eight—of our grandchildren will be glad of this Conservative Government’s fiscal responsibility and the part that their grandfather played in sustaining it. Without fiscal responsibility, we cannot afford defence, health, education or any other of our immensely valuable public services on which the Government spend taxpayers’ money.

I congratulate the Chancellor on his forward-looking positivity. He described a future full of change and challenges, yes, but also opportunity. His Budget speech presented a picture of a Government who are getting on with the business of governing and bringing about the change that our country needs as we embrace the future, including the fourth industrial revolution, with all the opportunities coming in its wake, and of course Brexit. I welcome the much needed investment in R and D and the necessary investment to prepare for our departure from the European Union and to make plans for all possible outcomes, including the possibility that few of us would prefer: no deal.

The Budget clearly shows the value of Scottish Conservative Members to this House. Scotland was at the heart of the Budget, and Scotland is at the heart of the Union. We have a Budget before us that is good for Scotland, and we engaged positively with the Budget process to secure our city deals and tax changes, to bring about a resurgence of activity in the oil and gas sector in the North Sea and to allow Police Scotland and the Scottish fire and rescue service to receive VAT refunds. That all goes to show what can be achieved when Scotland’s place at the heart of the Union is embraced rather than scorned.

I am pleased by and welcome the universal credit reforms, and I was grateful for the news on fuel duty and spirits duty. As an aside, I was also grateful to hear my right hon. Friend the Prime Minister give my hon. Friend the Member for Angus (Kirstene Hair) a clear indication yesterday that the next phase of the broadband roll-out of local full-fibre networks and 5G in Scotland will be delivered in partnership with local authorities instead of the Scottish Government, who have gone about the first roll-out phase extremely slowly.

As we begin the implementation of the Stirling region deal, 2018 will be a seminal year for Stirling. We have a transformative vision for Stirling, including the creation of a national aquaculture innovation centre to build on that growth industry, and by enhancing the UK’s position as the world capital of fashion by creating a UK tartan centre to leverage this great iconic product across the world. We will see improvements in rural and urban infrastructure to enhance economic conditions and economic prospects right across Stirling.

[Kirsty Blackman]

How does the hon. Gentleman feel about his neighbouring city of Dundee no longer being able to be a European city of culture because this Government are dragging us out of the European Union?

[Stephen Kerr]

The Government are not dragging us out; the people of this country voted in the referendum on the UK’s membership of the EU.

There are many questions that could be asked of the SNP Government. For example, will the Scottish Government lift their broadband tax? In England, new broadband infrastructure will attract tax relief, so we are waiting for the Scottish Government to act. Will the SNP Government match the Chancellor’s commitment to remove stamp duty for first-time buyers by removing said buyers from having to pay the discredited land and buildings transaction tax? We will wait and see. Will the SNP Government continue to make Scotland the highest taxed part of the United Kingdom? Will they press on with their plans to increase personal taxes for everyone in Scotland earning over £24,000 a year, which is the average income in Scotland? It is a disgrace. It is hardly progressive politics. The SNP want to foment grievance, and the people of Scotland are seeing through that. We need a Conservative Government in Holyrood with Ruth Davidson as First Minister. That is the only way that we will be able to realise the full benefits of Scotland’s place at the heart of the United Kingdom. I am proud to be present in the Chamber for my first Budget debate as Stirling’s Member of Parliament, and I welcome this Budget.

Budget Resolutions

Stephen Kerr Excerpts

Wednesday 22nd November 2017 Commons Chamber

[Ian Blackford (Ross, Skye and Lochaber) (SNP)]

I want to wish the Chancellor all the best. He talks about preparing for the future, but let us look at the reality of the figures contained in the OBR book. We are faced with the United Kingdom falling to the bottom of growth in the G7. When we look at GDP per capita for the years 2019 and 2020, we see that the OBR has reduced its forecasts from 1.7% to 0.7% for 2019 and from 1.9% to 0.7% for 2020. That is what post-Brexit Britain is going to look like—an absolute shredding of growth forecasts for the next three years. The OBR talks about GDP—

[Stephen Kerr (Stirling) (Con)]

Will the right hon. Gentleman give way?

[Ian Blackford]

No, I will not, because this is the third party speech and the practice is that it is not to be intervened on.

The change in GDP that we will see in the OBR book is a cut to GDP of 2.7%—that is what this Government are presiding over. It is a threat to the wages, living standards and job prospects of people up and down the United Kingdom. This Government should be ashamed of themselves. When we look at the rhetoric of the Budget speech—[Interruption.] Conservative Members are laughing, but we see a fiscal loosening in this Budget of 0.1%. That does not take into account the reality of the risks the people of the UK face.

Let me welcome the removal of VAT on our police and fire services, but remind the Chancellor of the Exchequer that, together with his friend the Secretary of State for Scotland, he was given the opportunity to support an SNP amendment to the Finance Bill in 2015 that would have removed VAT from Scotland—[Interruption.] I can hear the remarks that are coming from those on the Conservative Benches, but I remind them that the Conservative manifesto supported the establishment of Police Scotland. It was the vindictiveness and nastiness of the Tory Government that imposed VAT on Scotland, which has ripped £140 million out of our frontline services. When the Chancellor of the Exchequer and the Secretary of State for Scotland were given the opportunity in the 2015 Finance Bill to act they failed. It is a disgrace that we have had £140 million taken out of frontline spending—

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[Ms Nadine Dorries (Mid Bedfordshire) (Con)]

It is a relief to rise after the speech from the SNP spokesman, which was actually longer than the official Opposition’s—and half as riveting.

Budget resolutions tend to be about figures and statements that can be quite dry and which are often leaked before the actual Budget statement, so I am delighted that one of its headline measures—the scrapping of stamp duty on properties up to £300,000—was not leaked. It was an exciting announcement.

[Stephen Kerr]

I thank my hon. Friend for giving way—something that the SNP spokesman was not prepared to do, for whatever reason. Does she agree that the Chancellor’s announcement on stamp duty presents an almighty challenge to the Scottish Government, whose land and buildings transaction tax has been an unmitigated disaster, and does she think that the leader of the SNP in Westminster should go to the First Minister and suggest that the policy be followed in Scotland?

[Ms Dorries]

I am sure that SNP Members have heard my hon. Friend’s point and will take it forward—tomorrow, I would imagine.

I wish to address an issue that is very close to my heart—and actually the reason I became a Conservative MP in the first place: home ownership. We have heard today measures that amount to a revolution in house building: the target of 300,000 homes per year and the establishment of Homes England to bring together all the strands needed to meet this target. It will deal with people who land grab, the planning application process and the training of skilled artisans and workmen to build the homes. Homes England will have the authority required to drive forward that degree of home ownership.

It is sometimes easy to forget what home ownership means to many people, and we have not seen measures like these in the UK since the 1970s. I am one of those Members who understands the value of home ownership more than most. I lived in a council house until I was in my late 20s, and I was reminded of this earlier in the year while canvassing in a constituency that was not mine—it was in Luton in Stopsley ward. A lady on whose door I knocked said to me, “Oh, I know you. You’re not standing here, but I couldn’t vote for you anyway because you support home ownership.” I found that quite remarkable, because I was knocking not on a council estate door but on a private, well-appointed home.

It was a seminal moment for me. This lady said to me, “The thing is, Nadine, I’m a trade unionist, and I abhor right to buy and home ownership, because people with mortgages don’t strike.” We then discussed how people, when they buy a home, prioritise their own private capital over and above the social capital. She was a principled lady with strong views, and I never want to diminish somebody else’s point of view—it is just as relevant as mine. She can abhor home ownership as much as I adore it, although the end of our conversation was interesting. I asked her if she was in private rented accommodation, and she told me it was her own home. That was an interesting moment.

That said, I took on board this lady’s points. She said, “You should not be a Conservative. You should be a Labour politician. You come from a council estate. I know your background.” It was very interesting. Indeed, I have witnessed what happens to people when they are given the opportunity to buy their own home. I will describe what it is like not to own a home. So many people are in that position right now. On my estate, every door was painted the same colour—by the council—and the gardens on the ground floors were divided by packing cases and wooden pallets. There were no flowers and what had been gardens had become patches of mud. Life was pretty grey and people worked at the Ford’s factory and nobody had any particular aspiration to do anything else.

When people began to own those council houses, however, it seemed to change overnight. People started to paint their front doors their own colours and express their individuality. The packing cases were ripped up and painted fences would be put in their place. Flowers were planted in the gardens. People started working overtime. The very first car was bought and arrived in our road. My mother, a teacher, was giving almost nightly classes to women knocking on the door for lessons because they wanted to go out to work—I regarded home ownership as a driver of equality for women because it gave them a reason to break free from the kitchen sink and get out to work.

I saw a transformation on the estate because of home ownership. Its benefits include family stability. If a family do not own, they rent, but is the most unstable position for a family to live in, as they have to move perhaps every six months and do not get to live in the kind of properties or areas they want to live in. People who buy their own homes can decide where to live and where to send their children to school.

Oral Answers to Questions

Stephen Kerr Excerpts

Tuesday 24th October 2017 Commons Chamber

[Mel Stride]

As the hon. Lady knows, we are in the middle of negotiations with our European partners. I am confident that, as the Prime Minister has expressed at every turn, we will secure a good deal for this country. In the context of our borders, that will mean that the situation will be as frictionless as possible, which will be good for trade, our country and our economy.

[Stephen Kerr (Stirling) (Con)]

Does the Minister agree that the Labour party’s plans to raise corporation tax would harm small and medium-sized businesses—

[Mr Speaker]

Order. Just for the benefit of the hon. Gentleman, may I say that the Opposition’s plans for taxes are not a responsibility of the Government? This is a lesson we all have to learn; in my case I learned it early in my first Parliament, and the hon. Gentleman has learned that lesson today.

Devolved Powers in Scotland

Stephen Kerr Excerpts

Tuesday 17th October 2017 Westminster Hall

[Stephen Kerr (Stirling) (Con)]

I beg to move,

That this House has considered the use of devolved powers in Scotland.

It is a pleasure to serve under your chairmanship, Mr Hollobone, and to lead my first debate as a Member of Parliament.

Twenty years ago, I was in the minority. At the referendum in 1997, I campaigned against the establishment of a Scottish Parliament, not from party loyalty but from the starting point that any dilution of the Union could lead to its ending. I urged the people of Scotland to think twice and vote no. They did not; instead, they voted yes to a future with a devolved Parliament in Edinburgh.

However, I now realise that I was wrong. With the zeal of the convert, I have trodden my own road to Damascus and now I stand here today to extol the virtues of the Scottish Parliament and devolution. The Scottish Parliament has helped and is helping to create a better Scotland, and a more comfortable and confident Union, too; but more than that, I firmly believe that devolution is a principle worth arguing for. I am not talking about devolution in the sense of the establishment of a Scottish Parliament or Welsh Assembly, but about the concept of devolution. It is core to my credo that politics should be and is local. It is personal to communities that decisions that impact on people’s lives should be made as near to them as possible. Edinburgh is not the end of the road; Holyrood should just be the beginning. Politics should be local and we should seek to localise decision making.

[Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

rose—

[Mr Philip Hollobone (in the Chair)]

Order. This is an hour-long debate. Lots of Back Benchers have put in to speak. The time limit is already looking like it will be three minutes; that time limit will go down if there are interventions. I say now that if a Member intervenes, they will not catch my eye to be called to make a speech.

[Stephen Kerr]

I give way to the hon. Member for Na h-Eileanan an Iar (Angus Brendan MacNeil).

[Angus Brendan MacNeil]

I am grateful to the hon. Gentleman for giving way. As he might know, we have a problem on the west coast of Scotland, because we need fishermen from non-European economic area countries. Westminster is stopping that, in contrast to Switzerland, for example, where half the visas are controlled by Bern and the other half by the 26 cantons. Does he not think that it is time for Westminster to loosen its iron grip and allow fishing boats on the west of Scotland, and indeed in Northern Ireland, to fish?

[Stephen Kerr]

I do not necessarily recognise the nature of the problem that the hon. Gentleman is describing and I will come on to talk about the relationship that should exist between the Parliaments of this island.

As I was saying, Edinburgh is not the end of the road; Holyrood should just be the beginning. Politics, indeed, should be local. However, that is not Scotland’s story, nor has it been for the last 20 years of our Scottish Parliament. Instead of treating devolution as a process of bringing power to the people, first the Scottish Executive and then the Scottish Government have consolidated power in their offices in Edinburgh.

There has been a power grab in Scotland, sucking power from communities and taking power from the many into the hands of the few. Decisions taken around the Cabinet table in Bute House are remote and removed from the daily lives of the people of Scotland. They often run roughshod over the views of the public, and are apparently unheeding to and uncaring about the difficulties that communities face.

I am, however, full of hope that that situation can be addressed by the simple adoption of the principles of devolution by the Scottish Nationalist Government in Edinburgh. Since the passage of the Scotland Act 2016, we now have a powerhouse Parliament. It should not be forgotten that it was a Conservative Government who delivered those powers, in fulfilment of the vow made by David Cameron and, as Scottish Conservatives, we are proud to have done that. It is David Cameron’s proud legacy. Powers over equalities, gaming machines, income tax, railway policing, welfare, quarrying, air passenger duty, consumer advocacy and advice, the Crown Estate, elections and employment programmes—all these are in addition to the powers of general competence that the Scottish Government already enjoy, and there are more powers on their way.

The powers at the disposal of the Scottish Parliament have the potential to make a real difference to the lives of the people of Scotland. The Scottish Parliament can develop the economy, create specific help for people who need welfare and choose to vary taxation. I am by no means a fan of the idea of raising taxes, but I believe that services must be paid for and it should be for local councils and the Scottish Government to set an appropriate level of tax to pay for those services. With all those powers and the ability to tax and borrow more than ever before, the Scottish Parliament is well placed to get to work to solve our country’s problems and to work for Scotland’s betterment. What a shame that we still have so much confusion and grievance being shown.

Let me give an example of that. One of the Members of the Scottish Parliament made a statement just last month calling on Westminster to do something about the number of fixed odds betting machines, with the grievance about the lack of power hanging in the air, but of course that power was devolved in May 2016. It is possible that that statement was a simple mistake brought about by the confusing nature of the legislation, but it also misled members of the public about who is responsible. Instead of using such an important issue as a political ping-pong ball batted over Hadrian’s Wall, would it not be better if we approached such issues as a way of creating partnerships between different levels of Government, in order to achieve something?

[David Linden (Glasgow East) (SNP)]

I am very grateful to the hon. Gentleman for giving way and for giving us the opportunity to talk a bit about why the Scottish National party Government are still polling very highly and why the Tories have moved back into third place in Scotland. However, on the subject of fixed odds betting terminals, I represent a constituency that is littered with betting shops, as a result of the liberalisation of the Gambling Act 2005. Does he recognise that most of those shops are covered by previous legislation and that only new terminals are dealt with differently?

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[Stephen Kerr]

The reality is that the power to legislate in this area belongs with the Scottish Parliament.

As I have said, instead of treating such issues as political ping-pong balls, where there are elements reserved for Westminster, elements that are at Holyrood level and elements that require the intervention of a local authority, would it not be better if we worked together? Problems can be passed between Holyrood and Westminster without resolution, or we can take responsibility as lawmakers to work together for a solution. I believe in creating partnerships to achieve things, rather than issuing press releases as a display of political virility. Activity and achievement are not the same thing in politics. There is much to do in Scotland.

[Ian Murray (Edinburgh South) (Lab)]

I congratulate the hon. Gentleman on securing his first debate in this Chamber and on his election. He talks about working together, so was he as astonished as I was when the Scottish Nationalist Government in Edinburgh voted against lifting the public sector pay cap in Scotland while SNP Members here voted to lift it in Westminster? If so, could the UK and Scottish Governments work together to lift the public sector pay cap?

[Stephen Kerr]

Contradictions between what the SNP does in the Scottish Parliament and what it says here are quite common.

The Scottish Parliament has powers to do so much good, but some of those powers remain unused. The tax-raising powers that the Scottish Parliament has had since its inception, which were agreed to at the referendum in 1997, remain in their box, unused. I do not believe in higher taxes, but there have been a few parties that might have some small representation in the Scottish Parliament that do. The SNP has the full right to use those powers, so when we hear talk decrying the funding settlement, we should remember that the Scottish Government have the power to vary the tax rate and to raise their own money.

Newer powers, on speed limits and air passenger duty, also remain unused, but we will see what the future holds in respect of those powers. All these powers are weapons in the arsenal, and let us not forget that they were brought forward by a Conservative Government looking out for the interests of the people of Scotland.

Just because we have our own powerhouse Parliament in Edinburgh does not mean that our Parliament in London should be less of a force for good in Scotland. The UK Parliament is still as much of a Scottish Parliament as it has been since the Act of Union in 1707. Scotland is one land with two Parliaments. We deserve our voice to be heard here and we deserve our Government—the UK Government—to work in our interests. Action taken by the Exchequer to work with the oil industry, to ensure that the full force of the UK economy can come to the assistance of the regional economy of Aberdeen, is an example of our working together as a United Kingdom.

[Colin Clark (Gordon) (Con)]

On 3 October the Scottish Government announced an absolute ban on fracking in Scotland. In 1969—the year I was born—the main discovery of oil was made in the North sea. Does my hon. Friend agree that if the Scottish National party were in power now, it would ban the exploration of oil in the North sea, based on quasi-science?

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[Stephen Kerr]

Indeed, the SNP is more defined by what it is against than what it is for, in most instances.

I say to the Minister that it is vital that the UK Government do not devolve and forget. Betterment will come—in so many ways—only when different levels of government work together in co-operation. That is why a positive relationship between all levels of government—Edinburgh, Westminster and local government—is imperative. Such a relationship should be built on respect, and it should not matter whether someone is a local councillor, a Member of the Scottish Parliament or a Member of this Parliament. We are all unified in our goal of making Scotland a better place. We might have different approaches, but I believe that people who enter politics do so out of a genuine belief, either in a cause or in the value of public service or, as is often the case, in both. That respect must run both ways, and political parties have a fundamental responsibility to embody the principle of respect, as we all know what happens when it breaks down.

In Stirling we have a city deal, which, to work, requires the agreement of the local authority, the Scottish Government and the UK Government. The UK Government have made a significant commitment to the city region deal and the local authority is already spending money on projects. The Scottish Government are coming to the table, but there is a nagging feeling that Edinburgh is reticent about getting involved. I hope that changes soon and that we see movement, but it is part of a worrying trend. I will work with all levels—politicians, officials and businesses—to make the deal happen and to make it work.

On the other side, the UK Government are responsible for broadband policy in Scotland. [Interruption.] Listen, listen. That policy is being delivered through the Scottish Government. There is a contract set by the Scottish Government, targets set by the Scottish Government and a delivery body, within the Scottish Government. When new areas are released as being covered by broadband, SNP Ministers will be there getting their photos taken. Who can blame them? All politicians love to have their pictures taken. But then when questions are raised or there are negative stories, it all somehow, as if by magic, becomes a problem caused by Westminster neglect.

The Scottish Government—the SNP Government—tends towards grievance instead of fixing the issues. With fixed odds betting terminals, welfare rights or broadband, they prefer to focus on process. The reason the SNP exists is to build support for independence. Despite its being an overwhelmingly negative way of doing things, grievance is clearly how it likes to do them and, frankly, Scotland suffers because of that.

While the Scottish Government are distracted, education is slipping. The fact that international scoring puts us behind England should be a source of national embarrassment, yet the Scottish Government prefer to focus on independence. Business growth in Scotland in 2016 was the lowest for any part of the United Kingdom. The business community are crying out for a more joined-up approach to business support and reform of the business rates system. Despite that, the Scottish Government want to focus their time on fighting for more economic power, when they will not use the powers they already have at their disposal. Instead of focusing on the crime rate and the leadership crisis in the police force, the SNP Scottish Government choose to put their time and attention into scrapping the British Transport police.

There is a clear pattern: the SNP puts process and stoking up grievance ahead of the good of the people of Scotland, and that is not what the powers of the Scottish Parliament are for, nor what people pay their taxes to support the Scottish Government for—nor is it to pay for ministerial limos, by the way, but that is a different story. And there are more process issues being stoked up by Brexit. Scotland’s most important markets are in England, Wales and Northern Ireland—one could call that the United Kingdom single market. We have been in a social union with those countries for 310 years. There is freedom of movement and a customs union, but the SNP would prefer powers to be handled by unelected bureaucrats in Brussels than by a Government elected by the people of the United Kingdom. I have always found that position to be confusing at best and disingenuous at worst.

We need a regulated, open market within the UK, so it remains vital that some of the regulations and frameworks are set at Westminster level. Equally, some of the powers that Europe now holds should sit logically in the devolved Governments of Cardiff and Edinburgh. Beyond that, the devolved Assemblies have a responsibility to consider which of those powers can be reasonably held at local authority level. Again, if we approach this in partnership for Scotland, the UK and Scottish Governments can really deliver on the benefits of Brexit, but if we focus on the process and on fomenting grievance, Scotland will be let down again.

[Several hon. Members rose—]

[Stephen Kerr]

I am closing. With an approach that respects the motives of politicians from all along the political spectrum and from different levels of government, the people of Scotland would be better served. Our Scottish Government—

[Angus Brendan MacNeil]

Will the hon. Gentleman give way?

[Stephen Kerr]

I am going to close. Our Scottish Government have a wide range of powers that they can use for the good of Scotland—more powers delivered by a Conservative Government. Devolution, however, should be a process and the Scottish people are best served when decisions are made closest to where they live. We must push for more power to be delivered to town halls across Scotland. Clarity over where power sits and honesty about that is essential. Politicians should be problem solvers, working across government levels to achieve for their constituents, rather than throwing their hands up in the air and decrying their lack of power.

Throughout all this is my fundamental belief that by working together we can achieve so much more for Scotland. We need to stop arguing—[Interruption.] Sorry, I correct myself: we need to keep arguing—[Laughter]—about policy and ideas. That is part of our nature as Scots. If we get away from the grievances and use the powers of devolution, we can all be winners. That is the promise of the use of power by government, whether local, devolved or national. Scotland is a land with two Parliaments, but it is one land and it deserves to be governed not in conflict but in partnership.

[Mr Philip Hollobone (in the Chair)]

The debate ends at 5.30 pm. Mr Kerr has three minutes to sum up at the end. The guideline limits for the Front-Bench speeches are five minutes for Mr Sheppard and the SNP, five minutes for Mr Sweeney and Her Majesty’s official Opposition, and 10 minutes for the Minister. That means that I have to call the Front-Bench spokespeople at seven minutes past five. There are 19 minutes between now and then, and there are nine Members seeking to speak, so to get you all in there will have to be a two-minute limit, starting from now. If there is a two-minute limit, all those Members will get to speak; if there are interventions, someone or some people will lose out.

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[Mr Paul J. Sweeney (Glasgow North East) (Lab/Co-op)]

It is an honour to serve under your chairmanship, Mr Hollobone.

I thank the hon. Member for Stirling (Stephen Kerr) for securing this debate, and I congratulate him on his first speech in this Chamber. I also thank him for reminding us that this is the 20th anniversary of the historic referendum on devolution. It was generally accepted at the time that it was the settled will of the Scottish people to establish a Parliament in Edinburgh—they were clearly not in agreement with the hon. Gentleman. He reminds us that the Scottish Parliament was founded in the face of Tory intransigence—that must never be forgotten. I am heartened that he has changed his view since then. Perhaps the evidence of the Parliament’s credibility over its two decades of operation has made him see the light. I fear that we may be doomed to disappointment, because it is clear that there is continued intractable opposition from Conservative Members about how we progress the constitutional future of the United Kingdom sustainably.

Several Conservative Members referred to the need to move power closer to the people, yet the Strathclyde Regional Council was abolished because it dared to hold a referendum on maintaining a public-sector water supply company. How does that square with their position?

I have asked questions on two occasions—including to the Prime Minister—about the need to establish a constitutional convention to deal with the distribution of power and governance across the United Kingdom in the wake of Brexit, and I had a totally unsatisfactory response on both. It is clear that, when it comes to defending the integrity of the United Kingdom, the Tory party is utterly inept and totally incapable. That is unacceptable. It is becoming increasingly clear to me that the only presence in this House that will fight for a sustainable future built on solidarity in the United Kingdom is the Labour party.

I recall John Smith’s comment that there are two forces sawing away at the legs that support the Union—the Scottish National party, whose primary mission is to destroy the United Kingdom, and the stupid Conservative party, which always fails to rise to the occasion when it comes to delivering deep, meaningful and fundamental reforms to the constitution of this country. That is unacceptable, and it must be called out in this Chamber today.

Although the hon. Member for Stirling lauds the Scotland Act 2016, which enhanced the Scottish Parliament’s powers, he failed to say that the devolution of welfare powers was due to my hon. Friend the Member for Edinburgh South (Ian Murray), who tabled more than 120 amendments to the Bill, including on all of the welfare powers. Therefore, to suggest that it was all the initiative of the Conservative party is absolutely bogus and unacceptable.

[Stephen Kerr]

We did deliver it.

[Mr Sweeney]

They delivered it in the face of intransigence. They failed to rise to the occasion.

The hon. Member for Angus (Kirstene Hair) talked about NHS cuts, but did not propose to use the Scottish Parliament’s powers to deal with them meaningfully. Conservative Members talk about NHS cuts, but I have heard repeated claims that they have no interest in using the Scottish Parliament to deal with them meaningfully. My hon. Friend the Member for East Lothian (Martin Whitfield) said that 19% of Scots feel that the Scottish Parliament has not risen to the occasion; in fact, they wish to abolish it.

We have to raise our game. We have to look at what we can do to build a credible devolution settlement. We need to use the Scottish Parliament’s powers to maximise the benefit for the Scottish people.

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[Stephen Kerr]

I thank all my colleagues serving in the House of Commons who have come here today to participate in the debate in one form or another. I have thoroughly enjoyed the experience. If nothing else, what we have displayed together in Westminster Hall this afternoon is the shared passion and love that we have for Scotland and its people. With that passion and all the arguments that go with it, I hope that there might be enough good will that we can occasionally stretch across the divide between nationalists and Unionists to work together to get the best possible deal for the United Kingdom.

For my part and that of those in my party who serve in the House of Commons, there is nothing but the utmost respect for the institution of the Scottish Parliament. We look forward to the increased powers to which the Minister referred coming to the Scottish Parliament. I note, however, that I found the speech of the SNP Front-Bench spokesman, the hon. Member for Edinburgh East (Tommy Sheppard), to be totally graceless. I do not feel that he did himself any credit in how he conducted himself in this debate. On a personal level, I have always held the hon. Gentleman in a degree of respect, which has sadly been challenged this afternoon by the things he has said and the way in which he has spoken.

Once again, I thank everyone for supporting this debate and for the privilege of leading it.

Question put and agreed to.

Resolved,

That this House has considered the use of devolved powers in Scotland.