Health and Social Care Levy Bill

Steve Barclay Excerpts
Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
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I beg to move, That the Bill be now read a Second time.

Last week the Prime Minister announced a plan to tackle the NHS backlog, put the adult social care system on a sustainable long-term footing, and end the situation in which those who need help in their old age risk losing everything to pay for it. The Government’s plan will make an extraordinary difference to the lives of millions of people across the country, and it will be funded with a record £36 billion investment in the NHS and social care. In order to pay for a significant increase in spending in a responsible and fair way, the Bill introduces a new 1.25% health and social care levy based on national insurance contributions.

John Baron Portrait Mr John Baron (Basildon and Billericay) (Con)
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We need to give credit where it is due, and the Government are absolutely right to try to grasp this nettle, but many of us are concerned about the haste with which it is being done. Does my right hon. Friend think it is a good idea to raise taxes on jobs ineffectively, and risk choking off an economic recovery before we have even got to know the details of the social care reforms?

Steve Barclay Portrait Steve Barclay
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My hon. Friend, and good friend, has raised two connected points. The first was dealt with earlier in points of order: it is the will of the House that decides the timings of debates, and the Chair addressed that point. As for the second, we discussed it at length during last week’s ways and means debate. We discussed the wider purpose in dealing with the consequences of covid and the backlog in care that needs to be tackled, but we also discussed grasping the nettle in relation to the long-term challenges surrounding social care—challenges that the House has debated repeatedly over many years.

The levy will apply UK-wide to taxpayers liable for class 1 employee and employer, class 1A, class 1B and class 4 self-employed national insurance contributions. However, it will not apply where taxpayers pay class 2 or class 3 NICs. It will be introduced in April 2022, and from April 2023 it will also apply to those working over the state pension age. As my right hon. and hon. Friends will understand, it takes time for Her Majesty’s Revenue and Customs to prepare its systems for such a major shift. That is why, as set out in clause 5, in 2022-23 the levy will be delivered through a temporary increase in NICs rates of 1.25% for one year only.

Geraint Davies Portrait Geraint Davies (Swansea West) (Lab/Co-op)
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Does the Secretary of State agree that in principle hypothecation is to be avoided, and that what we should be doing is defining what spending is financially desirable and economically effective, and then asking a separate question: what is a socially equitable and effective tax regime? Those are two different issues, but we are smashing them together, and we do not even know what we are spending the money on. This is farcical, and it is being done in a mad rush.

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Steve Barclay Portrait Steve Barclay
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There is a precedent in the form of what the hon. Gentleman’s party did in 2002-03. I do not think it is fair for him to say it is farcical to do something which was done by the Government whom he supported. He has opened up a much wider question about hypothecation, on which many a former Treasury official has commented, and I think that that is a separate debate; but there is a precedent for the use of national insurance in the way that my right hon. Friend the Chancellor has set out.

Let me stress that all revenues generated by this increase will be ring-fenced and paid not just to the NHS in England, but to NHS Scotland, NHS Wales, and the equivalent in Northern Ireland.

Andrew Mitchell Portrait Mr Andrew Mitchell (Sutton Coldfield) (Con)
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I have a great deal of sympathy with what my right hon. Friend is saying, and I think the Government deserve considerable credit for grasping this nettle at last, but may I ask for an assurance? When the charge has been introduced, will he ensure that every six months a Treasury Minister comes to the House and tells us what results are being achieved—what money has been raised through the levy and what results have been delivered; in other words, what additional treatment has been achieved—so that we can see and show our constituents why it was right to raise this levy and what they are getting for the money?

Steve Barclay Portrait Steve Barclay
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As a former Chief Whip, my right hon. Friend knows better than most that it is for the House to decide which Ministers come to the House and provide updates. Obviously, in respect of regular fiscal events and others—[Interruption.] It is. The right hon. Member for Leicester South (Jonathan Ashworth) chunters from a sedentary position, but through urgent questions and other such devices it is always for the House to decide which Ministers come here and, of course, there are regular events such as Treasury and other departmental questions. [Interruption.] He chunters but, as I have said, there are many procedures through which updates—[Interruption.] The procedures to which I referred.

Under clause 2, this revenue will be ring-fenced for health and for social care—

Andrew Mitchell Portrait Mr Mitchell
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Will my right hon. Friend give way?

Steve Barclay Portrait Steve Barclay
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I will make a little progress. I have taken a number of interventions, including one from my right hon. Friend.

Existing NICs reliefs and allowances will also apply to the levy. That will mean that 40% of all businesses will not be affected owing to the employment allowance. When it comes to individuals, those earning more will pay more. Indeed, the top 14 per cent. of taxpayers will pay about half the revenues. Conversely, at least 6.2 million people earning less than the NICs primary threshold will not pay the levy at all.

Steve Barclay Portrait Steve Barclay
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I am sure that the hon. Lady rises to welcome the progressive nature of that measure.

Catherine West Portrait Catherine West
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Does the Secretary of State accept that, if 40% of businesses or employers are not affected, the other 60% therefore will be? What assessment has the Treasury made of the number of jobs that employers will not create because of, apart from anything else, the introduction of this measure at a time when the recovery from covid is fragile?

Steve Barclay Portrait Steve Barclay
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It is not just that the first 40% will not pay anything, as my right hon. Friend the Chancellor mentioned. The next 40% will pay less than 1% of their wage bill, and indeed 70% of the employer contribution comes from just 1% of business. To some extent, the hon. Lady’s point was also picked up by the Monetary Policy Committee in its evidence to the Treasury Committee, when it said, “You should not ignore one half of the policy announcement.” Of course, one needs to look at the spending implications of the measures, not just—

Steve Brine Portrait Steve Brine (Winchester) (Con)
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In my experience of being a Minister at the Department of Health—with my right hon. Friend, indeed—Treasury Ministers do not like to spend billions of pounds without knowing exactly what they are getting for their money, and rightly so: it is our constituents’ money. We know that there is a very carefully worked out plan that the Secretary of State for Health and Social Care has agreed with the NHS for the catch-up programme. Will the Minister help us to see that published, so that we as representatives can hold the NHS to account for the money that this levy is raising and our constituents are therefore spending?

Steve Barclay Portrait Steve Barclay
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I could probably go slightly further—Chief Secretaries do not like to spend, not necessarily just on any particular area of Government policy—but my hon. Friend is absolutely right about the importance of delivery and how the money is spent, particularly the £8 billion allocated to electives catch-up. Just yesterday I was at a meeting in No. 10 with the leadership of the NHS, discussing that issue with the chief executive of NHS England and other senior health leaders. I know that it is an issue of concern to a number of Members, but ultimately it is an issue of concern throughout the House, because through our constituency surgeries we see the consequence of the backlog in terms of electives. That is, I think, an area of common ground.

Steve Barclay Portrait Steve Barclay
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I will give way once more.

Christine Jardine Portrait Christine Jardine
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The Minister has made the point that we see the impact in our constituencies. Yes, we do, but we are also seeing the impact in our constituencies of the pandemic on business. What would the Minister say to the Federation of Small Businesses, which, notwithstanding what he has just said, believes that

“Business owners who have done all they can to retain and support their staff during the pandemic are now being punished”?

The FSB sees this as a jobs tax, and we will see that impact in our constituencies as well.

Steve Barclay Portrait Steve Barclay
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First, in order to meet the quantum of spend, one needs a broad-based tax. That is a point that my hon. Friend the Member for Wycombe (Mr Baker), who is not in his place, raised in the debate last week. Secondly, I would point to the more than £400 billion—[Interruption.] I do not know why SNP Members are laughing at £400 billion of support. I do not think that this is a point of difference. I think we can all agree across the House that there has been huge fiscal support across the UK through the broad shoulders of the United Kingdom to support business, at a cost of £400 billion to businesses, public services and individuals, and that has a consequence. Most of the business leaders I speak to recognise that, and recognise that the backlog in the NHS needs to be dealt with. I would add the further point that those businesses benefit from the NHS clearing its backlog because it is members of staff in those businesses that are affected.

Jonathan Edwards Portrait Jonathan Edwards (Carmarthen East and Dinefwr) (Ind)
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What analysis has been undertaken of the long-term sustainability of this policy, which targets working-age people at a time of an ageing population? There will be 10 million extra pensioners within 20 years, which means that the pool of people who are paying in is shrinking in relative terms while demand is increasing.

Steve Barclay Portrait Steve Barclay
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Again, this is why, as is standard practice, my right hon. Friend the Financial Secretary to the Treasury has published the tax information and impact note on the tax change. Of course, that will be dynamic because it will interact with the fiscal forecast that the Office for Budget Responsibility will set out alongside the Budget on 27 October. So that is dealt with in the normal way for measures such as this—

Steve Barclay Portrait Steve Barclay
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I want to make some progress, and I have already given way once to the hon. Member for Swansea West (Geraint Davies).

Let me remind the House why this levy is necessary. As the Prime Minister and the Chancellor have said, the levy will enable the Government to provide additional funding to the NHS so that it can recover from the pandemic. Senior NHS leaders have made it clear that, without additional financial support, we will not properly be able to address the significant backlog in the national health service. However, it is going to take time to get everyone the care they need. In addition, our social care plan will create a dramatically expanded safety net for people in their later life. This means that, instead of individuals having to bear the financial risk of catastrophic care costs themselves, we as a country are deciding to share more of that risk collectively.

Munira Wilson Portrait Munira Wilson (Twickenham) (LD)
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Could the right hon. Gentleman explain to people up and down the country who are either in receipt of care now or will need to start care between now and October 2023 and are facing catastrophic care costs what they are meant to do? Does he accept that there will be a massive cliff edge? Lots of people will try to avoid coming forward for care in the months before October 2023, and there will then be a massive surge. How do the Government plan to deal with that?

Steve Barclay Portrait Steve Barclay
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In a number of ways. First, this fiscal support is not in isolation. There is £33.9 billion of additional support going into the core NHS budget over the five years of the long-term plan. That has had a significant impact. On top of that, significant covid support has gone into the NHS. One of the points that came out of the debate on the ways and means last Wednesday was the interrelated nature of the impact on the NHS and on social care. That is why it is right that we are gripping this issue, but it is alongside the wider financial support that the Treasury has offered.

None Portrait Several hon. Members rose—
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Steve Barclay Portrait Steve Barclay
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Given that we need to progress on to Committee, I shall just point out that this is a permanent new role for the Government and a structural increase in the size of the British state. We therefore need a permanent new way to pay for it. The only alternative would be to borrow indefinitely, but that would clearly be the wrong course of action when our national debt is already at the highest it has been in peacetime. Borrowing even more today would just mean higher taxes in the future.

Richard Drax Portrait Richard Drax (South Dorset) (Con)
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With money tight, did the Treasury support the appointment of, I think, 43 new executives on £270,000 a year to check where all this money is going?

Steve Barclay Portrait Steve Barclay
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I think one needs to see whether these are roles that are driving efficiency and creating savings elsewhere, or whether they are viewed in isolation. That is why one needs to understand the workforce as a whole, where there are overlaps within the NHS but, above all, how we deliver reform, which is something I know that the Secretary of State for Health and Social Care is passionately committed to doing. That relates to the point that was rightly raised by my hon. Friend the Member for Winchester (Steve Brine) on the delivery of reform in order to maximise the value for money of the spend that the levy will unlock.

Finally, we need to fund our vision for the future of health and social care in this country over the longer term. As the Prime Minister said, with proper funding, we can not only tackle the NHS backlog and expand the social care safety net but afford the nurses’ pay rise, invest in the best equipment and prepare for the next pandemic. We can provide the largest investment ever to upskill social care workers and build the modern, more efficient health service the British public deserve.

Clive Efford Portrait Clive Efford (Eltham) (Lab)
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It seems to me that we are spending this money twice, so can the Minister tell the House specifically how much will go into the NHS from this increase and how much will go into social care? What I am hearing from him is that we are going to deal with the backlog, which will take us back to pre-pandemic levels. That will leave us with a 2 million waiting list, so can he tell us specifically how much is going into the NHS and how much is going into social care?

Steve Barclay Portrait Steve Barclay
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Of the £36 billion, £5.4 billion is going to adult social care, with the rest going into the NHS or through Barnett. That is over three years.

Andrea Leadsom Portrait Dame Andrea Leadsom (South Northamptonshire) (Con)
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Does my right hon. Friend think that the Government could consider different bands for frontline staff in the NHS and management staff in the NHS, to get away from the concern that so many of my constituents have that any pay rises in the NHS will be taken up by managers over frontline operators?

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Steve Barclay Portrait Steve Barclay
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In the public sector pay agreement that we reached, we accepted the recommendations of the independent pay review body. That is why we decided on 3% and why the NHS was treated differently from other areas of the public sector such as the police and teachers. This recognised the importance of those frontline workers and it was why those under the threshold of £24,000 were carved out. This recognises the point that my right hon. Friend has raised.

In conclusion, this levy will enable the Government to tackle the backlog in the NHS. It will provide a new permanent way to pay for the Government’s reforms to social care and it will allow the Government to fund our vision for the future of health and social care in this country over the long term. I commend the Bill to the House.

Rosie Winterton Portrait Madam Deputy Speaker (Dame Rosie Winterton)
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Before I call the shadow Minister, I should say that there will be a six-minute limit on Back-Bench speeches to start with. If anybody wishes to speak, they should catch my eye, and to do that it is important to keep standing. If colleagues have not put in to speak but wish to do so, it would be helpful to let me know. They will have to have been here from the beginning of the debate, and they will be expected to be here for the wind-ups, which will start at approximately 4.45. Bearing all that in mind, I now call the shadow Minister, James Murray.

Health and Social Care Levy

Steve Barclay Excerpts
1st reading
Wednesday 8th September 2021

(2 years, 6 months ago)

Commons Chamber
Read Full debate Health and Social Care Levy Act 2021 View all Health and Social Care Levy Act 2021 Debates Read Hansard Text Read Debate Ministerial Extracts
Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
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Let me first thank hon. and right hon. Members for their thoughtful and constructive contributions to today’s debate.

Yesterday, the Prime Minister set out a series of necessary steps to tackle the covid backlogs, reform adult social care and bring the health and social care system closer together on a long-term, sustainable footing. As the House well knows, the pandemic has put unprecedented pressure on the NHS. The number of patients waiting for elective surgery and routine treatment in England is now at a record high of 5.5 million. If left unchecked, that could reach 13 million, an issue of concern across the House. At the same time, this country is facing a long-standing challenge to the social care system. Typically, around one in seven must pay over £100,000 for care, with bills falling indiscriminately on some of the sickest and most vulnerable in society.

The Government’s response, the plan we have debated today, means an investment of £36 billion in the health and social care system over the next three years. Patients across the country will benefit from the biggest catch-up programme in the history of the NHS. The social care system will finally be reformed, ending unpredictable and catastrophic care costs faced by thousands and making the system fairer for all. I gently say to the shadow Chief Secretary to the Treasury, the hon. Member for Houghton and Sunderland South (Bridget Phillipson), who said a moment ago that this is not the right time, that many times in this House people have highlighted the urgency of acting both on the covid backlog and on social care.

Jake Berry Portrait Jake Berry
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My right hon. Friend has helpfully said that one in seven—I believe that is what he said—people currently in the care system pay over £100,000. Could he just say in absolute numbers how many that is, in any given year or period he chooses? If he does not have the information with him tonight or cannot get it from the Box, can he write to me with that information and put a copy in the House of Commons Library before we have our next debate?

Steve Barclay Portrait Steve Barclay
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I am glad my right hon. Friend highlights that point. Let me address it in two ways, because it goes to the crux of his remarks in the debate. We have set out, as was referred to even by critics of the Government, the illustrative analysis of the impact of this from a distributional point of view, with lower-income households being the largest net beneficiaries. We have also said that we will say more on that, because it will evolve by 2023, when those of state age who are working come within scope. Obviously, the distributional analysis will change.

Let me take head on my right hon. Friend’s central concern, which was that his constituents in Rossendale and Darwen, because of lower housing costs, will be disproportionately impacted. First, if one looks at London, the Evening Standard, for example, is concerned that 14% will pay the lion’s share of the cost because that is where the highest concentration of higher tax payers are. For his constituents, one key aspect of the reform is that, through the cap, it ends the unpredictability of costs. If I look at the north-east of England, the Resolution Foundation found that only 29% of individuals aged over 70 have sufficient eligible assets that they will not receive any state support. The point is that the uplifting in the means test, which my right hon. Friend the Chancellor set out, again benefits those parts of the country he was championing.

Jake Berry Portrait Jake Berry
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Will my right hon. Friend give way?

Steve Barclay Portrait Steve Barclay
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I have just given way and addressed my right hon. Friend’s points head on. Let me, in turn, address head on the points raised by the shadow Chancellor, the hon. Member for Leeds West (Rachel Reeves).

In the shadow Chancellor’s speech, she said that she opposed the levy despite, as a number of Members pointed out, the previous Labour Government taking a similar approach in 2002-03, because she supports taxing wealth. The problem with that is that only a broad-based tax base, such as income tax, VAT or national insurance contributions, can raise the sums needed for such a significant investment. Again, that was a point made by critics of the Government, including my good friend, my hon. Friend the Member for Wycombe (Mr Baker). It could not be raised by taxes on wealth. Currently £6 billion is raised from inheritance tax, £8.7 billion from capital gains tax and £12.3 billion from property transaction tax. Indeed, that case was demolished by the Chair of the Treasury Committee, my right hon. Friend the Member for Central Devon (Mel Stride), as well as by my hon. Friends the Members for Dudley South (Mike Wood) and for Thirsk and Malton (Kevin Hollinrake), who highlighted that to raise the revenue required requires a broad-based approach.

Peter Grant Portrait Peter Grant
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On the subject of cases being demolished, one of the cases that the right hon. Gentleman’s colleagues have made great deal of play of today is that of the fictional Yusuf in the Government’s own document. According to the Government, Yusuf’s care home costs are £700 a week. They claim that under the current system they would have had to spend £293,000 before they reached the current cap. The Minister will be aware—I hope he can count—that in order to spend £293,000 at £700 a week—

Peter Grant Portrait Peter Grant
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What percentage of people going into a care home have any chance of still being alive in nine years’ time?

Steve Barclay Portrait Steve Barclay
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One of the features of the Dilnot proposals—Dilnot has been very frank about this—is that his costs ramp up over time. That is why the initial funding is £5.4 billion, but obviously, the social care element will increase. I will come to the case put forward by SNP Members, who seem bizarrely not to want the Union dividend that is offered and to not be seeking that additional funding. Let me finish on the Opposition amendment—

Richard Thomson Portrait Richard Thomson
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Will the right hon. Gentleman give way?

Steve Barclay Portrait Steve Barclay
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I will come to the points on devolution and happily give way at that stage, but let me just deal with the Opposition amendment, which requests a distributional impact assessment. As we have covered, that has been set out today. The Government have already published a document on the impact of our health and social care plan on households, looking at the impact of the new spending and the levy, with a full distributional analysis being published at the Budget and spending review.

As for the impact on businesses, businesses will play their part in funding this plan. However, existing national insurance contribution reliefs and allowances will also apply to the levy. This means that 40% of all businesses will not be affected due to the employment allowance, and it allows eligible employees to reduce their national insurance liability by up to £4,000. Again, that point was brought out by my right hon. Friend the Member for South West Wiltshire (Dr Murrison), who highlighted the impact on business and the fact that businesses, with 1% of the highest turnover, will cover 70% of the cost.

Clive Betts Portrait Mr Betts
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I think the right hon. Gentleman probably knows which point I am going to raise. I am very interested in the impact on local authorities. Out of the £36 billion that will be raised over three years, how much extra money will go to local authorities after the costs of the “cap and floor” system have been taken into account? How much extra money over three years will go to local authorities out of the £36 billion?

Steve Barclay Portrait Steve Barclay
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I listened very closely to the hon. Gentleman’s speech, because he is a very informed and knowledgeable commentator on these issues. He rightly pointed to paragraph 36, where we are being very clear about the role in terms of demographic and unit pressure. As he well knows, part of the discussion at a spending review is to look at local government pressures in the round. That is in the context that local authorities are getting an additional £2.2 billion of funding. I remind the House, in terms of the adult social care flexibility that was allowed for councils this year, that out of the 152 local authorities, less than two thirds actually used that flexibility. That is part of looking at these issues in context.

Let me come to the central point put forward by the Scottish National party, which was very well demolished by my hon. Friend the Member for Berwickshire, Roxburgh and Selkirk (John Lamont). All parts of the United Kingdom need a long-term solution to fund health and social care. The Scottish Government’s independent review of adult social care recently noted—[Interruption.] I am quoting from their own review. I thought they would want to hear that. It stated that

“Scotland’s ageing demography means that more money will need to be spent on adult social care over the long term”—

and its recommendations to the Scottish Government are that this would

“require a long-term and substantial uplift in adult social care funding.”

In fact, in 2002, John Swinney said that a 1% increase was

“progressive taxation…required to invest in the health service in Scotland”.—[Scottish Parliament Official Report, 18 April 2002; c. 8005.]

Alison Thewliss Portrait Alison Thewliss
- Hansard - - - Excerpts

Does the right hon. Gentleman accept that that was 18 years ago and that things have changed? Since that time, national insurance has not been reformed in any way to protect the poorest, as income tax has been.

Steve Barclay Portrait Steve Barclay
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Obviously, what SNP Members regard as progressive has changed. The point is that if they disagree with this, they can adjust their Barnett consequentials, spend that and reprioritise their spending accordingly. Indeed, likewise, the hon. Member for Carmarthen East and Dinefwr (Jonathan Edwards)—I hold him in great affection and he speaks very powerfully in the Chamber—said that these are “English priorities”. Clearing the covid backlog and addressing the challenges of social care are not English priorities. They are United Kingdom priorities, they are this Government’s priorities, and they are the people’s priorities.

This levy will enable the biggest catch-up initiative in the history of the NHS, a comprehensive long-term solution to the social care challenge and a significant long-term investment that will directly improve people’s lives.

Those are things that I think my hon. Friend the Member for Wellingborough (Mr Bone) values, and I hope he will support them.

The Prime Minister said yesterday:

“You can’t fix the covid backlogs without giving the NHS the money it needs; you can’t fix the NHS without fixing social care; you can’t fix social care without removing the fear of losing everything to pay for social care”.—[Official Report, 7 September 2021; Vol. 700, c. 155.]

This plan addresses those problems. I commend it to the House.

Oral Answers to Questions

Steve Barclay Excerpts
Tuesday 7th September 2021

(2 years, 6 months ago)

Commons Chamber
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Patricia Gibson Portrait Patricia Gibson (North Ayrshire and Arran) (SNP)
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10. What recent assessment he has made of the effect of his policies on living standards.

Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
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Her Majesty’s Treasury analysis published alongside Budget ’21 has shown that policy interventions in response to covid-19 have, on average, supported the poorest working households most as a proportion of pre-pandemic income.

Owen Thompson Portrait Owen Thompson
- Parliament Live - Hansard - - - Excerpts

The Government’s plan to increase national insurance will clearly unfairly impact the living standards of young people and the low paid. That is in stark contrast to the Scottish Government’s free education, bus travel for under-25s and the Scottish child payment. Will the right hon. Gentleman confirm how many Ministers spoke against this move at Cabinet today and whether this included the Scottish Secretary?

Steve Barclay Portrait Steve Barclay
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I would have thought that, having sought additional powers, the hon. Gentleman would be more interested in reminding the House how his own Government are using the powers that they have. The key issue is that in many areas they are choosing not to use their tax powers—for example, to top up universal credit. He should focus on the alliance that his party has formed with the Greens, which is bad for business, bad for the economy, bad for the oil and gas industry, and counterproductive to growth.

Alan Brown Portrait Alan Brown
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In 2016, the Tories promised that fuel bills would be lower for everyone on leaving the EU. The reality is that fuel bills are increasing while they make the heartless cut to universal credit. In order to tackle fuel poverty, will the Minister use the net zero review to cut VAT on energy efficiency products, keep new nuclear off electricity bills, provide direct funding for heat decarbonisation and sort out the unfair grid charges on Scottish renewables?

Steve Barclay Portrait Steve Barclay
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Well, I think we should look at what my right hon. Friend the Chancellor has done. I touched a moment ago on how the covid measures have protected the poorest working households the most. Alongside that, the Budget measures on tax, welfare and spending decisions made since 2019 have, on average, benefited all households this year, with the poorest gaining the most as a percentage of net income. That is the approach that my right hon. Friend the Chancellor has taken and it is one that the Scottish Government should follow.

Patricia Gibson Portrait Patricia Gibson
- Parliament Live - Hansard - - - Excerpts

According to Save the Children, more than 3 million children living in low-income households across the United Kingdom are likely to be affected by the £20 universal credit cut, with half of claimants saying that they will face significant financial impacts as a result and one in seven worrying about affording food. The Joseph Rowntree Foundation says that the cut will push 500,000 people below the poverty line. Will the Minister explain how this squares with the Government’s so-called levelling-up agenda?

Steve Barclay Portrait Steve Barclay
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A key way to tackle poverty is to get people into work and then skill them up in their jobs. That is what we have set out through the plan for jobs, and that plan is working. Ultimately, if that is the priority of the Scottish Government, why are they not using the powers they have to prioritise it?

Mel Stride Portrait Mel Stride (Central Devon) (Con)
- Parliament Live - Hansard - - - Excerpts

Does my right hon. Friend agree that it is difficult to justify raising national insurance to fund social care for the predominantly elderly, when the impact of that tax rise would fall mainly on young people and those who are earning little in the workforce? Does he also recognise that those two groups are the very groups that have been most impacted by the economic consequences of the pandemic?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

As my right hon. Friend knows, the Prime Minister will make a statement on this matter shortly, but what he and I would agree on is that the best way is to grow the economy, drive productivity, get people into work and skill them up through work. That is what the plan for jobs is doing, alongside the £600 billion investment in infrastructure over the course of this Parliament as part of levelling up and our commitment to net zero. We need to grow the economy, skill up the workforce and get those who have been impacted by the pandemic back into work as quickly as possible.

Harriett Baldwin Portrait Harriett Baldwin (West Worcestershire) (Con)
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I wonder if the Chief Secretary has had the opportunity to read a recent report by the Institute for Fiscal Studies that says:

“Material living standards held up surprisingly well through the pandemic…This is an astonishing outcome given the scale of economic disruption”.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is absolutely right. The package of measures that my right hon. Friend the Chancellor took improved on the economic scoring that was forecast for the pandemic, including the figure for unemployment, which will now be 2 million lower at its peak than was estimated. That package of measures has helped to prevent many of the worst outcomes that were forecast by the Office for Budget Responsibility as we went into the pandemic.

Paul Maynard Portrait Paul Maynard (Blackpool North and Cleveleys) (Con)
- Parliament Live - Hansard - - - Excerpts

One group whose living standards have been impacted during the pandemic has been low-income individuals who have used buy now, pay later credit products to buy online. I very much welcome the Government’s announcement in the spring of regulation of this sector. Will the Minister update me on the progress being made in regulating the sector given that it is become of increasing importance, as Citizens Advice reported just last week?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I understand that by the end of October there will be reassurance on that, and I am happy to take that up with my hon. Friend following this session.

Bridget Phillipson Portrait Bridget Phillipson (Houghton and Sunderland South) (Lab)
- Parliament Live - Hansard - - - Excerpts

When the Chancellor increased universal credit eighteen months ago, he said that he wanted

“to look back…and remember how we thought first of others and acted with decency.”

Does the Minister consider that taking £20 a week from millions of families across our country is really an act of decency?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I think that £400 billion of support in response to the covid pandemic across our public services and individual businesses shows the scale of measures that the Chancellor has put in place. On the specific issue of universal credit, we were always clear that the uplift was going to be temporary. As it was, my right hon. Friend the Chancellor extended it for a further six months. But ultimately what divides the two sides of the House is that we believe the best approach is to have a plan for jobs, to get people into work, and to upskill them in those jobs. The Opposition simply do not have a plan at all.

Bridget Phillipson Portrait Bridget Phillipson
- Parliament Live - Hansard - - - Excerpts

Let us think about what £20 a week really means. Twenty pounds a week means being able to afford to buy a coat for your children this winter. It means not having to worry about turning on the heating when the weather turns cold. Can the Minister offer any advice to families who work hard and play by the rules about how they should manage with £100 less each and every month?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

As the hon. Lady knows, alongside the universal credit uplift other measures of support were given. Those are not only my words; I quote the Resolution Foundation, which has said:

“Since the crisis hit, the support schemes introduced by the Government have prevented an unprecedented collapse in GDP from turning into a living standards disaster.”

That is the package of measures put forward by the Government. That is how we have protected people’s living standards. The key is to have a plan and to get that plan working; it is, and that is helping people back into work.

Christopher Chope Portrait Sir Christopher Chope (Christchurch) (Con)
- Parliament Live - Hansard - - - Excerpts

Can my right hon. Friend comment on the living standards of those thousands of public sector employees to whom the Government have given exit payments in excess of £100,000 a year and continue so to do?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is right to highlight this issue, which he and I have discussed on many occasions. In July I chaired a roundtable on it across Government, and it is prioritised across Departments. We have a manifesto commitment that the Chancellor and I are committed to delivering on. As my hon. Friend knows, we have a £200 million cost to this that we need to tackle. But at the same time we also need to be true to the manifesto, which was not about tackling those on low incomes who had high pay-offs because of the way their pension benefits were structured and those proprietary claims. We need to differentiate between that and the real ill that he is concerned about, which is those on six-figure salaries who are receiving pay-offs. That is something we are prioritising.

Lindsay Hoyle Portrait Mr Speaker
- Hansard - - - Excerpts

I am not quite sure if that related to the original question, so we are going to have to watch out for that in future.

Alison Thewliss Portrait Alison Thewliss (Glasgow Central) (SNP)
- Parliament Live - Hansard - - - Excerpts

Scottish hospitality and generosity is world-renowned, but could the Minister explain to us why he thinks that Scottish taxpayers should pay for England’s social care crisis?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

It is a slightly odd question, because through the broad shoulders of the United Kingdom, it is Scottish jobs that have been protected through the furlough, it is Scottish businesses that have been supported through the self-employment income support scheme and it is the block grant that has provided additional funding to the Scottish Government. The oddity is that they are choosing not to use those uplifts in the Scottish grant to prioritise the things that they come down to Westminster and say they care about.

Lindsay Hoyle Portrait Mr Speaker
- Parliament Live - Hansard - - - Excerpts

Can I just suggest to the Minister that it might be easier if he speaks through the Chair?

Alison Thewliss Portrait Alison Thewliss
- Parliament Live - Hansard - - - Excerpts

It would be good if the Minister answered the question, as well. The Prime Minister’s hike in national insurance has been roundly panned, not least by his own Back Benchers and the Chair of the Treasury Committee, the right hon. Member for Central Devon (Mel Stride). People in Scotland are already feeling the pain of a decade of Tory austerity cuts and the harms caused by Brexit, with the devastation of the £20 a week cut to universal credit still to come, none of which they voted for. Why should my constituents pay for the Prime Minister to break his manifesto pledge with a new poll tax on the poorest who can least afford it?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

It may be helpful for me to remind the House of the uplift in funding that the Scottish Government have received as a result of the ability of the UK Government to act across the UK. Baseline funding of £28 billion last year with an additional £8.6 billion of funding—that is £36.6 billion in total—has increased to £40.9 billion this year, so the Scottish Government are getting additional funding. As a result of covid, they have received an additional £14.5 billion, but they are choosing not to prioritise that extra money or to use the additional powers they have on tax or welfare to target the issues they say they care about.

Anthony Browne Portrait Anthony Browne (South Cambridgeshire) (Con)
- Parliament Live - Hansard - - - Excerpts

At the beginning of this pandemic, like most people I was really worried that unemployment would rise by millions, and I am delighted that it has peaked 2 million below what most people forecast. Unemployment, at 4.7%, is now at historic lows. Does my right hon. Friend agree that the best way to raise living standards is to get those without jobs into jobs and, for those who already have jobs, to give them the training and skills they need so that they can get higher-paid jobs? That is exactly what the Government are doing.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I very much agree with my hon. Friend. It is as a result of those measures that unemployment has now fallen for six months in a row and that the OBR is forecasting a peak of 5% to 6%, compared with the previous forecast of 12%. As he rightly says, the peak will be 2 million fewer. It is not just about those who are being helped back into work, however; it is also about the programme of apprenticeships, traineeships, jobs support and the doubling of work coaches that will then help people in work to get into the better jobs that they deserve.

Bambos Charalambous Portrait Bambos Charalambous (Enfield, Southgate) (Lab)
- Hansard - - - Excerpts

3. What fiscal steps he is taking to help achieve the Government’s net zero emissions target.

--- Later in debate ---
Luke Evans Portrait Dr Luke Evans (Bosworth) (Con)
- Parliament Live - Hansard - - - Excerpts

T5. The levelling-up fund is about improving a region. In Bosworth, we are putting forward the Twycross zoo for its national centre of conservation and education. It will be a world-leading scientific, education and conservation centre, driving tourism and the local economy. It is backed by the borough council, the county council, the local enterprise partnership and the midlands engine. Would the Chancellor like to come and visit it and, failing that, would he like to meet me to discuss how we can make this a symbol of the levelling up of the nation?

Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Parliament Live - Hansard - -

I do not know about the Chancellor, but I am sure my children would love to come and visit the zoo. I thank my hon. Friend for putting forward a bid for the levelling-up fund. As he will know, bids are currently subject to competitive assessment against objective criteria, but more generally, I think the whole House will welcome the fact that zoos are once again fully open to the public this summer. They provide a wide range of valuable benefits.

Kenny MacAskill Portrait Kenny MacAskill (East Lothian) (Alba)
- Hansard - - - Excerpts

T2. Scottish communities, other than those in Shetland, failed to benefit from the North sea oil and gas bounty landing on their shores. Now that the North sea’s offshore wind is casting ashore on East Lothian, will the Treasury ensure that East Lothian will actually benefit, as opposed to it all simply being transmission-stationed down south? Or will it go the same way as Scotland’s oil and gas: down to the Treasury?

--- Later in debate ---
Tanmanjeet Singh Dhesi Portrait Mr Tanmanjeet Singh Dhesi (Slough) (Lab)
- Hansard - - - Excerpts

T4. The Government should lead by example with their spending power and with the design of public contracts to buy more from Great Britain, as Labour would, but the UK strategic steel sector has been neglected by this Conservative Government. Highly skilled jobs have been lost because a huge proportion of our steel, including for HS2, is purchased from other nations. Will the Chancellor explain why his Government do not even have a non-binding target for the use of our own steel in our national public infrastructure projects?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The hon. Gentleman raises a very valid point. It is right that we maximise the opportunities from domestic suppliers; my right hon. Friend the Business Secretary is focusing on that through the industrial strategy. It is also linked to targeting the seven innovation sectors funded through the significant uplift in our research and development budget.

Daniel Kawczynski Portrait Daniel Kawczynski (Shrewsbury and Atcham) (Con)
- Hansard - - - Excerpts

We are working hard in Shropshire on a £500 million investment in modernising A&E services in our local hospital. There is a funding shortage; I have written to the Chancellor on the issue and would be very grateful for a response. There is nothing more important than modernising A&E services for the safety of our patients and constituents.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I know that that is a very important constituency issue, and my hon. Friend has championed it frequently. He will know that, through the long-term plan, there is a £33.9 billion uplift in core funding, in addition to the other funding through covid and other measures announced by my right hon. Friend the Chancellor. I am very happy to discuss the matter with my hon. Friend; I know that it is a key constituency issue, and he is right to focus on it.

Kate Osborne Portrait Kate Osborne (Jarrow) (Lab)
- Hansard - - - Excerpts

T6. Research by the Disabled Children’s Partnership has revealed that nearly three quarters of disabled children have regressed in managing their conditions during the pandemic as vital services have been delayed. Ahead of the forthcoming spending review, will the Chancellor consider offering a lifeline to families and funding dedicated recovery to help disabled children and their families to catch up on missed services?

--- Later in debate ---
Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I am in no doubt about the importance and the merits of my hon. Friend’s approach to freeports, not least after an early morning meeting that he and I had—last week, I think—on that very topic. As part of the integrated rail plan, we are looking at how we link that to levelling up across the UK. He is quite right to highlight the growth and productivity opportunity that freeports offer.

Peter Kyle Portrait Peter Kyle (Hove) (Lab)
- Parliament Live - Hansard - - - Excerpts

T7. At the last Budget, the Chancellor gave a £25 billion tax break to the top 1% of businesses in the form of the super deduction, but when the school catch-up tsar came to him asking for £15 billion over a three-year period, he said that he could not fund“everybody who comes knocking on my door.”Why is it that when an Amazon-style business comes knocking, the door is wide open, but when students come knocking, asking for money to get over the challenges of the past few years, the door is slammed in their face?

Katherine Fletcher Portrait Katherine Fletcher (South Ribble) (Con)
- Parliament Live - Hansard - - - Excerpts

Jobs are the most important way of helping communities to move forward. Those who have been out of work for 12 months or more can access the restart scheme, worth nearly £3 billion. Will my right hon. Friend ensure that part of his plan is helping everyone to have proper, decent work and decent training to enable them to get the right job?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is absolutely right to highlight not only the importance of restart to the long-term unemployed, but how it sits alongside the kickstart scheme, the tripling of traineeships and the boot camps for skills. That is part of a plan for jobs that is working.

Alex Davies-Jones Portrait Alex Davies-Jones (Pontypridd) (Lab)
- Parliament Live - Hansard - - - Excerpts

T9. Will the Chancellor clarify which Department is paying the £200 million for the Prime Minister’s vanity yacht? What does it say about this Conservative Government’s warped priorities when the Chancellor approves that while planning to cut universal credit for those who need it the most?

European Union Finances: Annual Statement

Steve Barclay Excerpts
Thursday 15th July 2021

(2 years, 8 months ago)

Written Statements
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Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Hansard - -

I have today laid before Parliament the “European Union Finances 2020: statement on the 2020 EU Budget and measures to counter fraud and financial mismanagement” (CP472). This is an annual publication and is the 40th in the series. This edition of the statement is the last in this publication series that will cover the period of the UK’s membership of the EU (which lasted until 31 January 2020) and also covers the 11-month transition period that ended on 31 December 2020.

This year, annex E of the statement provides additional detail on the assurance arrangements that HM Treasury has introduced in relation to the financial settlement under the withdrawal agreement, and which were reflected in domestic law in the European Union (Withdrawal Agreement) Act 2020. HM Treasury has worked with the European Commission and its implementing partners to ensure their systems and controls over financial reporting are suitable for the specific requirements of the withdrawal agreement.

The first invoice under the financial settlement was received in April 2021 in relation to payments to be made in the period June to September 2021. The net UK liability under the first invoice was €3.74 billion and the first of four equal monthly instalments was paid at the end of June. A second invoice, covering payments due in the period from October 2021 to April 2022, is due in September.

The document also provides an updated HM Treasury estimate of the total value of the financial settlement. HM Treasury estimate that the current value of the financial settlement is £37.3 billion. This remains within the Government’s previously published reasonable central range, adjusted to take into account the UK’s 31 January 2020 exit date. In annex E, HM Treasury provides an updated summary of the financial settlement, other costs set out in the withdrawal agreement and short-term public expenditure costs.

The 2020 statement also includes a new annex F on UK participation in EU programmes under the trade and co-operation agreement. This sets out an update on the EU programmes the UK is set to associate with later this year.

[HCWS181]

Public Service Pensions: Cost Control Mechanism and Discount Rate Methodology

Steve Barclay Excerpts
Thursday 24th June 2021

(2 years, 9 months ago)

Written Statements
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Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Hansard - -

The Government have today published two consultations relating to public service pensions. These consultations seek views on two important aspects of the framework governing public service pension schemes: proposed reforms to the cost control mechanism and the methodology used to set the discount rate used at valuations of unfunded public service pension schemes.

One of the proposed reforms to the cost control mechanism could mean that the discount rate used at valuations of unfunded public service schemes to set employer contribution rates may also become relevant to the outcome of the cost control mechanism in the future. These consultations are therefore being published in parallel to ensure that respondents are fully informed of any potential interactions and to allow them to consider their responses across both areas of the public service pension framework.

The cost control mechanism

The first consultation document published today is titled “Public Service Pensions: Proposal to Reform the Cost Control Mechanism”.

Following recommendations from the Independent Public Service Pensions Commission in 2011, the cost control mechanism was introduced into the valuation process for public service pension schemes in the Public Service Pensions Act 2013 following consultation with member representatives. It was designed to ensure a fair balance of risk regarding the cost of providing defined benefit (DB) public service pensions between members and the taxpayer.

In September 2018, the Government announced they would ask the Government Actuary to conduct a review of the mechanism amidst concerns that it was not operating in line with its original objectives, which are:

To protect taxpayers from unforeseen costs

To maintain the value of pension schemes to the members

To provide stability and certainty to benefit levels—the mechanism should only be triggered by “extraordinary, unpredictable events”.

The Government Actuary’s final report, which sets out his findings and recommendations, was published on 15 June. The Government have considered this report and are now consulting on reforms they propose to make to the mechanism to ensure it operates as intended. All of the Government’s proposed changes are recommendations by the Government Actuary.

The consultation will last for eight weeks and close on 19 August. The consultation document can be found at: https://www.gov.uk/government/consultations/public-'>https://www.gov.uk/government/consultations/public- service-pensions-cost-control-mechanism-consultation.

The discount rate methodology

The second consultation is titled “Public Service Pensions: Consultation on the discount rate methodology”.

“SCAPE” (superannuation contributions adjusted for past experience) is the name of the process for setting employer contribution rates at valuations of unfunded public service pension schemes. The “SCAPE discount rate” is the discount rate used as part of this process. It is used to express the pension promises being built up in a scheme as a present-day cost and is set by HM Treasury following a prescribed methodology.

The Government previously consulted on the methodology used to set the SCAPE discount rate in 2010. In response to that consultation, they announced that the SCAPE discount rate methodology would be based on expected long-term GDP growth.

In response to the 2010 consultation, the Government expressed an intention to review the SCAPE discount rate methodology every 10 years. This consultation meets that intention and seeks views on the most appropriate methodology for setting the SCAPE discount rate going forward.

The consultation will last for eight weeks and close on 19 August. The consultation document can be found at: https://www.gov.uk/government/consultations/public-'>https://www.gov.uk/government/consultations/public- service-pensions-consultation-on-the-discount-rate-methodology.

[HCWS117]

Oral Answers to Questions

Steve Barclay Excerpts
Tuesday 22nd June 2021

(2 years, 9 months ago)

Commons Chamber
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Parliament Live - Hansard - -

In March 2021, the Chancellor announced a further £300 million to build on the existing £1.57 billion of culture recovery fund support to protect our cultural sector. To date, more than £1.2 billion in grants has been paid.

Robert Neill Portrait Sir Robert Neill
- Parliament Live - Hansard - - - Excerpts

The Minister is right, of course, to point out the unprecedented sums that have been given to the arts sector, and that is very welcome, but does he recognise that, particularly for the performing arts, the further four-week delay is crippling their future plans? As all the leading producers both in the west end and throughout the country point out, it takes months to get a show going, and uncertainty cripples that planning. Will he at least consider the calls from throughout the industry for a Government-backed insurance scheme to deal with cancellations if there is further uncertainty? There is a precedent in film and TV production that could readily be adapted. This is about getting them back working, which is actually want they want, rather than simply being subject to grants all the time. They want to get back on stage.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is right to draw attention to the success of the film insurance scheme, which has protected over 45,000 jobs and £1.6 billion of spend. On the specific issue he raises, that is exactly why my right hon Friend the Chancellor announced the additional £300 million of support at the Budget. He anticipated the fact, in going long with that support, that there would be the risk of further delays to the covid row-back, so that was part of the announcement of an additional £300 million that he set out at the Budget.

Alison Thewliss Portrait Alison Thewliss (Glasgow Central) (SNP) [V]
- Parliament Live - Hansard - - - Excerpts

The live events sector continues to be hard hit by covid-19. UK Music and We Make Events have called for additional financial support, an extension of the VAT reduction and Government-backed covid-19 cancellation insurance. Just now, it is impossible for those running concerts and festivals to plan, and some, including Kendal Calling, have had to postpone again until 2022. Can the Minister tell me why the UK Government have left this sector and the many thousands who work in it without the additional support they are calling for?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I fear that the question came before my previous answer. I had just mentioned the £300 million of additional support, over and above the £1.57 billion of support that has been announced. Indeed, the hon. Member frequently raises the plight of those individuals who have been hit, and again that is something we very much recognise. Again, however, that is why my right hon. Friend the Chancellor has set out the wider package of support, such as the time to pay arrangements, loans, business grants and the universal credit uplift. This is about looking at the totality of support within the £352 billion that my right hon. Friend has set out.

Jane Stevenson Portrait Jane Stevenson (Wolverhampton North East) (Con)
- Parliament Live - Hansard - - - Excerpts

What steps his Department is taking to incentivise businesses to invest in new equipment or infrastructure.

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Mohammad Yasin Portrait Mohammad Yasin (Bedford) (Lab)
- Hansard - - - Excerpts

What assessment he has made with the Secretary of State for Education of the (a) effectiveness, (b) value for money and (c) adequacy of the funding allocated to educational catch-up provision announced on 2 June 2021.

Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Parliament Live - Hansard - -

We are providing a further £1.4 billion over the next three academic years for education recovery. This is on top of the £1.7 billion provided for academic year 2020-21.

Mohammad Yasin Portrait Mohammad Yasin [V]
- Parliament Live - Hansard - - - Excerpts

It has been widely reported that it was the Chancellor who refused by a 90% margin to find the funding recommended by Sir Kevan Collins to help our nation’s children to catch up on their education after the pandemic. The Chancellor has benefited from a first-class private education, so will he take this opportunity to apologise to the generation of children he is letting down as the Tories refuse to invest in our children’s and our country’s future?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

There was a striking omission from that question. There was no reference at all to the additional £2.2 billion of core school funding, over and above which there is the £1.4 billion announced by my right hon. Friend the Chancellor. Of course, the House would expect proposals to be evidence-led, deliverable and provide value for money, and we will work with Department for Education colleagues on that, but there was no mention in the hon. Gentleman’s question of the additional £2.2 billion of core school spending uplift this year.

Bridget Phillipson Portrait Bridget Phillipson (Houghton and Sunderland South) (Lab)
- Parliament Live - Hansard - - - Excerpts

The Institute for Fiscal Studies has estimated that the significant long-term cost to our economy from the Chancellor’s failure to invest in our children and young people is as much as £350 billion in lost earnings. Has the Treasury done its own assessment and will the Minister have the decency to publish it?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

As I said in my last answer, we will have a review to inform the question in terms of the impact on time. Most of the debates that we have had in this House have focused on teacher quality as the biggest driver of outcomes for children, so we need to see the evidence of it. For example, if we look at Finland, we see that Finland has a shorter school day but a higher PISA—programme for international student assessment—result. If we look at the USA, we see that it has a longer school day but a lower PISA result. So it is right that we look at the evidence, but teacher quality is usually seen as the bigger driver and that is why we have funded the tuition in the way that my right hon. Friend the Chancellor has.

Bridget Phillipson Portrait Bridget Phillipson
- Parliament Live - Hansard - - - Excerpts

With this Government, it seems that it is a case of “don’t know, don’t care”. The reality is that the Chancellor’s failure to invest in our children’s future is the very definition of a false economy. The Chancellor recently said that he could not say yes to everyone. He seemed to have no problem saying yes to the friends and donors of the Conservative party, but it is a no to the children who urgently need support to catch up after the biggest disruption to their education for a generation. Is the Minister really proud of that?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I am very proud that my right hon. Friend the Chancellor has committed an additional £7.1 billion over three years to increase the school uplift, with £2.2 billion this year alone. I am very proud that he announced £1.7 billion of additional recovery funding. I am proud that he announced a further £1.4 billion, but again, the hon. Lady appears to have written her question before hearing the answer. The answer was that we will of course look as part of our review at the effectiveness of the additional time. I have cited some of the international evidence that we will look at, but teacher quality is usually the bigger driver and that is why we have focused on teacher training but also on the tuition programme, so that we are training an additional 500,000 teachers and rolling out 6 million tuition courses to get that targeted learning support to children across the country.

Sheryll Murray Portrait Mrs Sheryll Murray (South East Cornwall) (Con)
- Parliament Live - Hansard - - - Excerpts

What progress his Department has made in establishing freeports in England.

--- Later in debate ---
Mark Eastwood Portrait Mark Eastwood (Dewsbury) (Con)
- Parliament Live - Hansard - - - Excerpts

The youth investment fund remains an important manifesto commitment and will be valuable in supporting young people. Will my right hon. Friend inform me of its intended launch day and briefly outline the benefits it will bring to young people in Dewsbury, Mirfield, Kirkburton and Denby Dale once it is launched?

Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Parliament Live - Hansard - -

My hon. Friend is right to highlight the importance of the youth investment fund. It was a manifesto commitment and it is due to launch in the coming months. He will recall that at the spending review 2020 we allocated some funding to inform pilots, as we shape that launch.

Owen Thompson Portrait Owen Thompson (Midlothian) (SNP)
- Parliament Live - Hansard - - - Excerpts

Almost every time that I, or others Members, have raised the plight of the millions of people excluded from covid support, Ministers reel off the various levels of support that have been made available to those who have access to it. Without again going through the list of supports that are available, will the Minister tell me when the Government are going to put in place some level of support for those who have had nothing so far, and when it will be backdated to?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The hon. Gentleman will know, as we have discussed it on many occasions, how we have absolutely bent over backwards to attempt to include as many people as possible and have leant into considerable discussion, both with excluded groups and with other related groups. As he will know, it is not a single picture; different groups are not included for different reasons. As a result, we have in part been able to evolve and extend the programmes, and he will be aware that we did so in the last iteration of the self-employed scheme.

Angela Richardson Portrait Angela  Richardson  (Guildford)  (Con)
- Parliament Live - Hansard - - - Excerpts

I welcome the launch of the national infrastructure bank. Road infrastructure projects are needed in my constituency to meet the additional 14,000 homes to be delivered in our local plan, which is why I am calling for the A3 to be tunnelled under Guildford to ease congestion. As we move towards our target of net zero and transition our vehicles to being electric and hydrogen-run, there will be a decrease in revenue raised by fuel duty. Will my right hon. Friend outline what steps he is taking to replace that revenue and to help fund road infrastructure projects such as my tunnel?

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Robert Largan Portrait Robert Largan (High Peak) (Con)
- Parliament Live - Hansard - - - Excerpts

On 3 March, when the Chancellor announced the £4.8 billion levelling-up fund, High Peak was designated one of the top priority areas, and the Government committed to giving more than £100,000 to the council to help it deliver a world-class bid. However, despite my urging, and having had nearly four months, I regret to inform the House that my Labour council has failed to submit a levelling-up fund bid in time. Can my right hon. Friend assure the House and my constituents that there will be a second round for further bids and that High Peak will still be considered a top priority area in any future rounds?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I understand my hon. Friend’s frustration. He will know from the announcement at the Budget that the prospectus set out the process, the types of projects, and indeed how bids will be assessed. To reassure him, there will be further opportunities for local authorities to submit bids to the fund. One of the things that we are encouraging those local authorities to do is to work with elected Members of Parliament in the shaping of those bids, and I hope that they will now take the opportunity to do so.

Rushanara Ali Portrait Rushanara Ali (Bethnal Green and Bow) (Lab) [V]
- Hansard - - - Excerpts

More than half a million young people are out of work and thousands are on furlough. The delay in easing restrictions without associated support for businesses is set to further increase unemployment by 300,000. In the event of a third wave that triggers further restrictions, will Ministers commit to extending the coronavirus job retention scheme and other support that has been vital for our constituents and businesses in our constituencies?

Economy Update

Steve Barclay Excerpts
Wednesday 16th June 2021

(2 years, 9 months ago)

Commons Chamber
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Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Hansard - -

Before I make my statement, I add my appreciation to that of colleagues for Sir Roy Stone and the contribution he has made during his time in the House.

There is little doubt that the four-week extension to restrictions announced on Monday will present additional challenges to thousands of people and businesses across the country. That is why at the Budget we went long and erred on the side of additional support. The package of support from my right hon. Friend the Chancellor was designed to accommodate short delays such as this. Indeed, he told the House at that time that we were

“extending our support well beyond the end of the road map to accommodate even the most cautious view about the time that it might take to exit the restrictions.”—[Official Report, 3 March 2021; Vol. 690, c. 255.]

Most of our economic support schemes do not end until September or after, providing crucial continuity and certainty for businesses and families—something that was welcomed by business leaders and sector leaders when it was announced. They praised the reassurance provided for the long term.

Let me remind the House of the scale of support we have announced for British households and businesses over the past 15 months: £352 billion. We have protected jobs, with 11.5 million unique jobs supported by the furlough scheme, which will be in place until the end of September. At the Budget, we also extended the self-employment income support scheme, supporting nearly 3 million self-employed people and taking the total expected support offered through the scheme to nearly £3 billion.

Businesses have been supported, too, with tax cuts, deferrals, loan schemes and cash grants worth over £100 billion. Our restart grants, worth up to £18,000 from April, have helped Britain’s businesses to get going, at a cost of £5 billion. Some £2.1 billion of discretionary grant funding has been provided for councils to help their local businesses. Last financial year, we provided an unprecedented 100% business rates holiday for all eligible businesses in the retail, hospitality and leisure centres—a tax cut worth £10 billion. This financial year, over 90% of these businesses will receive a 75% cut in their business rates bill across the year to March 2022, and we have extended the 5% reduced rate of VAT for a further six months. The loan guarantee schemes, including the bounce back loan scheme, have provided £70 billion of loans to 1.5 million companies.

We have provided targeted sectoral support, too. At the Budget, for instance, we provided an additional £700 million to support local and national arts, culture and sports institutions as they reopen. That is on top of the £1.57 billion culture recovery fund, bringing our total support for sports and culture to more than £2 billion, with about £600 million yet to be distributed. It is businesses that will create jobs and grow the economy, and we have stood behind them since day one of this crisis.

Just as we have supported jobs and businesses, so have we supported livelihoods too: the temporary £20 uplift to universal credit will continue until the end of September; we increased the national living wage to £8.91 from April and extended it to those over 23; we have increased the local housing allowance for housing benefit, meaning that more than 1.5 million households have benefited from an additional £600 a year, on average; and we provided a £670 million hardship fund to help more than 3 million people keep up with their council bills. This comprehensive package has helped to protect millions of jobs, businesses and livelihoods, and our plan is working. GDP is outperforming expectations: unemployment is forecast to be much lower than previously feared; consumer confidence has returned to pre-crisis levels; businesses insolvencies in 2020 were actually lower than in 2019; and signs in the labour market are encouraging, with 5.5 million fewer people on the furlough than in April 2020. In fact, figures released by Her Majesty’s Revenue and Customs just yesterday showed that the number of people employed has risen by more than 400,000 since November. Of course, covid has impacted different sectors in very different ways, and some particularly acutely, but it should be welcome news to everyone in this House that the early signs are of a recovery in our labour market.

This plan has come at a cost, albeit one that has reduced economic scarring that would have been inflicted otherwise by covid. Last year saw the highest peacetime level of borrowing on record—£300 billion. We are forecast to borrow a further £234 billion this year and a further £107 billion next year, and at a higher level of debt the public finances are more vulnerable to changes in inflation and interest rates. Indeed, a sustained increase in inflation and interest rates of just 1% would increase debt interest level spending by more than £25 billion in 2025-26. As a result, at the next spending review, we will keep the public finances on a sustainable medium-term path, maintaining the trajectory established at the Budget, so that we have the resilience we need to respond to any future challenges.

A huge and comprehensive economic shock has been met with a huge and comprehensive response—one that is working. I am pleased, however, to be able to make one further announcement today. Many businesses have accrued debts to landlords during the pandemic. Because of the threat that posed to jobs, we introduced protections to prevent the eviction of commercial tenants due to non-payment of rent. It is the Government’s firm position that landlords and their tenants should continue to resolve those debts through negotiations, and I welcome the various industry-led schemes already in place, and those being developed, to provide resolutions through arbitration. But in recognition of the importance of jobs in the many affected businesses at the heart of local communities, we launched a call for evidence in April on further actions to take to resolve those debts. As a result of that call for evidence, the Government now plan to introduce legislation to support the orderly resolution of these debts that have resulted from covid-19 business closures. We will introduce legislation in this parliamentary Session to establish a backstop so that where commercial negotiations between tenants and landlords are not successful, tenants and landlords go into binding arbitration. Until that legislation is on the statute book, existing measures will remain in place, including extending the current moratorium to protect commercial tenants from eviction to 25 March 2022.

To be clear, all tenants should start to pay rent again in accordance with the terms of their lease, or as otherwise agreed with their landlord, as soon as restrictions are removed on their sector if they are not already doing so. We believe that that strikes the right balance between protecting landlords and supporting the businesses that are most in need. Based on the successful Australian approach, it sets out a long-term solution to the resolution of covid-19 rent, ensuring that many variable businesses can continue to operate and that debts accrued as a result of the pandemic are quickly resolved to mutual benefit. I thank those on both sides of the issue for their constructive engagement.

Striking the right balance, just as we are doing with commercial rents, has been the key to our approach all along, and it will continue to shape our approach in the weeks ahead.

--- Later in debate ---
Rachel Reeves Portrait Rachel Reeves
- Hansard - - - Excerpts

Not just “hopeless”. People have given up so much over the last year. We have pulled together and shown the best of our country. People have done everything that was asked of them and much, much more. We should not be in this position today. Businesses and workers do not deserve to have the rug pulled from under their feet at the eleventh hour. We want to see businesses make it through the pandemic and thrive again, because they are an important part of what makes our country so great and they are essential for our economic recovery. We need them and they need us today. That is why the economic support we have should match the health restrictions that are still in place, and that is what the Government have failed to deliver today.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

May I first echo the remembrance by the hon. Lady and colleagues across the House of Jo Cox? I also pay tribute to the hon. Lady for the work that she has done, including with my friend Seema Kennedy, through the loneliness commission.

Let me turn to the various points raised by the hon. Lady. She said that she is not calling for support forever, but suggested that the Government were withdrawing support. The package announced by my right hon. Friend the Chancellor was designed deliberately to go long, until September. Measures such as furlough were extended to anticipate the fact that there were no guarantees on the covid road map. That was very much designed into the support, so there is no question of withdrawing support; it was in the very plan announced by the Chancellor.

The hon. Lady’s question about the delta variant was addressed comprehensively by the Prime Minister during Prime Minister’s questions, where he pointed out the timing. One can look back with hindsight now, but the issue was the timing of the delta variant becoming a variant of concern. I will not repeat the points made by my right hon. Friend the Prime Minister.

I am grateful to the hon. Lady for recognising the announcement regarding commercial rents. I hope that that is appreciated across the House. I know that it speaks to a very real concern that many Members will have seen through their constituency emails and post bags, and that it will provide some extended support.

The hon. Lady questioned whether the Government are doing whatever it takes. Again, I remind the House that the Government have spent £352 billion to date. By any definition, I think that is a comprehensive package. More to the point, the plan is working. We see that in the plan for jobs, in the fact that the unemployment projections have improved and in the number of jobs there have been since November. My right hon. Friend the Chancellor’s plan is working. He has done whatever it takes to protect our NHS and public services, putting a further £63 billion into the NHS for covid support measures last year. The plan is having clear benefits.

The hon. Lady asked specifically about the furlough taper. Labour market conditions have improved substantially since the turn of the year and will continue to do so. Indeed, demand for staff has increased at the quickest rate for more than two decades. With unemployment falling in the last four releases, there is clear evidence that the labour market is beginning to recover, but we went long in the first place to anticipate any slippage in the covid road map.



The hon. Lady had a query on business rates. Again, it is worth reminding the House just how comprehensive the support on business rates has been, with 100% business rates relief last year for many businesses, and those businesses now paying 75% over the course of this year. There is a comprehensive package of support for businesses. There is no question but that many businesses will feel strain as result of the further extension, and it is not a decision that my right hon. Friend the Prime Minister took lightly, but the package of support announced by the Chancellor anticipated this scenario. It went long in order to provide support and it continues to do so in a way that the evidence and the data shows is working.

Stephen Crabb Portrait Stephen Crabb (Preseli Pembrokeshire) (Con)
- Parliament Live - Hansard - - - Excerpts

I welcome the Minister’s statement. He is right: the latest employment and job vacancy figures do demonstrate that the UK economy is now rebounding strongly. I cannot recall a time when so many businesses in my constituency were telling me that they are struggling to hire staff, right across all sectors. Does he agree that we need to take a sober and clear-sighted look at the furlough scheme, because it is the view of a great many employers out there that there are still far too many people being paid to do nothing, which is distorting the efficient functioning of the labour market as well as costing the country tens of billions of pounds?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My right hon. Friend draws attention to exactly why the attack from the Opposition is misplaced and why the furlough taper is justified—because there is demand for labour from businesses. He also knows that it is part of the wider package of support. As a former Secretary of State, he has done a huge amount to champion the need to support people looking for work. That is what the doubling of the number of work coaches is doing. We announced a further £2.6 billion of additional support for the Department for Work and Pensions in the spending review, alongside further specific measures such as the restart scheme, to tackle the situation of those who have been unemployed for over a year. Over 1 million unemployed people on universal credit will have access to that scheme.

This is about a combination of the furlough, which is providing much-needed support but needs to taper, and a wider plan for jobs, including the restart scheme, the kickstart scheme, the tripling of traineeships, and the increase in the apprenticeships incentive to £3,000—a whole package alongside the doubling of the number of work coaches.

Alison Thewliss Portrait Alison Thewliss (Glasgow Central) (SNP) [V]
- Parliament Live - Hansard - - - Excerpts

My thoughts are also with the family and friends of Jo Cox.

Over the past 15 months, companies in sectors such as tourism, travel, hospitality, events, the arts, the night-time economy and weddings—and their supply chains—have been building up debts and have not even gotten close yet to breaking even. It is shameful that not an extra penny of support is being announced for them today. The debt incurred by businesses could take a decade to pay back and will be a drag on recovery. The Treasury Committee was told last week by the British Retail Consortium and UKHospitality that their estimate of commercial rent arrears alone stands at over £5 billion. The Minister has extended the moratorium today and spoken of legislation, but what is his plan to deal with this debt? He asks businesses to start paying back, but with what?

Under the Treasury’s furlough scheme, businesses must pay an additional 10% of their employees’ wages on 1 July, rising to 20% in August, before the scheme is due to end in September. When this happened last year, businesses could not cope with the costs and people lost their jobs. Kate Nicholls of UKHospitality has called this situation unsustainable, and the Federation of Small Businesses has called for urgent additional support.

So will the Minister delay the furlough increase, and will he now extend furlough and the self-employment income support scheme for as long as they are required? Will he act to support those like the Blue Dog employees in Glasgow, whose employer’s behaviour has meant that they have not received the payments they were entitled to? Will he finally—finally—put things right for the millions unjustifiably excluded from UK Government support schemes, such as those on short-term pay-as-you-earn contracts? Many have faced absolute financial ruin through no fault of their own, and it is high time they got support, and an apology from the Minister. Will he make the VAT cut to 5% permanent to give hospitality, tourism and events a much-needed boost into next year, and extend it to the hair, beauty and personal services sector? Will he keep the universal credit uplift and make an increase to sick pay?

The UK currently has the lowest stimulus package of any G7 country despite suffering the worst economic slump. We now need to boost it like Biden with a major fiscal stimulus of at least £100 billion. There is so much more that Scotland would do with the economic levers if we had access to them—so if the Minister will not act, will he give Scotland the power to do so?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The Scottish Government are still not using all the powers available to them on tax and welfare, and I always feel that before they seek further powers it would be useful for them to use fully the ones they already have. I found it slightly odd that the hon. Lady said that not a penny of support had been announced, because the whole point of the package that was announced was the extensive support going on until the end of September. She seems to be ignoring that and suggesting that everything should start afresh from today.

The hon. Lady mentioned business rates, which I picked up on earlier. This financial year, over 90% of businesses in the retail, hospitality and leisure sector that benefited from the 100% business rates holiday last year will receive a 75% cut in their business rates for the full year to March 2022. Let me just put that in context. In that last year, that tax cut cost £10 billion. This year, it is an additional £6 billion. The hon. Lady says that not a penny has been announced, but there is a further £6 billion of tax cuts on business relief this year in addition to last year. I think it is worth remembering the wider picture of the £352 billion of support.

The hon. Lady mentioned universal credit. We have been very clear from the start that it was a temporary uplift; my right hon. Friend the Chancellor set that out at the time. She also mentioned delaying furlough. As my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) mentioned earlier, there are good reasons why it is not in people’s interests to be on furlough for extended periods of time if their job has disappeared and is not going to come back and if there are other businesses that want to employ that labour. The furlough has achieved its main purpose in retaining the link between labour and business and allowed businesses to bounce back better as a result. So before asking for new powers, the Scottish Government should be focusing on the delivery of their response to covid and recognising the fact that we have been able to respond in this way because we have the strength of one United Kingdom. It is through this wider resilience that we have been able to put together a package of the size that the Chancellor has done.

Virginia Crosbie Portrait Virginia Crosbie (Ynys Môn) (Con)
- Parliament Live - Hansard - - - Excerpts

Thanks to decisions made by this Government, recent ONS data shows that UK unemployment is among the lowest in Europe at 4.7%, with almost 200,000 more people in work since April. My families on Ynys Môn desperately need more jobs, and a freeport on Anglesey would create thousands of high-skilled job opportunities. Can the Minister please update the House on what discussions he has had with the Welsh Government about the creation of at least one new freeport in Wales?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

We want to ensure that the whole of the UK can benefit from freeports, and that is why we remain committed to establishing at least one freeport in Scotland, Wales and Northern Ireland as soon as possible. As in England, a Welsh freeport will be chosen according to a fair, open and transparent allocation process.

Christine Jardine Portrait Christine Jardine (Edinburgh West) (LD)
- Parliament Live - Hansard - - - Excerpts

My thoughts and sympathies are with the family of Jo Cox on what must be a very difficult day for them.

The Chief Secretary to the Treasury has just been patting the Government on the back for what he calls “going long”, but does he appreciate that it does not feel that way for all the businesses facing another month of restrictions, during which time many will have to find 10% of salaries for furloughed staff, face increased VAT in hospitality, retail and leisure, and think about repaying bounce back loans without being able to trade again? When exactly will the Government abandon this piecemeal approach and reveal the long-term strategy for recovery and the extension of furlough and VAT holidays on which so many businesses, communities and families in this country depend for their future?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

No one is saying that next month those businesses have to repay their bounce back loans. We have already extended the furlough and we have provided a huge amount of support to the businesses concerned. I have addressed some of the questions in relation to the business relief, VAT, the extension of the furlough scheme, the restart grants of up to £18,000 and the £2 billion of discretionary grant funding to local authorities. A comprehensive package of support has been offered, and it is simply not the case that these loans must be immediately paid back or that support has not been extended in line with the road map.

Simon Fell Portrait Simon Fell (Barrow and Furness) (Con)
- Parliament Live - Hansard - - - Excerpts

Visiting businesses across Barrow and Furness last weekend, I had one clear message from both those who run the businesses and the staff: they are incredibly grateful for the support they have had from the Government, especially the furlough scheme, but they asked for continuity and certainty that these schemes will continue through the delay in the road map. With that in mind, can my right hon. Friend confirm that the schemes will continue through this time and that, if the high street faces future shocks, the Treasury will look sympathetically at what measures it can put in place to support businesses there?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

One thing my right hon. Friend the Chancellor has shown throughout the challenges of the pandemic is his nimbleness and willingness to respond to changing circumstances, but part of the design of the package of support was that, if there was a delay to step 4, it would be accommodated through the continuation of measures such as the furlough, the self-employment income support scheme, the business grants, the business rates relief and the loans programme. That was part of the design, but throughout the pandemic it has very much been the Chancellor’s ethos to respond to changing needs.

Cat Smith Portrait Cat Smith (Lancaster and Fleetwood) (Lab)
- Parliament Live - Hansard - - - Excerpts

For as long as the health restrictions mean that businesses must stay closed, it is right that the economic support package supports jobs in those workplaces, but that simply is not the case. With the extension of the restrictions and, from 1 July, employers having to make a 10% further contribution to the wages of employees who are furloughed, jobs and livelihoods will be put at risk, including 3,700 jobs in my Lancaster and Fleetwood constituency. Surely the Minister can see how illogical that is, so will he reassess the tapering on the furlough scheme?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

With respect to the hon. Lady, the number on the furlough has come down. As I mentioned in my opening remarks, there has been an increase in the level of employment since November, and my right hon. Friend the Member for Preseli Pembrokeshire mentioned some of the challenges around employers wanting to hire and finding on some occasions that the furlough is an impediment to labour moving. Actually, I do not think the data bears out the hon. Lady’s point. The furlough has been a very expensive but essential measure in order to reduce economic scarring, but it is right that it tapers as we bounce back and more businesses open, and I think the data supports that.

Bim Afolami Portrait Bim Afolami (Hitchin and Harpenden) (Con)
- Parliament Live - Hansard - - - Excerpts

As the Chief Secretary has mentioned, unemployment is down. It is 2 million people fewer than originally forecast in April last year, and the unemployment rate at the moment is about 4.7%. Does this not show that our plan for jobs is working, and will the Chief Secretary set out how the plan will help people take advantage of the many vacancies that there are across many sectors?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I agree with my hon. Friend that the plan for jobs is working. We see that in the furlough data from the end of April, which is the last set of data that we have. There were 3.4 million people on furlough—down from a peak of 8.7 million—which shows the effectiveness of that. Output grew by 2.3% in April, and there was growth of 2.1% in March. Again, one can see the trajectory and the improvement there. Indeed, GDP data so far through 2021 has come out above the Office for Budget Responsibility forecast. There is still much work to do, but my hon. Friend can take comfort from the trajectory, which shows that the plan is indeed working.

Sarah Owen Portrait Sarah Owen (Luton North) (Lab)
- Parliament Live - Hansard - - - Excerpts

At the weekend, I visited Tip Top Linen Services in Luton North, which is a fantastic part of the local hospitality supply chain, with its roots committed to the community and an ethical ethos to be proud of, but the Government’s abject failure means that many of the company’s clients now cannot reopen for at least another four weeks. What does the Chief Secretary say to this and other brilliant but forgotten firms, which have taken a hit yet again because of his Government’s failure to contain this dangerous new variant and to recognise that the hospitality sector is not just hotels and restaurants?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I do not accept that. Looking at the vaccine programme that the UK has had thanks to the huge efforts of our NHS, volunteers and so many people in communities up and down the country, I would not characterise it as an abject failure. Actually, our deployment of vaccines is the envy of many countries, and it is key to the road map.

For Tip Top Linen Services, and businesses across the United Kingdom, we have provided a comprehensive package of support, as I set out in a number of responses. That is key to those important businesses being able to bounce back as the road map moves to step 4.

Eleanor Laing Portrait Madam Deputy Speaker (Dame Eleanor Laing)
- Hansard - - - Excerpts

I call Dame Andrea, whom I congratulate on her extremely well deserved honour.

Andrea Leadsom Portrait Dame Andrea Leadsom (South Northamptonshire) (Con)
- Parliament Live - Hansard - - - Excerpts

Thank you, Madam Deputy Speaker. My right hon. Friend will be aware that some people who have been furloughed during lockdown have taken on other jobs. A big hotel and golf complex—a family-owned business in South Northamptonshire—furloughed about 300 staff. When it came to unlocking and it called back all those staff, around half of them resigned because they already had other jobs at supermarkets, delivery companies and so on. What can my right hon. Friend do, first, to protect the taxpayer from people effectively earning double pay, and also to stop that happening to the huge detriment of this family-run business?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

First, may I join you, Madam Deputy Speaker, in offering congratulations to my right hon. Friend on her well-deserved recognition? She raises an important and legitimate point. The furlough scheme was designed to operate within the employment law framework. An employee is able to have a second job while on furlough, provided that that was allowed within the terms of their existing employment contract. I appreciate the spirit of the point she raises, and that was not the original intention when someone moved on to another job. It was part of the balance, as we have debated in this House many times, between the speed of the scheme’s deployment and how one designed its various features. What is allowed within an employment contract shapes what employees can do while on furlough.

Ben Lake Portrait Ben Lake (Ceredigion) (PC) [V]
- Parliament Live - Hansard - - - Excerpts

In addition to addressing the public health emergency of covid-19, there is a pressing need for Governments across the world to act decisively to combat climate change. The Climate Change Committee has today criticised the Government’s lack of action on climate-proofing our economy and society. Will the Treasury adopt the same urgency in tackling this crisis as it did when tackling the covid-19 pandemic, by allocating the funding necessary to address the recommendations in today’s report, and accelerating our net-zero transition?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Future spending commitments on net zero will be matters for the spending review, but the hon. Gentleman will know well the Prime Minister’s commitment to that agenda and the 10-point plan, as well as the leadership that the UK is providing through COP26. This issue is a key priority of the Prime Minister and the Government as a whole. There is much agreement across the House about the urgency of addressing climate change, but spending decisions on that will be for the spending review.

Andrew Selous Portrait Andrew Selous (South West Bedfordshire) (Con) [V]
- Parliament Live - Hansard - - - Excerpts

I thank the Chief Secretary to the Treasury for the £352 billion for jobs and businesses. Will he look urgently at sectors such as aviation, travel agents, and the events industry, which cannot currently trade out of the pandemic? For example, Ace Bar Events in Studham has had very little income and no help since the March 2020 £10,000 grant.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

As my hon. Friend will know, Treasury Ministers and colleagues across the Government are always keen to engage with him on specific sectoral issues. The wider package of support was designed to work across sectors, and in addition to that I also mentioned specific support for the culture and sport sectors, such as the £1.57 billion announced and the further grant of £300 million. More than £11 billion of support has gone to the aviation sector. There are targeted measures of support for specific sectors, but they fit within the wider package of support such as the covid corporate financing facility, grants on research and development, and the furlough package of support.

Drew Hendry Portrait Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP) [V]
- Parliament Live - Hansard - - - Excerpts

People and businesses, especially in the hospitality sector, still need urgent and ongoing help to navigate the continuing covid emergency. The UK Treasury alone can help in three ways: it could continue the VAT cut for the sector or, even better, remove VAT; it could continue furlough at its current rate; or, as less than a fifth of the promised £350 billion for covid loans has been used, it could convert a chunk of it to grant funding. Will the Treasury do all or any of those three things?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The support package announced by my right hon. Friend the Chancellor was designed to anticipate any potential slippage in the covid road map. The hon. Gentleman specifically mentions VAT, which has not been raised so far. The package of support in terms of reducing VAT totals £7 billion so far, with the 5% rate being extended to 30 September. Then there is a further transitional period for six months at 12.5%. Again, the narrative that VAT reductions are coming to an end, and that that is out of step with the covid road map, is not the case: the VAT reduction has already been extended to 30 September and then there is a transitional period at the lower level of 12.5%, in anticipation of the situation we face.

Christian Wakeford Portrait Christian Wakeford (Bury South) (Con)
- Parliament Live - Hansard - - - Excerpts

The business rates holiday last year delivered a tax cut worth £10 billion for businesses in the retail, hospitality and leisure sectors—businesses such as the Goat’s Gate in Whitefield in my constituency, which won my best pub competition. Will my right hon. Friend confirm that 90% of the businesses that benefited last year will also receive a 75% cut to their business rates bill for the full year to March 2022, thus continuing to support vital businesses in Prestwich, Whitefield and Radcliffe?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is absolutely right that businesses will continue to benefit from support. It is about getting the balance right between support for businesses and the cost to the Exchequer. There was 100% support for those businesses last year, and this year it equates to a 75% reduction in their business rates bill across the financial year.

Rebecca Long Bailey Portrait Rebecca Long Bailey (Salford and Eccles) (Lab) [V]
- Parliament Live - Hansard - - - Excerpts

Both the Association of Independent Professionals and the Self-Employed and the CBI have this week called for urgent sector-specific support packages; the British Chambers of Commerce and the TUC have urged the extension of the full furlough scheme; and ExcludedUK has reiterated calls to support the millions who have been left without support for over 15 months.

Will the Chief Secretary heed these calls and commit today to outlining urgently updated sector-specific support for industries subject to continuing restrictions, to extending the full furlough scheme for as long as needed and, finally, to ensuring a comprehensive and backdated package of income support for the excluded?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

We have already covered the point that furlough has been extended until the end of September. As I said in my answer only a moment ago, there are specific sectoral support packages in addition to that. At the same time, we need to get the balance right between that and the very considerable cost to the Exchequer—borrowing £200 billion last year and with significant further borrowing this year and next. We need to get the balance right between that level of borrowing and the wider package of support offered.

Eleanor Laing Portrait Madam Deputy Speaker (Dame Eleanor Laing)
- Hansard - - - Excerpts

I appreciate that these are complex issues and that the Chief Secretary is being most assiduous in giving full answers, but I wonder if we could go just a little faster now. We have a lot of business to get through, which means people have to ask questions, not make statements.

Scott Benton Portrait Scott Benton (Blackpool South) (Con)
- Parliament Live - Hansard - - - Excerpts

Nobody in this House, or indeed in Blackpool South, wanted to see a pause in our road map of easing restrictions. Does my right hon. Friend the Chief Secretary to the Treasury agree that this short delay is necessary so that we can proceed irreversibly out of lockdown, build back better from covid and, finally, begin to get our public finances back in order?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Yes, I agree with my hon. Friend. The key is that it will allow time for more second vaccinations, which is key in the step-forward decision on the road map.

Catherine West Portrait Catherine West (Hornsey and Wood Green) (Lab)
- Parliament Live - Hansard - - - Excerpts

My constituents will be very disappointed that the Chancellor has not bothered to come to this Chamber in such a week as this to answer my question relating to freelancers—particularly but not uniquely in the creative sector—who have been excluded from any package. So to pay for that, will the Minister have an urgent meeting with me and other Members who are worried about those who have been excluded from all packages of support, by the end of this week?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

It is slightly odd to criticise me when I am literally in the Chamber answering the hon. Lady’s question. The point is that there has been a comprehensive package of support for those on the self-employment income support scheme, which has been further extended. Many of those who were of most concern to colleagues on both sides of the House in earlier debates have come into scope of those schemes as we have gone through extensions, and I understand that my colleague the Financial Secretary has met groups to hear representations on these issues.

Nigel Mills Portrait Nigel Mills (Amber Valley) (Con) [V]
- Parliament Live - Hansard - - - Excerpts

I welcome the measures announced today to help business tenants resolve any arrears disputes with their landlords. Does the Chief Secretary think that money could be found for a similar scheme for residential tenants who have gone into arrears with their landlords, to help to contribute to clearing those arrears so that tenants can have a fresh start once the pandemic is over?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Today’s announcement clearly pertains to commercial rents. Of course, colleagues continue to listen to Members from across the House on other issues as they arise. I am very happy to have further discussions with my hon. Friend.

Joy Morrissey Portrait Joy Morrissey (Beaconsfield) (Con)
- Parliament Live - Hansard - - - Excerpts

I thank my right hon. Friend for the assistance and tax cuts that he has given to businesses. Unlike Opposition Members, I will not demand additional spending and borrowing: does my right hon. Friend agree that we must come to grips with our level of borrowing and spending? We must have sound financial management moving forward out of the pandemic. Will he confirm that the Government have firm plans to do that?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I strongly welcome my hon. Friend’s question. She is absolutely right to focus on that. That is why, at the Budget, my right hon. Friend the Chancellor announced key measures such as maintaining the level of personal tax thresholds until 2025-26 and increasing the main rate of corporation tax. It is important that we take measures to protect the public finances and get them back on to a sustainable path in the medium term. She is absolutely right to highlight that important issue.

Alan Brown Portrait Alan Brown (Kilmarnock and Loudoun) (SNP)
- Parliament Live - Hansard - - - Excerpts

In December, the UK Government provided a quarantine exemption to people flying business class, as if somehow the richest were immune to covid. Despite the bluster, we know that India was not added to the red list quickly enough. In terms of learning lessons, does the right hon. Gentleman agree that financial analysis needs to be undertaken on the cost of protecting borders with full quarantine and supporting the travel and tourism industries, versus the damage in financial impact of the longer imposition of restrictions?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Where there is a balance between protecting the unlocking of the wider UK economy versus a tougher approach at the border, the bigger prize economically is the UK’s ability to unlock our economy. As the Prime Minister set out in Prime Minister’s questions, we should not judge that with the benefit of hindsight when information on variants of concern which were not known at the time subsequently come to light, not least because of the UK’s capacity to undertake 47% of current global genome testing. Again, that is a further illustration of the UK-wide capacity that allows us to be more effective in our response.

Andrew Jones Portrait Andrew Jones (Harrogate and Knaresborough) (Con)
- Parliament Live - Hansard - - - Excerpts

At the Budget in March, the Chancellor made it clear that he was taking a long-term approach to the support schemes for two specific reasons: to accommodate any short pauses in the road map, and to provide certainty in planning for businesses and families. Does my right hon. Friend agree that because the support schemes—most of them, anyway—do not end until September, the principle of continuity and certainty is being delivered? Will it continue to be a part of all planning?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Very much. I am grateful to my hon. Friend for that question, and he is absolutely right. That was exactly the Chancellor’s design for that continuity and certainty. Indeed, that particular thing was recognised and welcomed by many business leaders at the time.

Steve McCabe Portrait Steve McCabe (Birmingham, Selly Oak) (Lab) [V]
- Parliament Live - Hansard - - - Excerpts

Nightclubs and live music venues across Birmingham have been busy preparing and selling tickets for events in anticipation of the now delayed reopening. That is a further cost they can ill afford. Is there any further support the Minister is prepared to give them?

--- Later in debate ---
Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I have set out the comprehensive package of support that applies to businesses with restart grants and so forth. Of course, I would draw the hon. Gentleman’s attention to the support through local authorities, including the discretionary grants that are available as well.

Luke Evans Portrait Dr Luke Evans (Bosworth) (Con)
- Parliament Live - Hansard - - - Excerpts

I continue to meet businesses in Bosworth, most recently those from the Hinckley business improvement district. They told me they were very grateful for all the support the Government have offered during this time, but they are looking to grow for the future as they come out into the post-pandemic economy, and one of the biggest concerns they have is business rates. I know the Chancellor is committed to a review of business rates. Is the Treasury heeding that call, is the Chancellor committed to bring that forward, and is there a timeline to do so?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

As my hon. Friend touched on in his question, the Government have committed to conclude the business rates review by autumn 2021. The review is considering the issues he mentions, including the fundamental changes to the administration of the business rates system and indeed the impact that has on businesses.

Afzal Khan Portrait Afzal Khan (Manchester, Gorton) (Lab) [V]
- Parliament Live - Hansard - - - Excerpts

It is wonderful to see cafés, restaurants, pubs and bars in my constituency reopening their doors. Local spots like Levenshulme Bakery, Mediterranean Café and Coffee Cranks in Whalley Range and the Sanam restaurants in both Longsight and Rusholme are well worth a visit, if the Minister would like to join me some time. Despite doors being open again, the hospitality sector is now facing a mountain of debt. Forcing businesses to pay this back while many are still struggling to turn a profit is unfair and could well harm the recovery, so does the Minister agree that a flexible repayment scheme tied to profits is now necessary?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

First, I am very grateful to the hon. Member for the kind invitation, and I hope one day to be able to join him in what I am sure are fantastic local businesses to which he is quite right to draw the House’s attention. The key is the support that those businesses have had so that they are able to bounce back and to be open now. On the issue of debts carried by business, part of the design of the Chancellor’s schemes such as bounce back loans has been to allow additional time for those loans to be repaid so that they do not become an undue burden on those businesses.

Simon Jupp Portrait Simon Jupp (East Devon) (Con)
- Parliament Live - Hansard - - - Excerpts

East Devon is back open for business, but step into any pub, café, hotel or restaurant and it is clear that it is struggling with the impact of social distancing. Does my right hon. Friend agree with me that social distancing in hospitality must go next month to give these businesses a fighting chance of survival?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

My hon. Friend is right to highlight the importance of the review of social distancing that the Government are committed to undertaking, and that will obviously shape the approach. We have said that we will have a review, and we are very committed to that. The future beyond step 4 will therefore need to be taken in the round, shaped by the data in that review.

Martyn Day Portrait Martyn Day (Linlithgow and East Falkirk) (SNP) [V]
- Parliament Live - Hansard - - - Excerpts

Last year, when faced with the second wave of covid-19, the Scottish Government called for an extension of furlough as Scotland went into a further lockdown. However, the Tories only extended the scheme when it was clear that the south of England needed to be placed under tighter restrictions. Does the Minister agree that if Scotland is to be treated as an equal partner in the United Kingdom, furlough must be available if and when we need it?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The furlough is available—it extends to the end of September—but the hon. Gentleman seems to be suggesting that it is there almost indefinitely, as opposed to being an exceptional measure in response to the exceptional circumstances of the pandemic. Given the wider fiscal cost, not least the £352 billion spent to date, I do not think that that would be fiscally responsible.

Richard Fuller Portrait Richard Fuller (North East Bedfordshire) (Con)
- Parliament Live - Hansard - - - Excerpts

May I commend my right hon. Friend for the Treasury’s response to the immediate challenge of covid, but also for having an eye on the longer-term challenge of inflation? We are now in the 13th year of competitive quantitative easing by the Fed, the Bank of Japan, the European Central Bank and the Bank of England. May I ask for his reflections on its effect on his near-term economic plans?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

Of course, decisions on quantitative easing are for the Bank of England, which is independent. The last time I looked, I think the initial response to the global financial crisis was approximately £75 billion, and there has been about a twelvefold increase in QE since then, so I understand my hon. Friend’s underlying point. Ultimately, what my right hon. Friend the Chancellor has been focused on is the plan for jobs and supporting the economic recovery. We can see from the output data that the economy grew by 2.3% in April, as I said earlier, and GDP data has come out of the Office for Budget Responsibility forecast.

However, as my hon. Friend, who takes a deep interest in the matter, well knows, the picture remains challenging. There were 1.9%—or half a million—fewer employees in May than in February 2020, and 3.4 million people are still on furlough. It is a challenging picture, but I think that the plan for jobs is working, and the data suggests that.

Toby Perkins Portrait Mr Toby Perkins (Chesterfield) (Lab)
- Parliament Live - Hansard - - - Excerpts

The impact of these restrictions on Britain’s pubs has been very tough indeed, but it has been even worse for nightclubs that have been unable to open at all. It seems entirely wrong to me that, from 1 July, a nightclub that is unable to open will be paying a 33% business rate bill and seeing an increase in its furlough contributions. Given that the Government’s failure has forced them to extend how long the nightclubs are closed for, will the Chief Secretary confirm that he will consider whether nightclubs should no longer be expected to pay that 33% on their business rates?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The hon. Gentleman raises a perfectly legitimate point about how acutely that sector in particular has been affected, as I think everyone in government recognises, but I do not think it fair to say that the Government have not announced any measures that reflect those challenges. Indeed, on commercial rent, he will have heard in my statement today’s specific announcement that applies to the sector. There are also other things, such as the furlough going long, the restart grant and a number of things within the comprehensive package, that are obviously of benefit to nightclubs.

Gareth Davies Portrait Gareth Davies (Grantham and Stamford) (Con)
- Parliament Live - Hansard - - - Excerpts

This morning’s ONS inflation report highlights the risk we face of rising rates, given the amount of debt that we have incurred during the pandemic. Does my right hon. Friend agree that it is important we focus on sustainable public finances, and that one way we can help is by mobilising more private capital investment?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

I absolutely agree, and I think that the importance of securing private investment is a very good note on which to end. My hon. Friend will know that in May, on the consumer prices index, inflation rose to 2.1% and the Monetary Policy Committee judged:

“Inflation expectations remained well anchored.”

However, with debt at nearly 100% of GDP, we need to pay close attention. To finish on a more sobering note, perhaps, a sustained increase in inflation by one percentage point would increase debt interest spending by £6.9 billion in ’25-26, so my hon. Friend raises—as did the hon. Member for Leeds West (Rachel Reeves)—an important point that the House needs to keep under review.

Eleanor Laing Portrait Madam Deputy Speaker (Dame Eleanor Laing)
- Hansard - - - Excerpts

I thank the Chief Secretary and everyone who took part in the statement for getting through it in 58 and a half minutes. That always keeps the occupant of the Chair happy.

I would like to take a second to thank Sir Roy Stone for his extraordinary, long and patient service to this House; I cannot imagine this place without him. I know that we all wish him well.

We come to the result of today’s deferred Division on the Draft Climate Change Act 2008 (Credit Limit) Order 2021. The Ayes were 363 and the Noes were 263, so the Ayes have it.

[The Division list is published at the end of today’s debates.]

We now come to the exciting annual event of the presentation of Bills, which have arisen as a result of the private Members’ Bills ballot. We have 20 such Bills. Contrary to the normal procedure when Members queue up behind the Chair, I hope that all 20 Members are either now in their places, or ready to participate virtually.

Bills Presented

Education (Careers Guidance in Schools) Bill

Presentation and First Reading (Standing Order No. 57)

Mark Jenkinson presented a Bill to extend the duty to provide careers guidance in schools.

Bill read the First time; to be read a Second time on Friday 10 September, and to be printed (Bill 14).

Employment and Trade Union Rights (Dismissal and Re-engagement) Bill

Presentation and First Reading (Standing Order No. 57)

Barry Gardiner, supported by Robert Halfon, Gavin Newlands, Christine Jardine, Caroline Lucas, Sammy Wilson, Ben Lake, Andy McDonald, Dawn Butler, Darren Jones and Bell Ribeiro-Addy, presented a Bill to amend the law relating to workplace information and consultation, employment protection and trade union rights to provide safeguards for workers against dismissal and re-engagement on inferior terms and conditions; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 22 October, and to be printed (Bill 15).

Menopause (Support and Services) Bill

Presentation and First Reading (Standing Order No. 57)

Carolyn Harris, supported by Judith Cummins, Peter Dowd, Rosie Duffield, Nick Smith, Karin Smyth, Jim Shannon, Tracey Crouch, Jackie Doyle-Price, Tim Loughton and Caroline Nokes, presented a Bill to make provision about menopause support and services; to exempt hormone replacement therapy from National Health Service prescription charges; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 29 October, and to be printed (Bill 16).

Down Syndrome Bill

Presentation and First Reading (Standing Order No. 57)

Dr Liam Fox, supported by Ben Lake, Ian Paisley, Dr Lisa Cameron, Mark Logan, Nick Fletcher, Layla Moran, Darren Jones, James Daly, Mrs Flick Drummond and Elliot Colburn presented a Bill to make provision about meeting the needs of persons with Down syndrome; to place a duty on local authorities to assess the likely social care needs of persons with Down syndrome and plan provision accordingly; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 26 November, and to be printed (Bill 17).

Marriage and Civil Partnership (Minimum Age) Bill

Presentation and First Reading (Standing Order No. 57)

Sajid Javid, supported by Mrs Pauline Latham, Robert Halfon, Sir Graham Brady,

Philip Davies, Sarah Champion, Mrs Maria Miller, Alun Cairns, Fiona Bruce, Siobhan Baillie, Mr Virendra Sharma and Ms Nusrat Ghani, presented a Bill to make provision about the minimum age for marriage and civil partnership; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 19 November, and to be printed (Bill 18).

Copyright (Rights and Remuneration of Musicians, Etc.) Bill

Presentation and First Reading (Standing Order No. 57)

Kevin Brennan, supported by Ms Karen Buck, Damian Green, Alex Davies-Jones,

Claire Hanna, Sir Greg Knight, Ben Lake, Esther McVey, Abena Oppong-Asare, Jim Shannon, David Warburton and Pete Wishart, presented a Bill to make provision about the rights and remuneration of musicians and other rights holders; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 3 December, and to be printed (Bill 19).

Medical Cannabis (Access) Bill

Presentation and First Reading (Standing Order No. 57)

Jeff Smith presented a Bill to make provision about access to cannabis for medical reasons; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 10 December, and to be printed (Bill 20).

Climate Change Bill

Presentation and First Reading (Standing Order No. 57)

Colum Eastwood, supported by Clare Hanna, presented a Bill to place a duty on the government to declare a climate emergency; to amend the Climate Change Act 2008 to bring forward the date by which the United Kingdom is required to achieve net zero greenhouse gas emissions; to place a duty on the Government to create and implement a strategy to achieve objectives related to climate change, including for the creation of environmentally-friendly jobs; to require the Secretary of State to report to Parliament on proposals for increased taxation of large companies to generate revenue to be spent to further those objectives; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 10 December and to be printed (Bill 21).

Taxis and Private Hire Vehicles (Safeguarding and Road Safety) Bill

Presentation and First Reading (Standing Order No. 57)

Peter Gibson, supported by Daniel Zeichner, Caroline Nokes, Mr Robert Goodwill, Sarah Champion, Sir John Hayes, Ms Nusrat Ghani, Esther McVey, Ms Harriet Harman and Lee Anderson, presented a Bill to make provision about licensing in relation to taxis and private hire vehicles for purposes relating to the safeguarding of passengers and road safety; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 10 September, and to be printed (Bill 22).

Planning (Enforcement) Bill

Presentation and First Reading (Standing Order No. 57)

Dr Ben Spencer presented a Bill to create offences relating to repeat breaches of planning controls; to make provision about penalties for planning offences; to establish a national register of persons who have committed planning offences or breached planning controls and make associated provision about planning applications; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 19 November, and to be printed (Bill 23).

Cultural Objects (Protection from Seizure) Bill

Presentation and First Reading (Standing Order No. 57)

Mel Stride presented a Bill to extend the protection from seizure or forfeiture given to cultural objects.

Bill read the First time; to be read a Second time on Friday 10 September, and to be printed (Bill 24).

Pension Schemes (Conversion of Guaranteed Minimum Pensions) Bill

Presentation and First Reading (Standing Order No. 57)

Margaret Ferrier presented a Bill to make provision about the amendment of pension schemes so as to provide for the conversion of rights to a guaranteed minimum pension.

Bill read the First time; to be read a Second time on Friday 26 November, and to be printed (Bill 25).

Childcare Bill

Presentation and First Reading (Standing Order No. 57)

Matt Rodda presented a Bill to enable provision to be made for appeals relating to free childcare for young children of working parents to be settled by agreement; to make further provision designed to increase efficiency in the administration of free childcare schemes; to make provision about the promotion of the availability of free childcare, including to disadvantaged groups; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 29 October, and to be printed (Bill 26).

Glue Traps (Offences) Bill

Presentation and First Reading (Standing Order No. 57)

Jane Stevenson presented a Bill to make certain uses of glue traps an offence; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 19 November, and to be printed (Bill 27).

Acquired Brain Injury Bill

Presentation and First Reading (Standing Order No. 57)

Chris Bryant presented a Bill to make provision about meeting the needs of adults and children with an acquired brain injury; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 3 December, and to be printed (Bill 28).

Local Government (Disqualification) Bill

Presentation and First Reading (Standing Order No. 57)

Sir Paul Beresford presented a Bill to make provision about the grounds on which a person is disqualified from being elected to, or holding, certain positions in local government in England.

Bill read the First time; to be read a Second time on Friday 22 October, and to be printed (Bill 29).

Taxis and Private Hire Vehicles (Disabled Persons) Bill

Presentation and First Reading (Standing Order No. 57)

Jeremy Wright presented a Bill to make provision relating to the carrying of disabled persons by taxis and private hire vehicles.

Bill read the First time; to be read a Second time on Friday 14 January 2022, and to be printed (Bill 30).

Hare Coursing Bill

Presentation and First Reading (Standing Order No. 57)

Richard Fuller presented a Bill to make provision about hare coursing offences; to increase penalties for such offences; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 21 January 2022, and to be printed (Bill 31).

Animals (Penalty Notices) Bill

Presentation and First Reading (Standing Order No. 57)

Andrew Rosindell, supported by Sir David Amess, Tom Hunt, Mrs Sheryll Murray, Bob Stewart, Alexander Stafford, Theresa Villiers, Chris Grayling, Miss Sarah Dines, Henry Smith, Bill Wiggin and Joy Morrissey, presented a Bill to make provision for and in connection with the giving of penalty notices for certain offences in relation to animals and animal products.

Bill read the First time; to be read a Second time on Friday 29 October, and to be printed (Bill 32).

British Sign Language Bill

Presentation and First Reading (Standing Order No. 57)

Rosie Cooper presented a Bill to declare British Sign Language (BSL) an official language of the United Kingdom; to provide for a British Sign Language Council to promote and advise on the use of BSL; to establish principles for the use of BSL in public services; to require public bodies to have regard to those principles and to guidance issued by the Council; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 28 January 2022, and to be printed (Bill 33).

Public Service Pensions: Government Actuary Review of the Cost Control Mechanism

Steve Barclay Excerpts
Tuesday 15th June 2021

(2 years, 9 months ago)

Written Statements
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Hansard - -

The Government have today published the Government Actuary’s final report on his review of the cost control mechanism.

The Government are committed to providing public service pensions that are fair for public sector workers and for taxpayers. The cost control mechanism was introduced into the valuation process for public service pension schemes in the Public Service Pensions Act 2013 following consultation with member representatives. It was designed to ensure a fair balance of risk with regard to the cost of providing defined benefit (DB) public service pension schemes between members of those schemes and the taxpayer.

I commissioned the Government Actuary to conduct a review of the mechanism amidst concerns that it was not operating in line with its original objectives. These objectives are:

To protect taxpayers from unforeseen costs;

To maintain the value of pension schemes to the members;

To provide stability and certainty to benefit levels—the mechanism should only be triggered by “extraordinary, unpredictable events”.

The Government Actuary’s report sets out his findings and makes a number of recommendations on possible changes to the mechanism. The Government will respond to this report in due course.

The report can be found on the following link: https://www.gov.uk/government/publications/cost-control-mechanism-government-actuarys-review-final-report.

[HCWS90]

0.7% Official Development Assistance Target

Steve Barclay Excerpts
Tuesday 8th June 2021

(2 years, 9 months ago)

Commons Chamber
Read Full debate Read Hansard Text Read Debate Ministerial Extracts
Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Parliament Live - Hansard - -

Let me begin by acknowledging the words and the good intentions of my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell). He knows as well as I do that decisions such as this are not easy. In short, this is a hugely difficult economic and fiscal situation that requires difficult actions.

Responding to twin health and economic emergencies, the Government have acted on a scale unmatched in recent history to protect people’s jobs and livelihoods and to support businesses and public services, paying out £352 billion in support since the start of the pandemic last year. That is equivalent to 17% of GDP and one of the largest fiscal support packages of any country in the world.

Our plan is working. The economy grew by 2.1% in March alone, and the Bank of England now expects the economy to return to its pre-crisis levels by the end of this year—two quarters earlier than previously expected. At the beginning of the crisis, unemployment was forecast to reach 12% or more. The latest projections show that it is due to peak at 5.5%, meaning that almost 2 million fewer people will lose their jobs than was expected last spring.

As the House will note, however, much of that response has relied on borrowing. Last year saw the highest peacetime levels of borrowing on record—£300 billion of borrowing—and we are forecast to borrow £234 billion more this year and a further £109 billion the following year, so without corrective action, borrowing would continue at untenable levels, leaving underlying debt rising indefinitely. At our higher level of debt, the public finances are more vulnerable to changes in inflation and interest rates. Indeed, a sustained increase in inflation and interest rates of just 1% would increase debt interest level spending by over £25 billion in 2025-26. The goal of any Government should be sustainable finances, and the current level of borrowing is not sustainable.

My right hon. Friend the Member for Sutton Coldfield used a number of emotive terms around the morality of the context of these changes, but leaving the next generation vulnerable to the degree of fiscal threat that would be entailed with a high debt level is not itself morally sound. At the same time, loading ourselves with more debt now might well damage our ability to spend on aid later. There are some in this House who say that since we are already borrowing to protect jobs and businesses, what is £4 billion more? Indeed, that was the nature of the intervention from my hon. Friend the Member for Winchester (Steve Brine). Crucially, the only reason we were able to act during the pandemic in the way that we did is that we came into the crisis with strong public finances, and we believe it is our duty as the economy recovers to return to a sustainable fiscal position.

Harriett Baldwin Portrait Harriett Baldwin (West Worcestershire) (Con)
- Hansard - - - Excerpts

I thank the Chief Secretary to the Treasury for giving way and I appreciate his fiscal stance, but can he explain to the House why the only manifesto pledge he has chosen to break is the one that forces the World Food Programme in South Sudan to choose between feeding hungry children and feeding starving children?

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The point is that we have made a number of difficult decisions, and I will come on to that, but we are also continuing to spend £10 billion in response to the commitments that we have made. I am sure that my hon. Friend, as a former Treasury Minister, is well aware of the fiscal reality we face.

Strong public finances mean making difficult decisions, such as increasing corporation tax. That is one of the difficult decisions that my right hon. Friend the Chancellor has made, alongside the decision around overseas aid. Indeed, this is something that the International Development (Official Development Assistance Target) Act 2015 explicitly anticipates when it refers to the effects of one or more of the following:

“(a) economic circumstances and, in particular, any substantial change in gross national income;

(b) fiscal circumstances and, in particular, the likely impact of meeting the target on taxation, public spending and public borrowing;

(c) circumstances arising outside the United Kingdom.”

In other words, the 2015 Act clearly envisages situations in which a departure from the target may be necessary. It provides for the Secretary of State’s accountability to Parliament by way of the requirement to lay a statement before Parliament and, if relevant, makes reference to economic and fiscal circumstances, as well as circumstances outside the United Kingdom. Indeed, the Foreign Secretary has already committed to doing that, as required by the Act.

Sarah Champion Portrait Sarah Champion (Rotherham) (Lab)
- Parliament Live - Hansard - - - Excerpts

That accounts for the cuts in July, but surely it was a political decision, and potentially an unlawful one, to cut to 0.5% in November.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

The provisional data shows that for the 2020 ODA figures, the 0.7% was met. The point is that the Act allows for the economic and fiscal instance that I just set out—it is in section 2. If the UK were to spend 0.7% of gross national income as ODA, it would cost the country an additional £4.3 billion this year. Given our commitment to fiscal sustainability, we could offset that either by raising taxes or by cutting public spending. [Interruption.] We can come on to that. To put that in context, it means a 1p increase in the basic rate of income tax or about a 1% increase in the standard rate of VAT at a time when taxes are at a historical high.

Andrew Mitchell Portrait Mr Mitchell
- Parliament Live - Hansard - - - Excerpts

The Treasury really must do better than that, because 1p on income tax is worth nearly £6 billion, so the increase would be much less than 1p.

Steve Barclay Portrait Steve Barclay
- Parliament Live - Hansard - -

In the context, it is £5 billion to £6 billion. My right hon. Friend did not set out in his speech how he would address that gap. Which fiscal measures was he suggesting? Was he suggesting a specific tax, in which case I did not hear that in his remarks? Was he suggesting more borrowing, in which case one needs to look at the impact on our stock? Was he, in fact, suggesting spending? [Interruption.] From a sedentary position, the right hon. Member for Ashton-under-Lyne (Angela Rayner) mentions Test and Trace. Given that 80% of the Test and Trace budget relates to testing, if she is saying that she wants to get rid of PCR testing or lateral flow testing, she needs to set that out in detail. That speaks to the lack of detail provided; it is strikingly absent from the alternatives put forward.

The fundamental point before the House is that the scale of our overseas aid remains significant. In fact, we continue to lead the world in overseas development. This year we will spend more than £10 million to improve global health, fight poverty and tackle climate change, including £400 million on girls’ education in 25 countries, and we are doubling to £11.6 billion our commitment to international climate finance for the period 2021 to 2026, with at least £3 billion for climate change solutions that will protect and restore nature and biodiversity. According to the OECD, in 2020 we were one of only two G7 countries to actually meet the 0.7% target and the only country to do so each year since 2013. Even after the change we are debating today, we are still the third largest donor in the G7 as a percentage of gross national income, and 0.5% is considerably more than the 29 countries on the OECD’s Development Assistance Committee, which average just 0.41%.

Importantly, the Foreign Office makes its aid spending choices based on maximum impact, coherence and value for money. The Integrated Review has reaffirmed our pledge to fight against global poverty and to achieve the UN sustainability development goals by 2030. We are the fifth largest contributor to the UN peacekeeping budget, the third largest bilateral humanitarian donor, the second largest member state donor to the World Health Organisation, and among the world’s largest donors to the COVAX advance market commitment—the global initiative supporting developing countries with access to vaccines. The funding we will continue to make available to countries all over the world is helping to educate young girls, boosting diversity, tackling climate change, vaccinating the needy against deadly diseases such as Ebola and malaria, and improving the nutrition of staple food crops—millions of lives improved, millions of lives saved.

This is a generous and outward-looking country whose impulse has always been to help others around the world. We do not and we will not shy away from making a determined contribution to addressing the world’s problems. But at the tail end of a huge economic emergency, we also have a responsibility to the British people. We are absolutely clear about our intention to return to 0.7% of our national income on overseas aid when the fiscal situation allows, but cannot do so yet. We will, however, keep the matter under careful and regular review. I know that Members on both sides of the House will make their cases cogently and passionately, but for now, the tough choice is the right choice.

Official Development Assistance: Departmental Allocations

Steve Barclay Excerpts
Thursday 13th May 2021

(2 years, 10 months ago)

Written Statements
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Steve Barclay Portrait The Chief Secretary to the Treasury (Steve Barclay)
- Hansard - -

I would like to update the House on the official development assistance (ODA) allocation by Department, 2020-21.

The Foreign Commonwealth and Development Office’s provisional statistics on international development confirmed that the UK met the target to spend 0.7% of gross national income on official development assistance in the 2020 calendar year. https://www.gov.uk/government/ statistics/statistics-on-international-development-provisional-uk-aid-spend-2020.

Following the end of the 2020-21 financial year, we are now publishing the total ODA allocations to Departments and cross-Government funds for 2020-21, as set by HM Treasury at the 2019 spending round and subsequently adjusted through supplementary estimates 2020-21.

The below allocations show the revised financial year budget for 2020-21 compared to SR19 allocations. As set out in the “Official Development Assistance spending for 2020: First Secretary of State’s letter” published on 22 July, last summer the Government identified a package of possible reductions in their planned ODA spend for the calendar year 2020, which included arrangements to tailor spending further during the remaining months to enable the Government to manage ODA spend against an uncertain 0.7% position. That package included underspends, delaying activity and stopping some spend. https://www.gov.uk/government/publications/official-development-assistance-oda-spending-for-2020-first-secretary-of-states-letter/official-development-assistance-oda-spending-for-2020-first-secretary-of-states-letter.

The Foreign Secretary led a cross-government review of how ODA is allocated for 2021-22 against the Government’s priorities after the 2020 spending review. The final allocations were provided in a written ministerial statement on 26 January 2021 (HCWS735).

Departmental ODA Allocations, 2020-21

ODA allocation by Department (£m)

2020-21 allocations made at the 2019 spending review

Revised 20-21 allocations

FCDO

11,865

11,075

BEIS

1,406

1,281

CSSF

687

644

HO

482

482

DHSC

301

273

Prosperity Fund

295

237

DEFRA

95

95

Other

58

54

1. The FCDO total for SR19 is constructed using the original DFID (accounting for reclassified R&D confirmed at SB20) and FCO SR19 allocations.

2. These figures do not account for budget exchanges or transfers that are agreed and occur between Departments at mains and supplementary estimates.

3. Departmental ODA outturn figures may differ from allocations due to transfers undertaken and agreed between Departments, budget exchanges, and any financial year underspend that may occur.

4. ODA allocations are adjusted as needed at fiscal events in line with OBR projections.

5. ODA in cross-government funds (CSSF and Prosperity Fund) is spent by several Government Departments.

6. “Other” includes DfE, DCMS, DWP, MOD, HMRC, HMT, ONS and Barnett given to the devolved Administrations as a result of UK Government spend on ODA.



[HCWS25]