Equitable Life Policyholders: Compensation

Tom Tugendhat Excerpts

Thursday 23rd March 2017 Commons Chamber

[Justin Madders]

The hon. Gentleman is absolutely right. We are dealing with people who are getting on in years. As he points out, sadly about 15 policyholders a day are dying before the situation has been resolved. I am strongly of the belief—we see this for a whole range of issues—that the longer people wait for justice, the harder it is to appreciate that justice has been served.

The core of this issue is that many people feel that, even after all these years, justice has not been done. That message has come across loud and clear from my constituents and those of other hon. Members who have spoken. These people worked all their lives only to find that their pension pot has failed to materialise in the manner they were promised and they genuinely believed would occur.

In practice, this means that people who spent decades working for a comfortable retirement have had it denied them. It means that they are downsizing or even re-mortgaging their homes in their old age just to make ends meet. That is clearly not what we want for people who have contributed throughout their lives.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

The hon. Gentleman is speaking extremely powerfully. He is absolutely right to focus on those who will not have the opportunity to recover the money they have lost unless the Government change their mind. Does he agree that a real message can be sent to young people and those of us who, like myself, are less young? We must show that saving and responsible action during a working life is rewarded. There is a danger that if we continue to get this wrong, the lesson we are providing is that people should not bother to save, because it is not worth it.

[Justin Madders]

I thank the hon. Gentleman for that point. I am sure that he has many years to go before he reaches retirement age, but that is something that is absolutely central to the debate, so I will expand on it a little more. We are entering an era in which retirement ages will increase and there will be more and more onus on people to take responsibility for their own retirement. If we have a system that people lack confidence in, it simply will not work. That is why compensation in these situations should be delivered in full.

One of my constituents told me:

“what I personally find sickening is that Her Majesty’s Government, no matter which party is in power, has utterly refused to act on the Ombudsman’s findings, which point to its own shortcomings.”

That point, which has been made by many Members, really does sum up where we are. I hope that the Minister will update us on what the Government are doing and focus on what good news those individuals who feel that the system has short-changed them can expect. That is important not just for them, but for the trust we should have in the system to secure our own futures. There is a need to restore confidence and build trust not just for the individuals affected by the scandal, but for everyone. As the hon. and learned Member for Edinburgh South West (Joanna Cherry) said, there are uncomfortable parallels with the WASPI campaign. People’s confidence has been shattered by what they consider to be broken promises by the Government and the institutions in which we place our trust.

I agree that we all need to encourage people to plan for their retirement and to contribute to their pensions, but what kind of message does it send if the Government fail to properly regulate a provider and then fail to compensate people fully for their losses? It is not just trust in the finance sector that is at stake here; it is trust in politics itself. As has been said in previous debates as well as today, the 2010 Conservative manifesto included this comment, which links these issues in a neat way:

“We must not let the mis-selling of financial products put people off saving. We will implement the Ombudsman’s recommendation to make fair and transparent payments to Equitable Life policy holders, through an independent payment scheme, for their relative loss as a consequence of regulatory failure.”

I think that all Members agree that that is a worthy aim, but the question of whether the pledge has been met in full is a matter of some debate.

I am conscious of the time, because we do want to hear from the Minister. What has already been said today has really summed up the situation, but let me end by making what I think is a key point. A failure to correct the wrongs of the past will lead to a failure to secure confidence in the future. I do not believe it is an exaggeration to say that the erosion of confidence that this episode has engendered could, in fact, be of greater impact in the long run than the cost of full compensation. I hope that, even at this late stage, the Government will do the right thing, not only for the policyholders of Equitable Life, but to restore confidence in the entire system of savings and pensions.

The hon. Member for Harrow East spoke of a debt of honour, and I think that that is an excellent way of referring to our obligations. We need to act honourably, and to correct this injustice in full. Given the age of many of the policyholders involved, it is clear that the adage “Justice delayed is justice denied” was never more true than it is in this case.

Oral Answers to Questions

Tom Tugendhat Excerpts

Tuesday 28th February 2017 Commons Chamber

[Mr Hammond]

Nobody will see their rates bill go up by 600%, and the damping mechanisms make that clear. Of course rateable values may go up by very significant amounts. I shall have more to say about this next week.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

I welcome the Chancellor’s promise to explain more about what he is going to do about business rates in the Budget next week. Does he recognise, however, that in taxing our towns and villages around the UK, especially the beautiful ones in west Kent, he is in danger of changing the culture that is at the heart of our community, not just raising money for the Exchequer?

[Mr Hammond]

Yes, I absolutely recognise my hon. Friend’s concern. It is for that reason, as well as for reasons connected to the economic sustainability of individual businesses, that we have said that we will look at how best to help those most seriously affected.

Leaving the EU: Financial Services

Tom Tugendhat Excerpts

Thursday 3rd November 2016 Commons Chamber

[Tom Tugendhat (Tonbridge and Malling) (Con)]

The clock is back. The excitement! The hare is running!

I should briefly declare an interest. I have at times worked in the financial services industry. I draw Members’ attention to my entry in the Register of Members’ Financial Interests.

Like so many other hon. Members, I am here to talk about financial services outside the capital. I pay tribute to the hon. Member for Leicester West (Liz Kendall), who spoke very powerfully about that. In my constituency, I drive past the Fidelity asset management centre, which is based in Hildenborough and employs nearly 1,000 people. Financial services also support economies such as the legal economy, accountancy and various other innovators. As we have discovered from the success of start-ups in the United States, access to financial services is often a trigger for improvements in the tech sector.

[Robert Neill (Bromley and Chislehurst) (Con)]

I apologise for not being in the Chamber earlier because of Select Committee duties. Does my hon. Friend concede that it is important that we link access to financial services with access to other professional services including legal services, which are critical to building the infrastructure backing up the financial services sector?

[Tom Tugendhat]

My hon. Friend makes an extremely good point and I will let it rest there.

Access to financial services is not just about the financial services industry but about all industries. Finance greases the wheels of the whole economy. It is important that we maintain the access we have in the UK. I therefore urge hon. Members to see Brexit not just as a threat, which sadly so many people do, but also as an opportunity. The United Kingdom used to be extremely good at taking the opportunity to innovate. Too often we have limited ourselves. Many people will look at the potential loss from the eurobond clearing and various other elements, but we should also look at the potential openings in financial technology, where we have already seen such innovations in the UK, to which I hope we agree we can add.

Services here in the UK are built on the foundation of skills that support the current industry and that will support future growth. Tomorrow’s growth will be based on those same skills, which come from a highly educated, highly literate and highly open population of people across our islands, whose languages, ethnicity and cultural links tie them around the world. They are able not only to do deals but to finance and enable entrepreneurs and businesses around the world. That is why I am less concerned than some about the potential closing off in markets in the European Union. We must remember that the EU itself depends on the City of London and that the depth of asset pools in the City gives the industries of Germany, Italy and France a reach they would not get from their own domestic markets. It gives them an opening to other financial sources around the world, including east Asia, that they would not get from Milan, the Paris Bourse or the Frankfurt exchange. I know that the Minister, who is in his place, will see this as a good deal for both parties, as all good deals should be, because the EU and Britain have a common interest.

Having that common interest requires us to remember who we are. It requires us to remember that we, here in the United Kingdom, are in so many ways more than the sum of our parts. We define ourselves not by the nations we come from, but by what we give together. I mean this very seriously. In so many countries in the world, people define themselves as a “something-something”. In the United States, for example, people often define themselves as a Polish-American or an Irish-American. I, who am the son of a French woman, the grandson of an Austrian man and an Irishwoman, do not define myself by that. I define myself as British, as so many people here do. It is that openness and inclusivity that has made Britain the home for so many and the centre for so much.

That is why, when we look at the financial industry, we must not look at it alone, or indeed just consider the legal and accountancy aspect. We should not even consider its enablement of other industries. We should consider the ethos it requires. That ethos is the ethos that we have promoted on these islands for a thousand years. It is one that defines people by the breadth of their experience, skill and knowledge, and not in a narrow sectarian definition of origins or passports. It is much greater than that.

I will leave it there and urge the Minister, as he takes the negotiations forward and sits around the Government table, to see that the financial services around our whole country, particularly in the great kingdom of Kent, are not just a simple route to enrichment, but an avenue to openness, growth and the support of what the UK has always been: a beacon to other nations, an island of safety and in many ways an example to all to enrich all.

--- Later in debate ---

[Joanna Cherry]

That is not what I am actually talking about. I am talking about the way in which European Union law has enabled Scots lawyers, English lawyers and lawyers across these islands to practise across Europe not for their benefit but for the benefit of their clients. That is the point. It is also to the benefit, as earlier speakers pointed out, of the financial services sector and to the British economy in general. This is not naked self-interest on the part of the lawyers. Lawyers depend on their clients to make a living. If lawyers are not able to practise across Europe easily, they will not be able to provide such a good service to their clients. That does not just apply in the financial sector. It covers all sorts of areas, including, very importantly, child and family law.

In Scotland, the Law Society of Scotland will be urging the UK Government and the Scottish Government to argue in negotiations that the current arrangements for lawyers to be able to practise in the European Union should be retained. It would be very disappointing if the only route for lawyers to be able to practise in Europe in future would be to requalify in other EU jurisdictions and go through the cumbersome processes that we have done away with as one of the many benefits of being in the EU.

Clearly, the best way to protect the legal and financial services in my constituency and in the city of Edinburgh is to remain part of the single market. That would be the easiest way to give comfort to those sectors. Of course, we are not able to give any comfort to those sectors, because the Government “do not want to give a running commentary”. However, it appears, as the result of a legal decision today, that the Government may in due course be forced to come to this democratically elected Chamber and tell us a little bit more about what their plans are. It is worthy of comment that that is not as a result of European judges sitting in Brussels, Luxembourg or Strasbourg. It is the result of English judges sitting in London. As a Scots lawyer, I wish to pay tribute to those English judges for the decision they have reached.

[Tom Tugendhat]

Of course, a few judges sitting in Belfast came out with a slightly different decision, as the hon. and learned Lady may be aware.

[Joanna Cherry]

Ultimately, it will be for the Supreme Court of the United Kingdom to decide, and it includes, of course, two very senior Scottish judges. I believe that the Supreme Court has already allocated a few days in December. I read that the full Bench will sit, so the Scottish judges will be there as well. The Scottish Government have said that it is very likely that Scotland will intervene in that case, and I have every confidence that the Supreme Court will reach the right decision.

Budget Resolutions and Economic Situation

Tom Tugendhat Excerpts

Tuesday 22nd March 2016 Commons Chamber

[John McDonnell]

On that Friday before last, there was outrage among disability groups—the Multiple Sclerosis Society, Parkinson’s UK and Disability Rights UK. Why? Because all of them, like many of us, had gone through that process of agreeing the criteria—at least coming to some compromise on what would constitute the criteria for access to this benefit. But the Chancellor moved the goalposts, those already agreed through consultation. Disabled people and their families have been sick with worry about the threats to their benefits.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

The hon. Gentleman has called into question the morality of the leadership of my right hon. Friend the Chancellor, but would the hon. Gentleman please discuss with this House the morality that allows him to stand with bombers who murdered my friends in Northern Ireland and to question the integrity of the Chancellor? [Interruption.]

[Mr Speaker]

Order. Before we proceed further, perhaps I can just say to the House, on my own account and on the basis of sound procedural advice, that we must stick to the matter of the Budget. [Interruption.] Order. I do not require any comeback or any comment, agreement or disagreement. Let us proceed in a seemly manner with the debate. That is in the House’s interest, and that is what the country has a right to expect.

DRAFT Grants to the Churches Conservation Trust ORDER 2016

Tom Tugendhat Excerpts

Monday 29th February 2016 General Committees

[Mr Evennett]

I thank my right hon. Friend for her question. Before I answer it, I congratulate her on her superb work as a Church Commissioner. She is always hard at work on such matters. I totally agree with her: we want to bring new life into our rural communities, and if we can use churches to do that, we should. I mentioned earlier the innovative champing initiative. In a rural area that might be just what is needed. I welcome my right hon. Friend’s comments. We would warmly welcome and encourage any developments that bring tourism, jobs and opportunities to rural areas.

In the past year the trust has saved for the nation three additional churches of exceptional merit, all of which are grade I listed. It will cost an average of £300,000 each to bring recent or upcoming acquisitions into a suitable condition so that they can be safely opened to the public and equipped for community use.

The trust’s primary objective, and the greatest call on its funds, is the conservation of its churches, particularly upon vesting, when buildings might have been out of use for a number of years. The trust has an excellent reputation for the quality of its conservation work. In 2015, it won the European Union prize for cultural heritage, the Europa Nostra award, in recognition of its role in promoting the architectural significance of historical places of worship and their essential function as centres of community life. The work and expense do not end there. With an estate of 347 buildings that could and should be serving communities, there is a rolling programme of repair needs, and new facilities are needed where consents can be granted.

In autumn 2014, the trust opened a new flagship urban project that saw the rescue and adaptation of All Souls church in Bolton for modern community use. With the support of the Heritage Lottery Fund, the £4 million project has conserved the grade II* listed church in a disadvantaged area of the north-west in which the majority of the residents are from an ethnic minority background and put it back into the hands of the community. Hi-tech internal pods provide space and amenities for the whole local community, small business and arts use, while the historical fabric has been beautifully restored. The building is now being run by a newly constituted community group, its facilities are fully booked and it will be self-sustaining in the long term.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

As the Minister mentioned the Heritage Lottery Fund, it would be remiss of me not to commend the work it does alongside the CCT. The fund has done some impressive work in Tonbridge and Malling and I am very much looking forward to announcing a new project it will be doing for us shortly.

[Mr Evennett]

I thank my hon. Friend for those comments, which I endorse.

This year, the CCT will complete the £6 million regeneration of the grade I St Mary-at-the-Quay in Ipswich. With HLF support and a partnership with Suffolk Mind, the church has been fully conserved and, once new facilities are complete, will open as a wellbeing centre in the autumn. The church will be available for a wide range of community uses and will provide a range of therapeutic services, as well as a new model for accessible mental health provision.

In the year to April 2015, 1.9 million people visited CCT churches—an increase of 5% on the previous year. The trust’s churches are run by a growing army of regular volunteers, to whom I offer my praise and thanks. Without them, events as diverse as fashion shows, concerts, flower festivals, and farmers’ markets would not be able to take place. The CCT is busy increasing the number of volunteer helpers, of whom there are currently around 1,800 throughout the country, that it relies on to open churches to the public and make them welcome. The CCT offers its volunteers support and new skills through networking and training. It has shown that it is excellent at partnership working and is at the forefront of saving buildings by looking beyond the traditional heritage solutions.

The CCT has also been applying its expertise in community solutions for churches that are still in use, when they would otherwise, if closed, be significant enough to come to the trust. Benington All Saints in Lincolnshire is one example of where a non-CCT, grade I church, which was in a sad state of repair, has been rescued by the community, with significant CCT help, and was this year endorsed by the award of a major Heritage Lottery Fund grant.

Church buildings can again be the centre for community activities, which is good news. I hope that the Committee shares my enthusiasm for the work of the trust and will approve the draft order.

Equitable Life

Tom Tugendhat Excerpts

Thursday 11th February 2016 Commons Chamber

[Crispin Blunt (Reigate) (Con)]

I declare an interest: I invested in Equitable Life while a special adviser. I cheerfully put 17.5% of my salary into an Equitable Life scheme over four years, when I worked for Malcolm Rifkind, and then watched, after I was elected to this place, as the whole Equitable debacle developed over the next decade or so. But at least I was sharing the pain of many of my constituents—well north of 3,000, according to an estimate given to me. The situation that my hon. Friend the Member for Romsey and Southampton North (Caroline Nokes) laid out is exactly my experience. To start with, there was a substantial lobby, but that dwindled, although there remain some persistent people—I have their letters—who lost hundreds of thousands of pounds, and they come from all classes of annuitants and policyholders.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

I welcome this debate. Does my hon. Friend agree that some people, like him and my father, did at least have time to make up the shortfall, but that others, including many of my constituents, simply did not have that time? Will he mention the fact that some people did not have the opportunity to recover their losses?

[Crispin Blunt]

My hon. Friend makes an extremely pertinent point.

On being returned in 2010, I found myself a member of the Government and obliged, at one level, to support their decision to limit the compensation to £1.5 billion. At the time, as the Prisons Minister, and the prisons budget being rather less than the total compensation required, I could understand, in the circumstances, why they decided to limit the overall compensation. I resolved, however, to speak in this debate and to re-examine the letters I sent out defending the Government’s position, and to re-evaluate my position to see whether it was reasonable.

I was much taken with the comments from the hon. Member for West Bromwich West (Mr Bailey), the former Chairman of the Business, Innovation and Skills Committee. This is about confidence in the entire savings system. I can remember Labour’s first Budget in 1997 and the consequences—unreported from the Dispatch Box—of IR35, which saw £5 billion cheerfully lifted from investors in pension funds through a tax on dividends. If a £5 billion change can be made in a Budget, announced not in the House of Commons but by press release, we need to be aware that we are dealing with vast numbers when it comes to pension policy. I tell the Economic Secretary, who is replying to the debate, that I believe we are on the verge of a substantial—and, for me, very welcome—change in pension policy. As part of that, we need to acknowledge the point made by the hon. Member for West Bromwich West that this issue is about confidence in the system as well as fundamental fairness to our constituents.

I congratulate my hon. Friend the Member for Harrow East (Bob Blackman), who introduced the debate so effectively, on securing it. I also congratulate my hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) on setting up the all-party group in 2006-07 to reinforce the efforts that were already under way. He attempted to corral those efforts, make them more effective and secure from the Conservatives and the Liberal Democrats an undertaking that the issue would be addressed in their manifestos leading into the 2010 election. It is important to highlight that as a simple issue of fairness we need to revisit the sum of £1.5 billion and decide whether or not we have discharged our duty.

--- Later in debate ---

[Peter Heaton-Jones (North Devon) (Con)]

I congratulate my hon. Friend the Member for Harrow East (Bob Blackman) on securing this incredibly important debate. In common with Members on both sides of the House, I have received a considerable amount of correspondence on the issue and met people in my surgeries who have been affected by it.

Other Members have mentioned this, but I want to pay particular tribute to the Equitable Members Action Group, which has done extraordinary work to highlight the issue and to represent members who have suffered as a result of the unfairness. The group members are persistent, dogged and effective campaigners and lobbyists. I have had the pleasure of meeting the EMAG chairman who covers the whole of the south-west. He is an extraordinarily effective campaigner.

As many Members have said, this is an issue of fairness. Policyholders who were doing the right thing and saving for the future have found themselves in an awful position. We need to take account of that. They have our sympathy, without doubt. Whatever solution we find, however, we also have to keep it in mind that we need to be fair to taxpayers as a whole. Although £2.6 billion is a considerable amount of money that would plug the gap and ensure that those who lost out are compensated in full for their losses, it does, none the less, place a burden—it is a big ask—on the taxpayer and the Treasury to find it. We need to be aware of that.

I am glad that the Treasury has responded to a number of letters from me. There has been a considerable amount of correspondence back and forth. I am particularly happy to have received a letter from a Treasury Minister, which addresses the need and, indeed, the desire to keep the matter under review. As my hon. Friend the Member for Tewkesbury (Mr Robertson) says, time is short, so I urge the Treasury not only to keep the matter under review, but to bear it in mind that, sadly, the passage of time means that it needs to be addressed quickly. The letter, which I received in response to a letter I wrote on behalf of the chairman of EMAG in the south-west, makes it clear that the Treasury welcomes submissions and ideas for my right hon. Friend the Chancellor to include in the Budget statement. I am sure that the Treasury is taking account of all those submissions.

It is worth bearing in mind that the Chancellor has already announced—and I am sure he will announce more—extremely welcome changes and reforms to the pension system. I hope we can look at the issue as part of that wider package of reforms.

[Tom Tugendhat]

As the Treasury looks at that wider package, may I urge it to ensure that helping the EMAG pensioners is very much part of setting the conditions for other people to save? If people feel that their savings will go unrewarded, that undermines the tone that the Chancellor and the Economic Secretary have rightly set in the various pension arrangements they have made, helping people to realise that pensions are worthwhile and will help them in the future.

[Peter Heaton-Jones]

My hon. Friend makes a very good point. That is, indeed, the tone of the pension package reforms that the Chancellor and the Treasury have made and will continue to introduce. The Equitable Life policyholders need to be part of that wider package.

Tax Avoidance and Multinational Companies

Tom Tugendhat Excerpts

Wednesday 3rd February 2016 Commons Chamber

[Helen Goodman (Bishop Auckland) (Lab)]

I am pleased to have the opportunity to take part in this extremely important debate. Clearly, a number of things have gone wrong in the case of Google, but I shall focus on one aspect: the tax treatment of intellectual property. This is a growing part of the economy and we need to get it right.

I draw a distinction between two extremes—on the one hand, a large pharmaceutical company that does a great deal of research and development and employs a large number of people to make a new drug, and, on the other, a company such as Starbucks, which registers its name in Luxembourg, seemingly purely as a tax avoidance device. Between those extremes there is a continuum and Google is somewhere in the middle. It has done some mathematics to make some algorithms, but it also has a brand that is extremely powerful. We need to tighten up on this.

What happens at present is that a name is registered in a low tax domain. That separate company charges a fee to this country, where the work is done. That wipes out the entire tax treatment. That is ridiculous. One thing that is wrong is that the company seems to be able to set the price itself. The Revenue is not auditing it and asking whether that is reasonable. Obviously, maintaining a brand involves some costs, but small costs—perhaps to repaint some signs or to train its marketing people. Those costs cannot be compared to the cost of research and development.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

Does the hon. Lady understand that an awful lot of the cost could be in intellectual property and in ideas held by people overseas? That is not necessarily as cheap as a lick of paint, as she suggests.

[Helen Goodman]

I was trying to distinguish between real intellectual property and intellectual property that is purely branding. Take the example of the BBC, which sells television programmes. The BBC can get more money for its television programmes than a small television production company, partly because it is called the BBC, even though the actual costs of making the television programme are the same.

The question we have to ask ourselves is whether, because of the high value of the brand, the company should pay less tax. I submit that that is a fundamental mistake, because the brand is an asset. What the company is getting in that situation is economic rent. The fact that it has a valuable asset is not a reason for it to pay less tax. That is absurd. If a company invests in a piece of machinery and makes a claim against its capital allowance, over time the amount that it can claim against tax decreases as it moves from the point at which the investment was made. In cases where the brand is the asset, companies are claiming more over time as they are selling more. I think that is an area where we could very usefully tighten up.

Perhaps this area of tax would be better handled if we had a few more economists looking at the underlying economics and fewer accountants, who seem very comfortable with the way the system works but are not driven by the desire that the rest of us have to make sure that these people pay their fair share.

Electoral Law

Tom Tugendhat Excerpts

Tuesday 2nd February 2016 General Committees

[John Penrose]

I shall try to respond briefly to the points that have been raised. In spite of the slightly different starting precepts of the various contributions, there is a fair amount of cross-party agreement in the Committee. We all cleave to and support pretty strongly the notion of subsidiarity—the principle that things should be done at the place closest to the citizen, whether at a local elected level, a regional elected level or at a national level. Only when something requires international co-operation should sovereignty be voluntarily pooled as part of that process.

[Tom Tugendhat (Tonbridge and Malling) (Con)]

I have a specific question: how many other nations does the Minister think will also veto this proposal?

[John Penrose]

It is a little early in the process to have a precise count. However, I am told that the mood music from other capitals around Europe is that they are equally concerned and that many other countries share our point of view on most if not all of these proposals. We do not need a huge degree of consensus, because, as we have all observed, there is a veto, but we are far from alone on this matter. I hope that the Committee is reassured by the fact that many other countries share the view that has been widely expressed, which is that there is no such thing currently as a European polity—a European demos.

As the hon. Member for Caerphilly pointed out, we are a diverse continent, with many different points of view and many different inheritances and traditions. We are hugely religiously diverse, ranging from Catholic and Orthodox Christians to many other more newly arrived religions as well. We are enormously different in our heritage and in our attitudes, so it would be perverse for us to assume that a one-size-fits-all solution is either desirable or likely to be effective. Neatness is an outcome that is usually beloved only of accountants and lawyers and very rarely something that politicians should go for as a starting point. I share his suspicion of something that comes out as a one-size-fits-all solution across Europe. It is very revealing that he, as a former Member of the European Parliament, feels so strongly in that respect.

The hon. Gentleman asked about finances. It is rather early in the process to have a precise, detailed accounting, but as we are politely but pretty firmly demurring from most of the contents of this proposal, we hope not to get to the point at which the finances become relevant, because we do not want this to happen in the first place, but should we get to that point in the process, of course we would have to add up which bits would cost money and which would not.

The hon. Gentleman also asked about the role of the Commission, which I think he had heard was analysing the results of previous elections. I am not familiar with that process or with any proposals; I do not think that any proposals have been issued from there at all so far. I guess the point I would make is this, and it goes back to the points underlying the speech made by my hon. Friend the Member for North East Somerset. These proposals focus mainly on the plumbing of democracy—the dates on which the nomination papers need to be filled in, the way in which electoral registration is handled and the way in which elections are conducted. There will be a suspicion in this country and, I suspect, in many others that through changing the plumbing of European countries’ democracies, Brussels will be trying to advance the case of more Europe—the case of more Brussels.

I just gently suggest, both to everyone in the Committee and to the wider audience, that what is needed is not, in this case, changes to plumbing. What is needed is not plumbing, but poetry. People in Europe—certainly in this country and, I suspect, in many other countries—need to be persuaded of the benefits of Brussels. They need to be persuaded about why Brussels feels that it has something to add—the principle of added value—and to understand where it does not. At the moment, given the turnout in European parliamentary elections, it is clear that that poetry is lacking and that many people are not persuaded of the way in which Europe could, in its view, add value. Therefore, I suggest that focusing on the plumbing is not the answer. These proposals are not the solution. This will seem to many to be an attempt to achieve by stealth what cannot be achieved through honest, genuine democratic debate and persuasion.

If people were persuaded, if there were at some future point some kind of European demos, a shared European view on the benefits or demerits of more or less Europe, we would be able to have a much more straightforward, pan-European and honest democratic debate, but that is not where we are. It is not the direction of travel at the moment, because levels of trust in the European project have been falling more widely

European Union (Finance) Bill

Tom Tugendhat Excerpts

Tuesday 23rd June 2015 Commons Chamber

[Tom Tugendhat (Tonbridge and Malling) (Con)]

I note again a matter that is of great interest to the electors of Tonbridge, Edenbridge and Malling. The budget will be 7% lower in real terms by 2020, which is very welcome, but will the Minister say more on the consequences to the EU budget of the UK’s position, because we are rather hoping that 7% is the beginning and not the end?

[Mr Gauke]

My hon. Friend touches on the point made by my hon. Friend the Member for Eddisbury (Antoinette Sandbach), who drew attention to the fact that our net contributions are forecast to be lower in 2019-20 compared with 2013-14. In fact, our net contribution in 2019-20 will be £9.3 billion compared with £10.2 billion in 2013-14, which is clearly lower in cash terms but also lower in real terms. My hon. Friend the Member for Tonbridge and Malling (Tom Tugendhat) raises the issue that we should make a strong case for budget discipline. He wants to ensure that we appreciate that we are dealing with taxpayers’ money. Whether UK taxpayers’ money or taxpayers’ money from the wider EU, that money has to be spent wisely. That is a good point, and I will return to it later when we deal with the Labour new clauses and amendment.

--- Later in debate ---

[Mr Gauke]

I am grateful to my hon. Friend. New clauses 1, 2 and 3 and amendment 1, all tabled by the hon. Member for Worsley and Eccles South (Barbara Keeley), would require the Treasury to undertake a series of actions prior to the Act coming into force. New clause 1 would require the Treasury to inform both Houses that it has formally requested a review by the European Commission into alternative ways of running the EU budget and a comparative analysis of commitments and payments as the basis for appropriations for the budget. New clause 2 would require the Treasury to request a fundamental review by the Council of Ministers of EU budget priorities, waste and inefficiency. New clause 3 asks for the Chancellor to issue an invitation to the Commission to provide further details of the draft budget to scrutiny Committees. Amendment 1 would delete subsection (3) of clause 2, which would mean that the Act would not come into force until 14 days after the conditions specified in each new clause were met.

We recognise the concerns underlying the amendments. Nevertheless, the hon. Lady will recall that the Bill relates exclusively to the financing of the EU budget, while the amendments relate to the separate, although equally important, issue of EU budget expenditure. On that basis alone, we reject them.

[Tom Tugendhat]

My hon. Friend talks clearly about financing and the details of various percentages going up or down. Does he recognise that what he is really talking about is setting the tone on the agreement we have in the European Union? The UK can play its part as a good partner in the EU, but the EU can help to play its own role in promoting what we all recognise is a growing economy in Europe, and not just a redistribution of wealth.

[Mr Gauke]

The deal that the Prime Minister reached in February 2013 was clearly a success, as our negotiating objectives were met. I am sure my hon. Friend and most of us would hope and expect similar success to be achieved in the months ahead.

--- Later in debate ---

[Barbara Keeley]

Before we go any further, may I point out that my constituency is now called Worsley and Eccles South? The people of Eccles would rightly be very upset if we left them out of the equation; Eccles is a very important town in my constituency.

I rise to speak to the new clauses standing in my name and those of my hon. Friends. We are dealing with a slight complexity, in that the Bill is simple but drafted in such a way as to make it complex to amend. Amendment 1 is therefore a technical paving amendment which can bring in the new clauses, so it is that amendment that we will push to a vote, if necessary.

The Bill relates to agreement of the own resources decision that will be incorporated into UK law, based on the agreement reached at the February 2013 European Council. The Minister covered that at great length over the past hour and 20 or so minutes. Decisions on UK contributions reaching €14 billion are brought into sharper focus in a week when Ministers are discussing cuts to tax credits for the low-paid and have not been prepared to rule out cuts to financial support for disabled people. We find ourselves in a serious and austere financial context, so we must ensure that we look at every aspect of value for money, budgetary control and the reform of priorities within the EU budget.

When we debated the MFF in this House in October 2012, the Government’s motion talked about agreeing that we must see

“significant improvements in the financial management of EU resources by the Commission and by Member States and significant improvements in the value for money of spend”.—[Official Report, 31 October 2012; Vol. 552, c. 295.]

The last debate contained many examples, some of which I shall refer to, showing that we are not there yet. I am sure the Minister would agree, so what we are simply trying to do with the new clauses is find ways in which we can enhance value for money assessments, budgetary control and the reform of priorities. That is very important to many of the Members in the Committee today and to Members throughout the House.

The proposals standing in my name and those of my hon. Friends will assist greatly in ensuring that reports are made to this House on value for money and budgetary control, and on budget priorities and waste and inefficiency within the EU budget. Examples have been given in interventions that give us an understanding of the extent of concerns about this out in the country—which we explored on Second Reading—and those can only increase.

[Tom Tugendhat]

Would the hon. Lady let me know which of her hon. Friends are so supportive of her? There appears to be somewhat of a dearth of support.

[Kelvin Hopkins]

Will my hon. Friend give way?

European Union (Finance) Bill

Tom Tugendhat Excerpts

Thursday 11th June 2015 Commons Chamber

[Tom Tugendhat (Tonbridge and Malling) (Con)]

Thank you, Madam Deputy Speaker, for calling me to speak in this important debate. I praise the hon. Member for East Lothian (George Kerevan), whose tour de force demonstrated the strength of speaking skills in the northern part of our nation. I am grateful to be called to speak today, because the financing of Europe is a matter in which I must declare an interest. As the husband of a French wife, I know all about foreign powers deciding on British finances.

It is an honour to represent the people of Tonbridge, Edenbridge and Malling in this wonderful House. Our beautiful towns and villages prove that England is today enjoying a bountiful summer. The fruits of our fields are enjoyed nationwide and I hope that this summer you, Madam Deputy Speaker, will be among the many who relish the Mereworth strawberries when you go to Wimbledon. I could give you a tour of my wonderful constituency based on the pubs, but for brevity I shall stick to the numerous towns and villages.

In the west, Edenbridge is a wonderful market town that once made cricket balls—indeed, the balls that Lord Cowdrey of Tonbridge smacked out of the ground to the delight of Kent and England fans. Chiddingstone is home to one of the finest ales in our nation, Larkins, which will, I hope, one day be on tap here. A little further on is Wolf Hall or, as it is known on the maps, Penshurst. Sadly, these wonderful communities are not entirely tranquil. As I reminded my right hon. Friend the Secretary State for Transport this morning, Gatwick’s low flights are blighting our days.

A little to the east, our largest town, Tonbridge, is home to some of the finest schools in our country. I declare an interest again, as a governor of Hillview School, which is committed to the arts, to drama, to design and to fashion and through that enriches the lives of many young people. West Malling’s High Street shows that commerce and community can combine. The award-winning florists and shoe shops are indeed a delight to all. East Malling is more famous abroad than at home, as its agricultural research has introduced new varieties to farmers around the world, while at Hadlow College those innovations are translated into reality by the teaching of a new generation.

Our community is not cut off from modernity, but communications too often hamper rather than improve lives. Borough Green, for example, is shaken by heavy traffic while many across our area suffer from poor trains and failing phone signals. The response of my right hon. Friend the Secretary of State for Culture, Media and Sport and of the Rail Minister, the Under-Secretary of State for Transport, my hon. Friend the Member for Devizes (Claire Perry), has been exemplary, and I look forward to seeing both issues improved with their welcome support.

I am not the first to campaign on these matters. The right hon. Sir John Stanley did so before most people can remember and, indeed, before I was born. In his maiden speech, he tested Hansard with the names of some of our wonderfully yclept villages: Wrotham, pronounced “Routem”; Trottiscliffe, pronounced “Trozlee”; and Ightham, pronounced “Item”. As I say them, I know that I am testing Hansard again 40 years later.

The House knows Sir John’s formidable legacy. His close links with the councils he served alongside and his dedication to every part of the constituency have left an integrated approach and exemplary work ethic that I am determined to maintain. Furthermore, his dedication to our country saw him serve as Minister for housing, for Northern Ireland and for the armed forces. That connection to the armed forces is very strong in Tonbridge and I am proud to join the line of representatives that our town has sent to this House still holding a commission in her Majesty’s armed forces. Sir John continued that tradition of service and his personal courage was clear both from the ministerial offices he held during the darkest days of the troubles and, perhaps most dramatically, as Parliamentary Private Secretary to Baroness Thatcher. That really took courage. I wish Sir John and Lady Stanley well. They deserve our utmost praise and gratitude.

My time in this House is, to be honest, unlikely to match the length of Sir John’s, so I shall briefly outline my reasons for seeking a voice in the heart of our democratic Union. The first is the law. As St Thomas More, a former occupant of your seat, Madam Deputy Speaker, once put it:

“I would uphold the law if for no other reason but to protect myself”.

Though my learned father invariably displayed the judgment of Solomon, I learnt clearly that the rule of law is not the same as the rule of lawyers. Those are not just words of filial rebellion but a call for the sovereignty of the people—the fundamental principle of British governance reasserted many times since Magna Carta 800 years ago—that finds expression in this House, the court of Parliament, and not through the Queen’s courts nor Strasbourg’s.

My second reason for seeking a voice is dementia. That silent time bomb is affecting the whole community, both directly and as carers, and that in turn calls for community response. That is why I am working with the whole community to help Tonbridge, Edenbridge and West Malling to become dementia-friendly towns that can offer the support we need across west Kent.

Finally, I come to the armed forces. Having served in combat in Afghanistan and Iraq and latterly as military assistant to the Chief of the Defence Staff, I know that numerical totems are for accountants, not soldiers. It is capability that matters and that is measured in assets and readiness. As we face an uncertain future in a world in which Russia threatens our allies in the east and Islamic-inspired violent extremism is redrawing the maps of the middle east, we must not only have the ships, the soldiers and the aircraft but must be certain that they are ready. Only by demonstrating our readiness on exercises and operations can we reassure our friends and deter our enemies. Deterrence is about much more than the nuclear boats that are the British people’s ultimate guarantee of sovereignty. It is about the morale and training of our soldiers, sailors, airmen and marines. Like a fiat currency, defence relies on confidence in our ability and only truly works when no one dares test it.

As we continue our debate on financing the European Union, I pay tribute to my right hon. Friend the Prime Minister—the only Prime Minister to have lowered the budget. I am also grateful and humbled to be the voice of my community in this Chamber. I will speak for the thousands who supported me and for the thousands who did not. I pledge to serve them all and the interests of our United Kingdom to the best of my ability, as long as the people of Tonbridge, Edenbridge and Malling will grant me that privilege.