House of Commons
Thursday 13 July 2000
The House met at half-past Eleven o'clock
PRAYERS
[Madam Speaker in the Chair]
PRIVATE BUSINESS
Mersey Tunnels Bill (By Order)
Order for Second Reading read.
To be read a Second Time on Thursday 20 July.
Oral Answers to Questions
TRADE AND INDUSTRY
The Secretary of State was asked--
Post Offices
1. Ms Sally Keeble (Northampton, North): If he will make a statement about development of services at post offices. [128940]
The Minister for Competitiveness (Mr. Alan Johnson): In the statement on the post office network on 28 June, my right hon. Friend the Secretary of State for Trade and Industry announced a range of proposals and measures drawn from the performance and innovation unit's report and designed to modernise and sustain the post office network. Among them were proposals to develop new areas of business and services, utilising the modern online computer system that is being installed in every post office throughout the country and to which the Government are contributing almost £500 million.
Ms Keeble: I am grateful to my hon. Friend for that response. I am particularly interested in the universal bank. Could he tell us more about the way in which that will be taken forward? In particular, given that most of the people who take up that type of banking service are unbanked because they have not been able to get bank accounts, would it be possible for the universal bank to be given mutual status? That may be appropriate as the conventional banking sector has, by and large, failed those people.
Mr. Johnson: My hon. Friend is right. The universal bank is central to the recommendations in the performance and innovation unit's report, which contains a helpful chart setting out what should be available through a universal bank. That includes getting cash out of the post office and cashing cheques at the post office. Perhaps more importantly, people will not be allowed to go into debt. Discussions are taking place between the Post Office
and the high street banks. We have given a clear message that the Government fully support the concept of a universal bank. It is consistent with the banks' obligations under the financial exclusions set out by policy action team 14. The idea of involving mutuals and perhaps credit unions is for the Post Office to take forward in those discussions.
Mr. Peter Lilley (Hitchin and Harpenden): Will the Minister quantify the universal bank's contribution towards making good the loss of one third of revenues that sub-post offices will experience as a result of the cancellation of the Department of Social Security contract? Will he confirm that a bank--the Girobank--already operates through post offices? Will the universal bank compete with that bank? What contribution does the existing bank make to post office services? Can he confirm the figure in the PIU report that the maximum contribution that banking services will make to the revenues of post offices is just £50 million?
Mr. Johnson: I am surprised--the right hon. Member usually asks about the private finance initiative that was previously established, so he is changing his tack. [Hon. Members: "Answer the question."] I shall answer the question. The PIU expects a combination of the universal bank and the other aspects in the report in large measure to make up for the loss of income from the move to automated credit transfer.
More important, the universal bank is not being established as a re-run of the national Girobank. It will facilitate access to existing bank accounts. It will be both a substitute distribution system and a social bank. The two together mean that, in answer to the right hon. Gentleman's question, people will be able to present a smart card at the post office, instead of a benefit payment book, to access their pensions and benefits free of charge across a post office counter. That is similar to the position that everyone hoped we would be in had the benefit payment card, of which the right hon. Gentleman was the architect, succeeded and moved on to the second generation. We expect the universal bank to make an enormous contribution and to make up any loss of funds that may emerge from the move to ACT.
Mr. Martin O'Neill (Ochil): Is my hon. Friend aware that the National Federation of Sub-Postmasters yesterday gave evidence to the Select Committee on Trade and Industry? During the session, it changed it tack from being one of the most scathing critics of the post-Horizon situation to being satisfied, encouraged and excited by the prospect of the implementation of the PIU report. Will my hon. Friend accept the congratulations of many of his hon. Friends on the fact that postmasters and postmistresses are now with us in trying to improve the service to all our people?
Mr. Johnson: My hon. Friend makes an important point. Many of the ideas in the PIU report emerged from sub-postmasters and sub-postmistresses themselves. The NFSP has always taken a constructive approach to this issue. It warmly welcomed the report when it was
published, as the post office-based universal bank solution that I described was one of its major desires. The Post Office Users National Council, which represents the consumer, said:
- This report will put an end to the uncertainty that has been facing many subpostmasters."
Climate Change Levy
2. Mr. Christopher Gill (Ludlow): What assessment he has made of the impact on manufacturing competitiveness of the climate change levy; and if he will make a statement. [128941]
The Minister for Energy and Competitiveness in Europe (Mrs. Helen Liddell): The climate change levy has been designed with the competitiveness of United Kingdom manufacturing industry in mind. The impact of the levy will depend on the extent to which individual businesses take advantage of the various levy exemptions, the new scheme of enhanced capital allowances for energy efficiency and whether their sites qualify for a discount from the levy. The Government have offered to energy intensive users a commitment to reduce the levy in return for some sign from them that they are determined to meet challenging environmental targets.
Mr. Gill: Who does the Minister think she is fooling when she says that a tax will not destroy the competitive position of British industry? It is a poll tax on jobs in manufacturing industry and she knows it. If she does not believe me, will she take some notice of the chief executive of Invest.UK, who has said openly that the climate change levy is resented by industry? Will she also take note of what the chairman of Phillips UK said when he described the CCL as this Government's most crass mistake?
Mrs. Liddell: The hon. Gentleman is helpful in referring to Invest.UK. He will, of course, be aware that 52,000 extra jobs have come into this country as a result of the success of this Government in attracting inward investment. [Interruption.] I will answer the hon. Gentleman's question, as I answered it on 11 May when he asked it then. He should be well aware that the Government have introduced the CCL as a means of enabling industry to move towards more efficient energy usage to enable us to meet our environmental targets. The previous Government, whom the hon. Gentleman supported, were also committed to meeting international environmental targets. Was that yet another guarantee that has passed its sell-by date?
Mr. Peter L. Pike (Burnley): Does my hon. Friend accept that some concerns still exist among high energy using industries? However, is not it a fact that during the past 18 months discussions have taken place with the Government, who have responded positively to try to make the CCL work for the benefit of industry? That attitude will be continued by a Government who,
unlike the previous one, are fully committed to the manufacturing sector and recognise its importance to the British economy.
Mrs. Liddell: My hon. Friend makes a sensible point. The Government have consulted with intensive energy users which are not currently covered by the legislation with a view to seeking to address their needs. An announcement will be made shortly. One of the key elements of our commitment to more efficient energy usage is about increasing the competitiveness of British industry. In the long term, industries throughout the world will have to be much more energy efficient. In this country, we are determined to do something about that. Eight other European countries have introduced similar measures. The CCL is revenue neutral and has to be matched with other measures aimed at helping other companies achieve greater energy efficiency, thereby reducing their costs and increasing the competitiveness of British industry.
Mr. Alasdair Morgan (Galloway and Upper Nithsdale): Will large-scale hydro-electric schemes be exempt from the levy? If not, is not there a danger that they will not be refurbished when the current equipment becomes life expired?
Mrs. Liddell: Within the past couple of months I have met with Scottish and Southern Energy--to which I assume the hon. Gentleman refers, because it is significant in his constituency. I understand that the company has made recommendations to my right hon. Friend the Chancellor, which will be considered in due course.
Mr. Dale Campbell-Savours (Workington): Is it not strangely perverse that the Government bend over backwards on the levy to help companies such as Corus, which then announces thousands of redundancies?
Mrs. Liddell: I recognise the concerns that many right hon. and hon. Members have about the possibility of an announcement from Corus--and, as I represent a constituency close to the steelworks in Scotland, I share that anxiety. The Government will do everything they can to be of assistance to Corus and, in particular, to the work force should such redundancies come about. We are committed to manufacturing industry and have gone to considerable lengths to reduce corporation tax levies and to introduce assistance for innovation so that our companies can be as competitive as possible. Therefore, I recognise the disappointment that my hon. Friends and others feel when redundancies are announced by companies.
Mr. Nick Gibb (Bognor Regis and Littlehampton): Before I ask my question, may I say that it is not a discourtesy to the House that my hon. Friends the Members for Rutland and Melton (Mr. Duncan) and for South-West Hertfordshire (Mr. Page) are not in their places? Both have recently undergone hospital treatment. I am pleased to report that both are making good recoveries.
On the question of manufacturing industry and the Minister's response, is not that all academic if manufacturing such as shipbuilding is facing unfair competition from illegal subsidies in other European
Union countries? What has the right hon. Lady done to stop those subsidies, or is this just another example of the emptiness of the Government's claim to be ever so influential in Europe? Is it not the truth that she has failed to tackle European shipbuilding subsidies, just as she has failed to tackle European coal industry subsidies? Both those failures are causing enormous damage to major British manufacturing industries.
Mrs. Liddell: I trust that the hon. Gentleman will pass on to his hon. Friends the good wishes of Labour Members for their speedy recovery.
It is ironic that the hon. Gentleman's substantive point is about shipbuilding subsidies, when the Conservative Government patently failed even to engage in such matters in the European Union. We have extended the shipbuilding intervention fund. My right hon. Friend is meeting shipbuilding interests today, and two weeks ago I met Ministers in Germany and France specifically to discuss these matters. In the EU, considerable action is already being taken against Korea, which is one of the major sources of difficulty for the shipbuilding industry.
It is rich for Conservative Members to raise these issues when they patently failed to engage in them when in government. They were intent on operating in Europe from the sidelines rather than having real influence. The hon. Gentleman would be better advised to learn his homework more accurately before coming to the House.
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