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Dr. Roberta Blackman-Woods (City of Durham) (Lab): I thank the Chancellor for listening to those of us who were pressing for an extension to the free school meals programme, because it is an important measure in helping to reduce child poverty, but does he agree that it is quite wrong for the Liberal Democrats to lecture us on reducing child poverty when the first thing that Hull, which is a Liberal Democrat-controlled council, did was to withdraw its free school meals programme?
Mr. Darling: These things sometimes happen with the Liberal Democrats, but I am grateful to my hon. Friend for what she said about our proposals.
Sammy Wilson (East Antrim) (DUP): I fully recognise the constraints placed on the Chancellor in balancing and restoring public finances, while not damaging economic growth. One concern, however, for devolved Administrations is to have some certainty about Government spending plans for 2011 and beyond. When will he be able to give that assurance? When looking at those plans, will he bear in mind the House of Lords report that has indicated that Wales and Northern Ireland have greater needs than other parts of the United Kingdom?
Mr. Darling: I hope that, one way or another, the Government have recognised Northern Ireland's special needs, not just in the regular spending rounds but, as the hon. Gentleman well knows, in other discussions as well. As I have said, the Barnett formula will apply to the announcements that I have made today where appropriate in the usual way. All the devolved Administrations know the spending that they are getting for the rest of the spending review, but spending reviews have been fixed for three years in the past to give some certainty. I think that people will accept just now that, given what is happening, it is not possible to set out definitely what spending might be in three or five years' time, but they have that certainty for the next year, which will help them.
Jeremy Corbyn (Islington, North) (Lab): I note that the Chancellor's statement included the welcome reference to the fact that anyone who moves off benefits into work will not be worse off. Will he please explain how that will affect people who live in expensive private rented accommodation and receive housing benefit at the moment, but lose all or most of their housing benefit on going into work and thus end up considerably worse off and, in extreme cases, can even be rendered homeless as a result?
Mr. Darling: I understand that concern, and I can tell my hon. Friend that the Secretary of State for Work and Pensions will make a statement fairly shortly and give more details, but we are all very aware of his point about the withdrawal rates of benefits.
Dr. Andrew Murrison (Westbury) (Con): The Chancellor has announced increased funding for current operations, but after the increased costs of the redundancy of kit and the uplift in troops announced by the Prime Minister earlier this month, what will be left for the repair and replacement of our inadequate helicopter fleet, which is putting at risk the lives of our servicemen?
Mr. Darling: First, as I said in the statement, we are making available further sums to the Ministry of Defence. The Secretary of State for Defence will in due course set out how the MOD is reorganising what it does to ensure that it can provide support, particularly on the front line. I have said often enough before that it is important if we send troops into Afghanistan that they are properly equipped and supported. That means some reprioritisation in the MOD. I think that the hon. Gentleman would accept that, and my right hon. Friend the Secretary of State will be able to say something about it.
Rob Marris (Wolverhampton, South-West) (Lab): Does the Chancellor agree with the leader of the Conservative party that the problem is big Government and that there was too much regulation, or does the Chancellor agree with me that Government have a big role to play in protecting people and that the banking problems came about from too little regulation?
Mr. Darling: Despite being posed such a difficult question, I am probably more on my hon. Friend's side than the Leader of the Opposition's. The problem was partly caused by regulation that was not tough enough, but partly caused also by the fact that too many at the top of some banks clearly did not know what they were doing. There was a failure of corporate governance as well as a failure in regulation. That situation has undoubtedly had consequences, however, and every Government in the world have had to deal with those consequences. The question before us now is, how do we manage to deal with that situation in an orderly way?
Mr. Peter Bone (Wellingborough) (Con): The Chancellor was incorrect in saying that when the banks return to profit, they will pay corporation tax, because there will be £80 billion of losses to set off first. Does he not think that the citizens of the United Kingdom will be amazed by the fact that banks will be making billions of pounds in profit and not paying a single penny of corporation tax?
Mr. Darling: Of course I am aware of the tax treatment of losses, but the hon. Gentleman will be aware of the way in which tax losses are treated for capital adequacy purposes, so the situation is a little more complicated than the one he describes.
Helen Southworth (Warrington, South) (Lab): Will my right hon. Friend make sure that services to safeguard and protect vulnerable children who are at risk are a priority and receive investment?
Mr. Darling: I know that our right hon. Friend the Secretary of State for Children, Schools and Families is very concerned about that issue, as should we all be. It is very important that children who are at risk are properly looked after, and I very much hope that we can continue to do that.
Stewart Hosie (Dundee, East) (SNP):
Even if the deficit falls as planned, based on pretty heroic growth forecasts, the national debt will continue to rise, on the Treasury calculation, to £1.7 trillion, which is 91 per cent. of gross domestic product. That is in the Green Book. The Chancellor is right to say that we need a
budget for growth, but this was not a budget for growth. This pre-Budget statement specifically confirmed the cut announced earlier this year in both the resource and the capital departmental expenditure limit for Scotland. Why did the Chancellor not take the advice of even his own colleagues in Scotland and have a further year's reprofiling of capital expenditure to protect the recovery, instead of ensuring that the cuts come now and weaken Scotland's ability to recover?
Mr. Darling: I say this to the hon. Gentleman: yes, we did bring capital spending forward, and the situation in Scotland would have been infinitely better had the Scottish National party not turned its face against continuing to work with the private sector. The SNP had a vanity project to try to replace the private finance initiative, and as a result, as I know from my constituency and others, the only things being built under the schools building programme, for example, are schools that the previous Labour Administration authorised. The nationalists should have a long hard look at what they have done in Scotland over the past two years, because in just about every single case where they made a promise, they have failed to deliver it, partly because of dogma and partly because they have simply over-promised and overreached. It is no wonder that people are beginning to see through what the nationalists actually do.
Ms Dari Taylor (Stockton, South) (Lab): I warmly welcome the Chancellor's announcement of the innovation investment fund for research into the development of the green economy, which is led significantly by Teesside's chemical process industry. Will One NorthEast administer that fund, giving local companies an easy opportunity to get advice and access to it? If not, which Department will administer the fund and from what date?
Mr. Darling: I understand that the Secretary of State for Business, Innovation and Skills will make the situation clear very shortly. The regional development agency, One NorthEast, will of course be closely involved in everything that we do in relation to Teesside. It is important that Jobcentre Plus, the regional development agency and other public bodies all work very closely together, but I shall ensure that my hon. Friend is given that information by the Secretary of State.
Richard Younger-Ross (Teignbridge) (LD): I congratulate the Chancellor on adopting the proposal that I included in an early-day motion on the boiler scrappage scheme and on also adopting an EDM proposal for an effective 75p rate on banker bonuses. However, if such a rate is to be effective, measures to stop avoidance by increasing salaries or rolling over pay to a following year will have to be in place. What proposals does he have to ensure that such avoidance cannot happen? If he cannot do that, he will be far better off sticking with the proposals made by my hon. Friend the Member for Twickenham (Dr. Cable).
Mr. Darling:
I do not know whether the proposals from the hon. Member for Twickenham are to be found in an EDM, but it was not clear to me what his proposals actually were. Anti-avoidance measures will be introduced as part of the Finance Bill. On the other measures that the hon. Member for Teignbridge (Richard
Younger-Ross) has proposed, I cannot claim to have read the EDMs, but I am glad that he supports the policies.
Mr. Rob Wilson (Reading, East) (Con): Will the Chancellor confirm that manufacturing has contracted more under this Government than it did under the Thatcher Government in the 1980s?
Mr. Darling: I am glad to hear that there is common ground on this issue, because, certainly in my first 10 years in this House, it was not accepted that we lost far more manufacturing than perhaps we should have in the early 1980s. I think that manufacturing in this country, despite the downturn and despite the difficulties, is well placed for the future. We have a lot of manufacturing of which we can be genuinely proud, and in the past 10 years, through our investment in science and our support for universities, we have seen a lot more projects come out of universities and develop for the future. Much of what I had to say this afternoon was about encouraging such growth in the future. The policy of the hon. Member for Tatton (Mr. Osborne) is not to reverse the situation at all, but, it seems, to make it worse.
Adam Price (Carmarthen, East and Dinefwr) (PC): In the month when the Holtham commission, which the Labour-led Administration in the National Assembly for Wales appointed, has reported that the people of Wales are losing out to the tune of £400 million a year as a result of the Barnett formula, why did not the Chancellor use this opportunity-perhaps the final opportunity for some time for a Labour Chancellor-to implement the proposal for a needs-based formula and finally deliver justice to the people of Wales and, as we heard from the hon. Member for East Antrim (Sammy Wilson), to Northern Ireland as well?
Mr. Darling:
I believe that, certainly over the past 12 years, Wales has seen a significant increase in funding because of the increases in spending on health, education, science and research. Wales has benefited from that-tremendously so. If I have a disagreement with the nationalists, it is that I fail to understand what possible
justification there can ever be for Welsh independence. I cannot see how on earth it could benefit that country.
Justine Greening (Putney) (Con): The return to growth that is forecast in later years is predicated on consumers generating more GDP growth than they have in the past. The Chancellor suggests that 2 per cent. of GDP growth will be driven by private consumption, but between 2000 and 2007 only 1.75 per cent. of GDP growth was driven by consumer consumption. Does he think that wise, given that consumers are paying down their debt? Why does he think that he should rely on consumers backtracking, when they have worked out that they have a debt crisis even if the Government have not?
Mr. Darling: I think that many members of the public will be reducing the amount of debt that they carry, and that is a good thing. However, it is also true that people can at the same time maintain their spending, and some people increase their spending. Of course, as unemployment starts to fall and employment starts to grow, more people will be in work and more people will be able to spend their money on goods and services in this country.
Mr. Andrew Pelling (Croydon, Central) (Ind): As politicians are to blame, like bankers, perhaps the top 25 per cent. of our salaries should also be taxed at 90 per cent. However, the Chancellor mentioned in his speech a £550 million yield from the special tax levy, which is the equivalent of £1.1 billion in paid bonuses. Is he implying that the measure is a ban on bonuses? Otherwise, bankers will either redefine themselves as working for hedge funds or non-bank banks, or domicile themselves outside the UK to receive such bonuses.
Mr. Darling: The figure I mentioned is our estimate of what we will get after behavioural changes in terms of both payment of bonuses and, I suspect, people saying, "Okay, I will take my wage in salary." As I said earlier, the problem is not bonuses in themselves; the problem is when we start paying excessive bonuses or rewarding people for doing things that they really should not do. That is where we get the problems.
Points of Order
2.9 pm
Mr. Peter Bone (Wellingborough) (Con): On a point of order, Mr. Speaker. I know how keen you are for this House to hear news from the Government first. In the past, when a Budget statement has been made-this is, effectively, an autumn Budget-MPs have been sacked for leaking the information to the media first. Clearly, the BBC and Sky had important knowledge relating to this Budget, so will you look into this to see whether there has been a leak and what can be done about it?
Mr. Speaker: It is not, of course, a Budget. I note, however, the very important point that the hon. Gentleman has raised. I know that there has been a considerable amount of speculation, but I would be reluctant to say more than that. I am happy to reflect on the matter. I know how assiduous the hon. Gentleman is in these important matters.
Greg Mulholland (Leeds, North-West) (LD): On a point of order, Mr. Speaker. I need to bring to the attention of the House a separate, very important and worrying matter. Enterprise Inns is Britain's most notorious pubco. Its reputation is shown by its incredible litigiousness. It has tried to sue local media and national media, and has indeed threatened hon. Members of this House. I do not know if you are aware of this, but Enterprise Inns has sought by way of legal threat and intimidation to prevent the Business and Enterprise Committee from carrying out its scrutiny of the activities of the pub company-
Mr. Speaker: Order. I have listened very carefully to what the hon. Gentleman has said, which is certainly a matter of the highest importance to him and to many others. However, I have to say to him at this stage that if he has a complaint about a breach of the privilege of the House, that is a matter about which, in the first instance, he should come to me, or it is open to him to write to me, but he should not in the first instance raise it on the Floor of the House. Those options are open to the hon. Gentleman. If he wishes to pursue the matter with me in one or other of the ways that I have suggested, I will be all agog to hear what he has to say.
Bill Presented
Fiscal Responsibility
Presentation and First Reading (Standing Order No. 5 7 )
Mr. Chancellor of the Exchequer, supported by the Prime Minister, Ms Harriet Harman, Mr. Liam Byrne, Mr. Stephen Timms, Sarah McCarthy-Fry and Ian Pearson, presented a Bill to make provision for and in connection with the imposition of duties for securing sound public finances.
Bill read the First time; to be read a Second time tomorrow, and to be printed (Bill 13) with explanatory notes (Bill 25-EN).
Child Poverty Bill
[Relevant Document: The Twenty-eighth Report from the Joint Committee on Human Rights of Session 2008-09, Legislative Scrutiny: Child Poverty Bill, HC 1114.]
'(1) The relative low income after housing costs target is that less than 10 per cent. of children who live in qualifying households live in households that fall within the relevant income group.
(2) For the purposes of this section, a household falls within the relevant income group, in relation to a financial year, if its equivalised net income for the financial year is less than 60 per cent. of median equivalised net household income after housing costs for the financial year.'.- (Steve Webb.)
Brought up, and read the First time.
2.12 pm
Steve Webb (Northavon) (LD): I beg to move, That the clause be read a Second time.
Mr. Speaker: With this it will be convenient to discuss the following: new clause 2- The reduction in the causes of poverty targets -
'The Secretary of State shall make regulations setting out reduction in the causes of poverty targets.'.
'(1) The Secretary of State must, before the end of the period of three months beginning with the day on which the Act is passed, publish and lay before Parliament a report setting out an assessment of progress made towards meeting the 2010 target.
(2) The 2010 target is that in the financial year beginning with 1 April 2010, fewer than 1.7 million children live in households that fall within the relevant income group as defined by section 2(2).'.
Amendment 1, in clause 1, page 1, line 7, at end insert-
'(b) the relative low income after housing costs target in section [The relative low income after housing costs target],'.
Amendment 23, page 1, line 10, at end insert-
'(e) the reductions in the causes of poverty targets contained in regulations made by the Secretary of State under section [The reduction in the causes of poverty targets].'.
Amendment 33, in clause 6, page 3, line 9, at end insert-
'(ba) the circumstances in which a child living in communal accommodation may be regarded as living in a qualifying household;'.
Amendment 2, page 3, line 15, after 'costs', insert
'except when calculating household income for the purposes of section [The relative low income after housing costs target] (the relative low income after housing costs target)'.Amendment 3, page 3, line 20, after '5', insert
'and section [The relative low income after housing costs target]'.Amendment 34, page 3, line 22, at end insert-
'(4A) Before making regulations under subsections 1(a) and 1(ba), the Secretary of State must request the advice of the Commission as to what statistical surveys can reasonably be expected to be undertaken.'.
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