1.47 pm

Ian Murray (Edinburgh South) (Lab): I thank the Minister for her statement and for advance sight of it. Let me start by paying tribute to our sub-postmasters up and down the country. They are integral to all our local communities across our constituencies, and are indeed the social fabric of this country. However, the job of a sub-postmaster has become much more difficult in recent years. Research from the National Federation of SubPostmasters shows that incomes have fallen and many sub-postmasters work very hard, over very long hours, for very little return. That situation has not been assisted by the Government, who in 2010 announced plans to use post offices as the “front office for government”. The Government have failed to deliver on their pledge. No new major government services have been awarded to post offices since May 2010. The Minister says that the Post Office has won all that it has bid for, but these were contracts that it already had, and, according to the National Federation of SubPostmasters, many services do not make the Post Office any money at all.

The situation resulted in the NFSP removing its support for the Postal Services Act 2011, because the Government promised £466 million of government work but the Post Office is currently gaining only £130 million from government business—that is 7% less than last year. That failure has resulted in the post office network being under more pressure than ever before. In addition to that is the abject failure of the network transformation programme to do what the Government planned. Consumer Futures wrote to the Business, Innovation and Skills Committee last month saying that of the 6,000 branches that were predicted by the Government to convert to the new model, only 1,100 have done so. That shows that the programme is not working, which is why a degree of compulsion has been introduced, with additional funding to deliver it.

The Minister dresses up this statement as good news, but today’s announcement of an additional £200 million on top of the £440 million already trailed beyond 2015 means that we can firmly say that this is a vote of no confidence in what the Government are doing to the post office network. In effect, the Government are increasing the compensation for people to leave and providing more money to convert. Of that, £23 million alone is for completing a retail survey to determine who should be converted or removed from the network on a compulsory basis. If the Government had delivered on their front office for government work that they promised back in 2010, the £640 million would not be required. It is a payment for abject failure and for yet another broken Government promise.

The National Federation of SubPostmasters voted to approve the package yesterday, because most operators

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feel that the traditional post office model under this Government is not working. Sub-postmasters know that they face a degree of compulsion, but they will take the package as they are struggling on their incomes. The fact that members of the National Federation of SubPostmasters voted so wholeheartedly to support this package shows that they want out. It is the epitome of taking the money and running. Crucially, the money will be used to subsidise exit from the network rather than to go into the network to make it sustainable in the long term.

I welcome the last shop in the village and community post office funding and support the fact that there will be no compulsion in that area. The £20 million will assist in modernisation and help these critical community assets. Rural communities in particular need their post office services to survive.

By the end of the process, the Government will have spent £2 billion on network transformation, and there is a concern that we still do not have a model that is sufficiently attractive to current or future operators. If the model were attractive, it would not require additional funding, as the current programme would not be failing. Given that the National Federation of SubPostmasters has called the privatisation of Royal Mail a “reckless gamble” for the post office network, is it not the case that although the Minister is throwing as many sub-postmasters as she can into lifeboats, those lifeboats could already be sinking as retailers will not take on the local model? The Government are content not just with selling off the Royal Mail for a song but with hastening the demise of yet another cherished national institution.

In answer to a question from the hon. Member for Argyll and Bute (Mr Reid) a few weeks ago, the Prime Minister said that

“we have committed that no post office will close in this Parliament.”—[Official Report, 23 October 2013; Vol. 569, c. 296.]

If that is the case, post offices in which owners are paid to leave with no alternative in place are closing by stealth, showing that the Prime Minister’s claim is indeed hollow and shallow.

Let me ask the Minister a series of questions. First, will the current criteria be used for compulsion, or will it be updated? Secondly, will the new announcement require new state aid applications to the European Union? Thirdly, if a sub-postmaster stays and converts to a new model, they will have their salary subsidised until 2015, but what happens beyond that? Despite the fact that more than 1,000 sub-postmasters have said that they wish to leave the network voluntarily, only 94 retailers have been found to replace them in the past two years. What happens to the post office if other retailers are not prepared to take it on after a postmaster leaves the network on a compulsory basis?

As shareholders get a significant financial benefit from a privatised Royal Mail, the taxpayer picks up a new £650 million plan B for post office network transformation. It is clear that the Government have created chaos in our postal services, and that the era of Postman Pat and Mrs Goggins is well and truly over.

Jo Swinson: I thank the hon. Member for Edinburgh South (Ian Murray) for his contribution. I agreed with some parts of it. Of course we all join him in paying

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tribute to the sub-postmasters who do such a fantastic job in all our constituencies up and down the country. I also agree that it has been a very difficult environment for sub-postmasters. However, small businesses and retailers have also found the past few years difficult. We could go over the argument that takes place in this House on a regular basis about where blame for that lies, but suffice it to say that we have seen a challenging set of economic times, and that has had an impact on the post offices, as it has on other businesses in the high street. However, the Post Office is a key partner of the front office for government, and it has won all the contracts that have come forward. Potential streams of income are coming down the track in the form of assisted digital services and identity verification. A whole range of different models are being explored, including those with local government. Indeed, a number of contracts have been won with various local government services, and there is probably more that can be done there, too. However, it is about not only the front office for government or mail, but having a diverse range of income streams for the post office. Financial services is one on which we have focused. For example, the roll out of the current account, which was piloted earlier this year in East Anglia, will be welcomed by many sub-postmasters, as it will provide regular transactions and regular footfall into post offices to give them the customer input they need to run thriving businesses.

I do not recognise the hon. Gentleman’s comments on network transformation. We are talking about a process in which more than 2,000 post offices are already signed up to convert to network transformation. I am sure that Members will report that customers have been positive about it, and the customer satisfaction statistics speak for themselves. Indeed, retailers in some of the new models, with the brighter and more modern environments, have experienced a 10% uplift in sales. This is about building a sustainable future. The hon. Gentleman tries to talk down the network transformation, but we should be talking it up.

I make no apologies for providing welcome funding to sub-postmasters for participating in important surveys, which will also help to gather valuable management data across the network. We are dealing with a diverse and dispersed network of nearly 12,000 branches across the country. It is important to have that management data for the Post Office to work out how best to plan the network for the future. Ensuring that sub-postmasters are properly remunerated for undertaking those surveys is particularly helpful.

The hon. Gentleman asked a few questions about whether new state aid applications will be required. The answer is yes, but as the package runs from 2015, there is plenty of time to ensure that we get through that necessary process. On the payments that sub-postmasters will receive, he is right that there will be an enhanced package up until 2015 because we recognise that in making a change and a transition, new customer bases and income streams will have to be built up. It is important that sub-postmasters are helped and encouraged to do that.

The hon. Gentleman was wrong to say that we were subsidising the exit of sub-postmasters and leaving communities stranded without post offices. That would be taking a leaf out of the previous Government’s book. Under this plan and under this Government, that

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cannot happen. There cannot be a subsidised exit if there is not already alternative provision in that community. Importantly, communities have to be happy with the changes that are being made, and provision has to continue. In those circumstances, if some sub-postmasters want to leave the network and retire or perhaps take on a new challenge, we will compensate them for doing so, as long as the service continues. That is the key difference between what the hon. Gentleman’s party did in government and what this coalition Government are doing. Labour closed 7,000 post offices. That was its answer to these particular challenges. We are creating a sustainable future for the post office network at a stable level. That is the difference between what they would have done and what we are doing.

Several hon. Members rose

Mr Speaker: Order. A great many right hon. and hon. Members are seeking to catch my eye. This is of course an important matter that must be treated thoroughly. I remind the House that there is an Opposition day debate to follow, which is heavily subscribed, and the interest in which I am keen to accommodate. As a consequence, there is a premium on brevity from Back Benchers and Front Benchers alike. The first to exhibit that will be Mr Stewart Jackson.

Mr Stewart Jackson (Peterborough) (Con): My constituency suffered under Labour’s Orwellian urban reinvention programme. We also remember the unedifying sight of Labour voting against motions condemning post office closures before scurrying to their constituencies to address public meetings about the same thing. Will my hon. Friend carefully make the point that the voluntary sector and local authorities have an important part to play in advice and information services and maintaining the viability of rural and urban post offices?

Jo Swinson: My hon. Friend makes a good point. There are many examples across the country of local government and voluntary services working in strong partnership with the Post Office and that can be of great mutual benefit.

Mr Adrian Bailey (West Bromwich West) (Lab/Co-op): I broadly welcome the Minister’s announcement, which reflects the difficulties successive Governments have had in sustaining the sort of post office network we all want. The future of the network will depend, however, on the perception of sub-postmasters and would-be sub-postmasters of the long-term viability of the model. Will the Minister explain what that perception is following Royal Mail’s arrangement with Post Office Ltd?

Jo Swinson: I welcome that contribution and those words of welcome from the Chair of the Select Committee. He is right that this Government and previous Governments have faced the challenge of how a much-loved institution reforms and modernises for a very different retail environment from that of some decades ago. That is not necessarily always an easy process. He asks about the perception of the future viability of the network. The range of different services for which the Post Office can bid—not just Government services but the huge opportunities in the parcels market and financial services—are very significant. We must bear in mind the 10-year

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intra-business agreement between Royal Mail and the Post Office. The chief executive of the Royal Mail, Moya Greene, has said that it would be unthinkable for there not to be that commercial relationship between the two companies, so I hope that hon. Members will also respect that and not indulge in the scaremongering that has gone on in some corners about the future of the Post Office following Royal Mail privatisation.

Harriett Baldwin (West Worcestershire) (Con): Mr Speaker, have you ever heard a more grudging contribution from the Labour party, after the closure of 7,346 post offices? I thank the Minister on behalf of my constituents in West Worcestershire. Will any of the money that she has announced today help the Post Office to modernise its computer system for my sub-postmasters and, to reflect rural concerns, update the algorithm that allows post offices to hold cash ?

Jo Swinson: I am happy to look in more detail at some of the specific technological issues that the hon. Lady raises. The money we are announcing today is for a continuation of the network subsidy for the three years and to invest in the future network transformation programme. Of course, we must ensure that the central IT systems, managing a network of nearly 12,000 retail outlets, are also fit for the 21st century. I will happily get back to her with further details.

Katy Clark (North Ayrshire and Arran) (Lab): Will the Minister explain why, despite what she says, Government work undertaken by post offices has gone down by more than 7% over the past year? Surely she should be doing more to get new work for the Post Office.

Jo Swinson: The hon. Lady is right that Government work is important for the Post Office. As the Minister responsible for the Post Office, I am engaged in promoting and encouraging that. Obviously, the Post Office must win work on its merits, and the environment is competitive. Whether we are talking about the mail market, the retail market or bidding for Government work, a range of competitors would be more than happy to take some of the contracts. It is a testament to the strength of the Post Office that, despite that strong competition, it has continued to win contract after contract, but I am in no doubt that bidding for that work on a more competitive basis creates significant pressures, particularly for some sub-postmasters.

Mr John Leech (Manchester, Withington) (LD): I welcome the Government’s commitment to protecting and potentially expanding the post office network. As my hon. Friend is aware, I have been campaigning for the reopening of my post office in Ladybarn, which was shamefully closed by the previous Government. Will the Minister assure me that when decisions are made on any new post offices, consideration will be given to reopening old post offices that were closed and that would not impact on the viability of other offices in an area?

Jo Swinson: I thank my hon. Friend for his question and pay tribute to him for his assiduous campaigning on behalf of his post offices, and particularly for the community of Ladybarn, which he has raised with me

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on a number of occasions. In my statement, I gave some examples of new post offices that have opened and been able to plug some of the gaps left in communities under the previous closure programmes and when sub-postmasters retired. If we consider any new models or new offices, the obvious places to see whether such provision could be inserted would be such locations.

Ian Paisley (North Antrim) (DUP): I welcome the Minister’s statement and associate myself with the tribute paid by the Opposition Front-Bench spokesman, the hon. Member for Edinburgh South (Ian Murray), to sub-postmasters, who in Northern Ireland provide an essential service and have gone the extra mile in years past when they were targeted by terrorist attacks. That should be put on the record.

The Minister kindly mentioned Balnamore in my North Antrim constituency, just outside Ballymoney. Given that success story, for which I am very grateful, will the Minister tell us how much of the £640 million will apply to Northern Ireland over the years from 2015 to 2018?

Jo Swinson: Just last week I met in this House representatives of the sub-postmasters in Northern Ireland. The points that they made about how post offices had often been seen as a safe haven where people from different communities could come together were incredibly moving. The hon. Gentleman makes a particularly important point about the service in areas that have seen such difficulties. The subsidy payment will depend on the specifics of which sub-postmasters bid for which money and how that breaks down, but I know that Northern Ireland has a higher than average proportion of rural offices, so I am sure that the community fund for community offices will be of particular interest to sub-postmasters there.

Neil Carmichael (Stroud) (Con): Given that the previous Labour Government closed a third of our post offices—a staggering fact—we should listen to the Opposition with that in mind. Does the Minister agree that it is fantastic news that organisations such as National Express are using the Post Office to promote and sell their tickets? That is exactly what we need to see to promote post offices in our communities.

Jo Swinson: My hon. Friend makes a powerful point. The fact that we have a network with such a fantastic reach into communities up and down the country means that it is ideally placed for a range of different commercial contracts and potential partnerships, such as the one that he mentions with National Express.

Richard Burden (Birmingham, Northfield) (Lab): At a time when so many of our constituents face crippling debts, I think the Minister might agree that local post offices should be able to play a bigger role in providing alternatives to loan sharks. It has been argued that credit unions could be co-located with local post offices, but all too often that does not stack up financially for the post office or the credit union. What does she feel she can do to bring them together and remove those barriers?

Jo Swinson: The hon. Gentleman makes an important point, not just about the suitability of post offices for such ventures but about the need for such projects in

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our communities. As he will be aware, the Government are investing £38 million to support credit unions to modernise and to ensure that they can be accessible to people in communities. There might be ways in which that can be used to create collaboration with the Post Office in communities where that makes sense.

Roger Williams (Brecon and Radnorshire) (LD): I congratulate the Minister on her statement. Steven Like, the postmaster in Hay-on-Wye in my constituency, was concerned that the small and very important letter-sorting facility in his premises might be closed to the detriment of the viability of his business. The Minister was able to give him encouraging news, but will she encourage Royal Mail and the Post Office to work together for the benefit of both businesses?

Jo Swinson: I can certainly assure my hon. Friend that I will do that. As he says, he raised the issue of Hay-on-Wye with me and, thankfully, there is no threat to that service. He raises the wider point of the important commercial relationship between Royal Mail and the Post Office. They are natural partners that operate together for a mutual benefit, which will, I am sure, continue long into the future.

Ms Margaret Ritchie (South Down) (SDLP): I thank the Minister for her statement. With particular reference to Northern Ireland, where there have been bank branch closures, will she give assurances that she will have discussions with the major banks and her colleagues in the Treasury to ensure that banking services can be transferred to post offices, particularly in rural areas, to provide accessibility to services and, in so doing, sustain rural post offices?

Jo Swinson: Absolutely. The hon. Lady is right to raise that issue. Of course it is very good news that 95% of the main UK bank accounts are now available through post offices; only Santander is so far holding out. But in the meeting that I had with sub-postmasters from Northern Ireland last week, they did mention that there were some specific Northern Ireland issues around the full range of banking services. I am more than happy to look into those and encourage banks to ensure that they are provided. Of course, there is also the new current account, which has been piloted and will be rolled out across the post office network. The post office should be an obvious place for people to undertake their banking transactions.

Steve Brine (Winchester) (Con): I welcome the Minister’s statement. Just this week, I received news from the Post Office that the Chandler’s Ford post office, in the Fryern Arcade part of my constituency, is to be modernised and moved with some of the funding that she announced today. The additional funding will obviously ensure that post offices remain, but can she assure the people I represent that communities that lost out and were so bitterly disappointed—such as Littleton village in my constituency—will have a chance for a glorious return of their post office services? Will she meet me and other Members interested, to explore how we go about that?

Jo Swinson: My hon. Friend raises an important point. Many communities up and down the country were devastated by the loss of their post office under the previous closure programmes. Where it makes sense,

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and where there are new models—whether those are the local, main or other models that the Post Office has been trialling—that would make sense in those areas, of course we should look at whether that is appropriate, and I would be happy to receive representations from my hon. Friend and other hon. Members on that issue.

Steve McCabe (Birmingham, Selly Oak) (Lab): Will the Minister intervene to see whether her rescue package can be used to prevent the closure of Kings Heath Crown post office and the shoehorning of services into a corner of WH Smith that is unable to handle buggies, wheelchairs or mobility scooters—hardly modern, easier premises to use?

Jo Swinson: The hon. Gentleman mentions an apparent closure, but of course a post office service will continue, and that is vital to that community. He mentions the Crown office network. It is simply unsustainable to have 370 post offices out of a network of nearly 12,000 that lose £37 million a year, as of the last financial year for which we have figures. We need to take action to get the Crown network to break even, given that these are offices, in city centre and town centre locations, that are busy places and should be able to at least break even, if not provide a profit to go back into the network. That is why we are looking at franchising proposals. We do need to get them right and they are the subject of consultation. I am not sure of the exact timetable of the hon. Gentleman’s particular consultation process, but it is a six-week consultation for any suggested move. Where that is not right for the community, of course we should look again at different locations and ensure that a post office is continuing in all those areas that are up for franchising.

Mr Alan Reid (Argyll and Bute) (LD): I very much welcome my hon. Friend’s statement, especially the recognition that the local model is not suitable for small communities, and the £20 million for small community post offices, but may I draw her attention to the fact that the Post Office is threatening to close the Carradale East post office a fortnight on Monday? Can a rescue package be put together to save that post office for that small community?

Jo Swinson: I pay tribute to my hon. Friend’s campaigning on behalf of the numerous post offices in Argyll and Bute. In a constituency like his, they truly provide a lifeline. I am aware of the case that he has raised and I will happily look further into it. Clearly, there are circumstances where sometimes a sub-postmaster will decide to retire, but we need to ensure that what is put in that post office’s place is appropriate for that local community.

Geoffrey Clifton-Brown (The Cotswolds) (Con): May I say how strongly I agree with my hon. Friend about the importance of the post office network, especially to rural areas? Is she aware that, under the last Labour Government, they closed a massive 12 out of 34 post offices? In contrast, under this Government, a post office at Stratton has been reopened and the post office at Bourton-on-the-Water is now open seven days a week. Would she agree that the best way to maintain the viability of the post office network is to introduce an increasing and innovative range of services?

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Jo Swinson: I agree with my hon. Friend. He is right to highlight the challenges that his community and others faced under the previous Government. I am delighted to hear the news that the Post Office is delivering for his constituents, and he is right that a diverse and innovative range of services will help to ensure that the Post Office has a sustainable and secure future.

Bill Esterson (Sefton Central) (Lab): The people running a number of post offices in my constituency just cannot make them work. They are not viable, for many reasons. They have a knock-on effect on other retailers, and they will not be able to provide the vital community service to the local community, including the older people who rely on them. What is needed is the kind of Government work that my hon. Friend the Member for North Ayrshire and Arran (Katy Clark) mentioned. That is the essential long-term future for those post offices; otherwise, the measure announced today is just delaying the inevitable, and we will still have a closure programme by another name.

Jo Swinson: We are modernising the post office network because we recognise that it cannot look the same in the future as it did 50 years ago. There have been a range of changes in the way that we live our lives and the way that people access financial services through bank accounts. For example, there is less demand for people to be paid at post offices. Those all have an impact on the services that post offices offer. That is why we need to diversify into a range of new services, and why the new models are often based on co-locating a post office with a thriving retail business, where they can mutually benefit, with the post office driving footfall to help the retail business drive sales. In the new models, sales of the other retail businesses have increased. That is how we can build a sustainable future. We cannot set the post office in aspic and keep it as it was 50 years ago.

Miss Anne McIntosh (Thirsk and Malton) (Con): The loss of a rural post office can impact on the cost of living for those living in that area. Would the Minister look closely at the model of the community post office at Stillington as a way forward? Will she also review what will happen to rural post offices at the end of the 10-year operational agreement between Royal Mail and the Post Office, and the possible implications for rural post offices?

Jo Swinson: I will be happy to hear more about the post office at Stillington and how members of the community have been working to sustain it. I hope that the announcement of the funding for community post offices will be of interest to my hon. Friend’s constituents also. She is right to highlight that the mails work through Royal Mail is an important part of what the Post Office does, and we certainly want to ensure that that continues long beyond the inter-business agreement. People should bear in mind the reassurance that the chief executive of Royal Mail has given about that.

Diana Johnson (Kingston upon Hull North) (Lab): Will the Minister explain exactly what happens if a sub-postmaster wants to take the compensation and cease to operate a post office and a new operator cannot be found?

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Jo Swinson: We shall not compensate people to leave the post office network and leave communities without post offices because that would not be in keeping with what we want to provide for communities; so the compensation for sub-postmasters who want to leave is dependent on a new operator being found in that area. Obviously, at any stage sub-postmasters can decide whether they want to retire or to leave the network, but if we going to pay them and compensate them to do so, we want to ensure that the community still has a post office service that it can access.

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): In West Aberdeenshire and Kincardine there are many small local communities where the community model will be an excellent solution to their need to sustain the last access to public services in the community. Can the Minister confirm that the extension of the card account, and the funding model that has been put in today, will be used to grow other services for the Post Office, particularly financial services?

Jo Swinson: My hon. Friend is right to highlight the vital role of the community post office, particularly where that is literally the last shop in the village. That is where the investment in those branches that did not qualify under the previous programme but will now, will help to ensure that they too can provide a modern service and make available the widest range of financial services in a community where there may not be other banking facilities. In such areas, where people may depend significantly on deliveries and online shopping because of the access it gives to large retail areas and conurbations, the parcels market is increasingly important as part of the business model of post offices.

Roberta Blackman-Woods (City of Durham) (Lab): A designated post office recently closed in a village in my constituency. It has been replaced by post office facilities in a shop. Although local people are pleased that a service is continuing, they are worried about the lack of privacy in the new location. What steps is the Minister taking to ensure that old and vulnerable people are not put at risk by moves of that nature?

Jo Swinson: The hon. Lady makes a genuine point, and it is important, depending on what the transaction is, that appropriate privacy can be given. At the same time, the old model of the post office with a sort of fortress that had to be built in, seemed outdated to many people, putting a barrier between the customer service assistant and the customer. It also added a huge amount of cost to the way in which the network was run. It is important that retailers and sub-postmasters providing services can take into account the needs of all their customers, and if the hon. Lady has concerns about what is happening in a particular post office, I am certainly happy to look at that.

Mr Philip Hollobone (Kettering) (Con): May I welcome this massive new investment in sub-post offices? Many sub-post offices that were much loved and well used in my Kettering constituency were closed under the Labour Government. I congratulate the coalition Government on lifting the long, deep, dark shadow of closure that has hung over local sub-post offices for so long.

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Jo Swinson: I thank my hon. Friend for his intervention. The figures speak for themselves. If we look at the number of post offices that have been in place over the past decade or so, the network is at its most stable for many, many years, and the Government are absolutely committed to maintaining that. Although the post office network must change, the answer is not to cull it but to support it.

Lisa Nandy (Wigan) (Lab): The Minister has repeatedly said that the post office network is at its most sustainable for years, but that is not a picture that many people in Wigan and across the country—or I—would recognise. Government business to the post office network has fallen by 7% over the past year, and the National Federation of SubPostmasters says that we need

“a determined and co-ordinated effort across Government to provide a wide range of services through the post office network”.

Where is it?

Jo Swinson: The numbers in the post office network are at their most stable for decades and, as I say, the facts speak for themselves. Government services are an important part of post office income, but they are not the only part, because that is not the way to achieve a secure future for post offices. They need a diverse range of income streams, including mails and financial services.

As for where the Government work is, we have heard today that the post office card account, or its successor, will continue through the post office network, which is welcome. Last year, the Post Office competed for the framework contract for the Driver and Vehicle Licensing Agency and won, and that framework contract will allow further contracts to be put through, as indeed was the case with the UK Passport Service work earlier this year.

I am not for a second trying to suggest that things are easy for sub-postmasters. Things are not easy, and they have not been easy, in these difficult economic times. We recognise that, which is why we have enhanced the packages available to make them more attractive and make sure that sub-postmasters have more opportunity either to make the choice if they wish to leave the network or enable them to continue and invest in their business, get more customers through the door and build a thriving retail business.

John Pugh (Southport) (LD): In welcoming the statement, may I draw the Minister’s attention to the Crown post office network, and the fact that those post offices selected for closure are not necessarily, as is the case with mine in Southport, making the most losses? Will she tell the House what will happen if WH Smith, like other high street firms, goes out of business?

Jo Swinson: The selection from the Crown network is based on a range of criteria but, in every single case in which we are seeking to franchise, we are talking about Crown post offices that have made losses. I understand that in Southport, every £1 of income cost £1.75. People will accept that that is not sustainable. That said, it is important that we make sure that those services continue. I encourage my hon. Friend to ensure that he is involved in the consultation on the right location for continuing that post office service, to make sure that his constituents still have access to the full range of post office services.

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Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op): Royal Mail shares are selling today at about 70% above the price at which they were sold by the Government when the business was privatised. Does the Minister at least admit, if she is as determined on privatisation as she seems to be that, that had the Government not undervalued Royal Mail shares, she might have an extra £2 billion, which could be used to support the Post Office, now and in future years.

Jo Swinson: First, I would point out to the hon. Gentleman that he is talking about two entirely separate companies, because Royal Mail is separate from the Post Office. The privatisation of Royal Mail has, I understand, been discussed at length in the House and, indeed, this morning in the Select Committee on Business, Innovation and Skills, which took evidence from my right hon. Friend the Secretary of State for Business, Innovation and Skills and the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon). I would gently say that making a judgment some short weeks after flotation is perhaps not the best way of judging a company’s long-term share price.

Mr Russell Brown (Dumfries and Galloway) (Lab): As chair of the all-party group on post offices, may I tell the Minister that I warmly welcome the additional investment that she has announced? However, I think that there is an element of denial about what is going on out there. Perhaps she can share with the House how many post offices have been closed temporarily and how many are under temporary management? How much of the £1.34 billion allocation has been spent on modernisation, and how much has been spent to provide an enhanced package for people to leave? Can she tell the House the value of the 10 contracts that have been won, and how many of them were new contracts, not contracts up for renewal?

Jo Swinson: I shall endeavour to give a full answer to all those points but, if the House will forgive me, I shall write with all the details on those questions. As for temporary closures, I think it is about 400, but I can obtain the most up-to-date figures. As the hon. Gentleman can imagine, the figure fluctuates. I accept that it is important that we make sure that Government work is available as part of a mix of services and income streams that the Post Office can access. I absolutely accept that things are not easy, and I have said that a number of times when responding to questions this afternoon. I would not wish to suggest that it is an easy life being a sub-postmaster, because it is not, but we are trying to create a sustainable network for the future and, indeed, in communities that have experienced temporary closures, to look at what more we can do to make sure that post office services are delivered to those communities.

Mr Mike Weir (Angus) (SNP): The sad fact is that many post offices in rural areas continue to close and have been replaced by outreach services. The £20 million investment fund is said to enable the improvement and modernisation of branches, but that is not the problem—it is postmasters’ income in those branches. Is there anything in the statement that will allow the Post Office to give more direct subsidy to the income of postmasters in remote rural areas to stop the closure of those branches?

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Jo Swinson: We have to recognise that across a network of nearly 12,000 branches some post offices are not commercially sustainable by themselves, but none the less they play a huge social and economic role in their community. I believe that there will always be a role for continued Government subsidy for those branches. That said, we are using taxpayers’ money, which must be spent judiciously. It is about making sure that those branches that can become viable without subsidy proceed without subsidy, but branches that require ongoing subsidy should have the certainty that that is the situation. At the moment, that is not the case, because those post offices do not know whether they are designated as community branches or whether they can access subsidies.

That certainty will help, but as for the question of whether we can increase the money for those branches on an ongoing revenue basis, that is not something which, in the current economic circumstances, I can promise to deliver for the hon. Gentleman. Investment in those branches is sometimes needed to ensure that they can become more sustainable, perhaps by improving the layout or structure of the office so that it can do more parcels work, for example. There could be ways to enhance income streams by using a bit of capital investment.

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Points of Order

2.28 pm

Graham Jones (Hyndburn) (Lab): On a point of order, Mr Speaker. May I seek your advice on a reply given by the Prime Minister in Prime Minister’s questions, as he may inadvertently have misled the House? When asked about the impact of the bedroom tax on disabled people, he told the House: “Obviously, what we have done is to exempt disabled people who need an extra room.” Leading charities claim in a letter to the Secretary of State for Work and Pensions today that there is “stark evidence” to the contrary.

Mr Speaker: I am extremely grateful to the hon. Gentleman for that attempted point of order. The juxtaposition of the two lines of argument has been made perfectly clear from his first quotation and from his second, of which no more is needed for me to rule. My ruling is that it is not a matter for the Chair. I understand the hon. Gentleman’s concern, but it is a point of debate. Of course, all Members, including Ministers, are responsible for the accuracy of what they say in the House, and everyone will be conscious of that. The hon. Gentleman has made his point, it is on the record, and I trust that he is satisfied.

Mr Charles Walker (Broxbourne) (Con): On a point of order, Mr Speaker. I draw your attention to remaining orders and notices in the Order Paper—future business item 40 on changes to Standing Order No. 33, as tabled by the Leader of the House and the Deputy Leader of the House. The Procedure Committee, which I chair, has been in discussion with the office of the Leader of the House, and we thought we had been in a fruitful discussion. The Leader of the House is promoting the proposal that there may be three amendments to the motion on the Queen’s Speech, and the Procedure Committee has advised that it should be four amendments, so there seems to be a point of disagreement on the matter. I seek your advice: is it not the established principle that it is the Procedure Committee in this House, not the Executive, that leads changes to Standing Orders?

Mr Speaker: I am grateful to the hon. Gentleman for his point of order. He is substantively correct, as far as I am aware, on the latter front. Indeed, that point has been made to me in the past in other contexts by Ministers when they have thought it convenient to deploy that line of argument. I would always hope that Ministers would treat Committees of the House with courtesy. However, nothing disorderly within the rules of the House appears to have occurred and I do not think there is a point of order for the Chair. Those on the Treasury Bench will have heard what the Chair of the Procedure Committee—a very important Committee with a very illustrious Chair—has said, and we will leave it there for today.

Thomas Docherty (Dunfermline and West Fife) (Lab): Further to that point of order, Mr Speaker. Would it be helpful if I were to release a letter that I received from the Clerks of this House which said, in effect, that there was no need for the Leader of the House to be helpful to you as the Chair, as you already had sufficient discretion as to how many subsequent amendments could be chosen on the day of the Queen’s Speech debates?

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Mr Speaker: Well, in one sense it is very flattering that the hon. Gentleman seeks my advice and asks whether a proposed course of action on his part would be helpful or not, but I feel that the hon. Gentleman is, in most circumstances, his own best counsellor. He will judge whether or not he wishes to release the said letter. I think he can rest content with that emollient and non-committal response from me. He knows how to look after himself. We will leave it there for now.

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Winter Fuel Allowance Payments

Motion for leave to bring in a Bill (Standing Order No. 23)

2.32 pm

Mr Mike Weir (Angus) (SNP): I beg to move,

That leave be given to bring in a Bill to provide for the early payment of winter fuel allowance to eligible persons whose residences are not connected to the mains gas grid and whose principal source of fuel is home fuel oil, liquid petroleum gas or propane gas; and for connected purposes.

This is an issue that I have raised on numerous occasions, during the passage of energy Bills, in debate and by means of a private Member’s Bill, and it has had support across the House on other occasions.

I do not intend to speak on the general problem of fuel poverty, the details of which should be well known by Members in all parts of the House. I merely note that the percentage of households off the gas grid that are in fuel poverty is more than twice as high as those that are on the gas grid. I acknowledge that the present Government have taken some action in respect of off-gas grid consumers, including the establishment of the ministerial round table on heating oil and liquefied petroleum gas, which led to the Federation of Petroleum Suppliers’ customer charter.

My proposal will not end fuel poverty for off-grid consumers; nor does it seek to extend winter fuel payments to additional groups or to tread on the contentious subject of means-testing which concerns some Members. It does not attempt to tackle the many issues that surround the topic of off-grid energy, but it is tightly drawn to give some relief to a particularly vulnerable sector—those pensioners who are off the gas grid. I have many of these pensioners in my constituency and they face a number of particular problems.

Like all forms of energy, the price of home fuel oil has rocketed in recent years, but there is clear evidence that the price of home fuel oil rises in the early autumn and stays high over the winter period. This year it has been somewhat skewed by the long cold spring, with prices staying stubbornly high over the spring before falling in the summer, but they are now rising again. The rise in prices affects all areas of the United Kingdom over the winter months. It is important to note that this is as much an issue for the rural areas of England, Wales and particularly Northern Ireland as it is for the rural areas of Scotland.

The House of Commons Library note that was produced for my Bill in the previous Session states:

“The average costs of heating and providing hot water for a typical three bedroom house with LPG have been estimated at around £2,300 per year (based on April 2012 prices with a conventional boiler), heating oil is thought to cost around £1,700 and gas around £1,200.”

The figures may now have changed but the general point stands: the cost of heating an average home with propane or home fuel oil is higher than heating with mains gas. Not only that, but the costs are also rising much more sharply. It is also important to note that the main use of LPG and home fuel oil is for heating, so although those homes generally have electricity, they still face greater costs.

Traditionally the Government have called for an extension of the mains gas grid as one way of tackling the problem, but realistically such schemes will help only

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those homes where there is a gas mains nearby, although even then the costs can be very substantial. I have had cases in my constituency in urban areas where the quoted cost of connecting to the grid is thousands of pounds, even when the mains are relatively close by. In many rural and island areas, where the cost of connection would be enormous, there is absolutely no chance of that being done.

The Government’s advice to switch does not work in a market where there is often a practical local monopoly on supplies. The problem in many rural areas is exacerbated by the fact that much of the housing is old and of a construction that makes it very difficult to install energy-saving measures, such as cavity wall insulation.

Of course, these households will receive the same winter fuel allowances as pensioners on the gas grid, but the crucial difference is how the energy is delivered. Those who are on the gas grid will receive their winter fuel bill around the time that the winter fuel allowance is generally paid, and it therefore works well for them. Indeed, in the explanatory notes to the regulations that last amended the benefit, the previous Government said specifically:

“They are paid in a lump sum each winter to ensure that money is available when fuel bills arrive.”

This is clearly not the case for those off the gas grid. They face the difficulty that they have to pay for their LPG or home fuel oil up front at the beginning of winter, well before they have the benefit of the winter fuel allowance. Many find it difficult to do so and may not fill up the tank completely, leaving them having to do so, if they can afford it, in the depths of winter, which brings problems of its own in getting a supply through in bad weather. That has been a serious problem in many rural areas in past winters.

The price of fuel is rising substantially as winter approaches, and even those suppliers who offer a fixed winter price will do so at a price higher than the summer price. My Bill suggests how we might tackle this problem. The current winter fuel allowances are paid as a result of regulations that specify a date by which pensioners must apply. It is worth noting that once they are on the system, they do not have to apply every year. Clause 1 seeks to vary the regulation to bring forward for those off the gas grid the qualifying date from late September to late July. Clause 2 seeks to bring forward the payment date for those off-gas grid to no later that 30 September to allow them to buy a complete tank of gas prior to the winter.

These proposals would ensure that money is available when fuel bills arrive, as the regulations put it. I have debated this with the Minister of State, Department for Work and Pensions, the hon. Member for Thornbury and Yate (Steve Webb) and, with the greatest respect to the hon. Gentleman, it seems to me that the objections

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to the proposal are bureaucratic excuses. The first objection is that the payment would have to be paid to everyone earlier or other claimants may feel aggrieved at being denied early access. The whole point, however, is to tackle the problem of having to pay for energy up front. Other claimants will have access to the allowance when their quarterly bills become due. I reiterate the point made in the memo to the regulations that the payment was meant to be available when the bill arrives: for those who pay up front, the most appropriate way to achieve parity would be to make payment as close as possible to the time of the outlay, which is precisely what I am attempting to do.

The second objection is that the Department would need to create a separate category of people who are off-grid, and that the situation of individuals could change from year to year. I recall the Minister giving us a rundown of his own situation—by buying a house, he subsequently became connected to the grid. That objection seems ludicrous, as the number of new connections would be low, and unlikely to be a major problem. As Members know, it is not unheard of for the Department to insist on claimants of other benefits notifying a change in circumstances, so I do not see the problem. A low number of claimants are likely to be affected in any event.

Moving the date forward could result in some people losing out on the payment in the initial year. I accept that that could be a problem, but it is hardly insurmountable. As I said, it would be a problem only in the first year of each claim, since once applicants are on the system they do not have to apply each year but receive an allowance automatically. It would be possible, for example, to allow off-grid consumers who miss the earlier date to apply at the later date but be transferred to the earlier date for year 2, so avoiding any difficulties. If, on the other hand, the Government have real problems with an earlier date, we could keep the September date and simply allow payment to off-grid consumers at an earlier date from year 2.

There is nothing revolutionary about this proposal, which simply seeks a very minor change to begin to address the problems of off-gas-grid consumers by targeting a particularly vulnerable group. With political will, none of the problems is insurmountable. I hope that the House will support this Bill and allow it to proceed.

Question put and agreed to.


That Mr Mike Weir, Dr Eilidh Whiteford, Hywel Williams, Angus Robertson, Mr Elfyn Llwyd, Sarah Newton, Mr Nigel Dodds, Jonathan Edwards, Ms Margaret Ritchie and Mr Angus Brendan MacNeil present the Bill.

Mr Mike Weir accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 28 February and to be printed (Bill 135).

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Opposition Day

13th Allotted Day

Cost of Living

2.41 pm

Chris Leslie (Nottingham East) (Lab/Co-op): I beg to move,

That this House notes that the Government has failed to meet its own economic goals over the last three years with prices rising faster than wages for 40 out of 41 months, average earnings for working people £1,600 a year lower in real terms than in May 2010, economic growth far slower than expected, the Government’s pledge to balance the books by 2015 set to be broken and the UK’s credit rating downgraded; further notes that growth of 1.5 per cent is needed in every quarter between now and May 2015 in order to catch up the lost ground from three damaging years of flat-lining growth; believes the Chancellor of the Exchequer’s Autumn Statement should take action to tackle the cost-of-living crisis which means that for most families there is still no economic recovery and to ensure recovery delivers rising living standards for all, is balanced and built to last; and calls on the Government to bring forward measures including an energy price freeze and long-term reforms to the energy market, an extension of free childcare for working parents of three and four year olds, action to boost long-term housing supply and a compulsory jobs guarantee for young people and the long-term unemployed.

On Thursday next week the Chancellor of the Exchequer will address this House in his autumn statement. My hon. Friends will know that we have come to expect a tin ear from this Chancellor, who in last year’s autumn statement cut tax credits and child benefit in the face of millions of people struggling to make ends meet while sticking firmly by his decision to deliver a millionaires’ tax cut for the richest 1%. This year, the time has surely come for the Chancellor to wake up to the chronic and unremitting cost of living crisis facing millions of households across the country. Never before have so many worked so hard for so little, working week after week only to find that their pay packet has shrunk in real terms and that they are unable to buy as much as the month before, with wages failing to keep up with prices and the pound in their pocket diminishing in value as everyday costs—rent, the weekly shop, child care, and gas and electricity bills—get higher and higher.

Dr Thérèse Coffey (Suffolk Coastal) (Con): Does the hon. Gentleman welcome the fact that the Government have taken many people out of income tax, such that next April 4,041 people in Suffolk Coastal will no longer pay income tax, alongside the freeze in council tax that they have enjoyed for the past few years?

Chris Leslie: The hon. Lady makes her point. Unfortunately, a lot of Conservatives like to pretend that they are giving with one hand, yet they are taking away so much more with the other—not just the tax rises that they pretend never happened but the unremitting rise in the costs that people face daily.

Mr Jim Cunningham (Coventry South) (Lab): My hon. Friend is right to say that the Government give with one hand and take with another. Does he agree that of the £14 billion of tax adjustments last year, £11 billion was inflicted on women and their cost of living?

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Chris Leslie: Absolutely. In last week’s Opposition day debate, my hon. Friend the Member for Ashfield (Gloria De Piero) correctly highlighted not only the impact of the cost of living crisis on households up and down the country but how it is particularly hitting women.

Christopher Pincher (Tamworth) (Con): On the subject of giving and taking, is the hon. Gentleman aware that in 20-odd years of Labour control of Staffordshire county council, Labour hiked council tax time after time, whereas this year the Conservative-controlled county council has cut the tax? Does that not show that Tories give money back and Labour takes it away?

Chris Leslie: The trouble for the hon. Gentleman is that an awful lot of Conservative councils have metaphorically stuck two fingers up to the Secretary of State for Communities and Local Government and, indeed, the Chancellor by deciding to increase council tax because the Government’s approach to local government finance has squeezed services. Even Conservative councils and authorities are finding themselves in a position where they are raising council tax.

Sheila Gilmore (Edinburgh East) (Lab): The Social Mobility and Child Poverty Commission has stated that the fiscal consolidation has been regressive. Does my hon. Friend think that that should be taken into account?

Kwasi Kwarteng (Spelthorne) (Con): It has worked.

Chris Leslie: My hon. Friend is correct. The fiscal consolidation is not only regressive but entirely the opposite of what the hon. Member for Spelthorne (Kwasi Kwarteng) shouted from a sedentary position, because it has not worked. I will be talking about him in a moment as I have given him a special place in my speech; several hon. Members will know why. The notion that fiscal consolidation has been successful is disproved by the fact that we now have an inordinate level of borrowing thanks to the lack of economic growth.

Kwasi Kwarteng: Will the hon. Gentleman give way?

Chris Leslie: Of course I would love to give way to the hon. Gentleman.

Kwasi Kwarteng: I am very grateful to the hon. Gentleman and touched that he specially mentions me in his opening remarks. If the fiscal consolidation has not worked, why is the UK currently growing faster than any other country in the G7 and in the OECD?

Chris Leslie: The hon. Gentleman should be shamefaced even to mention economic growth when for the vast majority of his esteemed time as a Member of Parliament growth has flatlined and he has failed to deliver. He needs to recognise that unless we get some serious and sustained economic growth, we will never deal with the deficit issues we have in this country.

Seema Malhotra (Feltham and Heston) (Lab/Co-op): Is my hon. Friend as surprised as I am by the amnesia among Government Members, bearing in mind that we were coming out of recession in 2010 but have since been flatlining and that they have failed to explain why prices have risen faster than wages for 40 out of 41 months?

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Chris Leslie: This is the problem that Government Members, who seem to think it is funny that we have not had any growth for such a long time, do not understand. They think, “Oh, the cost of living—that’s nothing to do with the economy, it’s a completely separate issue.” Not only my hon. Friends but my right hon. Friend the Leader of the Opposition have relentlessly called on Ministers to act now to alleviate the pressures that are facing many families’ household budgets. They do not just need to make the case for a living wage and a 10p starting tax rate; they need to act now to stand up to the large corporations who know that customers have little choice but to cough up and pay higher prices for life’s essentials.

Robert Flello (Stoke-on-Trent South) (Lab): My hon. Friend is being extremely kind and generous with his time. Returning to Staffordshire, is he aware that a Money Advice Service report shows that in Stoke-on-Trent the number of people in debt has now reached the 35% mark? More than a third of people in Stoke-on-Trent are now suffering in debt because of this Government’s policies.

Chris Leslie: The report published by the Money Advice Service, which the Government trumpeted as an organisation that was set up some while ago, is very startling. Certainly, the number of people in my hon. Friend’s constituency who are suffering from indebtedness is exceptionally high. In my constituency, over 40% of people are struggling to make ends meet when faced with these crippling burdens and debts.

Robert Halfon (Harlow) (Con): Whenever the Government introduce fundamental measures to help with the cost of living, such as freezing council tax, freezing fuel duty and cutting it in 2011, and cutting taxes for lower earners, why do you vote against them?

Chris Leslie: I do not know whether you voted against those measures, Mr Deputy Speaker, but we appreciate any efforts to help alleviate the cost of living. Does the hon. Gentleman believe that when people fill up their tank at the petrol station, they think, “How grateful we are to the Conservatives for the cost of petrol today”? When it comes to the cost of living—[Interruption.]

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. The hon. Gentleman has been very generous so far, but he cannot give way to six people at once. Let us get our act together and try to get through the debate. There are 21 Members who want to speak, and I am sure that other Members will want to hear them.

Chris Leslie: Thank you, Mr Deputy Speaker. I am still on the first page of my speech. I remind Government Members that the profits of the energy companies, which in many ways are the drivers hurting many of our constituents, have risen astronomically in recent years. Since the general election, energy company profits are up from £2 billion to £3.7 billion. Members will have read in The Independent yesterday that profits were £30 per household at the time of the general election, that they rose to £53 per household in 2012 and that they are now expected to be £105 per household this year, and yet the Government continually cower in trepidation of the big six gas and electricity corporations.

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They are not just recoiling from any willingness to challenge their behaviour, but in their cowardice the Government defend the status quo as though nothing can be done.

Labour says that energy bills can and should be frozen while Parliament legislates to reset the energy market to one that provides true competition, reduces scope for excessive profiteering and offers reductions for customers when wholesale prices fall.

Several hon. Members rose

Chris Leslie: I will give way to Government Members if they can answer this point: what was the Government’s reaction to our call to take action on energy prices? They dithered and argued among themselves, frozen like rabbits in headlights, flailed around and attacked us for daring to stand up to excessive profiteering and then, finally, No. 10 Downing street said, “Wear a jumper.”

Mr Brooks Newmark (Braintree) (Con): Will the hon. Gentleman give way?

Chris Leslie: I will give way to one of the woollier Members on the Government Benches.

Mr Newmark: Fuel prices would be 13p a litre higher if Labour were in power. Consumers have saved £170 on average, which is a saving on the cost of living. That is one area in which the Government have done a lot to help motorists.

Chris Leslie: When the public faced difficulties, the previous Government took action to freeze prices and duty for petrol and diesel. The hon. Gentleman mentions a fictional 13p and seems to think that when people fill up their petrol tanks they say, “Thanks goodness these prices are so low; I must thank the hon. Gentleman.” He is living in cloud cuckoo land. The Government are not just out of touch; they are out of ideas and they are running out of time.

Several hon. Members rose

Chris Leslie: I will give way in a moment. [Interruption.]

Mr Deputy Speaker: Order. Everybody else has sat down, but somehow the hon. Member for Vale of Glamorgan (Alun Cairns) feels he can hang around for another five minutes. I assure him that he cannot. The Minister will give way when he wishes to, not when the hon. Gentleman demands. [Interruption.] I do not need help from others, either.

Chris Leslie: I think that shows that we have touched a nerve. We know that the best we can expect from the autumn statement—[Interruption.]

Mr Deputy Speaker: Order. Did somebody shout out something about cowardice? No; okay, carry on.

Chris Leslie: I did not catch what was said, but we will see what Hansard records.

We know what will be in the autumn statement next week. The best we can expect is that the Chancellor will probably transfer about £100 or so off people’s energy bill and on to their tax bill instead. That is a ruse.

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Robert Halfon: On a point of order, Mr Deputy Speaker. The hon. Gentleman has said that his Government tried to help motorists, but he inadvertently forgot to mention that they raised fuel duty 12 times.

Mr Deputy Speaker: I assure the hon. Gentleman that that is not a point of order. He has made that point on many occasions and I did not need reminding.

Chris Leslie: Thank you, Mr Deputy Speaker.

Toby Perkins (Chesterfield) (Lab): My hon. Friend is being incredibly generous in taking interventions. May I encourage him to continue taking them, because every time he does so he utterly destroys the weak arguments made by Government Members? Does my hon. Friend recognise, like the 5,000 people who signed the “freeze that bill” petition in Chesterfield, that the Conservative party has nothing to say on energy prices because it is utterly beholden to the very energy companies that are impoverishing my constituents?

Chris Leslie: My hon. Friend is correct. The Government are afraid of the energy companies. We are not yet sure why they are so afraid to stand up to the big six, but it is clear that the Chancellor’s solution of simply shifting £100 or so off an energy bill and on to the taxes of all our constituents will not convince people that they have the answers. The switch is so obvious it can be seen in the dark. It is a palliative that merely shunts the costs from a bill payer to a taxpayer. It fails to tackle the root cause of the problem, which, as my hon. Friend has said, is the excessive profiteering of the utility companies. Government Members are going to have to try a lot better than that next week.

Alun Cairns (Vale of Glamorgan) (Con): I am grateful to the hon. Gentleman for giving way. He makes an extremely important point on the need to freeze bills, which is largely what has happened over recent years to council taxes in England. In Wales, however, where the Labour party runs the Welsh Government, there have been council tax increases of nearly 9% over recent years. That is a bill that can genuinely be frozen by politicians. Will the hon. Gentleman stand up to the Labour party in Wales to ensure that my constituents are not forced to pay 9% increases in council taxes?

Mr Tobias Ellwood (Bournemouth East) (Con): That was worth waiting for.

Mr Deputy Speaker: Order. We can all make a judgment about that, but it might be helpful to remind Members that there are many speakers to come, so if we are going to have interventions they have to be short and not speeches. I will be honest with Members: anyone on my list of speakers who makes a long intervention will go down the list accordingly.

Chris Leslie: The hon. Member for Vale of Glamorgan (Alun Cairns) is short in his contributions on most occasions. I note that he wanted to change the subject from energy prices. The problem is that, time after time, the Conservative party has no answers for the public, who want politicians—their elected representatives—to take action on the cost of living, particularly on energy prices. As long as the hon. Gentleman and all his

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colleagues let the rip-off merchants and unfair profiteers continue with business as usual, the public will take exception to the deceitful claim that we are all in it together.

Several hon. Members rose

Chris Leslie: I want to make some progress.

For most people life is getting harder and for most people there is still no economic recovery, but that is not what they were promised. Before the election, the Prime Minister said:

“Our plans don’t involve an increase in VAT”


“I wouldn’t change child benefit”.

He also said that tax credits would be cut only “for families on £50,000” and that his party would

“not scrap the Education Maintenance Allowances”.

Those are the promises the Conservatives made before the general election. They famously airbrushed a poster of the Prime Minister and in their efforts to cover up their website pledges they are trying to airbrush the past.

Mr Ellwood: I urge the hon. Gentleman to be cautious about questioning whether this subject is being taken seriously by Government Members, because the record should note that there are more Government Members than Opposition Members present to debate this important issue. On energy, will he now concede that Labour failed to ensure that the lights will be kept on in this country by failing to invest in nuclear energy? More than six nuclear power stations have closed down. That is why energy prices have gone up—because we are not making our own energy.

Mr Deputy Speaker: Order. I asked for short interventions. Please shorten them, Mr Ellwood, or we will not take any more from you. I am sure you will want to get another one in later.

Chris Leslie: There are only another 18 months during which there will be more Conservative Members than Labour ones in this Chamber. I hope that the hon. Member for Bournemouth East (Mr Ellwood) is watching the clock, because they are running out of time.

The Prime Minister has broken not only that list of promises, but more records than most Prime Ministers over the decades, and not in a good way. How has he been a record breaker? Since entering No. 10 Downing street, he has delivered a record-breaking cost of living crisis, with wages failing to keep pace with prices for an unprecedented 40 out of his 41 months in office. That is the longest period of diminishing real wage values since records began.

A record-breaking number of people now rely on food banks just to get by—it has tripled in the past year alone—with more than 350,000 families requiring food parcels in the past six months.

Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op): On the cost of living crisis that is driving people to food banks, does my hon. Friend share my shock at the hon. Member for Vale of Glamorgan (Alun Cairns) saying that people use food banks because they are drug addicts and cannot manage their money, rather than because of the cost of living crisis?

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Chris Leslie: I am happy to give way to the hon. Member for Vale of Glamorgan if he wants to explain.

Alun Cairns: On a point of order, Mr Deputy Speaker. The hon. Member for Cardiff South and Penarth (Stephen Doughty) has inadvertently misled the House in that the quotes attributed to me are wholly inaccurate. I ask him to withdraw what he said.

Mr Deputy Speaker (Mr Lindsay Hoyle): I do not know whether what was said is true or false, but the hon. Gentleman has put the facts on the record. I am sure that that point can be sorted out later, no doubt over a cup of tea.

Stephen Doughty rose—

Chris Leslie: I will happily give way to my hon. Friend in a moment, so that he can relay the quote that he has to the House. Perhaps a journalist wrote it down incorrectly, but I am sure that there is an explanation.

The point about food banks is that the crisis is so bad that the Red Cross has launched an emergency food appeal right here in the United Kingdom, something that has not happened since the second world war.

The Prime Minister’s broken records include real-term wage levels plunging to a new low and average weekly earnings at their lowest level since the Office for National Statistics started to record the figures in 2001. Not only has he hit record lows on incomes, but he has delivered record fuel bills and average household energy costs—

Stephen Doughty: On a point of order, Mr Deputy Speaker. I am sorry to raise another point of order, but the hon. Member for Vale of Glamorgan suggested that I may have misled the House—

Mr Deputy Speaker: Order. Let me reassure both hon. Gentlemen that I am not going to decide who is right. You have each claimed that you are right and that the other is wrong. It is on the record, and people can make up their minds tomorrow. I want to continue with this debate.

Chris Leslie: My hon. Friend the Member for Cardiff South and Penarth may have time later to elaborate on the quote. It may be incorrect, and we will see whether journalists want to look into that.

Andrew Gwynne (Denton and Reddish) (Lab): My hon. Friend is absolutely right to list this Government’s catalogue of broken promises on the cost of living crisis, but the crisis is far worse than the spiralling energy bills and the rising cost of living. He was moving on to make the serious point that, at the same time as prices are increasing, people’s wages have plummeted since 2010 by about £1,600. Is that not the real cause of this cost of living crisis?

Chris Leslie: Absolutely. This is an unprecedented period—we can characterise it as record breaking—during which wages have not been able to keep pace with the costs our constituents are facing.

James Morris (Halesowen and Rowley Regis) (Con): Will the hon. Gentleman give way?

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Chris Leslie: In a moment.

Let me give another example, private sector rents are at a record high. Average rent rises across England and Wales have just hit the highest level ever recorded, at £757 a month.

Robert Flello: Will my hon. Friend give way?

Chris Leslie: Will my hon. Friend allow me to make a little more progress on housing? The Prime Minister is also a record breaker because he is presiding over the lowest net supply of housing since records began. The Government’s own figures show that the number of dwellings added to our housing stock fell by 8% last year, which is the lowest level since such statistics were first collected. That is quite some achievement. It does not bode well for the affordability needed by many first-time buyers in this country. By the way, a record number of people are seeking help from the housing charity Shelter, which has reported an all-time high of almost 175,000 calls in the past year, up 10% on the previous year.

Government Members even like to portray the jobs market as wholly positive, but a record number of people are working part time because they cannot find full-time jobs. Nearly 1.5 million people say that they need to find full-time work, but cannot, which is the highest figure since records began.

Mr Brian H. Donohoe (Central Ayrshire) (Lab): I have done some work on this subject. Is not a consequence of the number of part-time jobs advertised not just in my constituency but across the country that wages have dropped to today’s level?

Chris Leslie: That is precisely what baffles Government Members so much: they cannot understand the ingratitude of the British people, who somehow seem not to recognise the work that the Government are supposedly doing. The reality is that these are the pressure points—the points of stress and anxiety—faced by so many people up and down this country.

James Morris: Will the hon. Gentleman give way on that point?

Chris Leslie: The hon. Gentleman has been very persistent, so I will give way.

James Morris: It has taken the hon. Gentleman 20-odd minutes to talk about one of the keys to solving the cost of living crisis, which is the creation of new jobs. I presume he welcomes the 11% fall in unemployment in his constituency during the past year, with a 15% fall in youth unemployment. Is that not absolutely key to our recovery and to solving the cost of living crisis that he has taken so long to talk about?

Chris Leslie: The hon. Gentleman, whose name is sometimes mixed up with that of others, should do better than to pick on my constituency of Nottingham East, where unemployment has been a persistent and long-running problem. Of course there have been fluctuations in the past few months, but I must tell him that the number of young people out of work for more than a year on jobseeker’s allowance has rocketed astronomically in this country: it is up 127% since the last general election. The number of long-term unemployed,

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who have been out of work for two years or more—we must turn our attention to that persistent problem—has gone up 374% since the last general election.

Several hon. Members rose

Chris Leslie: I just want the House to hear a few more record-breaking facts about the Prime Minister. Do my hon. Friends remember, from a Budget some time ago, the Chancellor of the Exchequer’s poetic declaration that he would create

“a Britain carried aloft by the march of the makers”?—[Official Report, 23 March 2011; Vol. 525, c. 966.]

We now have a record-breaking trade deficit with the European Union of £6 billion, which is a sign that the rebalancing of our economy has tilted in the wrong direction. The “Guinness Book of Records” is already familiar with the Prime Minister’s achievement in delivering the slowest ever, snail’s pace recovery out of an economic downturn since records began, taking Britain longer to claw our way back than after the great depression. That record-breaking performance is thanks to the drag anchor policies that have held back growth for the past three years.

The record-breaking let-down on growth has of course led to the Prime Minister’s biggest failure of all—more borrowing than any peacetime Government in history. The Prime Minister and the Chancellor have added £430 billion to our national debt in the three years since May 2010, which is more than the last Labour Government did in 13 years and more than any previous Government have done in peacetime. They are record-breaking borrowers, because no Government have ever neglected economic growth quite like this one.

Debbie Abrahams (Oldham East and Saddleworth) (Lab): Is it not a fact that the economy will have to grow by 1.5% every quarter to make up for the lack of growth since 2010?

Chris Leslie: Government Members see what they regard as green shoots for our economy. They hope that the public will just forget what has happened for the past three and a half years, but the public have long memories and will remember the harm and anxiety that the cost of living crisis is now causing them. Perhaps those record-breaking extremes from this Prime Minister and Government reflect the new extremism in the Conservative party and the drift away from the centre ground of British politics.

Gordon Birtwistle (Burnley) (LD): Will the hon. Gentleman give way?

Chris Leslie: I will come to the Liberal Democrats in a moment. I am talking about the Conservative party.

The Conservatives and the Prime Minister like to pretend that they understand the concerns of hard-working people. When they finally realise the strength of public opinion, they will grudgingly come up with a half-baked effort on energy bills, just as they finally caved in with a long overdue cap on payday loans. The trouble is that they just don’t get it, because their hearts aren’t in it. As with the action on payday loans and banking reform in this week alone, why does the Chancellor always have to be pushed into doing the right thing?

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The forces of moderation in the Conservative party—I am looking around desperately to see them; perhaps there are a couple of them here—complain that they are seen as the party of the rich and that voters do not trust their motives. Twenty-five of the dwindling number of those anxious Conservative Members of Parliament had a meeting with the Prime Minister to express their concerns, although that was before some of them announced that they were standing down from Parliament.

The moderates—there is one opposite me—are right to worry, because the Prime Minister’s pretence that he represents the middle of British politics has finally stretched beyond belief, as time and again his true instincts shine through. In the lord mayor’s banquet speech a fortnight ago, the mask slipped as the Prime Minister proclaimed the need for permanent austerity and the shrinking of public investment in perpetuity. The true ideological intentions of the Conservatives are there for all to see. Perhaps that is why the party’s Free Enterprise Group published its plans—

Kwasi Kwarteng: Will the hon. Gentleman give way?

Chris Leslie: I will give way to the hon. Gentleman because he is in the Conservative Free Market Group. He wrote the pamphlet. Will he tell us what it was about his pamphlet that hit the headlines?

Kwasi Kwarteng: I have no idea what the hon. Gentleman is talking about. I am very pleased and somewhat flattered that he should be referring to the Free Enterprise Group on the Floor of the House. What was the size of the deficit when his party left government in 2010? What was the absolute size of the deficit and what was the proportion of the deficit—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. We have got the point.

Chris Leslie: The national debt was about £800 million. The national debt—[Hon. Members: “The deficit.”] I know what the hon. Gentleman said. I could hear what he said. I am giving him the figures. The national debt—[Interruption.] It seems that Government Members do not want to talk about the national debt. The national debt was about £800 million. It is now £1.2 trillion. As Brucie might say, “Higher, higher!”

Mr Newmark: On a point of order, Mr Deputy Speaker.

Mr Deputy Speaker: It had better be a point of order, Mr Newmark, if you want to get in early. I do not want to have to put you near the bottom, because I know that this matter is important to you.

Mr Newmark: I want clarification, Mr Deputy Speaker.

Mr Deputy Speaker: Order. I was not taking a point of clarification, but a point of order.

Mr Newmark: It is a point of order, Mr Deputy Speaker. The hon. Member for Nottingham East (Chris Leslie) was asked a question about the deficit. Unfortunately, his answer was about debt. Rather like Rev. Paul Flowers, he does not know basic economics. [Interruption.]

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Mr Deputy Speaker: Order. I will let that go. It is up to the shadow Minister how he wishes to answer the question. It is not for you, Mr Newmark, to waste the House’s time on an irrelevant—[Interruption.] Order. On an irrelevant point of order. If you do not mind, we will have no more.

Chris Leslie: It goes to show—

Nick de Bois (Enfield North) (Con): Will the hon. Gentleman give way?

Chris Leslie: I have not even said a word in response to the point of order. I will do so if the hon. Gentleman will allow me. It just goes to show that the Conservatives will do everything they can to distract attention from the cost of living crisis that is facing this country. As Corporal Jones might have put it, “They don’t like it up ’em!”

The hon. Member for Spelthorne (Kwasi Kwarteng)—

Geraint Davies (Swansea West) (Lab/Co-op) rose—

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. You also want to speak, Mr Davies. You are constantly on your feet. I want to hear Mr Leslie. I also want to hear what the Government have to say. I will not hear either of them with the amount of time we have taken so far.

Chris Leslie: That is a good point, Mr Deputy Speaker, so I will be brief in talking about the hon. Member for Spelthorne and the Free Enterprise Group. The Free Enterprise Group published plans to slap a 15% increase on essentials such as food and children’s clothes through VAT and to triple the tax on heating bills. A number of hon. Members who are in the Chamber today are members of the Free Enterprise Group. They might be shuffling away from the hon. Member for Spelthorne now.

Charlie Elphicke (Dover) (Con): Will the hon. Gentleman give way?

Chris Leslie: Perhaps the hon. Gentleman wants to account for that plan. Does he agree with charging VAT at 15% on food and children’s clothes and increasing the tax on heating bills—yes or no?

Charlie Elphicke: What was the size of the deficit at the time of the general election in 2010? Was it £150 billion-plus—yes or no?

Chris Leslie: There is no answer to my question from the hon. Gentleman. I have given him the figures for the national debt.

The extremism and rightwards shift in the Conservative party are visible for all to see. As we can tell from the tactics that they are using, the Prime Minister, the Chancellor and all the Conservative Back Benchers are scraping the barnacles off the 1992 election strategy. They have a barely disguised plan to fight the next election in the gutter. Their tactics are visible for all to see.

The Prime Minister once spoke fondly of environmentalism while hugging the huskies. Perhaps I should ask this on a point of order, Mr Deputy Speaker,

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but is it using unparliamentary language to quote No. 10 when it allegedly said that it wanted to cut out all of the “green crap”? I know that that is appalling language, but it is a quotation from No. 10 Downing street. The Government are certainly cutting some things out: 578 Sure Start children’s centres have been cut, 76 NHS walk-in centres have been cut, 48 accident and emergency departments have been shut, 200 ambulance stations have been axed and 6,000 nurses have gone from the NHS, but 707 food banks have opened. Perhaps Government Members regard that as a success.

Several hon. Members rose—

Chris Leslie: I will take one final intervention from my hon. Friend.

Helen Jones (Warrington North) (Lab): Does my hon. Friend realise that the reason why some of us worry about the proposals of the Free Enterprise Group is that they are all of a piece with what the Tories have done already, including a drop of £35 a week in real wages in my constituency, the imposition of the bedroom tax on the poorest people and, contrary to what they say, increases in council tax for the poorest people? The reason Tory Back Benchers worry about being seen as the party of the rich is that they are the party of the rich.

Mr Deputy Speaker (Mr Lindsay Hoyle): I am concerned because the debate has been going for 36 minutes already. The time limit on Back-Bench speeches is due to be five minutes. I do not want it to go below that. At this rate, a lot of Members will drop off the list.

Chris Leslie: I want to draw my remarks to a close, so I will not take any more interventions.

In a moment, my hon. Friends will be subjected to the Minister claiming that the Government alone are responsible for the long overdue return of economic growth. What he cannot grasp is that growth is appearing despite his policies, not because of them. As the Nobel prize-winning economist, Paul Krugman, said of the Government’s attitude just the other day,

“It’s like hitting yourself over the head with a baseball bat for years. Then, you stop hitting yourself with the baseball bat and say, ‘See? I feel much better now—hitting myself with a baseball bat was clearly the right thing to do’.”

That sums up their view perfectly. They do not understand that only the return of strong economic growth will tackle the deficit in any meaningful way. Three years on, they still have not cottoned on.

The reason we have a cost of living crisis is that the historic connection between economic growth and household wealth has been severed. Even though it looks like we are finally seeing some growth in some parts of the economy, that growth is not being shared fairly. Indeed, GDP per capita remains flat. I pay tribute to the companies and households that have managed to keep it together despite the Chancellor’s inaction. What we need now is help for those who are trying to do their best—the people who never complain, who never say that they should be at the front of the queue, who go to work and who manage as best they can. Those people need real help with their energy bills and child care costs. They need us to tackle low pay and to freeze business rates for small firms.

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The challenge for the autumn statement is to take action now on the cost of living, not to use sleight of hand to pile more burdens on the taxpayer. We need long-term reforms that ensure that there is a balanced recovery that is built to last, not short-term, knee-jerk flip-flopping. We need fairness for the many, not tax cuts for the few. The Government are out of touch with the mood of the public—the wealthy elite are looking after the wealthy elite and are all in it together. They are timid in the face of excessive profiteering from big energy companies, while the rest get broken promises on the economy and the deficit from a Government who are lurching to the right and reverting to type. The British people cannot afford this Government any longer. Britain deserves better.

3.20 pm

The Financial Secretary to the Treasury (Sajid Javid): When the Opposition first tabled this motion, the title referred to the Government’s “economic failure”. The word “failure” has been mysteriously removed and replaced with “policy”. Perhaps the Opposition originally asked the Rev. Paul Flowers, who was their economic adviser, to help draft the motion. Now that they have been forced to sack him, they have had to amend the deluded original title of the motion. Even before the debate started, the Opposition have had to back down.

The Government recognise that many people up and down the country are facing living standards challenges. Each and every week I speak to many hard-working people in my constituency who are still suffering from Labour’s recession, and whose businesses or employers were hit hard in 2008 and 2009 and are still feeling the impact. Of course we all want the situation to improve.

Geraint Davies: On failure, does the hon. Gentleman accept that the movement of debt to GDP from 55% when he came into office, to 75% now and 85% by 2015, is a sign of failure both in increasing debt to a higher level than we borrowed throughout our term, and through not getting any growth?

Sajid Javid: I accept that the sharpest move in debt to GDP that this country has seen in recent times was under 13 years of Labour rule when national debt more than doubled. We will take no lectures from the Labour party about growing public debt. Allow me to remind the House, especially Labour Members, why people are facing such challenges.

Helen Jones: On a point of order, Mr Deputy Speaker. I note that the Chief Secretary to the Treasury is not present. Can you investigate whether that is because the Lib Dem part of the coalition no longer takes responsibility for economic policy?

Mr Deputy Speaker (Mr Lindsay Hoyle): As the hon. Lady well knows, that is not a point of order. It is certainly not a matter for the Chair and does not want to be. I call the Financial Secretary.

Sajid Javid: I give way to my hon. Friend the Member for Bedford (Richard Fuller).

Richard Fuller (Bedford) (Con): I was concerned that the shadow Chief Secretary to the Treasury did not seem to understand the difference between deficit and

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debt, which I thought would be a prerequisite for talking about economics. Will my hon. Friend explain to the House what the circumstances were when this Government came to office?

Sajid Javid: My hon. Friend tempts me and I will do just that in a moment, after I have given way to my hon. Friend the Member for Burnley (Gordon Birtwistle).

Gordon Birtwistle: The shadow Chief Secretary to the Treasury did not want to take an intervention from a Liberal Democrat, perhaps because it used to be a Labour Member who sat here and now it is a Liberal Democrat. Will my hon. Friend comment on the fact that in 2009 Burnley was classed as a basket case under the Labour Government with a Labour MP, but it has now won an award for the most enterprising town in the UK? Unemployment has collapsed under this Government.

Sajid Javid: I will comment on that because it reflects the hard work of the people of Burnley and their local MP. Why are people facing challenges up and down the country? The reason is simple and can be summed up in just three words: the Labour party.

Toby Perkins: The Minister asks why people are suffering a cost of living crisis, and he referred previously to Labour’s recession. Labour’s recession was over by the time he became a Member of Parliament, and it was a recession caused by the bankers. Will he remind the House what he was doing when Labour’s recession finished?

Sajid Javid: What I can do is remind the hon. Gentleman what was going on in his constituency during Labour’s recession. During Labour’s last term, unemployment in his constituency increased by 56%. So far, under this Government it has declined by 26%, which I think he would welcome.

Several hon. Members rose

Sajid Javid: I will give way to my hon. Friends in a moment. The Opposition spokesman talked about breaking records, so let us take a quick look at Labour’s record breakers—they are enough to make Roy Castle jump up and down with excitement. Labour gave this country the deepest recession in living memory, and the biggest budget deficit in our post-war history, and the largest in the G20. To answer the question from my hon. Friend the Member for Bedford (Richard Fuller), Labour was borrowing almost £160 billion—£300,000 a minute, or £5,000 every second. Labour gave this country the largest bail-out the world has ever seen. [Interruption.]

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. I find it strange that I cannot hear the Financial Secretary because Government Members are making so much noise. I would have thought they ought to listen to him, just as I wish to hear him.

Sajid Javid: I think the House missed hearing about another record breaker that Labour gave this country, which was the largest bank bail-out the world has ever seen. That is Labour’s legacy, and if the Opposition spokesman wants to apologise, he is welcome to do so.

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Chris Leslie: The Minister, who worked for Deutsche Bank before the general election, might wish to explain and answer a specific question on borrowing, the deficit and national debt. Can he tell the House how much the Chancellor has borrowed and added to the national debt since the last general election? What is that amount of money in cash terms?

Sajid Javid: We know that if we had continued the plans recommended by the Labour party, the country would be borrowing a lot more. According to the independent Institute for Fiscal Studies, Labour plans to borrow at least £200 billion more, which would push up borrowing costs for many hard-working families up and down the country.

Guy Opperman (Hexham) (Con): Does the Minister agree with the North East chamber of commerce, which said that the most important factor in raising living standards is to increase skills levels with an increase in skills funding and a doubling of apprenticeships? Is that not the true foundation of a long-term recovery?

Sajid Javid: I agree wholeheartedly with my hon. Friend, and I am sure he agrees that the Government were right to increase funding for apprenticeships, which are up by more than 1.5 million since the start of 2010.

Mr Donohoe: Will the Minister accept that a number of the jobs brought into the economy are part time? Would it be better for the Government to calculate the number of jobs in terms of hours worked by individuals, and would they find that the number of jobs has actually dropped in real terms if those hours are taken into account?

Sajid Javid: The hon. Gentleman tempts me and I will come to jobs shortly as there is plenty to tell. He should recognise that employment is at its highest level since records began, and that most jobs created are full time. Also, there is nothing wrong with part-time work.

Andrew Selous (South West Bedfordshire) (Con): Because the Government have taken the difficult decisions necessary and stuck to a long-term plan, the claimant count has fallen by more than a third in my constituency, where 730 more people are in work than when the other lot were in power.

Sajid Javid: The information my hon. Friend provides is true of almost every constituency in the country.

Debbie Abrahams: The Government consistently make that point, but it is totally misleading. The employment rate is lower now than it was in 2008. Absolute figures mean nothing; the Minister must quote a rate to make them mean something.

Sajid Javid: The hon. Lady is still fairly new to the House, but she will know that the Government changed hands in 2010. There is no point making comparisons with 2008. She will be interested to hear that unemployment in her constituency increased by a shocking 119% during Labour’s last term. I will say that again, because Labour Members have a hard time believing it: unemployment increased in her constituency by 119%. Under this Government, unemployment in her constituency is down by 24%.

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Neil Carmichael (Stroud) (Con): The Government have increased the number of private sector jobs by 1.4 million, and 88% of those jobs in the past six months were full time. Does that not illustrate that we are rebalancing the economy towards manufacturing and engineering, which we definitely need to do? That is part of an economic plan to recover this country from the disastrous situation in which we found ourselves in 2010.

Sajid Javid: I agree completely with my hon. Friend—I shall make further remarks on that in a moment.

In short, Labour left our country a lot poorer, and it still has not apologised for the damage it did, despite many opportunities, including this afternoon. The Labour Government destroyed the aspirations of millions of hard-working people up and down the country. Instead, Labour Members sneer over the Dispatch Box and oppose every single measure the Government take to clean up the mess they left behind.

Robert Flello: I say in all sincerity that it would have been nice to see the Minister’s boss in the Chamber—where is he?—but will he answer this question? A moment ago—[Interruption.] Conservative Members should listen for a moment. A moment ago at the Dispatch Box—Hansard will show this—the Minister criticised the Labour Government for bailing out the banks. Is he saying we should not have done that?

Sajid Javid: The hon. Gentleman needs to listen more closely to my remarks. He will be interested to know that unemployment increased by 104% in his constituency during Labour’s last term. The bail-outs and the other action the previous Government took did not help unemployment in his constituency but, thankfully, under this Government, unemployment there is down by 24%.

It is good to remind ourselves that office and government are a privilege given to us by the people of the United Kingdom. We are the tenants; the British public are our landlord. The Labour party was the tenant who trashed the house. It is left to this Government to clean up its mess.

We need to treat the public with the respect they deserve. We know that times are tough. Labour left our country a lot poorer, and families are feeling it. That is why we had to put in place a long-term, sustainable economic plan to fix things.

Yasmin Qureshi (Bolton South East) (Lab): The Minister says that Labour left the economy in difficulties or a mess, but does he accept that, in 2006, the GDP to national debt ratio was about 42%, whereas it is now 91%? How is that responsible?

Sajid Javid: The hon. Lady—[Interruption.]

Mr Deputy Speaker (Mr Lindsay Hoyle): Order. The hon. Lady has made her intervention. She cannot keep going.

Sajid Javid: The hon. Lady needs to check her figures. She will see that, as I have said, the sharpest rise in the debt-to-GDP ratio took place during the last 10 years of the Labour Government.

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Kwasi Kwarteng: With regard to the deficit, why, for nine years, and for seven years of economic growth, did the Labour Government run persistent deficits?

Sajid Javid: My hon. Friend makes a good point. He reminds the House that the previous Government began running a deficit from 2001, way before any financial crisis. They ran a structural deficit from 2006 onwards. Hon. Members will remember that the shadow Chancellor, the right hon. Member for Morley and Outwood (Ed Balls), tried to deny that until he was corrected by the International Monetary Fund.

Without a credible economic plan, we cannot have a plan for helping families with living standards challenges. Anyone, including the Labour party, can come up with a list of interventions, but they are completely meaningless and unsustainable if there is no long-term economic plan to back them up. Labour’s only plan is for more spending, more borrowing and more debt, which is exactly what got us into this mess in the first place.

Charlie Elphicke: I have a deep concern that many hard-working people lost earnings when interest was suspended on Co-op bonds in March. I am concerned that, 11 days later, it lent substantial amounts of money to the Labour party. Will the inquiry cover the bank’s relationship with the Co-operative party and whether the bank was unduly influenced by the national executive committee?

Sajid Javid: My hon. Friend raises a good point, but he will know that I am not in the best position to answer his question in detail. Perhaps the shadow Chief Secretary will rise to his feet to do so. I understand that he is a Labour and Co-operative Member and receives money from the Co-op. I am happy to give way if he would like to answer the question.

Chris Leslie: I am proud to be a Co-operative Member and a supporter of mutuality—I thought Conservative Members supported that, too. Will the Minister tell us the number of occasions on which his Treasury had meetings to discuss the Co-op Verde deal and the takeover of those Lloyds branches? How many times did Treasury Ministers have those meetings after the general election? Can he give us that fact now?

Sajid Javid: I am sure that question will be looked at further during the Co-op inquiry. The number and nature of meetings between the Leader of the Opposition, the shadow Chancellor and Co-op representatives will also be looked at—[Interruption.]

Madam Deputy Speaker (Mrs Eleanor Laing): Order. The House cannot hear the Minister. If hon. Members want to argue with him, they must hear what he has to say first.

Richard Graham (Gloucester) (Con) rose—

Sajid Javid: Thank you, Madam Deputy Speaker. I give way to my hon. Friend.

Richard Graham: I am very grateful to the Minister for giving way—he has been gracious throughout the debate. It is appropriate that we follow Madam Deputy Speaker’s advice and listen to him carefully. I would

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reinforce his point from my experience in Gloucester. Under the previous Government, 6,000 people in business lost their jobs, but since the last election, 3,000 new business jobs have been created and four times the number of apprentices have been employed, and unemployment and youth unemployment are lower. Does the Minister agree that this debate should not be about the cost of living, but be about the cost of having a Labour Government to people with jobs in my constituency?

Sajid Javid: My hon. Friend is right. Hon. Members know—I am highlighting this as much as I can in the debate—just how many lives and aspirations the Labour Government destroyed in their time in office.

The House has just heard the shadow Treasury Minister. His speech was more interesting for what was not in it than for what was. There is no talk today of plan B—[Interruption.] What the shadow Treasury did not mention was predictable. Let me say what it was, because four or five months ago, we heard what he did not say today in virtually every single speech from Labour Front Benchers. We heard no talk today of plan B. I did not hear anyone say, “Too far, too fast.” There was no mention of a double-dip, let alone of a triple-dip, because Labour Members know that there has been only one dip in recent times: Labour’s dip. They have comprehensively lost the economic argument. They have no plan and no answers for the problems they helped to create.

Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab) rose—

Sajid Javid: Does the hon. Gentleman have any answers to the problems Labour helped to create?

Tom Blenkinsop: I have no answer to the fact that we saw more growth in the last quarter of 2010 under the Labour Government than we did in the whole of 2011.

Sajid Javid: Let us talk about the growth in Middlesbrough South and East Cleveland. Is the hon. Gentleman referring to the record 92% increase in unemployment in his constituency in Labour’s last term? I notice that he did not refer to the 18% decline under this Government.

James Morris: My hon. Friend refers to what the Labour Front-Bench team will not mention. In the past two years, export growth in the west midlands has gone up by 30%—the best performance of any region. Is that not further evidence that the Government are on track with a sustainable, long-term plan to rebalance the British economy?

Sajid Javid: My hon. Friend is right. As a fellow west midlands MP, I have seen at first hand record growth, particularly in manufacturing and in the car industry.

Enough on the mistakes of the past. This Government are working hard to secure the country’s future. The only way we can deliver a sustained improvement in living standards is to continue to tackle the economy’s problems head-on and to deliver a recovery that works for all.

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Guto Bebb (Aberconwy) (Con): My hon. Friend talks about the future. How does he respond to the approval, given by the Labour party yesterday, of a 5% increase in council tax in my constituency—a decision made with no consideration of the cost of living for my constituents?

Sajid Javid: My hon. Friend makes an excellent point. What goes on in Wales is an excellent example of what a Labour Government would do, if they had the chance, in the United Kingdom. As well as increases in council tax, there has been a 10% cut in the NHS budget in Wales. That tells us exactly what Labour’s priorities are.

Stewart Hosie (Dundee East) (SNP): On exports, in 2011 the deficit for trading goods was £100 billion. In 2012, that rose to £110 billion in the red, and has been running at about £20 billion in the red every quarter this year. I am not sure if I am seeing the green shoots of export recovery that the Minister is seeing.

Sajid Javid: I will speak on exports in more detail shortly. I am not sure that Scottish independence would help the record on exports.

Under this Government, Labour’s record budget deficit is down by a third, confidence and investment is on the rise, and the economy has turned a corner. The UK is growing faster than any other developed economy, including the US, Germany and Japan. Just last week, while downgrading global growth the OECD revised up UK growth by more than any other developed country. That growth is spread broadly across all sectors of the economy. Recent survey data show that construction is at its strongest level in six years and that activity in the services sector has not been this strong since 1997. New orders in manufacturing have risen to their highest level since 1995, according to the CBI.

Mr Gordon Marsden (Blackpool South) (Lab): The Financial Secretary is taking pains to show that there is a long-term economic plan. What sort of plan is it when the number of young people on jobseeker’s allowance has gone up by 174% in a year? He and his colleagues have failed to provide 19 to 24-year-olds in traineeships with any funding to continue, JSA or otherwise.

Sajid Javid: I can tell the hon. Gentleman how our plan is panning out. Under the previous Government, he saw a 91% increase in unemployment in his constituency. Unemployment in his constituency is down by 7% under this Government. Youth unemployment is down by 24%. Rather than making cheap political points, he would do well to welcome the economic improvement in his constituency.

Debbie Abrahams: The Minister was making an international comparison with the UK economy. I remind him that the UK economy remains 2.5% below its pre-crisis peak, and the US economy is now 4.6% above its pre-crisis peak.

Sajid Javid: The US did not have a Government as incompetent as the one we had in Britain, who boasted the sharpest decline in GDP in this country in living memory and in our post-war history. When I said earlier that Labour left this country poorer, I am sure the hon. Lady realised—if she did not, I am happy to

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repeat it—that we saw the sharpest decline in GDP of any major developed country during Labour’s term in office.

Our economic plan is pulling in growing inward investment, with inflows into the UK in the first half of this year greater than any other country in the world except China. As I mentioned earlier, we are increasing exports to growing economies. From 2009 to 2012, exports to Brazil were up by 49%, to India by 59%, to China by 96%, and to Russia by 133%. We have become a net exporter of cars for the first time since 1976.

Tom Blenkinsop: Will the Minister please explain why, since 2011, lending to small and medium-sized enterprises has gone down by £30 billion? Long-term female unemployment in my constituency has increased by 144% since his Government came to power.

Sajid Javid: The hon. Gentleman will know that SME lending was hit from 2010 to 2011 because of Labour’s banking crisis. We had the deepest banking crisis and the largest bank bail-out the world has ever seen. What did he think the impact was going to be? He should welcome the Government’s action to help SME lending, including the funding for lending scheme, which has helped thousands of companies.

The Opposition claim that economic growth is not felt by people across the UK and that living standards are falling. The truth is that the previous Labour Government left the country a lot poorer and, as a result, many hard-working families are finding it difficult. Our long-term plan for the economy, the plan that has put our country on a path to prosperity, will help those families. What better way to increase standards of living than by making sure that as many Britons as possible can take home a steady wage at the end of each month? With more than 1.4 million private sector jobs created in the past three years—more private sector jobs created in three years of this Government than in 13 years of the previous Labour Government—we now have more people employed than at any time in our history.

We are also taking measures that help to keep more cash in the pockets of hard-working people up and down the country, while economic confidence has helped to keep mortgage bills low. If mortgage rates rose by just 1%, the average mortgage bill would increase by about £1,000 a year. We are also letting people keep more of their hard-earned income. Our increases in the personal allowance are worth £700 each year to every average taxpayer—a tax cut for more than 25 million people—while 2.7 million people on low incomes have been taken out of income tax altogether.

Simon Kirby (Brighton, Kemptown) (Con): Does the Minister realise that from next April 36,000 people in my constituency will be better off because of this policy?

Sajid Javid: My hon. Friend is right to make that point. I think every MP in this illustrious House could share similar numbers. Indeed, in the shadow Chief Secretary to the Treasury’s constituency, 4,000 people have been taken out of income tax altogether and more than 38,000 have had an income tax cut.

Our changes to the personal allowance mean that someone working full time on the minimum wage has seen their income tax bill more than halved under this

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Government. It also means that for any income on which people would pay Labour’s 10p tax rate, which it previously abolished, they pay a 0% tax rate under this Government.

Stephen Doughty: Is the Minister still a member of the Free Enterprise Group of Conservative MPs and does he agree with that group and the hon. Member for Spelthorne (Kwasi Kwarteng) that VAT could be increased to 15% on food and children’s clothes, which are currently zero-rated? How would that help with the cost of living crisis for my constituents?

Sajid Javid: I am pleased that the hon. Gentleman is so interested in tax, because he will be sure to welcome the news that 38,000 people in his constituency have had an income tax cut and 4,500 have been taken out of income tax altogether.

Alec Shelbrooke (Elmet and Rothwell) (Con): I am grateful to the Opposition for pointing out earlier that before the election the Minister worked for a bank that the British Government did not need to bail out, whereas the shadow Chief Secretary to the Treasury ran the campaign of the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown). Nevertheless, does my hon. Friend agree that the Prime Minister made it absolutely clear at the Dispatch Box only last Wednesday that he did not agree with putting VAT on children’s clothes and food?

Sajid Javid: My hon. Friend makes a good point. [Hon. Members: “Answer the question!”] The Prime Minister answered it. The Government have absolutely no plans to increase VAT.

Kwasi Kwarteng: This proposal has been ripped out of context and completely distorted by the Daily Mirror and some of Labour’s other friends in the media. Let me be clear: this proposal was designed as a tax simplification measure that would cut the VAT rate and allow the savings to be targeted at people who really needed the money. It was a complex proposal whose details, I am afraid, got lost in the Labour spin machine.

Sajid Javid: My hon. Friend has made his point well, and I will not dwell on it further, in the interests of time.

We have also frozen fuel duty. Petrol is now 13p per litre lower than under Labour’s plans. Each time the average motorist fills up their car, they are saving £7 because we have refused to implement Labour’s fuel duty escalator. We are also helping local authorities to freeze council tax, and our tax-free child care plan will mean savings for parents of up to £1,200 per child.

Alun Cairns rose—

David Rutley (Macclesfield) (Con) rose—

Sajid Javid: I give way to my hon. Friend for Wales first.

Hon. Members: For Wales? [Laughter.]

Alun Cairns: I am grateful to my hon. Friend for giving way.—[Laughter.]

Madam Deputy Speaker (Mrs Eleanor Laing): Order. The hon. Gentleman is making a brief intervention, and he must be heard.

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Alun Cairns: My hon. Friend makes an extremely important point about council tax, highlighting the freezing of council tax here in England. Sadly, in Labour-run Wales, council tax has risen by nearly 9% over recent years, in the same time as it has been nearly frozen here. Will he join me in calling on the Labour Front-Bench team to pressure their colleagues in Cardiff Bay to freeze council tax for my constituents in the same way that he is doing for constituents in England?

Sajid Javid: My hon. Friend has made his point very well, and the shadow Front-Bench team will have heard it. If they really cared about citizens in Wales, they would pressure their Government in Wales to take action on council tax.

We are also making it easier for hard-working people to put some of their savings towards buying their own home. Our Help to Buy mortgage guarantee and equity loans are making home ownership a real possibility for aspiring people. Just one month since its launch, more than 2,000 people have put in offers for homes under the mortgage guarantee scheme. More than three quarters of the applicants were first-time buyers, many of them in their early 30s. Since the launch of the equity loan scheme in April, 92% of the 5,000 new homes built have been bought by first-time buyers. This is how we are helping to raise living standards: we create a business environment in which more people can go to work every day; we create a tax environment in which people can keep more of the money they earn every month; and we work with the banks so that every year more people can secure the dream of their own home.

Our plans are improving living standards, but what is the Labour party’s solution? I am sure it will tell the public that the only way is up—and they would be right: under Labour, taxes would go up; mortgage rates would go up; inflation would go up; and unemployment would go up. That is what economic failure looks like.

As I said at the outset, the shadow Minister needs to give the British public more credit. They are a lot smarter than he realises. They recognise that it was the Labour party that got the country into this mess, and that it will take time and difficult decisions to clear up that mess. We, the coalition Govt, have put our faith in the British public, and because of their hard work over the past three and a half years, jobs are being created at a record rate, the economy is growing faster than in any other developed country, and as Governor Carney said just last week, the recovery has finally taken hold. There was never going to be a magical short-term fix, but our sensible, sustainable economic strategy will raise living standards, so let us not lose ground on the progress we have made; let us not allow Labour to take Britain back towards economic ruin. I beg the House to oppose this motion.

Several hon. Members rose

Madam Deputy Speaker (Mrs Eleanor Laing): Order. Before I call the next speaker, the House will be aware of the high demand for time to speak and the lack of supply of it before we reach the end of the debate. I therefore impose with immediate effect a limit of eight minutes on speeches from Back Benchers.

3.57 pm