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Mr Osborne: Let me also pay tribute to the former Chancellor for his work on the Scottish referendum campaign. To be fair to him, what we did not know in the debate before the previous general election, but which has subsequently been revealed in the various memoires that have been written about the Government he was at the heart of, is that he was arguing internally for the Government to set out the spending cuts that they would make. Indeed, he argued that the Labour Government should commit to a VAT increase, which of course the Labour party, somewhat hypocritically, opposed several months later when we had to take that step. What we know about his role in the previous Government does him great credit.

On the right hon. Gentleman’s point, as I explained in my statement, although borrowing falls in each year, the OBR has revised up the borrowing for the first two years but then revised it down, compared with the Budget, in the years after that. The structural deficit continues to fall at the same pace as in the Budget. This is not the big deterioration in the public finances that everyone has been predicting—it was on the front pages of many newspapers, and indeed the shadow Chancellor went about repeating it. That has not happened. With regard to lower tax receipts, I gave the tax receipts forecast but pointed out that one of the reasons why there has not been that deterioration in the public finances is the big reduction in debt interest payments.

Mr Andrew Tyrie (Chichester) (Con): The OBR forecasts that over the course of this Parliament the eurozone will grow at a little over 2% and the UK will grow at nearly 9%, which of course is a tribute to the capacity of UK businesses, particularly small businesses, to adapt to the huge economic shock of the euro crisis. However, just doing a bit better than the eurozone is not enough; our prosperity will depend on whether we can absorb the annual shock of increased global competition. Is not it therefore crucial, as we have seen with the pressure on Northern Ireland’s corporation tax rate, that we do much more to sustain a globally competitive tax system?

Mr Osborne: My hon. Friend is absolutely right. It is not enough just to do better than our neighbours, because of course they have their own problems and are stagnating. If one looks at all the various indexes of global tax competitiveness and global innovation, one sees that the UK is climbing up the ranks. We in the Treasury certainly seek to mark ourselves against the most competitive economies in the world, not just those on the continent of Europe. The steps I have outlined today, which probably will not make it on to the front pages of the newspapers, such as the increase in the small business research and development tax credit, the large company tax credit and changes to entrepreneurs’ relief and its relationship with the enterprise investment scheme, are all designed to support research and development and entrepreneurial business in this country.

Margaret Hodge (Barking) (Lab): I sincerely welcome the Chancellor’s announcement of the new measures to crack down on tax avoidance, particularly by challenging the mismatch between the form of a company’s structure and the substance of its activities, which is a key recommendation from the Public Accounts Committee. This week, Starbucks announced that it will pay no corporation tax in the UK for the next three years. Can

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he tell the House when the measures that he has announced will be implemented and how they will prevent Starbucks from sticking two fingers up to the British people?

Mr Osborne: Of course, the legislation needs to pass through the House of Commons before the tax can be levied, so the diverted profits taxes are from April next year, and the hybrids taxes are from a little later, in 2017. It is complex tax legislation, but we aim to get it through. I suspect that, in order to get it through before the general election—the right hon. Lady might be helpful in this—we might need the co-operation of the Opposition in passing those clauses in the Finance Bill.

Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): With several hundred job losses already announced in the north-east of Scotland, I certainly welcome the UK Government’s decision to send a signal that we want to maximise investment in the North sea. That would have been a necessary signal whether or not the price of oil was falling, and it will build the jobs base in the UK and a great export industry. Will the Chancellor confirm that such a move is possible because we are part of the United Kingdom’s diversified economy?

Mr Osborne: My hon. Friend makes a good point. Of course, what is very striking, if one looks at the receipts revenue forecasts from the OBR, is that they are wildly different from those produced by the Scottish Government before the recent referendum. As he will see tomorrow, when his colleague the Chief Secretary to the Treasury sets out in Aberdeen what we are doing, the tax cuts we announced today, which will come into effect in the coming weeks, will have an immediate effect, but we are also going to try to set out a longer road map for the direction we want to head in. As he well knows, industry investment decisions are made over long cycles and people need predictability about the future of the British oil and gas tax regimes so that we get the maximum amount of oil out of the basin.

Mr Michael Meacher (Oldham West and Royton) (Lab): With average wages still suffering the longest and biggest fall since Victorian times, productivity still one of the lowest in the OECD, business investment still flat and below pre-crisis levels, the deficit on traded goods now the biggest in British history and, to cap it all, the budget deficit is clearly beginning to rise because of the fall in tax receipts, how can the Chancellor, against that background, continue with austerity when its consequences are clearly now causing the deficit to rise?

Mr Osborne: I am afraid that the right hon. Gentleman is just wrong. Business investment is not flat; it is up 27% and is rising faster in the UK than in any other major advanced economy in the world. The deficit, according to the OBR document, was 10.2% under the previous Labour Government; it is now 5%. The idea that that is an increase is obviously nonsense. Indeed, it falls in every future year, just as it has fallen this year.

Sir Tony Baldry (Banbury) (Con): Does not providing potentially up to £100 million in infrastructure investment to make Bicester an exemplar of a garden town for the 21st century, and ensuring that 13,000 new houses are

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built as speedily as possible, demonstrate that a key part of the Government’s long-term economic plan is building new homes and creating communities of which we can all be proud for generations to come?

Mr Osborne: My right hon. Friend is absolutely right. I commend him and the community leaders in Bicester for working with us to secure this extra investment in the town, to create the vision of a garden town, and to make sure that there are housing and jobs for the town’s population while preserving its beautiful character.

Stewart Hosie (Dundee East) (SNP): I welcome some of the individual measures announced today, but they do not amount to a long-term economic plan. At its heart, what the Chancellor said was that the target to see debt fall as a share of GDP this year has not been met; that the current account will not be in the black next year, as he promised; and that borrowing then, far from being £20 billion, will be almost four times that, at £75 billion. Why should the public believe that if the Government do the same things over the next two or three years, that will be any different from their failure in doing them first time round?

Mr Osborne: At the moment, we see Britain as the fastest growing major economy in the world. We also see a record fall in unemployment, and the highest rate of job creation occurring in Scotland. That is the United Kingdom delivering for the people of Scotland. Now we have proposals from the Smith commission, jointly agreed between the different parties, whereby the Scottish Government, and the Scottish Parliament, can take more responsibility for raising their own taxes to pay for their own expenditure. Then we will have an even better debate in Scotland on how things are paid for.

Margot James (Stourbridge) (Con): I was glad to hear my right hon. Friend confirm that there has been no new recession in the years since 2010. It would have been a strange recession that resulted in unemployment falling by 45% and average weekly pay being up by 12.5% in my constituency and in 4,000 new businesses opening in my borough. Will he join me in congratulating the thousands of people who have got into work and started new businesses in my constituency in the past four years?

Mr Osborne: My hon. Friend has been a real champion for small businesses and for exporters in her Stourbridge constituency, and for attracting investment into the black country. I pay tribute to the work she has done. The measures we have taken today to help high street stores by increasing the business rate discount to £1,500, to take the smallest businesses out of business rates, and to back exporters and to increase the research and development tax credit for firms in the west midlands are all tribute to the work she has done and the issues she has raised in Parliament.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op): The Chancellor presented things as being very rosy, but a survey that came out today says that 72% of the British public feel no sense of recovery whatsoever. Why is he so out of touch?

Mr Osborne: In the hon. Lady’s own constituency, unemployment is down. In her own constituency, economic security has increased as people can see that the country is not in the crisis it was in four or five years ago. She

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has to ask her constituents this: do they want to return to the economic instability and crisis that everyone remembers under the previous Labour Government, or do they want to stay on course to prosperity? I think the British public will conclude that they want to stay on course to prosperity.

Mr David Willetts (Havant) (Con): May I warmly congratulate the Chancellor on extending the new loans to postgraduates? With increasing numbers of jobs requiring a postgraduate qualification, that really does remove a significant barrier to social mobility. Does he agree that if more people are able to stay on and do masters courses, that is an opportunity to look at broadening the range of subjects that they study at early stages of their education?

Mr Osborne: My right hon. Friend is absolutely right. Of course, he knows that we embarked on this work on how to extend support to postgraduates when he was Minister for Universities and Science—it might have been him who first proposed the idea to me—and I am absolutely delighted that it has come to fruition. This is one of the biggest reforms I have announced today. It will provide real support for postgrads, who do not currently get any support. In almost all the reports that one reads on social mobility, including the report by Alan Milburn, that has been identified as a barrier to entry for people from low-income backgrounds into the professions. It is a really important step forward. Again, I suspect that it will not be the headline in tomorrow’s newspapers, but that does not mean that it is not going to change lots of people’s lives.

Mr Andrew Love (Edmonton) (Lab/Co-op): Yesterday, the right hon. and learned Member for Rushcliffe (Mr Clarke), a former Chancellor, gave an extended interview to the BBC in which he said, among other things, that the Government should keep tax increases in the locker in case they are needed. Does the Chancellor intend to consult former Chancellors on his long-term economic plan? If not, will he now deny that a VAT rise will be imminent after the next election?

Mr Osborne: I have set out today how our plans to bring the deficit down and bring borrowing down can be achieved through spending reductions in Departments and through welfare savings, and therefore do not require tax increases. I also explained that if we were to achieve over the next period the same as we have achieved during this Parliament in dealing with tax avoidance, tax planning and aggressive tax evasion, we could achieve £5 billion of savings, or extra revenue, in that space of time as well. That is a better way to proceed, and that is the course we have set.

Mrs Cheryl Gillan (Chesham and Amersham) (Con): The Chancellor will be aware that I, and many colleagues in this House, have been working with the CLA, which is actively campaigning for reform of compulsory purchase to deliver fairer compensation for landowners who are affected by infrastructure projects such as HS2. I greatly welcome his announcements on stamp duty. Will he go a bit further and consider abolishing stamp duty land tax on the purchase of replacement property by landowners who are so badly affected by infrastructure projects?

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Mr Osborne: Like my right hon. Friend, I too have the challenge of HS2 going through my constituency, although of course she is further along in the process because her constituency is affected by the first phase of the route. I know, from my experience and from talking to her, that this has a big impact on communities. We have tried to make the compensation generous and to make the process for accessing it easier. It is certainly a lot easier than when I, as a constituency MP, had to deal with the compensation relating to the second runway at Manchester airport. Of course, I will look at any ideas that she puts forward, but any measure has to be affordable. I should also point out that in today’s document we set out further reforms that we intend to make to the compulsory purchase regime.

Fiona O’Donnell (East Lothian) (Lab): The Chancellor talked tough on tax evasion today, but so far none of the Crown dependencies or overseas territories has committed to a public register of beneficial ownership. I know that my right hon. Friend the shadow Chancellor will act tough on this issue. Why will not this Chancellor and his Government make some progress on it?

Mr Osborne: Frankly, the hon. Lady is not being fair to the Government or to those territories and dependencies. There had been no progress at all when we came into office. They have all now committed to the automatic exchange of information; they all attended the conference in Berlin where they made the international commitment to do that; and they are all consulting, right now, on the creation of these registries. They are doing that because my right hon. Friend the Prime Minister put this issue centre stage on the G8 agenda in Lough Erne.

Sir Bob Russell (Colchester) (LD): The Chancellor said that the end of our operations in Afghanistan will allow this country to save an additional £200 million this year from the special military reserve. There is also the sale of surplus Ministry of Defence radio frequencies, which he did not mention. Will he agree to ring-fence both sums to pay to modernise the family homes of the brave men and women of our armed services, whom he says he salutes?

Mr Osborne: We do have a programme, which we have extended, to renovate the accommodation of service families. We are all aware of the challenges that many families face with that accommodation. The special military reserve was created to fund overseas military operations—that is what it exists for. When we came into office, this country was spending £4 billion a year on operations in Afghanistan. The special military reserve is now down to about £1 billion; I have been able to reduce it a little today. Despite what the reserve is for, I am always willing to consider specific requests for support. I did not have time in my speech to set out the very many military good causes that we are supporting with the LIBOR money.

Caroline Lucas (Brighton, Pavilion) (Green): New analysis shows that an ambitious energy efficiency programme would create up to 108,000 new jobs, generate £1.27 in tax revenues for every £1 invested by the Government and end fuel poverty. Will the Chancellor

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explain why this statement fails to direct one penny of the infrastructure budget towards tackling the cold homes crisis in places such as Brighton?

Mr Osborne: We have proposals to help, for example, off-grid consumers with energy efficiency, and we also have the energy companies obligation programme to help with energy efficiency. We have announced this week a commitment to look at the idea of the Swansea bay tidal lagoon project, which could be a very interesting project for renewable energy generation in the future.

Mr Peter Bone (Wellingborough) (Con): Under 13 years of Labour, unemployment went up in east Northamptonshire, there were no road improvements and shops closed. That is why Tom Pursglove, our excellent candidate for Corby, and I launched a joint listening campaign to improve things in east Northamptonshire. Unemployment is now 30% lower, and we now have the Rushden Lakes retail development on line and, thanks to the Chancellor this week, the Chowns Mill and the A45 dualling improvements. Will the Chancellor visit east Northamptonshire so that Tom Pursglove and I can carry him shoulder-high through the streets of Rushden, Higham Ferrers, Stanwick, Raunds and Irthlingborough to cheering crowds?

Mr Osborne: That is quite an offer. I met Tom Pursglove and my hon. Friend to discuss the infrastructure improvements that they wanted in the east midlands. We have been able to deliver what they have so successfully campaigned on and attracted so much local support for. That is a good combination of two strong local campaigners working for their local area to deliver improvements that, frankly, were never delivered under a Labour Government and that Labour MPs have never asked me for.

Stephen Timms (East Ham) (Lab): The Chancellor has recognised that he will not deliver on his commitment to eradicate the deficit in this Parliament. Will he also recognise that a large part of the reason for the failure is that, as the OBR has acknowledged, tax receipts have been hard hit by the fall in real wages since the general election?

Mr Osborne: I acknowledged in my statement that tax receipts are £24 billion below what we forecast for 2017-18, but I pointed out that people have focused only on the tax side, not the spending side of the equation: lower unemployment and lower inflation have an impact on welfare payments and debt interest payments—we are paying £18 billion less in debt interest than was forecast—which is of course why we have not seen the big deterioration in the public finances that he and others predicted.

Eric Ollerenshaw (Lancaster and Fleetwood) (Con): If we are to have a shale gas industry, I welcome the idea of a sovereign wealth fund. Does the Chancellor agree that northern money for northern investment could be a real game changer? When he sets up the fund, will he take into account the fact that it looks as though the majority of the gas will come from Lancashire, not Yorkshire? [Interruption.]

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Mr Osborne: My right hon. Friend the Leader of the House, who is sitting next to me, said, “Oh, really”. I said that the sovereign wealth fund should be for across the north of England so that I did not get into any trans-Pennine, war of the roses dispute.

My hon. Friend is absolutely right that many of the immediate opportunities are in Lancashire, in or near the area he represents. I have spoken to him about what more we can do to make sure that local communities see the benefit of the jobs, investment and resources that we will get as a result of this important energy exploration and extraction. Of course, we now have the new college in the area—that has just been announced—so local people will have the right skills to get those jobs.

Mark Reckless (Rochester and Strood) (UKIP): If the economy is doing as well as the Chancellor says, why are we borrowing more than France, Italy, Spain and Greece?

Mr Osborne: The reason is that we started with a 10.5% budget deficit, which we have had to reduce. Interestingly, the International Monetary Fund assesses that we have had the longest and most sustained reduction in the structural deficit, and that we are forecast to have the strongest reduction in the headline and the structural deficit in the future. The IMF assessment of how we have done shows that we are restoring economic stability to this country.

Anne Marie Morris (Newton Abbot) (Con): May I again congratulate the Chancellor on being a friend to small and micro-businesses? His autumn statement is first class. His extension of national insurance and business rate reliefs is much appreciated, and it is inspirational that he is going to have a full review of business rates, the most-hated tax for all small businesses. While he is feeling inspired in the demolition business—getting rid of the slabs in stamp duty—will he look at the cliff in VAT? It is a real barrier to growth, despite the fact that it is a European tax.

Mr Osborne: As my hon. Friend knows—this is the problem of previous Governments having handed over various powers and rights of this country to Brussels—we are constrained by the VAT threshold that we can levy in this country. I think that it is already the highest in Europe, so we are restricted in what we can do. That is why we are seeking to help small businesses in her west country constituency both through the measures on business rates, and through investment in infrastructure, such as the A303, the Dawlish rail line and the Kingskerswell bypass. As I saw a few weeks ago, the bypass is proceeding very well in her constituency.

Chris Bryant (Rhondda) (Lab): Instead of wasting his time in Northamptonshire with a dead-beat candidate, may I suggest that the Chancellor comes to the Rhondda, particularly to visit the Conservative club in Tylorstown? I say the Conservative club, but it has closed and, ironically enough, is now a food bank. If he came to that food bank, he would learn from those who run it that the vast majority of people that they are helping with 2.5 tonnes of food every year are in work. That is because of the sanctions regime, low hours, zero-hours contracts and, most importantly, the bedroom tax. Why does he not deal with any of those facts?

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Mr Osborne: First, what the hon. Gentleman’s question reveals is, of course, that when the Labour party says it is committed to fiscal discipline, it does not mean that at all. It opposes welfare changes that bring the welfare budget down, and it opposes all the difficult decisions required to bring public expenditure under control. Because we are able to take those difficult decisions on day-to-day spending, we are able to make investments in infrastructure that will really help all parts of the United Kingdom. A shining example of that is the electrification of the valley lines, which the Prime Minister went to south Wales to talk about. That never happened in all the years that the hon. Gentleman was a Labour Minister and represented the seat as a Labour MP.

Nadhim Zahawi (Stratford-on-Avon) (Con): May I, on behalf of the Orchestra of the Swan, thank the Chancellor for the tax relief, which of course comes on top of the tax relief for the Royal Shakespeare Company? Savers were among the hardest hit under Labour’s great recession. Does not today’s autumn statement and the help that we are providing to savers demonstrate that this Government and the Conservative party are on the side of savers, who would be put at risk if Labour ever got anywhere near his position?

Mr Osborne: First, may I say that I know the Royal Shakespeare Company does a brilliant job? We were able to help it earlier this year with support for touring around the world. Such people are looking at the theatre tax break and at what they can do to use it. I hope that the orchestra tax break is of help to the Orchestra of the Swan, which my hon. Friend mentioned.

On savers, I have announced today that people can pass on their ISAs to their spouse tax free. That major step forward in the ISAs regime comes on top of the increase to £15,000 for the new ISA and, of course, the new freedoms on pensions.

Ian Lucas (Wrexham) (Lab): One thing the Chancellor did deliver in 2010 was an increase in VAT. Can he explain the difference between his statement in 2010 that he had no plans to increase VAT and his statement last weekend that he has no plans to increase VAT?

Mr Osborne: The plans that I have set out involve spending reductions and welfare reductions. By the way, the Labour party is the first to attack me for them. People have seen the decisions and the approach that we have taken on spending. We will go on reducing spending and reducing welfare, and we do not need tax increases.

As I remarked in my exchange with the right hon. Member for Edinburgh South West (Mr Darling), the previous Labour Chancellor planned to increase VAT after the general election—he put that in his memoirs—and those of us who were in that Parliament will remember that the Labour Treasury produced, by mistake, a document that said VAT would go up, which caused the Government great embarrassment at the time. As I say, our plans involve spending reductions and welfare reductions, and that is what we are committed to do.

Dr Sarah Wollaston (Totnes) (Con): I warmly thank the Chancellor for investing the extra billions of pounds in our NHS. There is not only extra revenue, but a transformation fund that will transform the NHS into

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the service that we need for the future. Does he share my concern, however, that our endorsement of the NHS’s forward view—our long-term plan for the NHS—would be put at risk if we handed it over to a Government who had no long-term economic plan to fund it?

Mr Osborne: My hon. Friend is right. The transformation fund is an important part of the NHS’s forward view, which has been looked at and endorsed by the Health Committee, which she chairs, the various health charities and the royal colleges. The head of the NHS, Simon Stevens, who drew up that plan, welcomed what we announced at the weekend and travelled with me to Homerton university hospital to explain how the transformation can take place. My hon. Friend is right that it is impossible to have a strong NHS unless we have a strong economy: we are delivering both.

Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab): Does the Chancellor agree with the Deputy Prime Minister that:

“There is not a single developed economy anywhere in the world that has balanced the books and only done so on the backs of the working-age poor, which Osborne has now confirmed several times he wants to do”?

Does the Chancellor realise how damaging those policies are to constituencies such as mine?

Mr Osborne: In constituencies such as the right hon. Gentleman’s and, indeed, in constituencies right across the country, unemployment has come down and people have come off the claimant count. That is a big positive development. The distributional analysis that we have published today, which was examined by the Treasury Committee, shows that the richest 20% in our society have made the biggest contribution to deficit reduction—bigger than the other 80% put together. Then there is the stamp—

Mr Clarke: So why is the Deputy Prime Minister unhappy?

Mr Osborne: The Deputy Prime Minister is unhappy because the Conservative party is trying to win his seats off him.

Mary Macleod (Brentford and Isleworth) (Con): I thank the Chancellor for announcing the review of the structure of business rates. That has been called for by the Chiswick traders’ group, the Federation of Small Businesses, the British Retail Consortium and others. Will he reassure small businesses in my area that the review will start as soon as possible?

Mr Osborne: Yes, the review will start as soon as possible. I urge businesses and business organisations to engage with it. It has to be fiscally responsible, but it is appropriate to look at the structure of the modern economy to see how it has changed and how the business rates regime can reflect that.

Sammy Wilson (East Antrim) (DUP): I welcome the additional resources that will come to the Northern Ireland Executive as a result of the Barnett consequentials of the additional spending, and the Chancellor’s commitment to devolve corporation tax to Northern Ireland, albeit on the basis that we show that we can manage the

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financial implications in our budget. Given that my party has defended fiscal responsibility, we have no fear of that. Will he confirm that the implication of what he has said is that the Northern Ireland Executive must make a decision on the implementation of welfare reform? Is that how he defines being

“able to manage the financial implications”

of the devolution of corporation tax?

Mr Osborne: I do not want to go into too much of the detail that will be on the table in the important cross-party talks, but clearly one challenge that the Northern Ireland Executive face is that they have not implemented some of the welfare reforms, which has led to a hole in their budget. There are not currently credible proposals on the table from all the parties—I use the term “all” in the collective sense. There is not yet collective agreement on how to address the challenges that the lack of welfare reform has created. That is why I phrased my statement as I did. We have the cross-party talks and we have an important couple of weeks ahead, as Members from Northern Ireland know. Let us hope that we make real progress in those talks.

Ian Swales (Redcar) (LD): I warmly welcome the new £28 million national formulation centre, which I believe is heading for Sedgefield in the north-east. That was one of the key asks of the chemistry growth partnership and is listed in the green book. Will the Chancellor continue to support the chemical industry, which is the UK’s biggest manufacturing exporter and is helping to make the north-east one of the fastest growing regions of the UK?

Mr Osborne: My hon. Friend is right that the new catapults that we have set out—the formulation centre and the investment in the high-value manufacturing catapult—will help the north of England, particularly around the area that he represents. Support for the chemical industry is important. The changes to energy taxation in the Budget will help the chemical industry. There might be an opportunity to look at specific things that we could do to help the chemical industry further, rather than all energy-intensive industries. I am happy to have that discussion with him and other Members who represent constituencies with chemical manufacturers.

Mr Ronnie Campbell (Blyth Valley) (Lab): If the Chancellor is right that the UK is the leading world economy, why does he not give health service workers their 1% increase?

Mr Osborne: Of course, our pay settlement does give health service workers 1%. For those on progression pay, we are saying that there should be a 1% pay rise in total. We are able to afford a strong national health service, to put the money into the national health service that we have announced over the past few days and to support the NHS’s forward plan about its bright future only because we have a strong economy. In the north-east of England, as the hon. Gentleman knows, we are investing in jobs and roads. I would have hoped that he would welcome the news this week on the A1 Gateshead bypass and the A1 north to Ellingham.

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Mr Mark Hoban (Fareham) (Con): Stamp duty has often been a barrier to families in my constituency owning a home of their own or moving house. The reforms that the Chancellor announced today will save £1,300 on the cost of an average house in Fareham. Does that not demonstrate that it is the Conservative party that is on the side of the home owner and aspiration, in stark contrast to the Labour party?

Mr Osborne: My hon. Friend is absolutely right. It is a major reform of stamp duty that gets rid of the very distorting slab system. The current stamp duty system has attracted huge criticism from all sorts of groups, including property websites, those who help people to move home and, of course, home buyers. [Interruption.] The hon. Ladies on the Opposition Front Bench say, “Do it in the Budget.” I am doing it now so that people can benefit from it now.

Alison Seabeck (Plymouth, Moor View) (Lab): The Chancellor did not pay significant attention to productivity in the south-west in his speech. Our devastated rail line is just getting crumbs from the table, and those are buried in the national infrastructure plan. We have a feasibility study that is semi-permanent, with no guarantee of investment until 2019-20. The Prime Minister said that money was no object when we had the storm damage, but he clearly did not mean it. People in the south-west will not forget and will be angry.

Mr Osborne: What the hon. Lady says does not bear a resemblance to what has been announced this week. The south-west is one of the biggest winners from the infrastructure plan that we have announced, with a massive upgrade of the A303 and the A358. In all the years of the Labour Government, nothing happened to those roads. The Dawlish rail line had problems when the storms came, which I guess says something about the investment that the Labour Government put into it, but I will move on from that. Not only have we repaired the rail line; we are looking at an alternative route to increase resilience to the south-west. We have also provided new trains on the sleeper route and made local road improvements, such as the—

Alison Seabeck: They’re crumbs!

Mr Osborne: This is billions of pounds of investment into the south-west of England that never happened under the Labour Government. The Labour Government completely neglected the south-west of England, and the Labour MPs who represented those constituencies got absolutely nothing from them. Conservative candidates and Members of Parliament are delivering for the south-west.

Chloe Smith (Norwich North) (Con): Rail passengers in East Anglia deserve a fair deal, and my hon. Friends the Members for Ipswich (Ben Gummer) and for Witham (Priti Patel), my right hon. Friend the Member for Chelmsford (Mr Burns) and I have worked hard for our constituents. I welcome the Chancellor’s commitment to the East Anglian economy, not just the road improvements but specifically his backing for two key recommendations of the Great Eastern main line taskforce and the work of its thousands of supporters, including the new Anglia local enterprise partnership. I also welcome his commitment to track improvements and new trains.

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Mr Osborne: I pay tribute to my hon. Friend, who has done a brilliant job in bringing to my attention, and that of Parliament, the needs of Norfolk, Norwich and East Anglia. Because of her campaigning, and that of my hon. Friend the Member for Ipswich (Ben Gummer), we have the Norwich in 90 and Ipswich in 60 campaigns, and the report. We are committing new trains to speed up those journeys, as well as a massive road investment on the A47, A11, A12 and A14. None of those things happened under a Labour Government, and East Anglia was completely neglected in terms of infrastructure for the future. That is not the case any more and my hon. Friend has put East Anglia on the map.

Michael Connarty (Linlithgow and East Falkirk) (Lab): When I was a teacher of children with learning difficulties, some of the children did not finish the race but were still given a prize. The Chancellor is different: he has run only half the distance he promised by the next election. Instead of apologising for not getting rid of the deficit as he promised, he wants us to applaud him. He says we are all in it together, but for the people I represent, yes, the claimant count has gone down, but the real value of their income has gone down by £2,000 per household. Last weekend, at Tesco, the warm-hearted people of my constituency had a massive collection for food banks. When will the Chancellor deliver for those people, instead of the millionaires who he claims are all in it together with them?

Mr Osborne: I have taken measures to reform stamp duty in a progressive way and introduced a tax, which could have been introduced in any Budget by a Labour Chancellor, to deal with multinational companies that divert their profits overseas. I have ensured that profits cannot be written off against losses incurred during the financial crisis—again, any Labour Chancellor could have done that but they did not. I am determined to ensure that the richest in our society make a contribution and that businesses pay our low taxes. More generally, the result of a pro-business policy is that in the hon. Gentleman’s constituency alone—I think he just dismissed this out of hand—unemployment has fallen by 20% in the last year. I would have thought he would welcome that.

Mr Robin Walker (Worcester) (Con): In our nation of shopkeepers there will be relief at the decision to extend small business rates relief and increase the benefit for small shops and cafés to £1,500. In his review of business rates, may I urge the Chancellor to take account of the Business, Innovation and Skills Committee report that urged a fundamental reform? The Conservative party believes in low taxation, and it needs to reform fundamentally a tax that can only ever go up.

Mr Osborne: My hon. Friend is a champion of small businesses in Worcester and infrastructure investment in Worcestershire and that part of England, and I thank him for his representations. In part because of those representations, we have been able to help with business rates and high street shops in the statement. We now want a review of business rates, but it must be done in a way that is consistent with stable public finances. It is appropriate to consider how the modern economy has changed and the impact of things such as the internet, and that is why we are undertaking that big review.

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Barry Gardiner (Brent North) (Lab): Will the Chancellor confirm that the £2.3 billion identified for flood defences was originally announced last year, and that of the 1,400 schemes he says are going forward, 1,119 are not fully funded but rely on 80% partnership funding and a 10% efficiency saving that has yet to be made? Will he also confirm that the 300,000 households he says will have a reduced flood risk are going from “low” to “very low” risk, and that households at “significant” or “high” risk will rise from 490,000 to 800,000 in the next six years?

Mr Osborne: I know the hon. Gentleman represents a constituency named after a river, but he has not been fair about our flood defence policy. Did we set out the money last year? Yes, we did. We then said, “Let’s have a plan for how to spend that money”, and this week we have announced all the different schemes that show how it can best be used. That is an increase on the capital funding that the previous Labour Government provided. Flood defence schemes have always involved a contribution from businesses, and today I announced—the hon. Gentleman did not mention this—that we are expanding the tax relief available for those contributions.

Martin Vickers (Cleethorpes) (Con): Unlike the hon. Member for Brent North (Barry Gardiner), my constituents welcome the Chancellor’s announcement on flood defences, particularly this week which marks the first anniversary of the tidal surge that flooded so many homes and businesses in my constituency. Cleethorpes has enormous potential for growth, as the Chancellor and Government have recognised, and to maximise that growth and support the rail franchises that my right hon. Friend referred to—particularly the south trans-Pennine route—it is essential to maintain coast-to-coast, east-to-west connections. Will the Chancellor do all he can to ensure that?

Mr Osborne: I certainly give my hon. Friend that assurance. He is a doughty champion for Cleethorpes and its strong road and rail links. He has raised train services with me and I am looking at that, as is the Transport Secretary. We are determined to provide a great service to the people he represents, and ensure that they travel in comfort. Today’s announcement about replacing outdated Pacer trains with new, modern trains will be welcomed across the north of England.

Teresa Pearce (Erith and Thamesmead) (Lab): The Chancellor spoke about fiscal discipline and welfare reduction, yet it seems that the Office for Budget Responsibility might not agree. Its “Blue Book” shows that the bill for housing benefit for people not on jobseeker’s alliance will rise year on year. More worryingly, despite repeated assurances from the Work and Pensions Secretary in this House that universal credit is on time and on budget, the OBR has reviewed all the evidence and states that there remains “considerable uncertainty” around its delivery, and “broader uncertainties” over the eventual cost. In whom does the Chancellor have more faith: the OBR or the Secretary of State for Work and Pensions?

Mr Osborne: Universal credit is a change to our welfare system that makes sure that it always pays to work. I pay tribute to my right hon. Friend the Work and Pensions Secretary because he is pioneering what I

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think are important far-reaching changes to the incentives in our country that encourage work and support people in work. We have introduced a welfare cap. That is a brand new mechanism for controlling welfare spending, including identifying pressures such as rising housing benefit bills that were completely ignored in the past by the Labour Government. If a Government are not prepared to address increases in one benefit with reductions or measures on other benefits, they are required to come before the House and ask for a vote because they have reached the cap. We have not done that because we are within the cap, as the OBR report confirms.

Ben Gummer (Ipswich) (Con): Last October, youth unemployment in Ipswich fell to the lowest point since records began—a fall directly attributable to the Chancellor’s policies. The future of young people in Ipswich is now much brighter because of his commitment to the Great Eastern main line and I thank him for that. Will he comment on the fact that the only way that scheme will not happen is if the Labour party stops the franchising process, which is precisely what it has promised to do?

Mr Osborne: I pay tribute to my hon. Friend. I have been to Ipswich and seen what he has done to attract businesses and jobs, and to champion big infrastructure improvements, such as in relation to the A14 and the Ipswich in 60 campaign. Those things would be under threat under a Labour Government. The Labour party’s rail franchising policy would prevent the improvement in train services to East Anglia. Big infrastructure projects that never happened under a previous Labour Government would almost certainly never happen under a future Labour Government.

Jack Dromey (Birmingham, Erdington) (Lab): After another broken promise made in 2010 that front-line policing would be protected, 16,000 police officers have gone, including 8,000 from the front line. The Association of Chief Police Officers has said that, based on the Chancellor’s plans for the future, at least another 16,000 police officers will go, the majority from the front line, threatening its ability to discharge its statutory duties and protect the vulnerable. Is ACPO right?

Mr Osborne: Because of the hard work of the police and the reform that has been undertaken, crime is down and there is more policing on the front line. That shows that savings can be made to the Home Office budget while achieving reform. The hon. Gentleman’s question again reveals the default position of the Labour party. The shadow Chancellor attempts to say that it has newly converted to fiscal discipline and that it would take the difficult decisions. Every single Labour MP then gets up and complains about future spending and welfare decisions. That just shows that they are totally unreformed and unreconstructed.

Iain Stewart (Milton Keynes South) (Con): I thank my right hon. Friend for the additional help he has given to hospices. Will he join me in paying tribute to the staff and volunteers at Willen hospice in Milton Keynes, which provides patients and their families from my constituency, the constituency of my hon. Friend the Member for Milton Keynes North (Mark Lancaster) and indeed your constituency, Mr Speaker, with incredible support?

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Mr Osborne: I think everyone in this House knows what an incredible job the hospice movement and hospice charities do. I am a patron of the East Cheshire hospice. From the conversations I have had with my hon. Friend and his colleagues, I know what a brilliant job the hospice in his area does. This measure is something that hospices have long asked for. They have been unfairly discriminated against, in comparison with the NHS, when it comes to VAT. We are going to refund that VAT and give the hospice movement the support it deserves in recognition of the brilliant job it does.

Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op): The Chancellor has made a number of statements today on infrastructure, but of course developing our infrastructure requires a thriving UK steel industry and supply chain. Will he explain why he and the Secretary of State for Business, Innovation and Skills have chosen not to bring forward the energy-intensive industries compensation package that he announced in the Budget earlier this year? Does he believe that the UK steel industry faces a level playing field, and if not, what is he going to do about it?

Mr Osborne: I have long thought that there is a challenge in ensuring that commitments to reduce carbon are consistent with having a vibrant and successful steel industry and other energy-intensive industries. What we hear when we go to Port Talbot and elsewhere is a real concern that UK energy prices could be higher than they are on the rest of the continent of Europe if we adopt measures such as a decarbonisation target. That is why the Conservative party is not in favour of a decarbonisation target. Unfortunately, the Labour party is in favour of it and the steel industry might be one of the industries that will bear the cost.

Gordon Birtwistle (Burnley) (LD): I congratulate the Chancellor on his plan to reduce the job tax on apprentices up to the age of 25. The country is obviously on the rise and manufacturing industry is booming, but we have a big problem with skills shortages. I am sure this measure will go a long, long way towards training young people to do the jobs of the future that this country will desperately need.

Mr Osborne: My hon. Friend has been a consistent champion of apprentices in Burnley and of the apprenticeship policy. He sends me and other colleagues in the Government a regular report of what is going on in Burnley and what more we can do to support apprentices. I am careful to make sure that I read that report each time it comes in. It is partly because people like him have been raising this issue with us that we have taken the big decision today to abolish the job tax when it comes to employing young apprentices. It is a major step forward in supporting apprentices and I think it will open the path to having 3 million apprentices in the next Parliament.

Mrs Louise Ellman (Liverpool, Riverside) (Lab/Co-op): It is very encouraging that the Chancellor recognises the importance of transport investment for creating the powerhouse of the north, but he has not committed to a funded programme to implement the changes that are

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required right across the north. Why did he single out the Manchester-Leeds link, which is just a part of what is required?

Mr Osborne: First, we have announced this week important changes to support infrastructure in and around Liverpool, including to the port of Liverpool, which is a very exciting source of economic development on Merseyside. Secondly, the trans-Pennine link supports journeys from Liverpool all the way over to Leeds and Hull, but we also want investment in the rail services in and around Merseyside. That is why we are electrifying the lines in that part of the north-west and why we are looking for major investment in HS2, so that journeys from Liverpool to Birmingham and London will be much quicker once the train joins the track at Crewe. Those are all measures that we are taking to support Liverpool.

I also announced major investment in science in the north, and Liverpool will be one of the beneficiaries of that. This is all about trying to work together. I am very happy to do that on a cross-party basis, with Members of Parliament representing Liverpool, Joe Anderson—the mayor of Liverpool—and the Government, to see what more we can do to increase the economic potential on Merseyside.

Mr David Burrowes (Enfield, Southgate) (Con): As we approach small business Saturday, I, on behalf of my high streets, welcome the package of measures to reduce the impact of business rates. What should I tell my businesses about the impact of following the shadow Chancellor’s proposal to increase corporation tax?

Mr Osborne: The shadow Chancellor and the Labour party want to increase corporation tax. That is their stated policy on the legislation this House has passed. They make it pretty clear that they would increase national insurance if they ever came to office. That would be devastating for the small businesses of Enfield, and indeed of the whole country. We know what happens when there is a Labour Government. We know the impact on businesses: the high unemployment and the business closures they would create, because that is exactly what happened five years ago.

Ms Margaret Ritchie (South Down) (SDLP): I welcome the commitment to the devolution of corporation tax to Northern Ireland, but there remains uncertainty on the cost to the block grant. Will the Chancellor outline the possible cost to the block grant over an estimated period, and will he outline the timeline for devolution, predicated on the outcome of cross-party talks?

Mr Osborne: The costs of Northern Ireland reducing, for example, corporation tax rates to the level seen in the Irish Republic have been set out and are the subject of discussions that we have had over the past year with the Northern Ireland Executive. We need to be sure—this is about the taxpayers across the whole of the UK—that if we go ahead with this step, which we are very well disposed towards, the Northern Ireland Executive will be able to manage the pressure on their resources. That will be one of the topics for discussion in the cross-party talks. If the cross-party talks are successful we could, as I said in the statement, introduce legislation in this Parliament.

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David Morris (Morecambe and Lunesdale) (Con): In the past four-and-a-half years, my constituency has benefited from the Chancellor’s policies. Some £700 million has been invested in my constituency, and I thank him for that. The greatest gift of all is the Government’s absorption of VAT on hospices. Does he agree that that will help St John’s hospice, and that the policy is long overdue? I thank him for listening.

Mr Osborne: My hon. Friend is a great champion of his constituency in Lancashire. He has raised with me and the rest of the Government the great work that St John’s hospice does and the unfair treatment, in comparison with the NHS, that it and other hospices have endured because of VAT. We have listened to him and to other hon. Members and have taken this step forward. We wish the staff at St John’s well with all the great work they do.

Mr Adrian Bailey (West Bromwich West) (Lab/Co-op): I welcome the belated recognition from the Chancellor of the importance of investment in the regions, but may I remind him that the west midlands has the second highest number of unemployed and the second lowest growth in employment in the country? What provisions are there in the Budget to respond to the proposals in the joint submission by the Black Country and Greater Birmingham and Solihull local enterprise partnerships? Those proposals are designed to expand the black country enterprise zone and the transport infrastructure between the two areas to ensure that Birmingham and the black country become the powerhouse of the west midlands.

Mr Osborne: I am absolutely ready to engage with authorities, including of course Labour authorities, in Birmingham and in the rest of the west midlands on what more we can do to invest in the west midlands. We have had a good and productive cross-party relationship with the Labour leaders in Manchester, and I would like to see that replicated in Birmingham, with Albert Bore, and with the Conservative, Labour and Liberal Democrat authorities in the black country. We are willing to do that and to hear their good ideas.

A number of proposals have been made on enterprise zones. We will make an announcement in the Budget. A lot of good ideas have come in. We were not ready to assess all the different bids to make a decision in time for the autumn statement, but we will do that in time for the Budget.

James Morris (Halesowen and Rowley Regis) (Con): I welcome the Chancellor’s statement, particularly his commitment to new spending on the NHS. Does he agree that we can invest in things such as the new Midland Metropolitan hospital in Sandwell and improved services at Rowley Regis hospital only if we stick to our long-term plan and have strong economic growth?

Mr Osborne: I have visited with my hon. Friend the great local NHS that he does so much to support and have seen his commitment to major capital investment in new hospital services. I hope his area will also benefit from the new £1 billion fund for improving primary care facilities so that we can deliver secondary care-style services in our communities, working with our GPs. That will be a huge investment, on top of the big investment he has already secured for his area.

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Lilian Greenwood (Nottingham South) (Lab): Given that one in five workers are earning less than the living wage, that wages have fallen further in this Parliament than in any Parliament since Victorian times, and that the Chancellor is spending billions of pounds more on tax credits and housing benefit for working people, is it any wonder that tax receipts are lower than expected and borrowing is higher? Does he finally understand that the cost of living crisis he has created for my constituents is self-defeating and the very reason he has had to break his promise on the deficit?

Mr Osborne: The hon. Lady neglected to say that in her constituency unemployment has fallen by 17%—[Interruption.] That seems to be a source of disappointment to the local Labour MP. It should be a source of encouragement to people living in Nottingham South that jobs are being created and that people can get them. However, we have to ensure that people have the right skills to get those jobs, which is why we are supporting apprentices in her constituency. Of course, people in Nottingham would see themselves returned to the economic instability and crisis of the past if there were another Labour Government.

Oliver Colvile (Plymouth, Sutton and Devonport) (Con): I thank my right hon. Friend for his comments about postgraduates and science investment and for the billions of pounds he is proposing to invest in south-west transport infrastructure. Does he recognise that Plymouth’s priority is a sustainable railway line that delivers more three-hour train journeys between London and Plymouth and ensures that we get trains into Plymouth before 9 am in order to deliver the city deal?

Mr Osborne: My hon. Friend has been a great champion for Plymouth—I have visited some of the economic developments taking place there with him—including for better rail services, and the work on how to improve those services is under way because of his interventions. In addition, there are now major improvements on roads into the south-west. There was never any investment into the south-west when there was a Labour MP representing his constituency. This is all proof that Conservatives in the area are champions for the south-west and are delivering for the region.

Jonathan Ashworth (Leicester South) (Lab): The Chancellor asked in 2010 that we judge him on whether he balanced the books by 2015, and he is set to fail that test. Will he explain why, compared with March, he has had to revise up borrowing for this year and next by £12.5 billion?

Mr Osborne: The hon. Gentleman, like the shadow Chancellor, neglects to say that borrowing has been revised down for the following three years of the forecast and that the structural deficit continues to fall at the same rate. The problem for Labour is that it has been parading around the television studios for the past two weeks saying, “Wait for the autumn statement and the big deterioration in the public finances.” Unfortunately for them, it has not happened. That is the problem with a shadow Chancellor who keeps staking the credibility of the Labour party on his terrible economic predictions.

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Andrew Percy (Brigg and Goole) (Con): In the Humber before the last election, youth unemployment was rising, unemployment was rising, there was no real rail investment—which is hard to say with our accent—there were no significant road improvements and we were becoming worse off compared with the south of England, but now our bridge tolls have been halved and there is massive investment in our flood defences. I thank the Chancellor for his announcements. Will he assure me that our joint bid to him and the Prime Minister will be considered seriously and that the £1 billion funding over the next 15 to 20 years will be considered quickly so that we can get certainty as soon as possible?

Mr Osborne: As we said this week, we are giving serious consideration to the bid that my hon. Friend, his colleagues and others in the Humber estuary area put forward for major improvements in flood defences. We are already investing in flood defences this week, which was welcome news, and his proposal is a big and well-argued one to which we are giving serious consideration. As he rightly said, on top of that we have seen major improvements into the Humber and, thanks partly to his campaigning, the Humber bridge tolls came down and traffic has increased.

Phil Wilson (Sedgefield) (Lab): I welcome the news that the national formulation centre will be based in Sedgefield at the North East technology park in my constituency, which was opened 10 years ago by my predecessor. Is the Chancellor aware that the chemical and other industries in the Tees valley use Durham Tees Valley airport to reach global markets and that this could be affected by the devolution of air passenger duty to Scotland? What plans does he have to ensure that small regional airports, such as Durham Tees Valley airport, in the north of England are not disadvantaged by these changes?

Mr Osborne: I am pleased to say that the current Member for Sedgefield probably gets a better hearing at the Treasury than the last Member for Sedgefield ever did. The formulation centre is great news for the north-east and Sedgefield, but the hon. Gentleman raises a serious point that we will have to look at. The Smith commission—and, to be fair, the Calman commission before it —recommended the devolution of air passenger duty, and we absolutely accept that recommendation. However, we will have to consider the impact, particularly on the airports in the north-east of England, which are geographically close to some of the Scottish airports. The shadow Chancellor raised the same point. I am happy to work with the hon. Gentleman and the Labour Front-Bench team, on a cross-party basis—we worked together like that on the Smith process—to see what we can do to support airports in the north-east.

Charlie Elphicke (Dover) (Con): The Chancellor used to receive representations that he was doing too much, too fast, but now Labour Members think he did not go quickly enough. Given their muddled and confused position, if we were to adopt a plan from these people, what would be the implication for interest rates in particular and economic policy and growth in general?

Mr Osborne: Of course, Labour economic policy would increase unemployment, reduce GDP and potentially put Britain back into recession. We know that its feeble

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commitments on borrowing would allow at least £26 billion of extra borrowing every single year, and as has been demonstrated over the past hour or so, every Labour MP actually wants to spend more money and increase welfare bills. That is the real Labour party, and of course it would bankrupt the country again.

Mr William Bain (Glasgow North East) (Lab): The Chancellor made just one passing reference to wages in his statement, some 42 minutes in, and small wonder. Will he confirm that the OBR has this afternoon revised down its forecast for income tax and national insurance contribution receipts through to 2018-19 by a further £11.8 billion, with £9 billion of that down to lower than forecast growth in wages? How can the worst Chancellor on wages for 140 years ever be the answer to higher living standards in the next Parliament?

Mr Osborne: I actually talked about tax receipts and earnings early on in the statement. I pointed out that although tax receipts were lower, crucially they were offset by lower debt interest payments, which is why we have not seen the big deterioration in the public finances that was forecast. Borrowing was lower towards the end of the period than was forecast at the last Budget; the surplus is higher than predicted; and the structural deficit is on course for the reductions we set out. That is because although tax receipts were lower, debt interest payments were also lower.

Rehman Chishti (Gillingham and Rainham) (Con): I very much welcome the Chancellor’s statement, and I would like to thank him for the previous measures he introduced, which have led to youth unemployment going down and overall unemployment going down in Gillingham and Rainham, with businesses and jobs going up there. Linked to that, I thank the Chancellor for the £30 million previously given to Medway through the growth deal to support the infrastructure. Linked to that, I thank him today for the specific support given to small businesses, which are at the heart of my constituency, in creating jobs and prosperity. Linked to that, I thank him for his visit to MEMS Power Generation in my constituency, which was very much appreciated.

Mr Speaker: The hon. Gentleman can also thank me for my indulgence.

Mr Osborne: I fondly remember my visit to Gillingham and the Gillingham town strip I was given when I was there. My hon. Friend is a great champion of Gillingham’s businesses and transport links in the town. Many of the small business rate decisions we have taken today are in no small part due to the campaigning my hon. Friend has done on behalf of Gillingham’s businesses.

Gemma Doyle (West Dunbartonshire) (Lab/Co-op): As the Chancellor’s Parliamentary Private Secretary passes him whatever fact is useful in answering my question, let me tell the right hon. Gentleman that earlier this year, long-term youth unemployment in West Dunbartonshire had rocketed by 625% on his watch. That is nothing to be proud of. He has driven down the living standards of my constituents and he has driven down the value of their wages. When is he going to admit that he has failed on the economy? Will he apologise to people in West Dunbartonshire for the misery he has caused them?

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Mr Osborne: The Labour Chancellors in the last Government who came from Scotland in the end gave this country the highest budget deficit in its peacetime history. They left a country with high unemployment, and questions were being asked about Britain’s ability to pay its way in the world. We have turned that around: unemployment has fallen across the United Kingdom and in Scotland, and the part of our UK that is seeing the fastest rate of job creation at the moment is Scotland.

Julian Smith (Skipton and Ripon) (Con): The Chancellor’s northern powerhouse vision is seeing the greatest transfer of powers and money south to north for generations. Will he confirm that in doing more to devolve powers to northern cities, rural and county areas will not lose out?

Mr Osborne: I can give my hon. Friend that assurance. This is a policy not just for cities, but for the shire counties that surround them. Rather like him, I represent a shire country seat outside a great northern city. This is about strengthening the transport links between the shire counties and the cities; it is about making sure that superfast broadband is available in our rural areas; it is about supporting towns and not just cities in the north of England. It is about ensuring that the whole thing is connected up in a way that it has not been before, so that the north of England has the economic clout of a great global city. I think we are well on the way to developing that.

Sheila Gilmore (Edinburgh East) (Lab): Before the Chancellor of the Exchequer tells me the unemployment figures in my constituency, I of course welcome the fact that the claimant count is down—but that is not necessarily the same as unemployment, as the right hon. Gentleman knows. We are now getting closer to the point where we were through the whole of the first 10 years of the last Labour Government, so we have only gone back to where we were. However, a £6 billion increase on overall housing benefit spending over the course of this Parliament has contributed to the Chancellor’s failure to meet his deficit reduction targets. When will his Government actually tackle the underlying causes, which are high rents and low wages?

Mr Osborne: First, it is no good saying that the first 10 years of that Labour Government were great and that we should forget about the last three, which brought about the greatest recession since the 1920s. It is a bit like Mrs Lincoln being asked about that play.

We have taken a number of steps to try to cap housing benefit, rent increases and the housing benefit associated with them; we have introduced a cap on housing benefit payments. When we came to office, there were examples of some people receiving over £100,000 a year from taxpayers in housing benefit, which is of course totally unacceptable. We have taken those steps, and now we have the welfare cap as well. All I can say is that every time Labour Members stand up, we hear about a proposal to add to the housing welfare benefit bill, and that it would be good to hear some proposals from them to reduce it.

Jason McCartney (Colne Valley) (Con) rose—

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Mr Speaker: Gosh. The hon. Gentleman appears to be experiencing some discomfort, which I do not like to see. We must hear from Mr Jason McCartney.

Jason McCartney: Thank you, Mr Speaker. It is my marathon training, and in that vein, I ran the London marathon for the Forget Me Not children’s hospice this year. Along with it and my local Kirkwood hospice I would therefore like to thank the Chancellor for the measures he has taken in refunding VAT. The Forget Me Not children’s hospice is recruiting two apprentices at the moment, so will my right hon. Friend continue to support apprenticeships, 4,200 of which have been created in my constituency since 2010?

Mr Osborne: It seems like the autumn statement is a tailor-made package for the marathon run that my hon. Friend is undertaking. In view of the brilliant work that he does in his community and the brilliant work of the Forget Me Not hospice, I am pleased that the VAT refund, along with the abolition of the jobs tax on apprenticeships, will be so welcome. My hon. Friend must send me a sponsorship form. Every year I sponsor the shadow Chancellor, so the least I can do is to sponsor my hon. Friend.

Mr David Lammy (Tottenham) (Lab): As a former universities Minister, I welcome the loan scheme for masters students in the statement. However, could not the Chancellor say more about the structure of the economy? The reason why the tax receipts are so low is partly because Britain has lost 1.2 million jobs in the skilled middle section of the economy—the plumbers and the mechanics, for example. Many of those jobs have been replaced by customer services, which certainly forms the increase in London. Will the Chancellor say something about how to restructure the economy, as we have heard nothing about that today?

Mr Osborne: I think the right hon. Gentleman is being a little unfair about the autumn statement, but I agree with the challenge he presented to us—how to improve the productivity of the United Kingdom. The measures we take to support postgraduate loans and to support apprenticeships, alongside the education reforms at primary and secondary level that my right hon. Friends the Education Secretary and her predecessor have implemented, are all designed to try to improve the skills in the country. We are all working together to try to address the productivity challenge that we face. Frankly, we faced it for a long time in the past, as our productivity lagged behind some of our European competitors, let alone that of the rest of the world. We need to do more. That can be achieved in London partly by investments in infrastructure, including those in the Tottenham area.

John Stevenson (Carlisle) (Con): For the people of Carlisle, average wages and house prices are lower than the national average. The announcements on the raising of the personal allowance and the stamp duty reforms will be extremely welcome. I fully support them. Does the Chancellor agree that when it comes to discussions about the northern powerhouse, and particularly about local government and civic reform, it is also vital that Carlisle and Cumbria are not forgotten?

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Mr Osborne: My hon. Friend is, of course, absolutely right. He came to No. 11 Downing street with representatives of businesses from the whole of the north-west, and particularly with those businesses that create and support jobs in Carlisle and across Cumbria. My hon. Friend, of course, has been instrumental in getting the Government to look at the A69 and the A66 to see what more can be done to support those east-west links across the very north of England. Without him as MP for Carlisle, that study would not have happened.

Diana Johnson (Kingston upon Hull North) (Lab): Why does the Chancellor consistently forget to mention Hull when he is talking about the northern powerhouse, particularly when people in Hull seem to think that the northern powerhouse is a new electrical store that is opening and not the joined-up plan for the whole of the north that it is? He can redeem himself, however, by announcing today the privately financed initiative to electrify the line to Hull, for which we are all waiting.

Mr Osborne: Of course, we are waiting for it partly because under 13 years of the Labour Government, it never happened. We are looking at improving rail connections to Hull. I was there fairly recently and talked to Lord Haskins, the head of the local enterprise partnership. I go out of my way to say that Hull should be part of the northern powerhouse, and I have talked about the links between Liverpool, Manchester, Leeds and Hull across the east-west link of the north of England. I think there are real opportunities, alongside the flood defence programme in the Humber estuary that we have talked about. The investment in the enterprise zones there and the Siemens investment in Humberside are important. There are lots of great things happening in Hull, and the “Hook up Hull” campaign is yet another example of a great campaign that we are looking to support.

Bill Wiggin (North Herefordshire) (Con): Can the Chancellor explain why he wants to introduce his stamp duty changes at midnight rather than a little further down the road?

Mr Speaker: Order. I am sure that the hon. Gentleman was here all along. He did not leave the Chamber—or did he?

Bill Wiggin: He might have done.

Mr Speaker: He might have left the Chamber? In that case, we cannot take his question.

Mr Osborne: It was quite a good question.

Mr Speaker: It might be. Go on, get in there.

Mr Osborne: The stamp duty changes must be introduced with immediate effect today because otherwise transactions in the housing market would stop as people waited for them. Given that 98% of home buyers will see a tax reduction, that would freeze quite a large part of the market. [Interruption.] I am told that the figure in Herefordshire is 99%.

May I take this opportunity to thank you, Mr Speaker, and the Clerks for the discussions that we have had over the last few days to make this possible.

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Mr Speaker: I am glad that the hon. Member for North Herefordshire (Bill Wiggin) has received his answer, but I must say that to toddle out of the Chamber and then beetle back in and expect to take part, in defiance of the conventions of the House, renders the hon. Gentleman a cheeky little boy.

Bill Wiggin: There is nothing little about me, Mr Speaker.

Mr Speaker: I use the term with some poetic licence, it must be admitted.

Nia Griffith (Llanelli) (Lab): The Chancellor is quick to blame the eurozone. However, the UK now languishes as 22nd out of the 28 EU countries in terms of export growth. What specific measures will he take to improve it?

Mr Osborne: As I said in my statement, we face a major challenge when it comes to increasing our exports. As the Office for Budget Responsibility made clear, it has been a challenge for the British economy for the past 20 years. If anything, however, the decline in our exports has slowed down slightly in recent years, compared to what was happening under the last Government. Today I have committed myself to a £45 million fund, which will be available both to UK Trade & Investment and to the Foreign Office, to increase our trade links with the new emerging economies of the world, and to support first-time exporters in particular. Lord Livingston is doing a great job as Trade Minister, and I want to back him.

Dr Julian Huppert (Cambridge) (LD): There is much to welcome in the autumn statement, including investment in the NHS and, in particular, investment in mental health. Strangely, that has not been mentioned in any of the questions so far.

I especially welcome the excellent news about the introduction of income-contingent postgraduate loans. I agree with what was said earlier by the right hon. Member for Havant (Mr Willetts). Indeed, when he was a Minister I worked with the National Union of Students and CentreForum to persuade him to do exactly this, so it is great to see it happening. More people from disadvantaged backgrounds obtain undergraduate degrees, but then find that they cannot afford to engage in postgraduate study. This welcome and long-awaited change will lower a barrier to social mobility.

Mr Osborne: I thank my hon. Friend for what he has said. I should have been extremely disappointed if my announcement of a big improvement in our support for postgraduate students had not been welcomed by the Member of Parliament for Cambridge. He is absolutely right: the lack of financial support available to people doing post-grads is indeed a barrier, which falls particularly on those from low-income backgrounds, and which has been identified as a real problem in a number of reports on social mobility. I am glad that we have been able to work together to bring about this change.

Debbie Abrahams (Oldham East and Saddleworth) (Lab): The OBR’s analysis clearly states that borrowing over the forecast period will increase above and beyond what was forecast back in March, predominantly as a result of the reduction in tax receipts. Far from rebalancing

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the economy, and failing to meet his own deficit reduction targets, the Chancellor is presiding over a low-pay, zero-hours-contract economy in which one in five people—one in three in my constituency—are paid below the living wage. Is it not an insult to the 3 million people on the lowest incomes, and an insult to the value of British fair play, that the Government will be hammering them yet again with a potential cut in tax credits?

Mr Osborne: Today we have increased the personal allowance, which increases the number of low-paid people taken out of income tax to 3.5 million.

It is interesting to look at the caricature of what is happening in this country that Labour Members have tried to present. They said that all the jobs were part-time; it turns out that 85% of them are full-time. They talked about the gender pay gap; of course that remains a challenge, but it is at its lowest level in British history, and has fallen since the period of the last Labour Government. They complained about the abuse of zero-hours contracts; I had to sit there for 13 years listening to Labour Chancellors, and never once did they introduce a reform of zero-hours contracts. That reform is now taking place, and we are ending the abuse that comes with the exclusive contracts.

Ultimately, the people who suffer most when the economy fails—when economic stability is destroyed and unemployment rises—are the poorest people in the country. That, sadly, was their experience under a Labour Government, but under this Government, employment is growing and economic security is returning.

Andrew Jones (Harrogate and Knaresborough) (Con): I warmly welcome the statement. I welcome, for instance, the support for small businesses, apprenticeships and the NHS, but the news that the Pacer trains will go from the northern franchise will be particularly welcome in my constituency. Will my right hon. Friend continue to prioritise infrastructure investment as a driver of economic growth?

Mr Osborne: Yes, I will. When it comes to these Pacer trains—[Interruption.] Labour Front-Benchers had all those years in which they could have got rid of the Pacer trains. They complain about them now, but what about all the endless Labour Transport Secretaries who did nothing about them? This is happening now, with a Conservative Chancellor, a Conservative Transport Secretary, and a Conservative Member of Parliament for Harrogate and Knaresborough.

Guy Opperman (Hexham) (Con): People in the north-east will welcome the news about the NHS, hospices—including those in my constituency—carers, who will set great store by the Chancellor’s announcement, and home buyers. I also welcome the Chancellor’s comments about northern airports and air passenger duty. May I urge him to revisit the north-east in the spring, when we will introduce him to a region that has the most technology start-ups outside London, and has experienced the fastest rate of growth in private sector businesses over the last quarter?

Mr Osborne: Of course I am always very happy to visit the north-east. I was there quite recently, and will be going again very shortly.

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There have been a number of great pieces of news for the north-east this week. There are the improvements to the A1 around Newcastle and Gateshead and up to Ellingham, and the commitment to look at dualling beyond that. There are the improvements that we are looking at for the A69 and the A66, which is something that my hon. Friend has raised with me personally. There is also the big investment in science in the north-east. I am particularly pleased to support investment in the brilliant work that Newcastle university does on ageing.

Mr Speaker: I will shortly call the Chancellor of the Exchequer to move a provisional collection of taxes motion. Copies of the motion are available in the Vote Office.

In accordance with our Standing Order No. 51 on ways and means motions,

“A Minister of the Crown may without notice make a motion for giving provisional statutory effect to any proposals in pursuance of section 5 of the Provisional Collection of Taxes Act 1968; and the question on such a motion shall be put forthwith.”

I call Mr Chancellor of the Exchequer to move the provisional collection of taxes motion formally.

Provisional Collection of Taxes

Motion made, and Question put forthwith (Standing Order 51(2),

That, pursuant to section 5 of the Provisional Collection of Taxes Act 1968, provisional statutory effect shall be given to the following motion:

Stamp duty land tax (residential property transactions)

That—

(1) Part 4 of the Finance Act 2003 (stamp duty land tax) is amended as follows.

(2) Section 55 (general rules on calculating the amount of stamp duty land tax chargeable) is amended as follows.

(3) In subsection (1) for “a percentage of the chargeable consideration for the transaction” substitute “determined in accordance with subsections (IB), (1C) and (2)”.

(4) After subsection (1A) insert—

“(IB) If the relevant land consists entirely of residential property and the transaction is not one of a number of linked transactions, the amount of tax chargeable is determined as follows—

Step 1

Apply the rates specified in the second column of Table A below to the parts of the relevant consideration specified in the first column of that Table.

Step 2

Add together the amounts calculated at Step 1 (if there are two or more such amounts).

(1C) If the relevant land consists entirely of residential property and the transaction is one of a number of linked transactions, the amount of tax chargeable in respect of the particular transaction under consideration is determined as follows—

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Step 1

Apply the rates specified in the second column of Table A in subsection (IB) to the parts of the relevant consideration specified in the first column of that Table.

Step 2

Add together the amounts calculated at Step 1 (if there are two or more such amounts).

Step 3

Multiply the amount given by Step 1 or Step 2, as the case may be, by—

where—

C is the chargeable consideration for the transaction, and

R is the relevant consideration.”

(5) In subsection (2) for the words from the beginning of that subsection to the end of Table A substitute—

“If the relevant land consists of or includes land that is not residential property, the amount of tax chargeable is the percentage of the chargeable consideration for the transaction determined in accordance with Table B below by reference to the amount of the relevant consideration.”

(6) In subsection (3) for “subsection (2)” substitute “subsections (IB) and (2)”.

(7) In subsection (4) at the beginning insert “For the purposes of subsections (1C) and (2),”.

(8) Omit subsection (7).

(9) Section 74 (exercise of collective rights by tenants of flats) is amended as follows.

(10) In subsection (1A)—

(a) in the opening words, for “rate” substitute “amount”,

(b) in Step 2—

(i) for “rate of tax and the” substitute “amount of', and

(ii) for “subsections (2) and (3)” substitute “subsection (IB)”,

(c) in Step 3—

(i) for “rate of tax and the” substitute “amount of”, and

(ii) for “subsections (2) and (3)” substitute “subsection (IB)”, and

(d) in Step 4 for “subsections (2) and (3) do” substitute “subsection (IB) does”.

(11) For subsections (2) and (3) substitute—

“(IB) Where step 2 or 3 of subsection (1A) requires the amount of tax chargeable to be determined in accordance with this subsection, it is determined as follows.

Step 1

Determine the amount of tax chargeable under section 55 as if the relevant consideration for the chargeable transaction were the fraction of the relevant consideration calculated under step 1 of subsection (1A).

Step 2

Multiply the amount determined at step 1 by the number of qualifying flats contained in the premises.”

(12) In section 75 (crofting community right to buy) for subsections (2) and (3) substitute—

“(1A) In that case, the amount of tax is determined as follows—

Step 1

Determine the amount of tax chargeable under section 55 as if the relevant consideration for the chargeable transaction were the fraction of the relevant consideration produced by dividing the total amount of that consideration by the number of crofts being bought.

Step 2

Multiply the amount determined at step 1 by the number of crofts being bought under that transaction.”

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(13) In section 77(l)(b) (notifiable transactions) for “which tax is chargeable at a rate of 1 % or higher” substitute “any part of which tax is chargeable at a rate of more than 0%”.

(14) In section 77A(2)(a) (notifiable transactions: exception of certain acquisitions of major interests in land: interpretation) for “1% or higher” substitute “more than 0%”.

(15) In section 80(2) (requirement to make return where contingency ceases, or consideration is ascertained, and tax or additional tax is payable etc)—

(a) in the opening words, after “before” insert “(calculated in either case according to the effective date of the transaction)”, and

(b) omit paragraph (c), but not the “and” at the end.

(16) In section 80(4) (cases where less tax payable) after “in respect of a transaction” insert “(calculated according to its effective date)”.

(17) In section 81ZA(l)(c) (alternative finance arrangements: additional tax where reliefs withdrawn to be calculated by reference to effective date) for “by reference to the rates in force at” substitute “according to”.

(18) In section 81A(1) (requirement to make return in consequence of later linked transactions where tax or additional tax is payable etc)—

(a) in the opening words, after “before” insert “(calculated in either case according to the effective date of the earlier transaction)”, and

(b) omit paragraph (c), but not the “and” at the end.

(19) In section 109(2)(b) (general power to vary Part 4 of the 2003 Act: power to alter descriptions of transaction chargeable at any existing rate or amount) after “amount” insert “, or in respect of which tax is calculated in accordance with any particular provision”.

(20) In section 122 omit the entry for “rate of tax”.

(21) In paragraph 3(l)(b) of Schedule 4A (certain high-value transactions not linked to other transactions for purposes of section 55(4)) for “55(4)” substitute “55(1B), (1C) and (4)”.

(22) Schedule 6B (transfers involving multiple dwellings) is amended as follows.

(23) For paragraph 4(1) substitute—

“(1) If relief under this Schedule is claimed for a relevant transaction, the amount of tax chargeable in respect of the transaction is the sum of—

(a) the tax related to the consideration attributable to dwellings (see paragraph 5(1) and (2)), and

(b) the tax related to the remaining consideration (if any) (see paragraph 5(7)).”

(24) Omit paragraph 4(4).

(25) For the italic heading before paragraph 5 substitute “The amount of tax chargeable”.

(26) For paragraph 5(1) and (2) substitute—

“(1) For the purposes of paragraph 4(l)(a), “the tax related to the consideration attributable to dwellings” is determined as follows—

Step 1

Determine the amount of tax that would be chargeable under section 55 on the assumption that—

(a) the relevant land consisted entirely of residential property, and

(b) the relevant consideration were the fraction produced by dividing total dwellings consideration by total dwellings.

Step 2

Multiply the amount determined at Step 1 by total dwellings.

Step 3

If the relevant transaction is one of a number of linked transactions, go to Step 4.

Otherwise, the amount found at Step 2 is the tax related to the consideration attributable to dwellings.

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Step 4

Multiply the amount found at Step 2 by—

where—

“CD” is the consideration attributable to dwellings for the relevant transaction, and “TDC” is total dwellings consideration.

(2) But if the amount found at Step 2 of sub-paragraph (1) is less than 1% of total dwellings consideration, for the purposes of paragraph 4(l)(a) “the tax related to the consideration attributable to dwellings” is an amount equal to 1% of the consideration attributable to dwellings.”

(27) For paragraph 5(7) substitute—

“(7) For the purposes of paragraph 4(l)(b), “the tax related to the remaining consideration” is the appropriate fraction of the amount of tax which (but for this Schedule) would be due in respect of the relevant transaction.

(8) In subsection (7) “the appropriate fraction” means—

where—

“RC” is the remaining consideration for the relevant transaction,

“TDC” is total dwellings consideration, and

“TRC” is total remaining consideration.

(9) For a transaction that is not one of a number of linked transactions, “total remaining consideration” is the remaining consideration for that transaction (see paragraph 4(3)).

(10) For one of a number of linked transactions, “total remaining consideration” is—

(a) the total of the chargeable consideration for all those transactions, less

(b) total dwellings consideration.”

(28) In paragraph 6(1) (change of circumstances after relief given) for paragraph (c) substitute—

“(c) had the event occurred immediately before the effective date of the transaction, more tax (calculated according to the effective date of the transaction) would have been payable, whether because the transaction would not have been a relevant transaction or otherwise.”

(29) In paragraph 6(3) (requirement to make return where more tax payable than was paid) omit paragraph (c), but not the “and” at the end.

(30) In paragraph 8(1) of Schedule 7 (acquisition relief)—

(a) for “rate” substitute “amount”, and

(b) for “0.5%” substitute “an amount equal to 0.5% of the chargeable consideration for the transaction”.

(31) In paragraph 4B(1) of Schedule 9 (shared ownership transactions) for “rate” substitute “amount”.

(32) In paragraph 12 of Schedule 9 (shared ownership trusts) for “rate” substitute “amount”.

(33) In paragraph 30(2) of Schedule 15 (partnerships) in paragraph (a) for “rate of tax chargeable under that section is 1% or higher” substitute “amount of tax chargeable under that section is not zero”.

(34) In paragraph 3(3) of Schedule 17A (leases that continue after a fixed term: additional tax to be calculated by reference to effective date)—

(a) in the opening words, after “before” insert “(calculated in either case according to the effective date of the transaction)”, and

(b) omit paragraph (c), but not the “and” at the end.

(35) In paragraph 4(3) of Schedule 17A (treatment of leases for indefinite term: additional tax to be calculated by reference to effective date)—

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(a) in the opening words, after “before” insert “(calculated in either case according to the effective date of the transaction)”, and

(b) omit paragraph (c), but not the “and” at the end.

(36) In paragraph 7(1) of Schedule 19 (old linked transactions relevant to rate of tax) for “rate” substitute “amount”.

(37) In paragraph 9(4) of Schedule 19 (exercise of option or right of pre-emption acquired before implementation date) for “rate” substitute “amount”.

(38) In consequence of amendments made by preceding provisions of this Resolution—

(a) in the Finance Act 2006, omit section 162(1),

(b) in the Finance Act 2010, omit section 7(1), and

(c) in the Finance Act 2012—

(d) omit section 213(1), and

(e) in Schedule 35, omit paragraphs 2(4) and (6) and 5(3).

(39) The amendments made by this Resolution have effect in relation to any land transaction of which the effective date is, or is after, 4 December 2014.

(40) But those amendments do not have effect in relation to a transaction if the purchaser so elects and either—

(a) the transaction is effected in pursuance of a contract entered into and substantially performed before 4 December 2014, or

(b) the transaction is effected in pursuance of a contract entered into before that date and is not excluded by paragraph (42).

(41) An election under paragraph (40)—

(a) must be included in the land transaction return made in respect of the transaction or in an amendment of that return, and

(b) must comply with any requirements specified by the Commissioners for Her Majesty's Revenue and Customs as to its form or the manner of its inclusion.

(42) A transaction effected in pursuance of a contract entered into before 4 December 2014 is excluded by this paragraph if—

(a) there is any variation of the contract, or assignment (or assignation) of rights under the contract, on or after 4 December 2014,

(b) the transaction is effected in consequence of the exercise on or after that date of any option, right of pre-emption or similar right, or

(c) on or after that date there is an assignment (or assignation), subsale or other transaction relating to the whole or part of the subject-matter of the contract as a result of which a person other than the purchaser under the contract becomes entitled to call for a conveyance.

(43) In paragraphs (40) to (42)—

“land transaction return”, in relation to a transaction, means the return under section 76 of the Finance Act 2003 in respect of that transaction;

“purchaser” has the same meaning as in Part 4 of that Act (see section 43(4) of that Act);

“substantially performed”, in relation to a contract, has the same meaning as in that Part (see section 44(5) of that Act).

And it is declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968.—(Mr George Osborne.)

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Business of the House

3.19 pm

The First Secretary of State and Leader of the House of Commons (Mr William Hague): With permission, Mr Speaker, following the announcement regarding the reform of residential rates of stamp duty land tax, made by my right hon. Friend the Chancellor of the Exchequer, I should like to make a short business statement regarding tomorrow’s business.

The business for tomorrow will now be:

Thursday 4 December—Motion to approve a financial resolution for the purposes of the Provisional Collection of Taxes Act 1968, followed by the business as previously announced: a debate on a motion relating to the Financial Conduct Authority redress scheme, and a general debate on availability and pricing of branded medicines on the NHS. The subjects for both debates were recommended by the Backbench Business Committee.

I will make my usual business statement tomorrow.

Ms Angela Eagle (Wallasey) (Lab): I thank the Leader of the House for finally deigning to inform us about the content of the unidentified Government business, which he was so coy about last Thursday. We have been waiting all week with bated breath, wondering what on earth it might be about. We dreamed that it might be about action to tackle low pay or under-employment, which is now rife in the country, hitting living standards and tax receipts. We thought that he might announce an intention to reverse the millionaires’ tax cut, or promise that the Government will not raise VAT. However, with the sudden legislation on stamp duty, are not the Government trying to hide the fact that the Chancellor’s promise to eliminate the deficit in five years is running four years late, borrowing is up by £12.5 billion compared with the March Budget, and he has had to borrow £219 billion more than he forecast he would in 2010? Is not he attempting to disguise the fact that the Government’s incompetence has wasted over £100 billion, which is £4,000 for every taxpayer in the country? The Chancellor may think he has a cunning plan, but every day he is looking less like the Machiavelli he models himself on, and more like Baldrick.

Mr Hague: I will take that as a welcome for the resolution tomorrow. I think that the hon. Lady made a better presentation of the Labour party’s case than the shadow Chancellor did a couple of hours ago. We look forward to her elevation to that position. She would be a dramatic improvement on the Opposition Front Bench.

It is apparent why I was coy about the business last week. It would have caused considerable mayhem had I announced the business for tomorrow last week, both to the Chancellor’s autumn statement and to the housing market. Therefore, I am sure that the House understands the reason why that business has been nominated today, just as I hope that it will understand the tremendous progress announced by the Chancellor in bringing down unemployment and addressing all the other issues that she mentioned.

Several hon. Members rose—

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Mr Speaker: Order. This is a very narrow statement. I know that, given the spirit and requirement of narrowness, hon. Members will comply.

Mr Peter Bone (Wellingborough) (Con): Can the Leader of the House say how long this debate will be —what is the maximum length of the debate—and whether the House will then divide on whether to support or oppose the reduction in stamp duty?

Mr Hague: It is certainly possible for the House to divide on such a measure. Hon. Members will have to decide where they stand on it, although the provisional resolution was approved by the House a few minutes ago. There is no time limit on the debate. It is not limited in any way. Indeed it is exempt even from the moment of interruption, but I hope that it will be possible to have the debate on the resolution and maintain a good length of debate for the Backbench Business Committee business, too.

Mr Marcus Jones (Nuneaton) (Con): I welcome the move that my right hon. Friend has made to table the business so quickly. In 2009, when the Labour party was in government, it brought in a stamp duty holiday but it took the party six or seven weeks to bring that in, which depressed the property market even further. Therefore, I am grateful to my right hon. Friend. Can he say when the measure will be enacted?

Mr Hague: As the Chancellor announced in his statement, the measure takes effect from midnight tonight —provided that the resolution was passed, which it was a few minutes ago. A second debate is necessary, as is customary, for the House to be able to look at the provisions in more detail and to debate them, since it has not yet had the opportunity to do so. However, the Chancellor is extremely mindful of any effect on the housing market or forestalling. That is why the measure takes effect at midnight and why we move on speedily to debate it tomorrow.

Bill Presented

United Kingdom Parliament (Sovereignty and Jurisdiction over Borders) Bill

Presentation and First Reading (Standing Order No. 57)

Sir William Cash, supported by Mr John Redwood, Mr Bernard Jenkin, Sir Edward Leigh, Sir Gerald Howarth, Steve Baker, Mr John Baron, Jacob Rees-Mogg, Mr Peter Bone, Chris Heaton-Harris, Mr Christopher Chope and Richard Drax, presented a Bill make provision for the supremacy of the sovereignty of the United Kingdom Parliament in relation to the United Kingdom’s membership of the European Union, including matters in respect of borders and immigration; and for connected purposes.

Bill read the First time; to be read a Second time on Friday 23 January 2015, and to be printed (Bill 130).

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Buses (Audio Announcements)

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

3.24 pm

Jim Shannon (Strangford) (DUP): I beg to move,

That leave be given to bring in a Bill to require the provision of audio announcements on public buses; and for connected purposes.

I am delighted to have the opportunity to raise this issue on behalf of Guide Dogs, which is vitally important to each of us in the United Kingdom of Great Britain and Northern Ireland. I hope that it will at least help to raise awareness of the issue and the need for “talking buses”. I also hope that this is something that we can start at Westminster today and follow through in Northern Ireland, Scotland and Wales. The evidence from across the United Kingdom is overwhelming in support of introducing audio announcements on all UK buses, rather than just those in London. That is why I wanted to raise the issue, which affects all of us. I hope to see this brought in to every part of the United Kingdom in the coming months and years.

The Public Service Vehicles Accessibility Regulations 2000 and the related Northern Ireland regulations stated that new buses had to include certain features to make them accessible to people in wheelchairs, such as low floors and ramps. We want the same legislation for all the UK, starting in England, and going to Scotland, Wales and elsewhere. Unfortunately, that legislation did not go far enough. It did not include requirements to make buses accessible to people with sight loss. That is what this motion is about.

Unlike rail, where audio-visual announcements are required on all new trains, only 19% of buses—the vast majority of them in London—provide next stop information for passengers. The Department for Transport reported that 97% of buses with audio announcements were in the capital, which leaves only 3% across the rest of the UK. That imbalance has to be addressed.

That means that the majority of blind passengers outside London have to rely on bus drivers to tell them when to get off. A visually impaired passenger in Glasgow claimed that the

“common response to the request to let me off at a particular stop is ‘if I remember’ and a common outcome is that they do forget”.

Of course we cannot blame the bus drivers or hold them to account because it is not really their job to do that and, like all of us, they do sometimes forget. Guide Dogs’ 2014 “Destination Unknown” report shows that, without audio announcements, seven in 10 blind and partially sighted passengers have been forgotten on the bus. For a sighted person, missing a bus stop can be an annoyance and an inconvenience, but for a person with sight loss, that can be extremely distressing and even dangerous. The experience can put people off using buses as a form of public transport; in fact 63% of blind and partially sighted people stay at home at least twice a month instead of relying on the bus. That has to be addressed.

There are 360,000 people registered as blind or partially sighted in the UK, and there are over 2 million people living with sight loss. That is roughly one in 30 people

3 Dec 2014 : Column 357

we meet. With an ageing population and the increasing incidence of diabetes—something which, as a sufferer of type 2 diabetes, I can understand—it is predicted that the blind or partially sighted population will reach 4 million by 2050. That is a vast number of people and we need to address those issues today.

Audio announcements are not just supported by those who are blind or visually impaired. For example, Paula, a bus passenger in my own constituency of Strangford noted:

“as a nurse working a long stint of night duty, I asked the bus driver to give me a shout when it was my stop. I fell asleep, he forgot and I had a huge hike home in horrible weather.”

She is not visually impaired but she believes, as many others do, that talking buses are a no-brainer for everyone. A simple easy technique, it is on trains, so why not buses?

According to the Chair of the Select Committee on Transport:

“there are 11.5 million disabled people in the UK, one fifth of whom report difficulty with transport.”

A Government survey showed that 37% of disabled respondents found transport accessibility a significant barrier to work. Guide Dogs’ data reinforce those findings, which show that the lack of audio announcements led to people with sight loss missing job interviews, turning down jobs, being late for work or even losing a job. Given the current economic climate, no one can afford to lose their job, or miss out on securing a job because of their difficulties with public transport.

The benefits of talking buses are not just confined to the blind or visually impaired. They can help to support older people, they can reinvigorate the bus industry by increasing the numbers of passengers, and they can bring environmental benefits with more people swapping the car for the bus. They can also attract tourists from both inside and outside the UK to use the buses. We cannot deny that audio announcements will help the tourist industry. There is a spin-off in that regard: many tourists use the metro buses in our capital, and when stops are announced, that helps them. The metro services which serve the cities are great, but I believe we must aim to get talking buses on to every route, rather than just metro lines. Of course this varies all over the United Kingdom, but Northern Ireland is a particularly rural community, as are some of the areas represented by the supporters of this Bill. People are extremely reliant on both rural and urban buses, but unfortunately at present the new talking buses on the metro lines will only serve those living in the urban centres, and relatively few of those outside it.

A YouGov survey showed that 85% of UK adults who already use buses fitted with audio announcements find them useful. Another finding from the survey was that 19% of 25 to 34-year-old motorists said they would be more likely to use the bus if it had an audio system installed. A 19% reduction in cars would see congestion levels well reduced and of course this would be a more environmentally friendly approach. That proves that the installation of an audio system would benefit all travellers, rather than just one specific group.

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Last September, the Select Committee on Transport gave its support to talking buses. However, the Government’s response to its report was not quite so positive. They claimed there were three reasons why they could not make audio announcements mandatory; first, that they planned to increase voluntary uptake of these systems among bus operators; secondly, and perhaps unsurprisingly, that there was a fear of a financial burden on the industry; and, finally, that there was the possibility that smartphones might be an alternative.

In terms of voluntary uptake, a previous Transport Minister wrote to bus operators encouraging them to take up audio-visual, or AV, on a voluntary basis. Despite some good examples, the uptake was very limited, as the earlier figure of 19% would suggest. This might have been a good idea, but unfortunately the reality is that bus operators are not rolling out these AV systems, and some bus drivers are not assisting their visually impaired passengers. In fact, 54% of blind and partially sighted people have missed their bus stop because drivers did not inform them when they had reached it.

In terms of costs, leading passenger transport specialists the TAS Partnership found that it costs just £2,100 to install AV on a single-decker bus or £2,550 on a double-decker bus. To put that into perspective, a new double-decker bus costs around £190,000, so to fit all new buses in the UK with AV would cost very little in each year, and the ongoing costs are fairly minimal so there is no ongoing charge after the initial hardware has been purchased.

We are all aware of the financial constraints Governments are facing now, but any economic costs are repaid by the benefits that audio announcements would bring. It has been revealed that for every £1 of public money spent on transport, there are £3 of benefits. This means that the installation of AV would actually return over £15 million each year extra, so this appears to be a financial solution with short-term costs bringing about long-term gains.

I have some issues with smartphones, which have been suggested as an alternative to AV, with “apps” that can be downloaded and used. There are clear limitations with these. First, not only the apps, but the phones themselves, can be extremely expensive and so are not always practical, and they are not particularly reliable due to varied network coverage and battery life issues. It has been noted:

“19% of families with at least one disabled member live in relative income poverty. For them, smartphones may be too expensive or difficult to use.”

In conclusion, I am pleased to see some progress being made at home in Northern Ireland and here on the mainland, but we must do more. Every single person should have the freedom and ability to move unaided throughout this great nation, and this is one way of ensuring that that happens.

It has been a privilege to be able to speak on such an important subject, and I must thank Guide Dogs for their help in providing useful information and statistics for me. This is something which really is of the utmost importance, not just for the blind and partially sighted, as I have mentioned, but for all of us throughout all of the United Kingdom of Great Britain and Northern Ireland.

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This Bill would benefit every single bus passenger in the UK and would ensure that the public service vehicles accessibility regulations are up to date, and include all those with disabilities, rather than just wheelchair-users, as at present. I commend it to the House.

Question put and agreed to.

Ordered,

That Jim Shannon, Henry Smith, Dame Anne Begg, Kate Green, Sir Bob Russell, Mr Jeffrey M. Donaldson, Mr Nigel Dodds, Ian Paisley, Ms Margaret Ritchie, Jim Fitzpatrick, Mr Mike Weir and Dr Eilidh Whiteford present the Bill.

Jim Shannon accordingly presented the Bill.

Bill read the First time, to be read a Second time on Friday 9 January 2015, and to be printed (Bill 131).

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Taxation of Pensions Bill (Programme) (No. 2)

Ordered,

That the Order of 29 October 2014 (Taxation of Pensions Bill (Programme)) be varied as follows:

(1) Paragraphs (4) and (5) of the Order shall be omitted.

(2) Proceedings on Consideration shall (so far as not previously concluded) be brought to a conclusion, at today’s sitting, two hours after the commencement of proceedings on the motion for this order.

(3) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion, at today’s sitting, three hours after the commencement of proceedings on the motion for this order.—(Mr. Gauke.)

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Taxation of Pensions Bill

Consideration of Bill, as amended in the Public Bill Committee.

New Clause 1

Impact on Government revenues

‘(1) The Chancellor of the Exchequer shall, within a period of no more than two years from 6 April 2015, publish and lay before the House of Commons a review of the impact of the changes made by this Act to the Finance Act 2004 and the Income Tax (Earnings and Pensions) Act 2003 on Government revenue, with particular reference to opportunities for tax and national insurance contributions avoidance.

(2) The information published under subsection (1) should include an assessment of the impact of this Act on—

(a) the use of salary sacrifice arrangements;

(b) income tax receipts; and

(c) national insurance contributions.’—(Cathy Jamieson.)

Brought up, and read the First time.

3.36 pm

Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op): I beg to move, That the clause be read a Second time.

Madam Deputy Speaker (Mrs Eleanor Laing): With this it will be convenient to discuss the following:

New clause 2—Pension flexibility: Treasury review—

‘(1) The Chancellor of the Exchequer shall, within a period of no more than 18 months from 6 April 2015, publish and lay before the House of Commons a comprehensive review of the impact of the changes made by this Act to the Finance Act 2004 and the Income Tax (Earnings and Pensions) Act 2003.

(2) The information published under subsection (1) must include—

(a) the distributional impact, by income decile of the population, of changes made by this Act to the Finance Act 2004 and Income Tax (Earnings and Pensions) Act 2003;

(b) the impact on Exchequer revenues of measures contained within Schedule 2: Death of a Pension Scheme Member, related to changes to the taxation of pensions at death;

(c) a behavioural analysis;

(d) an analysis of the cumulative impact of this Act on Exchequer revenues;

(e) an analysis of the impact of this Act on the purchase of annuities.”

Amendment (a) to new clause 2, line 13 at end insert—

“() an analysis of the impact of the changes introduced by this Act on the housing market;”

Cathy Jamieson: It is a pleasure to be here this afternoon for Report stage and Third Reading, and I do not think I can quite do justice to the excitement and delight that I felt when I saw that the final stages were indeed to be taken straight after the autumn statement. I am sure that is a view shared by the Minister, who will also be grateful for this miraculous feat of scheduling. Given the vast numbers who have turned out to hear us this afternoon, the excitement is obviously broadly shared across the House.

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This is a serious Bill, however, and we have serious matters to discuss this afternoon, so I will now turn to the content of new clauses 1 and 2. There is a certain symmetry to the scheduling of today’s proceedings, because the reforms in the Bill were first announced in the Budget statement and we are now discussing the Bill’s final stages alongside the autumn statement. We should be impressed—if that is the right word—by the speed with which the Government have rushed through these very significant pension reforms, although, given that we will now rush through something else even more quickly as a result of the autumn statement, perhaps I should have waited to hear that statement before writing that line in my script for this debate.

Toby Perkins (Chesterfield) (Lab): My hon. Friend has congratulated the Government on the speed with which they have brought in these measures. She will be aware that I have secured an Adjournment debate later today on the unintended consequences that have been visited on some of my constituents as a result of previous hastily introduced pension legislation. The Government have attempted to undo that legislation but, unfortunately, without any great success. Will my hon. Friend therefore temper her praise and reflect on the fact that hastily introduced pension legislation can often have unintended consequences?

Cathy Jamieson: I thank my hon. Friend for his intervention. If I had continued my speech for another couple of lines, he would have understood that my praise was somewhat tongue in cheek, given what I am about to say about the haste with which the measures have been introduced, about the impact that that has had, and about the concerns expressed by the industry. I know that my hon. Friend is taking up these issues on behalf of his constituents and putting them forward very seriously. We still do not know all the unintended consequences that will result from this Bill and the Pension Schemes Bill, which has now gone through the House, and that is one reason why I want to speak to the new clauses today.

At least one of the new clauses will seem familiar to those who had the pleasure, as I did, of serving on the Bill Committee. We have been consistent in our approach to the reforms. We have always said that we supported the principles of greater freedom and choice, but only when that leads to better outcomes for consumers. That is why we have consistently called on the Government to give us evidence that they have undertaken the appropriate assessment and analysis of the impact and potential consequences of the reforms. This also relates to what my hon. Friend has just said. For as long as we have pressed the Financial Secretary to the Treasury to provide that information, he has politely but firmly refused to do so. We on this side of the House are nothing if not persistent, however, and it would be remiss of us not to make one final attempt to bring the Government round to our way of thinking and to persuade them to accept our new clauses.

In a moment, I shall ask the Minister some questions on the figures that have been published today, but first I want to refer to some of the points that have been made about the speed with which the Bill has been taken through Parliament. Comments have been made in

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briefings and submitted in evidence as we have approached Third Reading. For example, the Association of British Insurers has stated that

“it is becoming increasingly clear that the first phase of the introduction of these reforms will be delivered in a period of regulatory uncertainty.”

The impact of that will be felt by the constituents of my hon. Friend the Member for Chesterfield (Toby Perkins). The ABI goes on to say:

“There is still a lack of clarity about what is expected of anyone offering retirement products from next April.”

I will come back to those points in a moment. The Bill has had thorough scrutiny, but a number of issues remain that we wish to pursue.

New clause 1 calls for a Treasury review within two years of the reforms coming into force on 6 April 2015, detailing the impact of the Bill on Government revenues, with particular reference to opportunities for tax avoidance and national insurance contributions avoidance. In Committee, we tried to get more details and figures, and the comments of John Greenwood and others were often quoted, particularly those relating to concerns that the Bill could allow individuals to divert large sums into their pensions through salary sacrifice. Those individuals would then be able to take as much as they wished from that pension in the following year, as 25% would be tax- free and the rest would be charged at their marginal rate, with no money deducted through national insurance contributions. Although the introduction of the money purchase annual allowance rules is supposed to prevent that, the reduced £10,000 limit is activated only after the pension has been flexibly accessed for the first time.

The Association of Accounting Technicians has raised concerns about this, saying: