Topical Questions

Oral Answers to Questions — Treasury – in the House of Commons at 12:00 am on 18th April 2017.

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Photo of Daniel Poulter Daniel Poulter Conservative, Central Suffolk and North Ipswich 12:00 am, 18th April 2017

If he will make a statement on his departmental responsibilities.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

My priority is to ensure that the economy remains stable and resilient as we conduct our negotiations with the European Union. That means building upon this Government’s achievements in reducing the deficit by two thirds and getting unemployment down to the lowest rate since the 1970s, while tackling the long-term challenges of productivity enhancement and making steady progress towards our goal of a balanced budget. I am pleased to be able to tell the House that in the past few minutes the International Monetary Fund has upgraded its UK growth forecast for 2017 by 0.5%, to 2%.

Photo of Daniel Poulter Daniel Poulter Conservative, Central Suffolk and North Ipswich

Farms and other agricultural businesses are often deterred from making investments in new buildings and infrastructure because of a complex system of capital allowances, including agricultural buildings relief. Will my right hon. Friend examine this issue, particularly in respect of giving the agricultural sector a boost in the wake of Brexit?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

Agricultural land and buildings are, of course, exempt from business rates, although I know my hon. Friend was talking in particular about some of the capital allowances. We are committed to a capital gains tax system that supports investment and growth right across the economy, which is why at Budget 2016 we reduced CGT rates from 28% to 20%, and from 18% to 10% for gains on most assets. Owners of agricultural businesses benefit from the same CGT rates and reliefs as other business owners.

Photo of John Martin McDonnell John Martin McDonnell Shadow Chancellor of the Exchequer

As you know, Mr Speaker, this morning the Prime Minister called a general election. She is breaking her commitment not to hold an early election, which was made only weeks ago. She has blamed Brexit, she has blamed our European neighbours and she has blamed the Opposition parties, but the real truth is that after seven wasted years of failure the Tories have failed to close the deficit; they have added £700 billion to the national debt; pay has fallen behind prices; 4 million children are growing up in poverty; our schools are in crisis; more people than ever are on NHS waiting lists; more families are homeless; and more elderly people are not getting the care they need. Will the Chancellor use this last opportunity before the election to apologise to the British people for the utter failure of this Government’s economic policies and for the pain he has inflicted on this country?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

The right hon. Gentleman has some brass neck to stand there and accuse us of having failed to eliminate the deficit, given that his policy is to add another £500 billion to it overnight. The British people understand very well what is going on here: we have a Conservative Government who are maintaining growth, and who have got unemployment down and record levels of employment, and a steadily closing deficit; and we have a Labour party which remains as fiscally incontinent as ever and which, if given a chance, would wreck this economy once again.

Photo of John Martin McDonnell John Martin McDonnell Shadow Chancellor of the Exchequer

There we have it: not one word of apology—no contrition whatsoever—from a Chancellor who has broken his promises to the British people and is still failing to deliver on a manifesto on which he was elected only 23 months ago. The Government are entering this election having scheduled £70 billion-worth of tax giveaways—for whom? It is for the super-rich and for the corporations, and is over the next five years. The Government are entering an election with a £2 billion unfunded black hole in the Budget the Chancellor delivered only a few weeks ago. So will he now use this opportunity before the general election to put on the record that his party will rule out raising VAT and rule out raising income tax? Will he commit unequivocally to support legislation to protect the triple lock? If the Tories can’t be straight with the British people, Labour will be.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

The truth is that promises made from the Opposition side of the House are not worth the paper they are written on. The voters, pensioners and workers of this country understand that very well, and they will give their verdict on Labour’s promises on 8 June.

Photo of Andrew Tyrie Andrew Tyrie Chair, Treasury Committee, Chair, Liaison Committee (Commons), Chair, National Policy Statements Sub-Committee

Assuming the House votes for an election, will the Chancellor confirm that he will seek to truncate the Finance Bill, remove its controversial measures, such as making tax digital, and thereby enable everybody to focus on the economic issue that will matter most to the whole country over the next few months: which party can best be trusted to run the economy?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I certainly agree with my right hon. Friend on that last point. On the matter of process, assuming that the House votes in favour of my right hon. Friend the Prime Minister’s motion tomorrow, there will then be the usual end-of-Parliament process of negotiation with the official Opposition on measures that are currently before the House, with a view to passing them in whatever form is appropriate before prorogation.

Several hon. Members:

rose—

Photo of Ian Blackford Ian Blackford Shadow SNP Spokesperson (Pensions)

As we are congratulating football teams, I am sure the House will want to join me in congratulating Hibernian football club, which has returned to the top league in Scotland.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I can confidently predict for the hon. Gentleman that, after the general election on 8 June, there will be a Budget that will give him the answers he is seeking.

Photo of David Gauke David Gauke The Chief Secretary to the Treasury

Improved rail resilience in the south-west is a priority, which is why we committed £5 million in Budget 2016 and £10 million in autumn statement 2016 to support that work. The Government will continue to work with Network Rail to develop options for future investment in the south-west in Network Rail’s control period 6.

Photo of Gareth Snell Gareth Snell Labour, Stoke-on-Trent Central

Co-operatives and worker-owned businesses tend to be more resilient and are more productive. Does the Chancellor agree that regulation and law should not disadvantage their development? Will he consider redirecting tax incentives away from company executives and towards employees looking to buy their own workplace?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

We are very keen on employees having an opportunity to take a stake in the businesses for which they work. We will look carefully at any proposals that would tend to enhance productivity by incentivising and encouraging employees.

Photo of Henry Bellingham Henry Bellingham Conservative, North West Norfolk

Given the large proposed increase in probate fees, and bearing in mind that deceased people’s bank accounts are frozen, will the Chancellor or the Chief Secretary look at allowing the fees to be paid after probate has been granted and the estate has been wound up?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

In most cases, the Ministry of Justice expects that banks will be able to release enough cash from the estate to pay the probate fee, and we know from HMRC that the average estate is 25% cash. The MOJ is working with the British Bankers Association and others to put arrangements in place.

Photo of Kate Hollern Kate Hollern Shadow Minister (Communities and Local Government)

We have heard today an awful lot about a stronger economy and the need to improve productivity. What discussions has the Chancellor had with his Cabinet colleagues about skills and education funding? There is concern that children in Blackburn are about to lose £284 per head under what the Government call a fairer funding formula.

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

The hon. Lady will know that my right hon. Friend the Secretary of State for Education is considering responses to the consultation on the school funding formula. At the Budget, we announced a substantial increase in funding for 16-to-19 technical education, which will make an important contribution to improving the UK’s productivity.

Photo of Andrew Turner Andrew Turner Conservative, Isle of Wight

Although the south-east is the financial powerhouse of the UK, it does none the less have some less prosperous areas such as the Isle of Wight. What steps is my right hon. Friend taking to ensure that the benefits of economic growth reach all corners and all islands of the United Kingdom?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I know that my hon. Friend regards the islands as particularly important, and I concur with him on that. The Government support continuing economic growth across the south-east, including all regions and islands. The Solent local enterprise partnership receives more than £180 million from the local growth fund, including funding for investment in local skills and business start-ups, with the Isle of Wight receiving about £15 million of investment in local infrastructure and skills.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Health), Shadow DUP Spokesperson (Transport), Shadow DUP Spokesperson (Equality)

Will the Chancellor give us an assurance that he will not surrender to the outrageous demands of Tusk, Juncker and Barnier that the UK must pay €60 billion before it leaves the EU?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

As I have already said, this should be seen for what it is: an opening gambit in a long and complex negotiation.

Photo of Peter Aldous Peter Aldous Conservative, Waveney

Britain’s coastal communities have enormous potential for sustainable economic growth in the trade, energy, fishing and tourism sectors. Much good work is being done, but I would be grateful if my right hon. Friend gave us an assurance that no stone will be left unturned to ensure that coastal Britain realises its full potential.

Photo of Simon Kirby Simon Kirby The Economic Secretary to the Treasury

As someone who also represents a coastal community, I am pleased to say that coastal areas will benefit from nearly £40 million of investment through the latest round of the coastal communities fund, and that we will do all we can to get the very best possible deal.

Photo of Stewart McDonald Stewart McDonald Scottish National Party, Glasgow South

Will the Chancellor tell us which will be the first to go in the upcoming Tory manifesto: the pledge on international aid spending, the triple lock, or the promise not to raise any new taxes?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

I am afraid that the hon. Gentleman will just have to contain himself and ready his money, because he will be able to buy a copy in due course.

Photo of Matt Warman Matt Warman Conservative, Boston and Skegness

The taxpayer has benefited from the return to private ownership of Lloyds and UK Asset Resolution, but can my right hon. Friend provide an update on the sale of the Royal Bank of Scotland?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

We are making real progress in realising our holdings in the banking sector. We continue the programmed sale of our shareholding in Lloyds, which is now down from 43% to less than 2%. Just last month, we sold £12 billion of Bradford and Bingley mortgages in a highly competitive process. The Government are not at present actively marketing their stake in RBS. Our policy remains to return the bank to private hands as soon as we can achieve fair value for the shares, recognising that fair value could well be below what the previous Government paid for them. We must live in the real world and make decisions on the future of our holding in RBS in the best interest of taxpayers.

Photo of Dennis Skinner Dennis Skinner Labour, Bolsover

In the real world, seven years ago, a Tory Chancellor stood at the Dispatch Box and said that we had to cut the money to every single local authority in Britain by up to 40% because we needed to get rid of the deficit. Now, seven years later, that deficit is still more than £60 billion. Will the Chancellor apologise to the people of Britain for that lousy mistake?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

That deficit is still £60 billion, but it was £200 billion when we started working on it.

Photo of Martin Vickers Martin Vickers Conservative, Cleethorpes

Following the football theme of this afternoon, I am sure that everyone would wish to know that Cleethorpes Town has finished as champion of the Northern Counties East League, which means that even more people will want to travel to Cleethorpes. Infrastructure development was mentioned earlier. Will the right hon. Gentleman give an assurance that all roads will lead to Cleethorpes?

Photo of David Gauke David Gauke The Chief Secretary to the Treasury

I will take that as a representation for all those many fans wanting to go to Cleethorpes to watch football.

Photo of Chris Stephens Chris Stephens Scottish National Party, Glasgow South West

Can the Chancellor confirm that HMRC takes eight months to fill a vacancy in the national minimum wage compliance unit? If that is so, what will he do properly to resource that service so that workers can get a decent day’s pay for a decent day’s work?

Photo of Jane Ellison Jane Ellison The Financial Secretary to the Treasury

I will look into the specific issue that the hon. Gentleman raises, but I want to make it very clear that HMRC investigates absolutely every report of national minimum wage violations. We take the matter very seriously, and we do enforce it.

Photo of David Morris David Morris Conservative, Morecambe and Lunesdale

In my constituency I held a public consultation on creating an enterprise zone or a business park. The Labour county council has blocked it considerably and constantly. Would my right hon. Friend the Chancellor like to come to my constituency and listen to what my constituents are saying about having an enterprise zone?

Photo of Philip Hammond Philip Hammond The Chancellor of the Exchequer

As it happens, I was just planning my domestic travel arrangements for the next five weeks, and I will keep my hon. Friend’s request in mind when I do that.