Live Treasury Questions House of Commons

First, we have questions to the Chancellor of the Exchequer, Mick

Hammond, and his team. Questions to Mr Chancellor of the

Exchequer. Question number one, Mr Speaker. We have regular discussions

with Cabinet colleagues as to how the Government can contribute to

greater productivity across Scotland and the UK. The Government is

currently discussing city deals for Edinburgh and Stirling and is

looking forward to receiving proposals for the Tay cities. With

the honourable gentleman agree with me that the Ayrshire growth deal

will generate investment and create the economic conditions to achieve a

step change throughout Ayrshire, an area of huge potential? Will he

commit today to actively and constructively, working with the

four Ayrshire MPs, the local authorities and the Scottish

Government, support this deal to the benefit of the whole county of

Ayrshire? Well, up to this point, growth deals have been city growth

deals and by definition focused on cities. And we haven't made a lot of

progress, as I said earlier, in terms of all the Scottish cities. Of

course, it is open to the Scottish Government to take forward projects

to enable growth in the County of Ayrshire if it wishes to do so. The

Financial Secretary to the Treasury. With your permission, Mr Speaker,

could I group this question with question 12? The Government Beckett

knows is absolutely the key role that small businesses play in the

economy. That's why for example in the Autumn Statement, we have

allocated ?400 million for the British business bank to help firms

access finance. And there are other steps we have taken, including for

example introducing the enterprise investment scheme. I think the

minister for that response. Does she agree with me that independent

retail stores such as ones in my constituency add greatly to the

character and vitality of our towns in high streets and the Government

should do what they can to support them? As a former co-chair of the

all-party retail group, I could not agree with him more. Independent

retailers and retail generally is a vital sector, and he is right that

we want to support them on our high streets. From April, 600,000 of the

smallest businesses will not have to pay business rates again. That is

occupying more than a third of all properties. This is part of the

business rates package which will kick in over the next few years. I

hope you would agree that that is a really helpful bit of support for

some key local businesses. I recently attended my local Chamber

of Commerce breakfast meeting in Seaford and met with many small

businesses who are pleased the economy is doing so well and being

so expertly led by this government. However, they do have some concerns

around the introduction of quarterly tax returns and the impact that this

will have on costs on small businesses. They have suggested

maybe a threshold be introduced for the smallest businesses - would the

minister consider this? I thank my honourable friend for that question.

I also have a good relationship with my local Chamber of Commerce. Of

course we are not introducing quarterly tax refunds, but she is

referring to the tax digital project. And we do understand that

whilst the select committee recently said that the long-term future can

and probably should be digital, we do understand that we need to look

carefully at the consultation responses we've had, and at the

concerns from small businesses. We have already exempted a number of

small businesses from the threshold, but we are looking carefully at the

consultation responses and at the select committee's report. We do not

recognise the Federation of Small Businesses' figure on the costs, and

we have not seen the assumptions which underpin it. That would be

very helpful if I am to address those concerns. Small businesses in

Doncaster are facing a very worrying skills shortage. So, will the

minister support those businesses by impressing on her colleagues in the

DfEE the need for a speedy decision on Doncaster's university technical

college and give the go-ahead for the money? Will she have a word,

please? I am of course very happy to raise the issue with the right

honourable lady mentions with colleagues. More broadly, the

Government absolutely is supportive of the skills agenda, and we have

made this a real priority. If we are going to close the productivity gap

in this country, then clearly investing in skills and high quality

apprenticeships is key to it and we are taking a lot of action in that

regard. One useful thing which the Treasury could enforce more

manufacturers in my constituency is to announce an objective to stay in

the customs union. Up to now, the Treasury has been a beacon in saying

that they want decisions based on analysis, not rhetoric and ideology.

Can she assure the House that that is still under consideration? Well,

again, these are issues we are looking at very, very carefully. The

Chancellor has had a series of round table meetings with different

sectors of industry in recent months, as have all of us as

ministers. We are looking very carefully at some of those detailed

issues. Much more will be said on this in the House I'm sure data

today. For we are quite clear that we want to understand issues faced

by businesses, so that we can move forward to make our future outside

the European Union and resolve some of those practical issues that

businesses face in a way way which helps the British economy. Access to

capital is vital for small businesses. A refusal from a big and

should not be the end of the line. Will the minister continue to

support the bank referral scheme as an alternative source of finance for

businesses? Absolutely we will. The Government's finance referral policy

helps SMEs whose finance applications have been declined by

their bank and helps them to explore alternative options. It requires the

major banks to refer them if they are rejected for finance. And there

are a range of other things that we can do to support the very good

point which my honourable friend makes. I would encourage all

members, if they have SMEs in their area, who have had finance

applications rejected, to refer them to some of these schemes, because

they are making a difference. Many of the small businesses in my area

operate in the tourism sector. Given the Chancellor's reported comments

at the weekend, will the Government now look again at the opportunities

which could be presented by the tourism industry's proposals for a

lower rate of VAT on that sector? Well, Mr Speaker, the House will be

unsurprised to learn that the Treasury is having a number of

suggestions about what might happen to VAT in some future new

arrangements, when we are not members of the EU any longer. And

I'm aware of the representations made by the tourism industry. Indeed

I meeting with the Northern Ireland select committee tomorrow, and I

know this is likely to be one of the issues on their mind. But we are

still of the EU, and all of our legal obligations etc remain whilst

we are. Thank you, Mr Speaker. As announced at the Autumn Statement,

the Government is significantly increasing investment in R, rising

to an extra ?2 billion a year by 2021. This is the largest increase

over a Parliament since 1979. It includes an industrial strategy

challenge fund to support collaborations between businesses

and science, to ensure the UK remains an attractive place for

business to invest in innovative research, and that the next

generation of discoveries are made, developed and produced in the United

Kingdom. I thank the minister for his response. One of the largest

employers in my constituency, Scientifica, is a winner of several

awards. I will be in could be proud to join Scientifica when they open

on the London Stock Exchange in March. Will he congratulate

Scientifica along with me and will he pledge to support such

businesses, which export the best of British scientific innovation and

enterprise to the rest of the world? I'm delighted to join my honourable

friend in congratulate Scientifica and I'm very happy to make that

pledge. We committed to 107 to ?5 million investment to drive UK

exports in this area. And we remain committed to making sure UK

exporters receive world-class support. -- 107 to ?5 million. On

Friday, I visited and innovative telephone technology company in

Newcastle in the emerging payments sector. They are concerned that

leaving the European single market, particularly the passport in rights,

will diminish investment in their area. What reassurance will he give

them? As the honourable member will be aware, the Prime Minister has

just begun making a speech on this matter. And my right honourable

friend, the Secretary of State for the department for exiting the

European Union, will be making a statement to the House later. The UK

is in a very strong position in terms of Finn 1ft it is a priority

that we ensure that this is a successful sector.

We led a delegation to India, with a focus on this sector, among other

things, with the aim of promoting British businesses. We will continue

ensure that the UK remains a strong base for that Fin Tech sector. Will

he join with me in welcoming the fact that Cheltenham's GCHQ cyber

accelerator is now up and running? Does he agree with me that this key

project will bring jobs and opportunities for Gloucestershire?

I welcome what my honourable friend has just said in terms of the

opportunities. He highlights what is an important sector that has

significant potential for the UK and indeed Gloucestershire. Thank you

very much, Mr Speaker. Minister, what discussions have gone on with

the Department of energy and industrial strategy in Northern

Ireland to ensure that catapulted projects, just as much as the rest

of the UK, will happen in Northern Ireland, to help our science and

business development? I think what I can say to the honourable member is

that we are determined to ensure that all of the UK is a good place

for these businesses to develop, to encourage the development of

technology and businesses that are based on that. The future of the

United Kingdom has to be as a highly skilled, technologically advanced,

outward looking country and we will engage with all the devolved

administrations to further that aim. Jonathan Reynolds. On this side of

the house, we believe encouraging investment is essential to making

our economy more productive and we recognise this will be especially

important post Brexit. But does the Treasury have a genuine indicator of

how levels of foreign direct investment have been impacted after

the referendum result, given it was recently reeled that the Department

of International trade's figures incorrectly include decisions taken

before the vote for Brexit? I think we are at an early stage in terms of

the impact on foreign direct investment. In terms of the levels

of business investment since the referendum, the numbers have

actually held up pretty strongly, although as I said, it is early days

and early data. But I have to say to the honourable gentleman, he says he

welcomes business investment in this country. I think he should be

listening to some of the things that his party leadership are saying,

which will do nothing but drive business out of the United Kingdom.

Chris Davies. Thank you Mr Speaker, question four. Chancellor of the

Exchequer. Mr Speaker, the only way to reduce debt sustainable use to

return a public finances about and our new fiscal rules commit us to

doing that as soon as possible in the next Parliament. We have already

reduced borrowing as a share of GDP by almost two thirds from the

post-war peak that we inherited in 2010. We are forecast to borrow less

than 1% of GDP by the end of this Parliament. I think the Chancellor

for his answer. The government 's debt interest currently sit at

around 5% of overall government spending, which is nearly 20% of our

overall health budget. Would my right honourable friend consider

paying down our debt more swiftly in order to relieve the strain debt

interest is putting on the public finances? Well Mr Speaker, we are

committed to reducing debt, while at the same time we prioritise

investment in high-value infrastructure which will enhance

our productivity. But of course, the only way we can pay down debt is to

generate a current surplus. That means more tax or less spending. And

I think the trajectory that I set out in the Autumn Statement is the

right trajectory for this country in the circumstances it finds itself in

at the moment and I say to my honourable friend that I intend to

stick to it, and ensure we get the public finances back into balance as

early as possible in the next Parliament. Alison McGovern. Thank

you Mr Speaker, the total of our UK Government debt owned by foreign

investors now some is more than half ?1 trillion for the first time ever.

As the value of sterling tumbles, what assessment as the Chancellor

made of the risk of the cost of servicing our debt rising

unsustainably? Mr Speaker, the way it works is that the pricing of new

government debt is determined by the auctions around new issuance.

Clearly, new issue and is is bought at current extreme traits as far as

foreign purchases of debt are concerned. -- current exchange

rates. The honourable lady raises a good point and it is important that

currency volatility rather than the actual level of the currency does

introduce an additional dimension for foreign purchasers of UK

Government debt. I have said many times that the process that we are

now embarked on, of negotiating the exit from the European Union,

creates some uncertainty. We have seen some of that uncertainty

manifesting itself in the currency markets. The sooner we can get

through that period of uncertainty, to have clarity about our future

relationship with the European Union, the better that will be for

markets, for business and for people in this country. The purpose of the

speech the Prime Minister is making right now is to start to give some

clarity. Question five, sir. Mr Speaker, we have committed to return

the public finances to balance as soon as possible in the next

Parliament and to reduce the structural deficit to below 2% of

GDP by the end of this Parliament. As I have said already, I think it

strikes the right balance between restoring the public finances to

health and giving ourselves enough flexibility to allow us to support

the economy in the short term if necessary, as we go through this

period of greater uncertainty. We have also been able to commit an

additional ?23 billion to a national productivity investment fund, to

improve our economic productivity. Does my right honourable friend

agree with me that the resilience of our economy would be best served by

what the Prime Minister has said today, that Britain will be leaving

the single market with no ifs and no buts? Well, Mr Speaker, for six

months, we have kept open as many options as possible while we review

the way forward in this negotiation with the European Union. We have

heard very clearly the views and the political red lines expressed by

other European leaders. We want to work with them and we want to

recognise and respect their political red lines. That is why the

Prime Minister is setting out right now the position that she is...

Which is that we will go forward, understanding that we cannot be

members of the single market because of the political red lines around

the four freedoms that are the European leaders have said. -- other

European leaders have said. But expressing an ambitious agenda for a

comprehensive free trader dream -- free-trade agreement with the

European Union which will allow our companies to trade in Europe and

European company to trade in Britain, minimising disruption to

existing business patterns and minimising disruption to

pan-European supply chains. Thank you, Mr Speaker. EU banks use

passport arrangements in order to operate in the UK, providing jobs

and revenue to the Exchequer. Given what the Prime Minister is saying at

this moment, those arrangements are clearly at risk. How hopeful is he

that passporting will survive exiting the European Union? Well, as

the right honourable gentleman says, EU banks use passporting to operate

in the UK and vice versa. UK banks use passporting to operate in the

European Union. I think what is important is that banks, both in the

European Union are able to continue operating in the UK, and banks in

the UK are able to continue operating in the European Union. He

will know that City UK, the Leeds city pressure group on this issue,

have taken the strategic decision last week -- lead city pressure

group on this issue, took the strategic decision last week to stop

focusing on passporting and what I would instead describe as an

enhanced equivalence regime. The important thing is not the mechanism

at the end result. That is what the Prime Minister will be setting out.

The Treasury committee has challenged whether the OBR's

sustainability reports, and the latest was published just an hour

ago, are worth the effort, given they amount to 50 year forecasting.

Their latest effort does not even try to take account of Brexit at

all. The OBR are required to do this work by statute. Doesn't the

Chancellor think it might be a good idea to revisit that commitment?

Well, Mr Speaker, my honourable friend has a point in one sense in

that economic forecasters themselves admit that even on a five-year

forecast, there will be a high degree of uncertainty. --

uncertainty about the accuracy of the forecast. So one of 50 year

forecast, there will be a very high degree of uncertainty. -- on a 50

year forecast. But we will see how the debate goes around this fiscal

sustainability report that is published today. I suspect it will

provide a very... For discussing some of the really very important

strategic issues that we face as a nation, not in the sort of white

heat of immediate political debate, but able to think much longer term

over a 50 year period about where we go in the balance between public

spending and taxation and how we support our vital public services.

Thank you, Mr Speaker, given the Chancellor's comments on the single

market, the financial services industry employs 40,000 people in

Edinburgh alone. What impact does the Chancellor think the changes

around the single market, leaving the single market will have on jobs

in Scotland? Mr Speaker, my assessment is that by setting out,

as the Prime Minister is doing right now, our agenda, and setting out

clear objectives, we are meeting the first ask of our European partners,

which is to be clear about what we want. We are recognising the

political red lines that they have set out. We are saying that we will

respect them. And I think that is the first step to being able to have

a sensible engagement with our European Union partners, to come to

an outcome which is positive for the UK and positive for the European

Union. That of course must include the freedom for financial services

firms to continue doing their business. I was going to call the

honourable gentleman... Well done, get in there, man, Jim Cunningham.

What provisions at the Chancellor of the Exchequer made after 2020 in

relation to the universities in this country? Will he match pound for

pound the lack of EU money? What we have said is that where EU funding

is awarded projects involving universities, businesses, external

research Institute, farmers, between now the point of our departure from

the European Union, provided those awards meet with our value for money

criteria and have the support of the UK or devolved administration

responsible department, that the Treasury will underwrite those

awards. We expect that in any settlement with the European Union,

the commission will go on paying those awards after we have left the

European Union. But in case they don't, we will stand behind them.

Many small businesses in Kettering are supplied by other British firms

and they sell their goods and services to British consumers. Yet

all are affected by often unnecessary EU regulation. Will the

Chancellor joint effort supposed Brexit to reduce this burden as

quickly as possible? -- join efforts post Brexit? The remedy to the

problem that the honourable gentleman sets out will of course

lie in the hands of this Parliament once we repatriate it in the great

repeal Bill. In the seven years to 2014, Scotland's trade with the EU

rose by 20%. Twice the rate of growth in trade to the rest of the

UK. And vital for a resilient economy. Today's hard Tory Brexit

puts that at risk. But is this not also a kick in the teeth to many of

those who voted Leave, believing there would be an EEA, Efta

arrangement put in place to mitigate the damage done? I reject the

gentleman's analysis. I think this is engaging constructively with the

real world, recognising the political red lines of our European

Union partners because if we don't recognise them, frankly we Anyon our

heads against a brick wall. They have to recognise our political red

lines and we have to recognise that and then we have to work together to

find a pragmatic solution that works fall of the people of the UK within

those red lines and that is what we doing. -- for all of the people. ...

So long as trade with the rest of the world on the same time frame

grew by 50%, driven by EU trade agreements. Given it takes an

average of 28 months to conclude a single agreement, how many pragmatic

decades is the Chancellor -- does the Chancellor believe it will take

to put in place the trade agreements we need to mitigate the damage of

the hard Tory Brexit? You know, Mr Speaker, I'm disappointed to hear

the honourable gentleman resorting to the sound bite. He's normally

better than that. Let me say this, the discussions I have had with

third countries that currently have free trade agreement with the

European Union suggest that there is a strong appetite for a quick and

simple agreement with the UK so that as it leaves the European Union, we

are able to immediately enter into a successor agreement with those

countries like South Korea, for example, so we can continue trading

with them on the same terms. Mr Speaker, at the weekend, the

Chancellor told the German newspaper, notice not this house, Mr

Speaker, that he prepared to turn this country into a tax haven. If

that means competing with the likes of Ireland on the 12.5% corporation

tax rate, on top of existing Tory tax cuts, it means according to the

House of Commons library, giving away over ?100 billion to

corporations over the next five years. That is the equivalent to

almost 5p on the basic of income tax. How does the Chancellor ever

propose to solve the funding crisis in the NHS and social care then,

given that this morning, the OBR thinks the public finances are on an

unsustainable path? Well, let's just take that question apart, if I may,

Mr Speaker, two points. The OBR 50 year forecast this morning sets out

a possible outcome, if the government takes no action. As I

made very clear in the Autumn Statement, we are acutely aware that

action will be required in order to return the public finances the

balance. In terms of the interview that he referred to at the weekend,

what I said very clearly, and I'm sorry if it didn't come across in

the UK reporting, but he should read the original, what I said very

clearly is that Britain wants to remain in the European mainstream

with its economic and social model, but that can only happen if we get a

sensible Brexit deal for continued access to the European market. If we

don't, the people of this country are not going to simply lie down and

accept that they will be poorer. We will do whatever it takes to

maintain our competitiveness and to protect our standard of living.

The threat is there, on the record, that this will be a tax haven,

according to what he has said today. The Prime Minister is now saying

that she is intent on drawing up the drawbridge, leaving the single

market, and possibly, possibly, the customs union. We will be cutting

ourselves off from one of the largest markets on the entire

planet, threatening jobs and finances. This is not a clean

Brexit, it is an extremely Messi Brexit, with the consequences we

have already seen in terms of the rise in the rate of inflation. And

with real living standards squeezed by this policy announcement so far,

isn't it time, and I appeal to the Chancellor, he has the opportunity

then to reconsider his cuts to in work benefits, and in the widget in

March, withdraw them in full? No, Mr Speaker, what the Prime Minister is

setting up to day use an ambitious agenda for a Britain engaged with

the world and a Britain engaged with the European Union. What she is

setting out is a broad-based offer for future collaboration in trade,

in investment, in technical and scientific collaboration and many

other areas. We want to remain engaged with the European Union, and

I am confident that the approach the Prime Minister is setting up today

will allow us successfully to negotiate a future relationship with

the European Union. We need to speed up. Short replies, please at the

Autumn Statement, the Government backed recommendations... This

includes development funding for the expressway road scheme, and ?100

million for the express line. The Government supports the delivery

models. Thank you, Mr Speaker. How does my right honourable friend

envisage this benefiting the economy in Northamptonshire? It is worth

pointing out, in the terms of reference for the national

commission's report, the Government noted that the area contained four

of the UK's fastest-growing and most productive places, including Oxford,

Milton Keynes and Northampton. Transport investment is key to

maximising the growth potential in this area. We will invest in the

east-west rail and expressway, which will connect the region better with

itself and with the rest of the country. The commission will issue

their final report later this year, including work on delivery options

for housing and transport. We will carefully consider those

recommendations. Mr Speaker, the government absolutely recognises the

significant contribution to the UK economy which is made by the

chemicals industry. And of course, the complex supply chains which

exist between the UK and the EU. We heard the Chancellor's words just

now about the importance we attach to getting the best portable market

access, and the Prime Minister is obviously talking about that this

morning. We are looking at a comprehensive range of analyses, to

inform our position as we go into those negotiations. Clarity and

certainty are one of the industry's big asks. The chemical industries

Association Brexit manifesto shows how the UK as a location for future

investment can be enhanced, whilst playing a leading part in addressing

global and invite a mental challenges. Has the minister read

the manifesto, and what is she doing to reassure the chemical industry

that it's very specific needs are at the forefront of her mind as the

Government develops its strategy? Rather than just need the manifesto,

ministers have been meeting with the chemical industry. The department

for exiting the EU met with the association on the 17th of November.

I know that all of these issues were explored in some detail. While

welcoming her typical constructive approach, does she recall the

directive which destroyed much of the pharmaceutical industry in this

country overnight, including Pfizer's in east Kent? As I recall,

the original directive did have some negative effects, but I know that it

was improved on in subsequent negotiations in terms of making

improvements to make sure it did not have the same effect. Voters partly

backed Leave on the basis of a ?350 million economic boost that our NHS

is still waiting for. Where, therefore, is the democratic mandate

for this Conservative version of hard Brexit, leaving the customs

union and the single market which the Chancellor himself has admitted

damages the economy and puts jobs in my Tooting constituency at risk?

This was with particular reference to unemployment in the chemical

industry! I'm sure she meant to add that into her question! Mr Speaker,

as colleagues across the House recognise getting the best deal

Britain means getting the best deal for all of our main sectors.

Does my honourable friend agree that when we leave the European Union,

the fact that this Parliament will be free to redraw the Reach

regulation is, which have long been identified as some of the most

burdensome EU regulations, will be of enormous benefit to small and

medium-sized businesses in the comical industry, particularly those

who only operate within the UK? Well, he makes a very fair point. I

do know that a discussion about the Reach regulations was on the agenda

when my colleague, the Parliamentary undersecretary, met the chemical

industry, and of course will form part of our discussions going

forward. US banks operating in the UK are begin late it applied the

Prudential Regulation Authority and the Financial Conduct Authority, the

men facing -- booming facing regime applies to all banks operating in

the UK. There is a threshold of ?25 billion. Does the minister agree

with me that the likely rolling back of the act in the US, combined with

the watering down of banking conduct reform, could result in either

deleted American banks with high-risk lending patterns operating

in the UK? It's worth saying that the UK and US financial sectors have

significantly increased their resilience since the crisis, and the

PRA has the powers it needs to begin late overseas firms operating in the

UK, to ensure the stability of the UK financial system. What steps is

the Government taking to ensure that banks meet the 2019 deadline for

separating retail banking from risky investment banking activity? I can

tell my honourable friend, well under way and we are keeping a close

eye on it. Mr Speaker, households' financial situations have improved.

Household debt has fallen from 160% of household income to 144%. UK

households have undertaken the second largest amount of

deleveraging in the G7. However, we should be alert to signs of a recent

reduction in the level of household savings. The savings ratio is now,

in Q3 2016, at 5.6%, down from 6.6% in Q3 2015. Notwithstanding that,

household debt IS very high, and housing costs are a bit proportion

of household expenditure. Has the Chancellor made an assessment of

what the impact would be of an interest rate increase on growth in

the industry, given that that growth history than by consumer spending?

Yes, Mr Speaker. The Bank of England makes regular assessments of the

impact of changes in interest rates. It is a central part of the

modelling work that it does. He's absolutely right that one of the

drivers of the relatively high household debt levels in this

country is our housing model being a relatively high percentage of

household... Mr Speaker, the Governor of the Bank of England

identified that we for the most serious challenges to the economy

today are the levels of household debt and of course the falling

pound. Both of these are made worse by the widespread belief in the

general public that interest rates are not going to go up. What more

can the Government do, and the Governor of the Bank of England, to

signal to the public that interest rates RISE and not fall in the near

future? That's not a matter for the Government, because as my honourable

friend knows very well, interest rates are a matter for the Monetary

Policy Committee of the Bank of England. And it is up to the

Governor and individual members of that committee to do as this e-fit.

Analysis published last week showed that unsecured household debt is at

a record high. Even the Bank of England voiced concern yesterday

that the UK was relying upon consumer spending rather than

exports and investment to boost growth reach boded poorly for the

future. Does the Chancellor acknowledge that such high levels of

household debt are indicative of the fact that the government Jose

canonic strategy simply is not working, especially for most

families, who are now struggling to get by on their income is alone? No,

Mr Speaker, I do not accept that at all. What I do accept is that the

extra Audrey performance of the UK economy over the last six months

which has defied many predictions, has been largely driven by consumer

behaviour. And as I just set out in answer to the previous question, the

savings ratio has declined. So, consumers are feeling confident,

they've been spending money rather than saving it over the last six

months. I would invite the Chancellor to meet struggling

families in my constituency, and indeed across the rest of Britain.

Even the Office for National Statistics reported on the 10th of

January that non-retired households have less money on average than

before the economic crash. Chronic low pay, lack of opportunity and

government cuts to support means they are desperately trying to find

ways to make ends meet on a monthly basis, using debt. And the

Chancellor therefore confirm what protection he will offer these

families, should inflation rise significantly as a result of the

pound's weakness since Brexit and indeed in light of the Bank of

England suggesting yesterday that interest rates could go up? Mr

Speaker, the honourable lady is right of course that the declining

value of sterling will have an impact on inflation, and we have to

take that into account as it feeds through into the economy, and the

OBR signalled in its Autumn Statement how it expects that to

occur. We will get new reports from the OBR in respect of currency

movements since the Autumn Statement at the time of the budget, on the

8th of March. And I will report to the House again then. Banks are

required to treat customers fairly and ensure that vulnerable customers

have appropriate access to banking. My right honourable friend and I met

recently to discuss this, and I'm pleased to understand that both the

FCA and the BBA have offered to meet with my honourable friend to discuss

this. I am grateful to my honourable friend, who as a carer for an adult

son, manages his finances in the hope that he will be able to live as

independent a life as possible but has real issues trying to access his

online banking. Even the increasing number of carers in the country,

does he agree with me that the banking industry should do all it

scan -- should do all it can? I know the FCA and the BBA are both looking

at ways to make it easier for trusted friends or family to be able

to manage their money safely. And I wish him luck. Mr Speaker, as my

brother's appointee, after severe head trauma, I can see many avenues

in which the time of carers is taken up with dealing with red tape. Can

the minister explain how things such as online banking can be kept safe

but made more simple for carers, with regards to multiple usernames?

I thank him for the question. I can assure him that this is something we

have discussed and it is the very issue which my honourable friend

will be discussing both with the FCA and the BBA but the Government are

keeping a close eye on it. Number 11, Mr Speaker. Progress has been

made since 2010, with housing starts near at -- now at an eight year

high. The Chancellor announced in the Autumn Statement that the

Government will invest more than ?5 billion in housing, including a new

housing infrastructure fund which will deliver up to 100,000 homes in

high demand areas. ?1.4 billion will go towards affordable homes. ?1.7

billion towards a programme of accelerated construction on public

land. I thank my right honourable friend. Does he agree with me that

supporting the off-site construction of new homes, as we've been doing in

Peterborough, is one important way to get more good-quality homes built

quickly? I do agree with my honourable friend that we should

explore the potential of modern methods of construction, including

off-site instruction. The accelerated construction programme

announced in October, which aims to speed up the building of homes on

public land, will include an element of off-site construction. The

department of amenities and local governing is considering ways of

encouraging diversification in the house-building market. We had better

get the fella in, I do not like to see him unhappy! As someone who

chairs a national charity based in Peterborough, but also the members

of Parliament for Huddersfield, can hide back the people who have been

saying that what we need is a more diverse housing market, better

provision, but also say that the future must be lower cost housing,

off-site construction, but to a highly sustainable standard?

I think we can agree on all of that. The is a consensus on this point. We

do need to build more homes. Being able to build more homes more

cheaply but of high quality and on a sustainable basis is something that

I hope the whole house can... Thank you, Mr is bigger. In my

constituency Rochester and Strood, we are facing high numbers of new

housing being proposed. Can the minister assure me this will be

matched with the increased investment in our local

infrastructure? Well, I think I withdraw my honourable's --

honourable friend's attention to the housing infrastructure fund which I

think demonstrates the determination of government to ensure that in

areas of high demand, where new housing is built, we also deliver

the infrastructure to support that housing. I think that will have a

beneficial effect in terms of getting more houses built and

ensuring that the appropriate infrastructure is there. This is

about Peterborough in England, not kill Marnoch and Loudoun or even

Scotland. I'm going to save the honourable gentleman up for a later

occasion. We look forward to that with eager anticipation. Mick

Kearney. For many in my constituency, homeownership is but a

pipe dream with more people renting privately than owning their own

homes. What steps is the minister considering to encourage private

landlords to offer at least longer term tenancies for these very

private renters in London and Hackney South? Well, we look to take

measures to support all sectors and all types of housing and she's

absolutely right to say that the Private rented housing is a really

important sector. I'm sure she would agree with this but I think we have

to be careful about some proposals that float around in terms of rent

controls in this area which would be damaging for the private rented

sector. Fiona McTaggart. Number 13. Chancellor. The government does not

comment on currency movements and we don't target and exchange rate but

in the last few minutes, I will tell the house the pound has spiked while

the Prime Minister has been speaking. The vote to leave the EU

has obviously caused some uncertainty and movements in

financial markets. More generally, the fundamentals of our economy over

the last couple of years have been strong. I think what the Chancellor

means is that he does not comment on currency movement unless he does.

Fiona McTaggart. But isn't it the case that number ten's office

briefed that the pound would fall as a result of her remarks today? And

did they do that in a cynical attempt to get the sound bite that

he has just sought to achieve? Mr Speaker, first of all, I draw a

distinction between providing a house with information and

commenting on that information. I wouldn't dream of doing the latter.

The other thing I would not dream of commenting on is any operations that

number ten might undertake that are well beyond my pay grade. James

Morris. Mr Speaker, the depreciation of the pound in the last two months

has had a significant benefit the West Midlands exporters,

particularly outside the European Union. So would the Chancellor agree

with me that whatever arrangements we come to for access to the single

market when we leave the European Union, we must not constrain West

Midlands exporters from growing their trade outside of the European

Union? On the contrary, Mr Speaker, it must support West Midlands

exporters in that endeavour. We still have a very large

current-account external deficit. We need to bring our trade into better

balance and one of our objectives in concluding the exit arrangements

from the European Union will be to support that. Question 14, Mr

Speaker. Well, Mr Speaker, the independent National Audit Office

has in fact just publics -- published its report into HMRC's

contract with Concentrix, today and HMRC managers will be attending a

Public Accounts Committee hearing on the 25th of January where the report

will be discussed? Thank you, Mr Speaker, giving the report the

Minister referred to believe this morning, and given the fact the

holder buckle has caused undue stress to thousands of people across

the country, including in my own constituency, can I ask the minister

what specific lessons have the Department and herself learned?

Well, Mr Speaker, there are a number of things, as indeed I reflected

when we had the opposition Day debate when the front bench, I

accepted their motion on this. Of course, there are a number of

lessons we have learned. That includes four ministers in the way

that we monitor the concerns that colleagues have, for example, in the

way we deal with their concerns behalf their constituents. HMRC have

confirmed they are not planning a contract of this nature for this

particular operation going forward. But they will have more to say when

they respond, both in committee and to the report. Given the National

Audit Office is exit rating -- office's exit rating report on

Concentrix's failure to achieve savings targets, performance

targets, serviceable staffing levels, sufficient levels of

training, call handling accuracy, proficient contract management,

competent decision-making while unbelievably increasing commission

by almost threefold, wouldn't the Chancellor's time be better spent on

concentrating on getting HMRC into a modicum of efficiency, rather than

popping off to Davos for a winter soldier? The first thing I want to

say Mr Speaker is that there are many tens of thousands of people

working for HMRC and it would do their morale the power of good if

people in this house could reflect on their current excellent

performance and the improvements they've made on two years ago in

terms of customer service. I want to publicly compliment them on the

improvements they have made. Mistakes were made on Concentrix and

we have accepted that and that is the reason the agreement was

terminated. We will be reflecting more on that when we respond to the

National Audit Office report. Topical questions. Topical one. Mr

Speaker, my principal responsibility remains delivering near term

measures to ensure stability and resilient as the UK exit the EU

while also addressing the UK's long-term productivity challenge. My

immediate focus is preparing the last ever spring budget for delivery

on the 8th of March. Many of my constituents are concerned about the

future of the clean investment bank, the potential of asset stripping,

the worth of the shares and the suitability of the buyers. What is

the Minister's department doing to ensure that the UK taxpayer is given

a fair deal out of the sale of the bank and that it retains its green

focus? Those are two of the criteria that we have set, that there should

be value for money for the taxpayer, and that the bank's focus for future

operations should be retained and protected. We are reviewing the sale

process as it goes forward and we will make sure that those outcomes

are protected. Thank you, Mr Speaker. The latest fiscal

sustainability report was published by the Office for Budget

Responsibility just over an hour ago. Knowing what a Crick read my

right honourable friend is, what assessment has he made of the

implications for the long-term health of the public finances? Not

only a quick reader but able to read the report while also answering

questions in the house. The OBR's report actually shows that under

certain circumstances, the UK public finances will come under increasing

pressure over the next 50 years. As I said earlier, what this does is

create a catalyst for a discussion which we have to have about how we

maintain the sustainability of our crucial public services, looking at

the demographic pressures and other pressures that they will face. I do

believe this report has served a useful purpose and I hope because

the point, 50 years outcome is sufficiently far away, we will be

able to have a mature cross-party discussion about how we address

these issues. The Autumn Statement revealed Brexit bombshell that

growth will be a massive 2.4% lower than previously predicted. What

further in fact does the Chancellor expect leaving the single market

will have on GDP growth in years to come? Well, Mr Speaker, I think the

OBR has set out its projections under different scenarios at the

Autumn Statement. It is the OBR that makes the forecast. It will of

course produce a revised set of forecasts which will be published on

the 8th of March, budget day. Derek Thomas. Businesses including

restaurants and guesthouses in my constituency curtail their business

in order to keep within their budget threshold. This obviously has a

negative impact on economic activity and jobs in West Cornwall and the

Isles of Scilly. We'll be Chancellor consider increasing the VAT

threshold as soon as the opportunity arises? Well, I thank my honourable

friend for the point and I'm happy to discuss it when we have the

meeting. It is worth putting on the record that the VAT rate is ?138

billion towards the public finances, projected for this year and it is in

fact one of the highest threshold in the EU but I'm always happy to

listen to colleagues and I know the concerns of the tourism industry in

particular are to the fore of the minds of many. Last week, the

nuclear decommissioning authority began a statutory consultation on UK

Government plans to cut final salary pensions across the nuclear state,

impacting 16,000 workers, including hundreds of my constituency. Is the

Chancellor aware that this is a trailer promises made by Margaret

Thatcher to nuclear workers when the energy industry was privatised? Of

course, the government, indeed the relevant agency recognises the

importance of the staff and employees that work in this sector.

But it is also necessary to have terms and conditions which reflect

the modern situation and what is the case that applies across the whole

economy. The Solent region has a deficit of 6% in edge EVA compared

to the rest of the south-east, and much of that is due to the lack of

investment in local transport infrastructure, for example, no

significant investment in rail for 50 years. Can the Chancellor

confirmed the new national productivity investment fund can be

used to address that deficit? Well, what I can say to my honourable

friend is that the purpose of the national productivity investment

fund is to support economic growth across all regions of the country.

Further details are specifying how and where the national productivity

investment fund will be invested will be set out by the relevant

departments and agencies in due course. Of course, the Solent won't

be forgotten and we are taking action to improve rail services with

a new franchise expected to deliver more services and quicker journey

times on South West trains. Mr Speaker, it's simply not good enough

to throw Concentrix under the bus on this one. The NAA report today found

that HMRC were at fault in the writing of the contract, in failing

to monitor it, and in intervening to make things worse after a Paul

Clough -- poor performance in summer 2015. Who will be held accountable,

HMRC for these gross failings of this contract from beginning to end?

-- accountable at HMRC. Well, Mr Speaker, the Honourable Lady and I

have debated this usual and of course they are significant

criticisms in the report and we are looking at those and we have

accepted a number of the criticisms that have been made about the

handling of this but are not -- a lot of money has been saved in the

area for that exist in the tax credit system and HMRC will be

responding in more detail at the PAC hearing next week and I will look at

the report and consider it in detail. Nicola Halifax reports that

the of first-time buyers is that it ties into 2007. -- the Halifax. It

cites government schemes as hell to bide making a major contribution.

What can the government do to back aspiration more and help people get

on the housing ladder? Be helped by schemes have helped over 220,000

households buy a home, including over 180,001st-time buyers. Add the

Autumn Statement, the Chancellor announced the government would

invest an additional ?1.4 billion in affordable housing to deliver 40,000

new homes for shared ownership, rented by and affordable rent,

bringing the total funding of the affordable homes programme to ?7.1

billion. Will the Chancellor state unequivocally the government's

commitment to the 0.7% aid target in this and future spending rounds? Mr

Speaker, as the honourable gentle minnows, the 0.7% target is

enshrined in primary legislation. -- honourable gentleman knows. The

government has no intention of changing that. The government is

investing in major infrastructure projects including Heathrow Airport,

HS2 and hopefully a new A36- 46 link Rd in my constituency. What is my

right honourable friend doing to ensure we provide enough funds to

make sure the work is conducted in a timely fashion? The government is

committed to supporting the skills we need to deliver our national

infrastructure. In 2016, the transport in the structure and skill

strategy committed to creating 30 Thousand Rd and rail apprenticeships

by the end of the Parliament. The Department for industrial strategy

is investing ?40,000 in the high-speed rail college with further

funding coming from local government and industry. Heathrow Airport has

admitted to double the number of apprentices to 10,000 by the time

the new third runway is operational. Changes to the regional funds for

solar power will mean that solar rooftop installations on schools and

hospitals could be increasing in cost by 68 times in April. Does the

Government realise the hugely damaging impact this will have on

organisations which have installed those panels in good health, and

also for the solar panel industry? The installation of solar panels is

of course only one of the factors which determine the rateable value.

The transitional relief scheme will support businesses which have an

increase in business rates bills and of course businesses with solar

panels will also benefit from these ?6.7 billion package to reduce

business rates, the biggest ever. The Government will be aware that

north Wales has some of the lowest productivity rates in the UK at

around 73% of the UK average. With that in mind, what plans does it

have to work with the six north Wales councils, the Mersey--Dee

Alliance and other organisations...? I can confirm to my honourable

friend that Treasury ministers have regular discussions with ministerial

colleagues as to how to increase growth and productivity across Wales

and the United Kingdom. In 2016 the Government confirm that the door was

still open for a growth deal with north Wales and it is committed to

negotiating a City Deal for the Swansea bay region in south Wales. I

look forward to receiving proposals from partners in the north Wales

region over the coming months. Is always very well briefed these

topical questions, reading out the screed, very good! IFS... What is

the Chancellor's strategy to ensure that growth in our economy benefits

everybody? Mr Speaker, we have seen income inequality falling, but of

course, we face issues as the depreciation of sterling works its

way through to inflation in the economy. That is an issue which we

will keep very much focused on and I shall address it in more detail at

the budget. Alongside other elements driving successful PMI is recently

was seven consecutive months of export growth. Will the Chancellor

agree this is a fine way to underpin our already record rates of

employment? I would agree. The survey has shown significant

resilience in the UK economy since the referendum, and the Prime

Minister has made it very clear recently that we will make a success

of leaving the EU. Given the minister's earlier comments about

attempts to stimulate house-building, can he guarantee

that at the end of this Parliament, the supply of rented homes will be

higher than at the beginning? What I can say to the honourable... To the

honourable gentleman, is that we are likely to build more affordable

homes in the course of this Parliament than has been done since

the 1970s. Currently, 87,000 ultralow emission vehicles on our

roads. , but a Committee on Climate Change says we need to have 1.7 by

2020. What more can the Treasury do to help us reach that challenging

target? I recognise his concern. As Transport Secretary in 2010, this

was on my agenda. The roll-out of ultralow emission vehicles has been

disappointing. It has not gone as fast as I would have hoped. And it

will be one of the issues that we look at as we seek to respond to

concerns about air quality, reinforced by recent court decisions

requiring the Government to review its approach to our quality. In his

last budget, the Chancellor stuck a 7 billion investment line on the

year 2022 which is actually beyond the remit of this Parliament. Can he

explain the purpose of that? I did not hear the first part of the

question. It's customary to present forecasts for fiscal events over the

forecast period, which as we progress through the Parliament will

stretch beyond the end of the current Parliament. But the way it

has always been done and I'm afraid it would not be hopeful to give

Parliament a shorter horizon. Mr James Berry. It is a London related

question. Major infrastructure investment will form a vital part of

our economy in post-Brexit Britain. Can my right honourable friend

confirm this in regard to Crossrail 2? Mr Speaker, the Government will

of course consider all proposals for infrastructure investment on their

merits. The industrial strategy green paper, when it is published,

will set out the Government's approach to prioritising

infrastructure to support the economy. When the Chancellor

considers the effects of bringing in quarterly reporting, will he look at

the figures which show that only 25% of our smaller businesses have

maintained electronic accounting records, and just 38% lack basic

digital skills? So will you listen to the committee which described

this as a potential disaster? Mr Speaker, I Will always listen to

what the tremens of the Treasury Select Committee says. It is a very

useful support and I am considering it carefully. They acknowledged that

the future digitisation of the tax service is the direction we should

be travelling in. But of course we are looking carefully at the impact

on small businesses, many thousands of whom we have already exempted

without current announcement. I think it is Lancashire's turn, Jake

Berry! Thank you, Mr Speaker. On the subject of berries, does my right

honourable friend the Chancellor share my concern that too many jams

are becoming jam tomorrow, with household debt? What will he do to

stop irresponsible lending by credit card companies and banks to

low-income households? Well, Mr Speaker, the Government does, the

regulatory authorities do take appropriate measures to prevent

inappropriate lending and to make sure that credit products are not

mis-sold. And we will continue to do so. Member for East Lothian, always

looks so happy. We will make him happier! Thank you, it is your

presence that makes me happy! While the Chancellor has been answering

questions, the Prime Minister in her speech has said that the UK will

most likely continue to pay into EU budgets. With the Chancellor have

something to say on that? Mr Speaker, we have always said that if

as part of our future arrangements with our former European Union

partners, we continue to collaborate in certain areas, scientific and

technical, research programmes, for example, then of course we'll have

to expect to contribute. All of this is for the negotiations ahead. What

the Prime Minister has done to date is set out a 12 point plan for

Britain's future relationship with the European Union, exactly what our

partners have been demanding from us. And I hope that this will no

signal the beginning of the serious engagement on Britain's future

relationship... I heard this morning that an overseas insurance company

had chosen Zurich over London as its European base because they felt the

Swiss authorities were much quicker to engage with them than the London

authorities. With the Chancellor have a look at, ensure that we are

the most competitive financial services market in the world and

that we really take overseas investment seriously? Of course, Mr

Speaker, I thought my honourable for was going to tell me that they had

chosen an EU location over London so I am interested to hear that they

have chosen Zurich, the only possible non-EU location over

London. But of course I will look at the issue. It is our objective to

have the most attractive location for inward investment for foreign

businesses to do their business on this continent. Inflation is still

below the Monetary Policy Committee's official target. The

economy has long been a more worrying risk in terms of deflation,

rather than inflation. Though he therefore seek to deflate the

Governor of the Bank of England from any notion of raising interest rates

which would inflict damage to the economy? No, Mr Speaker, it is not a

matter for me to persuade or dissuade the Governor of the Bank of

England with respect to this. But while the inflation figures

published this morning at 1.6% are below the Bank of England's target

rate, the OBR's forecast and indeed the Bank of England's forecast for

later on this year suggest that they will meet and exceed the target rate

later in the year. Over a year ago, the Treasury promised to consult on

breathing space, which would assist and protect people from interest and

other charges while they seek help. Will the minister commit to bringing

this forward as a matter of urgency in view of the high levels of

personal debt? We are looking very closely at, we will see some

progress in the vein of future. Statement, the Secretary of State

for Health man. -- the Secretary of State for Northern Ireland.

Secretary James Brokenshire. Thank you, Mr Speaker. With permission, I

should like to make a statement regarding forthcoming elections to

the Northern Ireland Assembly. As the House is aware, Martin

McGuinness resigned as