By Matthew Barrett
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Following on from the last few days' rolling blogs, I have below a final list of the MPs (and Baroness Warsi) appointed as Ministers for each department. I have put new appointments in bold.
Department for Business, Innovation and Skills
Department for Communities and Local Government
By Matthew Barrett
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Gavin Williamson (South Staffordshire) (Con): I understand that my hon. Friend recently received the very prestigious award of tax personality of the year. I am somewhat concerned that this glorious award may be influencing his conduct as a Minister in carrying on his business in relation to tax policy. Is that a fact?
Mr Gauke: I am grateful to my hon. Friend for that intervention. I am trying hard not to let the award go to my head. I will endeavour to do my best, but it is of course a great honour. I take it as praise for what the Government are doing more generally on tax policy. Before I break into tears—I find it quite emotional to talk about the award—I shall return to the issue of mutual assistance.
1.30pm update: Below is a photo taken at the event, with (left to right), David Kilshaw, Chairman of the Private Client Group at KPMG, the Minister, David Gauke, Chris Jones, Director of Tax & Accountancy at LexisNexis, and Natasha Kaplinsky, the host for the awards ceremony:
"The choice of winner for this award reflects the judges’ desire to recognise a significant change in the approach of government to tax policy, and the process of passing tax legislation. In particular, the recipient of the award has shown a real willingness to engage with the tax profession and develop a technical understanding of the issues which it raises with government. His attendance and accessibility at the tax profession’s events was noted well before he became a government minister. Even when he was shadowing another well-respected minister, Stephen Timms, this person impressed the tax profession with his grasp of the subject. Since he has come into the Treasury team as Exchequer Secretary to the Treasury, he has continued to deal with us as one professional talking to other professionals."
2.15pm Update: The award was also recognised by Nigel Mills (Con, Amber Valley) during the Finance Bill (No. 3) report stage on Monday evening:
"The Exchequer Secretary has made such a great start in tax simplification that he has had the honour of being named the “Tax Personality of the Year”. We could start making various jokes about accountants’ personalities, but we would probably cause grave offence to all my former colleagues, so perhaps we should leave that subject. We have had a consultation on removing a few simple tax allowances, such as the reliefs for angostura bitters and black beer—if going that far gets the Minister that award, just think what garlands could be thrown at his feet if he tackled some of the real complexities of our tax system!"
...and the Minister's Labour Shadow, David Hanson returned to the subject in summing up the debate:
"I am grateful to the hon. Member for Amber Valley (Nigel Mills) for kicking off this wide-ranging discussion on a number of important tax issues. He certainly enlightened me when he revealed that the Minister is tax personality of the year. I missed that; despite all my “Gauke” Google alerts, I missed the fact that he was tax personality of the year. May I offer the official Opposition’s wholehearted congratulations to him on that?"
by Paul Goodman
George Osborne bested Ed Balls yesterday. But the Treasury team also faced three sharp questions from its own side, which the sketchwriters have duly picked up this morning. Here they are in full, together with the answers.
"Mr David Davis (Haltemprice and Howden) (Con): There is a lot of public disquiet about alleged enormous sweetheart deals done with major public companies-Vodafone and others-in the last five years. Three or four months ago, I tabled a question asking how many of these deals had been done, costing more than £100 million at a time. The answer I received was that the information requested was "not readily available" and could be provided "only at disproportionate cost". I received a similar blocking answer this morning. When is the Minister going to tell the House what HMRC has been up to?
Mr Gauke: The National Audit Office has investigated and examined that as a matter of course. There is no question of sweetheart deals. The reality is that HMRC is seeking to recover as much tax as is due. That is what it has done in a number of cases. I am not going to comment on individual cases. That is a matter of confidentiality; I do not get to see the details. None the less, I think wild allegations have been made against HMRC, for which there is little or no evidence."
"Mr Douglas Carswell (Clacton) (Con): The Chancellor is entirely right to emphasise the need to be careful with public money. Will he therefore please explain his role in approving the deal to make the UK taxpayer liable for billions of pounds to bail out the euro under the European stabilisation mechanism? Will he respond to my freedom of information request, and publish the advice that he was given on the agreement on assuming office?
Mr Osborne: First, I will look at my hon. Friend's FOI request, because I have not seen it. The broader point that I would make is that my predecessor as Chancellor, in the weekend between the general election and the creation of the new Government, agreed to the creation of the European stability facility. That involves a UK commitment which takes place on the basis of qualified majority voting; we do not have a veto. I made it clear to the previous Chancellor at the time that I did not support what he had done. However, it has happened and we have to live with the consequences."
"Sir Peter Tapsell (Louth and Horncastle) (Con): Do Treasury Ministers agree that the real problem with bankers' bonuses is that they are paid not out of profits, but out of revenues? Taxing banks after the bonuses have been paid merely depresses dividends, particularly for pension funds. Why are bankers' bonuses not paid out of profits, as they always were by my very efficient stockbroking firm?
Mr Hoban: My hon. Friend makes an important point. Of course, under the old regime, there was no clawback when bonuses were paid out in cash, and no lock-up. The new code on remuneration introduced by the Financial Services Authority, which is ahead of international practice, has clear rules on deferral, requires that bonuses be clawed back for poor performance, and requires that bonuses for significantly highly paid members of staff-those who take risks-be paid out principally in shares, not in cash. That will ensure that the interests of bankers are aligned with those of shareholders."
By Jonathan Isaby
An amusing slip of the tongue from Commons Speaker John Bercow yesterday.
During questions to Treasury Minister David Gauke about the errors made at HMRC on millions of people's tax bills, the Speaker decided to call the new Conservative MP for West Suffolk - except he mixed him up with the founder of the TaxPayers' Alliance:
"I call Matthew Elliott. I mean Matthew Hancock. Tax was on my mind."
The minister, David Gauke, responded thus:
"My blood ran slightly cold for a moment when I thought that the TaxPayers' Alliance had managed to get in here."
I daresay it would be no bad thing.
The debate on the Second Reading of the Government's FIscal Responsibility Bill - the one which would put a duty on the Government to halve the budget deficit into legislation - was far shorter than it normally would have been due to a series of statements at the beginning of business.
It was not until 6.26pm that Shadow Chancellor George Osborne got to his feet to speak in opposition to the Bill:
"Although this piece of legislation consists of only six short clauses, it must be the biggest load of nonsense that this Government have had the audacity to present to Parliament in this Session. Quite frankly, I do not think the Bill is the idea of the Chancellor of the Exchequer or any of his Treasury Ministers, or indeed of any official in the Treasury. It was dreamt up by the Schools Secretary and the Prime Minister when they were trying to think of something to say on the “Andrew Marr Show” on the eve of the Labour conference, so now we all have to go through the rigmarole of debating it in Parliament. The Bill was a completely feeble stunt."
Yet over the following three hours, not one Labour backbencher was moved to deliver a speech in favour of the BIll, as shadow Treasury spokesman David Gauke noted in his summing up:
"This has been a somewhat curious debate. I do not know whether there has been a precedent for such a Bill. The Bill was at the heart of the Prime Minister’s party conference speech in 2009; it was the flagship economic Bill in the Queen’s Speech; and it is the centrepiece of the Government’s economic strategy to reduce the deficit. However, I wonder whether we have ever had such a Bill, because it has attracted not a single voice of support from Back Benchers on Second Reading.
"I suppose that the Government might have hoped that in a time of crisis the country would unite around them as they set out to address the problem, but as it happens the Bill has managed to unite the House in opposition. The fact is that we have had only two contributions from Labour Back Benchers in the debate. I do not know where the rest of the parliamentary Labour party are tonight—they may be plotting, once again, if the rumours that have been reported this evening are true—but not one Labour Back Bencher could be prevailed upon to speak in support of the Bill."
All in all, yet more evidence of Labour MPs having already given up the ghost. Indeed, the only backbench Labour MPs to give speeches were Frank Field and Katy Clark, who explained why they were not supporting their Government's Bill.
Here's a bit of light relief.
David Gauke, who is a Shadow Treasury Minister, raised a point of order in the Commons yesterday:
"On a point of order, Mr. Speaker. On a number of occasions, you have raised the requirement for Ministers to answer written parliamentary questions appropriately. I asked the Prime Minister a question, the answer to which was published in Hansard on 30 April 2009 at column 1415W. I asked him whether the recording of his statement on hon. Members’ allowances that was uploaded to his YouTube channel on 21 April had required more than one take. The response was:
“The recording is available on the Downing street YouTube channel.”—[ Official Report, 30 April 2009; Vol. 491, c. 1415W.]
Such a question could only have been posed in recent years. And there was a time when mocking the Prime Minister in this manner would have been scandalous. Even as recently as the 1960s Peter Cook caused great consternation with his impression of Harold MacMillan.
Times have changed. We can, for example, once again marvel at the unbridled awfulness of Gordon Brown's performance in the video below, and laugh ourselves hoarse. I think we've earned it.
It was Treasury questions yesterday.
Shadow Chancellor George Osborne poured scorn on the Budget growth forecasts:
"As the Chancellor knows, the growth forecasts that he gave us in the Budget last week, which predicted a return to boom levels of growth in just two years, and that the economy would stay at those boom levels, were greeted with near-universal derision, yet they were the fiction on which he constructed every other Budget forecast. When he gave those forecasts, did he know that the IMF was planning to contradict them flatly just an hour later?
Mr. Darling: Yes, of course I knew the IMF forecasts. The IMF takes a more pessimistic view, not just of our economy but of every economy across the world. However, we ensure that our forecasts are based on the information that we have. If hon. Members look at the IMF and its forecasting over the past three months, they will see that it has downrated its forecasting three times since last October, which demonstrates the uncertainty in the system. However, I believe that because of the action that we are taking, because of the fact that we have low interest rates, because inflation will be coming down this year, and because of the action that most other countries are taking to look after and support their economies, that will have an effect, which is why I remain confident that we will see growth return towards the end of this year.
Mr. Osborne: Frankly, I do not think the Chancellor is in any position to lecture anyone else about downgrading their forecasts after last week. Is not the truth this—that the dishonest Budget has completely unravelled in the space of just a week? We have seen the IMF produce those growth forecasts, which were wholly different from the ones given an hour earlier to the House of Commons. We have the CBI saying that there is no credible or rigorous plan to deal with the deficit. We have the Institute for Fiscal Studies pointing to the black hole, and yesterday a former member of the Cabinet, beside whom the Chancellor sat at the Cabinet table, said that his tax plans were a breach of a manifesto promise that is damaging not just to the Labour party, but to the economy. Today we had the Prime Minister getting a lecture in prudence while he was in Warsaw. We are used to Polish builders telling us to fix the roof when the sun is shining, but not the Polish Prime Minister as well.
Does not the collapse of the Budget in the past week and the damage to the Chancellor’s credibility make an almost unanswerable case for an independent office for Budget responsibility, so that we get independent forecasts on Budget day and the assumptions of the Budget are believed by the public?
The Commons also hosted Treasury questions yesterday.
Shadow Chancellor George Osborne scented blood:
"Are we really expected to believe that when the Prime Minister appointed Sir James Crosby to the board of the Financial Services Authority, and when the current Chancellor promoted him to the job of deputy chairman in 2007, neither of them had any idea that they were appointing someone whose business model at HBOS was being investigated by the regulator whose board they were appointing him to?
Mr. Darling: As the Prime Minister has just told the Liaison Committee, Sir James’s appointment in 2003 was made on the recommendation of a selection panel that followed an open competition, and that panel, which was chaired by the senior official then responsible for banking regulation, Sir James Sassoon, recommended the appointment of James Crosby. At that time, there was no reason to question that appointment. With the benefit of hindsight, many people now make claims about what they say they knew at that time, but the then Chancellor followed the proper procedures and followed the advice, and he had no reason not to make the appointment.
The FSA has said that in 2002, and subsequently, it drew attention to a number of concerns, as it did with several other organisations. In terms of the law, the way in which the FSA supervises any bank, let alone this one, is a matter for it. Neither the subsequent investigation into the allegations made against James Crosby, nor the concerns that it had, were reported to the Treasury. I would not expect them to have been, given the information that I have from the chief executive of the FSA at the moment.
Mr. Osborne: Either the Chancellor knew what was going on and did nothing, or he was entirely ignorant, and neither is much of a defence. Is not the net closing in on the Prime Minister and the Chancellor? Their accomplices are resigning, their alibi that no one knew what was going on has been blown apart, and their fingerprints are all over the mistakes that were made during the age of irresponsibility.
Is there a coherent view in the Cabinet about how long this recession will last? We know what the Treasury’s forecasts are, and we know what the Chancellor says about the economy recovering halfway through this year, but today the Health Secretary has said that we need to be ready for two years of recession. Is the Health Secretary expressing the collective view of the Government on this issue?
Mr. Darling: In relation to the FSA, the hon. Gentleman’s claims are frankly ridiculous. Appointments were made in the normal way, which is a great deal more open than for some of the appointments that were made in the past. At the time, there was no reason not to accept the recommendations in relation to Sir James Crosby.
On the broader economic picture, as I have said to the House on a number of occasions, there has been an extremely sharp downturn not just in this country but in countries right across the world, and we can see the effects of that. I am clear, though, that if we had followed the hon. Gentleman’s advice and done absolutely nothing to prevent the full effects of the recession from being felt, the impact and the long-term damage to this country would have been substantial. I believe that the action that we have taken is not only justified but will ensure that this recession will be shorter and less painful than would otherwise be the case. I am sorry that the Conservative party continues to take the view that there is absolutely nothing that they are prepared to do to help people and businesses in this country."