Liam Byrne
MP for Birmingham Hodge Hill and Solihull North · Labour · United Kingdom
“The loss of 4,000 jobs at Jaguar Land Rover is a body blow for workers, families and communities across the west midlands, so I commend Richard Parker, the Mayor of the West Midlands, for moving quickly on Monday to put £500,000 on the table to help ensure that everybody gets back to work.”
“I wholeheartedly welcome this well-rounded statement from the Foreign Secretary, and put on record my thanks to the new Prime Minister for the hard yards that I know he has put in over recent days and weeks.”
“I am grateful to my hon. Friend for giving way, and I offer my warmest congratulations to her on her appointment to the role; she will be a brilliant Minister.”
“Let me start with a word of thanks to my hon. Friend the Member for Chester North and Neston (Samantha Dixon), who is not in her place, who said quite rightly that an awful lot has changed since the Bill was first introduced to this House. Indeed, a lot has been revealed over the course of the summer.”
“The effect of new clause 34 would be to ban off-ramping, ban new forms of digital currency transactions and ban memecoins, which are exactly the kind of measures that Ministers now need to bring forward. If we want to take the crypto system out of political finance, this is what we need to do.”
“No doubt we will learn that Mr Cottrell was in fact on the electoral register when that money was passed. No doubt we will discover that his mother, Fiona Cottrell, declared and did not disguise the fact that the money had ultimately come from her son.”
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“I asked Sir John before the summer whether he has sufficient resources to undertake the work that we have asked him to undertake, and he assured me that he had—but as I have explained, there is a considerable task for him to sieve through. This has been a difficult legacy from the past that the Government have had to clear up. For me, the three principles are to deliver a payment scheme that meets the moral imperative to act; to deliver an ex gratia payment scheme in a way that is administratively simpler and faster than the way that the ombudsman suggested; and, perhaps most importantly of all, to ensure that the right people are included in the scheme. That is the approach reflected in the Government’s amendment, and I urge my colleagues to give it their support.”
“I agree with much of what my hon. Friend says, but if a parliamentary ombudsman finds an injustice and proposes a remedy that is, let us say for the sake of argument, wrong, and the Government propose a different remedy, that automatically breaks the link between the injustice identified and the remedy on offer. What is the right way to approach that question, when a legitimate debate may be had about the range of remedies that may address the injustice that the ombudsman has rightly identified? I am sure that my hon. Friend would agree that it would always be unsafe, in any area of public life, to receive arguments and proposals as if they were written on tablets of stone. No matter who produces those conclusions, there must always be a way of testing them in case the remedies proposed are incorrect.”
“As I said, these three elements are expected to deliver £16 billion in receipts over the period 2011 to 2014. However, we aim to secure receipts from central Government sales within the next two financial years where and when market conditions are right. We have already sold £30 billion of public assets since 2004. This success, building on the £22 billion sale of 3G licences in 2000, played a major role in the reduction of debt over the past decade. We have made tough choices to cut debt in the past; those decisions allowed us to support the economy now. We will not flinch now from tough choices to allow us to live within our means in the years to come.”
“As the Chancellor set out in April, an ambitious programme of asset sales is part of our plan—a plan that sets out up to £16 billion of property and other asset sales, with proceeds raised being used to support our priorities, including new capital investment and paying down debt. Today the Prime Minister set out a few details of that programme, and in the months to come we will publish a portfolio of assets to be sold. It will cover assets for sales, and assets where we wish to explore different ways of managing things in the future. The portfolio will include the Tote, the Dartford crossing, the student loan book and the channel tunnel rail link. We know that councils will make a major contribution to the overall level of asset disposals through sales of housing and other assets, as will central Government property.”
“Thank you, Mr. Speaker, for the opportunity to come here this afternoon and answer questions about the sale of Government assets. Our overriding ambition is to lock in the recovery and then to lay the foundations for growth in the years to come. Because of the action that we have taken this year, we are confident that growth will return to our economy towards the end of this year and into 2010. Over the months to come, therefore, the Chancellor will set out more detail around our plan to halve the public sector deficit over four years once recovery is secured. This entails a return to growth with support for firms and families; fair tax rises for those most able to bear the burden; and slowing the growth of public spending.”
“Over the past 20 years, local authorities have raised something like £3.7 billion a year, and of course they are free to keep those receipts and reinvest them in priorities such as affordable housing and schools. In addition, we anticipate that something like £2 billion of central Government property can be sold and reinvested by Departments. We believe that additional business and financial assets can also be sold, such as those that the Prime Minister listed, and that something like £3 billion can be raised from them over the next couple of years. Of course, that money will be available to pay down debt.”
“I am grateful to the hon. Gentleman for the question and for his renewed interest. I know that that is completely unrelated to his own difficulties to do with tuition fees and mansion taxes at his party conference recently. Let me be absolutely clear about the substantive question that the hon. Gentleman poses, because it is important and there will be wide interest in all parts of the House about our strategy. As I said in my statement, in the Budget, the Chancellor set out the ambition to sell about £16 billion of assets over the period 2011 to 2014. About £11 billion of those assets will, of course, be local authority assets. That is based on a long-term picture of what local government tends to sell each year.”
“It requires tougher decisions on spending in the years to come, but where there are things that the Government should not hold on to, we should sell them off. Yes, we should allow local authorities to keep receipts to invest in local priorities, but business or financial assets, such as those that the Prime Minister talked about today, can be sold off and the proceeds used to pay debt.”
“I enjoyed the remark about tough decisions. I have made a mental note of the Tate. The hon. Gentleman presumably refers to tough decisions such as proposals on state pension plans—I understand that the National Institute of Economic and Social Research, having looked at his plans, has discovered that he is £3 billion short and five years out in his sums. So I will not take lessons in tough decisions from him. The hon. Gentleman knows that bringing public spending within the bounds of what is possible in the years to come will take a mixture of things: growth coming back, investing in new industries and jobs, the right decisions on tax—decisions that he has opposed consistently; I think that the Conservative party has voted against something like £20 billion of necessary tax increases for the years to come.”
“I do not think that the Government’s position on the sale of the Tote has changed in essence. The medium-term decision was to keep it in the public sector, but now is the right time to look at the possibility of its sale. The dimensions and constraints around the sale of the Tote that my right hon. Friend outlined have not been disturbed.”
“Again, the precise way in which the different assets are sold will have to be the subject of further debate and conversation, not least in the House. That is why it is the Chancellor’s ambition to bring before the House a portfolio of assets, which we believe could be sold. There will be several different questions that relate to different assets, but once the portfolio is published, we might be able to have a bit more of a debate about the precise detail of each one.”
“There will be many different questions on each of the assets. In some cases, the sale of the assets will require us to return to the House to change legislation but, as I said, once the portfolio of assets is published, we can have a proper debate about the whys and wherefores of each one.”
“The announcement today has done nothing to disturb the policy commitments that have already been made about the different sales of assets. However, the Government must balance the need to get best value for the taxpayer in the years to come with the constraints and policies regarding each of the different businesses and assets. That is quite properly a subject for further discussion in the House.”
“The figures on local authority asset sales that have been put before the House this afternoon are projections based on the pattern of local authority asset sales for the past 20 years. Over the last 20 years, local authorities have sold something like £3.7 billion of assets a year. As the recovery sets in and as market values return, we have no reason to think that those values will be any different in future.”
“As I said in my statement, the Government must not only lock in the recovery, but lay the foundations for growth in the years to come. As growth sets in, our ambition is to halve the deficit over four years. That is going to require a number of difficult decisions. If we want to invest in creating new industries and new jobs in the years to come, as well as to put public finance on a sustainable footing for the medium term, there will be difficult decisions on tax and difficult decisions on spending. However, if we can create new investment in the infrastructure that we need in the years to come and if that can be financed through selling off assets that we no longer need, it is the right decision to take.”
“The Department for Transport has to look at a whole range of scenarios for the years to come, not least whether another crossing is put over the Thames. That is why I said that the ambition over the next couple of years—the next two financial years—is to raise something of the order of £3 billion from the disposal of central Government businesses. We think that the assets listed could make a big contribution, but there will not be a fire sale. We will seek to extract the most value for taxpayers from the sale of the assets. That is why the Chancellor will return to the House with a portfolio of assets that we think it is right to sell over the next couple of years—the assets to which the hon. Gentleman referred will, I think, be among them.”
“The programme that we are putting before the House now, and which we will put before the House in more detail in the months to come, does not include disposal of the Government’s interests in financial institutions.”
“I would define a fire sale as selling things for substantially less than we think we could secure for taxpayers. However, this Government have a good record of selling assets in order to pay down debt, not least regarding the money that was raised from 3G licences in years gone by. Those decisions allowed us to go into this recession with debt at something like 36 per cent. of gross domestic product, which is much lower than other countries in the G7. Those decisions have helped us to ensure that help is available for businesses and families to get through this recession—help that the Conservatives opposed.”
“As I tried to say in my reply to the hon. Member for Twickenham (Dr. Cable), we think that local authorities will be able to secure some £11 billion of asset sales and central Government will achieve some £2 billion of asset sales. That money will be available for re-investment in infrastructure and other capital investment priorities. There are some businesses that can raise some £3 billion over the next two financial years, and those proceeds can be used to pay down debt.”
“The answer to the second question is yes. The answer to the first question is, as I said to my right hon. Friend the Member for Makerfield (Mr. McCartney), that the current policy position on the sale of the Tote is undisturbed by the announcements made today.”
“We departed from the ombudsman in her recommendation for a compensation scheme across the board and we set out cogent reasons for that. They are being challenged by judicial review today, so my remarks on that question will be rather limited this afternoon; but—this is the crucial but—we believe an ex gratia scheme must be set up to help those who have suffered hardship as a result of the injustice that we believe was perpetrated. We have asked Sir John Chadwick to make recommendations on that question urgently, but he must first pin down who has lost what. He will set out his next steps in August and, if you would oblige me Mr. Speaker, I would be very happy to update the House on its return.”
“I am very grateful to you, Mr. Speaker, for granting me the opportunity to answer questions on Equitable Life today. A week or two ago, I promised the House a short statement, by way of update before the recess, and I laid that statement this morning. I do not intend to read it out as it is there for hon. and right hon. Members to consider. I know that time is short this afternoon, Mr. Speaker and that you will want to maximise the opportunities for questions, so let me limit my opening remarks. First, the Government are grateful to the ombudsman for her report. Secondly, in many areas we agreed with her conclusions of maladministration. In four key areas, we agreed with her findings that injustice had followed.”
“We also believe there will be people who have suffered and are suffering hardship—in some cases extreme hardship—as a result of that. That is why it is essential for us to set up an ex gratia payment scheme. The ombudsman did not have the chance to go into the vital question of who lost what. That is the first piece of work that we have asked Sir John to consider. I do not think it is possible to get an ex gratia scheme in place and operating justly until we have understood who has lost what. Obviously, there are hundreds of thousands of policyholders—”
“We think that would have perverse consequences, and it is a principle on which the House has voted in the past. Secondly, it would be irrational for the Government to propose a compensation scheme across the board for charges of maladministration or injustice that we did not accept. I know that when the ombudsman came before the Public Administration Committee on 21 January—my hon. Friends will correct me if I have the date slightly wrong—she said that she would almost rather the Government accepted her recommendations and then did nothing to provide compensation. I do not think that that is the right approach. There are findings that we have accepted. There are charges of maladministration that we have accepted. Further, there are charges of injustice that we have accepted.”
“Let me deal first with the central question about the difference between compensation schemes, as proposed by the ombudsman, and our conclusion that an ex gratia scheme would be more appropriate. The ombudsman made 10 findings and went on to say that a number of injustices resulted. When we looked through those findings, we came to the conclusion that in nine out of the 10 findings, we could accept wholly or in part her conclusion that there had been maladministration. In four of those areas, which I think were significant, we accepted that injustice followed. Two consequences follow from that position. The first is that we departed from the ombudsman in her conclusion that a compensation scheme should be put in place, because we do not think the taxpayer should be the compensator of last resort.”
“There are hundreds of thousands of policyholders, and every single bit of information associated with those policyholders has to be gone through first, which is why we have given Sir John Chadwick all the resources for which he has asked, and it is why we will continue to check that he has all the resources that he needs to conduct his task. We are absolutely committed to getting a scheme up and running as quickly as possible, and I hope that the hon. Gentleman will continue to make representations on behalf of policyholders, as I know other hon. Members will, to make sure that that ex gratia scheme is designed in the fairest possible way.”
“It is perfectly appropriate for the hon. Gentleman to seek to keep up the pressure and the momentum, particularly on the timetable, because that is the question that most troubles policyholders. I completely reject the argument about an absence of progress. Once the ombudsman concluded her investigation, and set out where she thought that injustice had been perpetrated, it was perfectly proper for us to reflect on what she said, then make the decision to put in place an ex gratia scheme to correct those injustices. I am sure that the hon. Gentleman would agree that to ensure that the maximum possible help is delivered to those who are in the hardest and most difficult financial position, it is vital to understand who has lost what.”
“He is publishing reports in quick succession to make sure that the maximum amount of information is available to policyholders and so that they can see and comment on the direction in which his mind is moving.”
“There have been three debates on Equitable Life and the Government’s response to the ombudsman this year, and we had a good debate during oral questions a week or two ago. I return to the basic argument that I have presented this afternoon: if we think an ex gratia scheme should be set up, to ensure that money under that scheme goes to the people who have been hardest hit, the first piece of work that we must do is to understand who has lost what. Until we do so, it is difficult to get up and running an ex gratia scheme that will operate justly. Surely, that must be the objective of right hon. and hon. Members. Sir John has an enormous amount of work to do to go through the information that has been passed to him by Equitable Life. A number of right hon. and hon. Members have made representations, and he is moving quickly.”
“No, I will not for the simple reason that, first, I do not believe that the Government should be the compensator of last resort when there has been regulatory failure; and secondly, I simply do not think that it would be rational or a good use of public money to provide compensation when there have been conclusions that we simply do not accept. However, I do not subscribe to the ombudsman’s view, put forward on 23 January, that it would be better to accept all the recommendations and then do nothing to provide any compensation at all. It is important that an ex gratia scheme be set up, because there is injustice that we recognise. We must now ensure that public money goes to where it is most needed, and that is why we must understand, first, who has lost what.”
“That is an extremely reasonable point to which I am entirely sympathetic. However, until Sir John has done his first run-through of the information from literally hundreds of thousands of policyholders, that being the exercise on which he is now embarked, it will be difficult for us intelligently to present that long-stop date to the House. However, it is my ambition to come back with that date at the earliest possible opportunity.”
“I would not want to steer Sir John in respect of the conclusions that he has been asked to reach; it is an open question that we have left to him to answer, and he has considerable experience in answering such difficult questions. I am satisfied that he has at his disposal all the information that he needs to come to those conclusions, but, if he were to make further requests of us for further information, I would consider them.”
“That is not an estimate that I shall present to the House this afternoon; it is something that I shall look at when Sir John presents his initial recommendations.”
“I absolutely agree that it is time that the policyholders of Equitable Life had the justice that they deserve. They are in their current position because of a series of regulatory failures that go back many years, but Governments sometimes disagree with reports from ombudsmen; there have been five such occasions in recent years. As I said, I do not accept the ombudsman’s conclusion that we should just accept the recommendations and then do nothing—she said on 23 January that that was her preference. I actually think that an ex gratia scheme is sensible, because there has been an injustice that we have accepted.”
“That will have a bearing on the breadth of the ex gratia scheme that is eventually recommended, but, as I said, until Sir John has studied who has lost what, it will be almost impossible to design an ex gratia scheme that operates justly.”
“If I may, I will just draw the House’s attention back to the four areas in which the Government said not only that there had been maladministration, but that injustice had followed. Those areas are significant, and they should not be cast aside lightly, because they are the basis of the ex gratia scheme that will be set up. When it came to changes to retirement age, reserves for guaranteed annuity rates, the financial reinsurance in which Equitable Life tried to engage and the information that the Financial Services Authority provided in the post-closure period, the Government accepted in all those cases not only that there was maladministration, but that injustice had therefore followed.”
“That would be a question for the business managers of the House. I want to tease out two points. Yes, the Government did depart from many of the ombudsman’s conclusions about maladministration. We set out cogent reasons for doing that, and they are subject to judicial review, commencing today. It would not be rational to propose a compensation or ex gratia scheme based on findings that we simply did not accept; that would not be a good use of public money. That said, we accept that injustice has resulted from maladministration in certain areas and we think that an ex gratia scheme is therefore required. We must make sure that that is set up so that it operates justly and that most help is delivered to those who have lost most.”
“As I said in reply to another Conservative Member, my ambition is to come back to the House with a long-stop date by which we can get the ex gratia scheme up and running. I accept entirely the hon. Gentleman’s point about the uncertainty and hardship that many Equitable Life policyholders are now confronting. The hon. Gentleman will accept that, in the world of limited resources in which all Governments operate, we must make sure that the help provided goes to those who need it most. That is the question that Sir John is now considering.”
“The principle that must guide the rewards that go to leaders of quangos has to be very clear: they must be rewarded only on the basis of their performance on behalf of the public. However, the hon. Gentleman is right to allude to the necessity for public service leaders, no matter what part of the public sector they work in, whether it be the BBC or any other non-departmental public body, to set an example and to show restraint. That is why we have limited pay awards for senior civil servants, judges, senior NHS managers and NDPB chief executives in this financial year to just 1½ per cent.”
“My hon. Friend has an excellent point. It is incumbent on the leaders of public services, at such times, to show restraint and to set an example. However, I agree that over the past 10 years it has been important to give some above-average pay increases to front-line staff in particular, such as nurses, fire service workers and the police. If we look back at the average pay rises throughout the private and public sectors, we find that they basically come out about the same. However, within that overall improvement in public sector pay, we are proud to have achieved particular rewards for nurses, teachers and police, because, let’s face it, for many years they were under-rewarded.”
“The argument is the argument that I made to the hon. Member for Broxbourne (Mr. Walker). There cannot be any automatic entitlement to bonuses or, indeed, to high pay. Any bonuses to people in the public sector can be awarded only on the basis of the performance that they have delivered for the public. Of course, on quangos there are wider questions—not just about pay, but about the number of quangos that we have in this country—and that is why I have asked for a cross-government look at the number that we have. What I will certainly not be doing, unlike the Opposition, is bringing forward plans for another 17 of them.”
“Sir John provides regular updates to the Government on progress. He has now established his office and appointed key members and the actuarial advisers Towers Perrin. On 16 June, Sir John issued a document setting out his proposed approach and requesting that representations be made to him by this Friday.”
“That is a fair comment. I spoke to Sir John Chadwick about this question this morning, and his office has confirmed that he would be very happy to continue to receive representations from Members of this House. The question of the speed of his conclusions is also an important one, but I would like him to balance speed with coming to the right conclusions. He will obviously have to go through an enormous amount of information about policyholders, which will have to be thoroughly analysed before any conclusions can be drawn about the right ex gratia scheme to correct this injustice. Sir John told me this morning that it will be much easier for him to pin down what the next stages will be after this Friday, when all the representations have been received. He hopes to publish a further document pointing out the next steps in August.”
“I would just like to underline my previous answer and to say that speed is of the essence now. It is vital that justice be delivered to the policyholders of Equitable Life. At the same time, however, I appreciate the enormous burden that has been placed on Sir John to get to grips with understanding where there have been losses and the scale of those losses, and where hardship has been caused and the dimensions of that hardship. The hon. Lady will appreciate that those considerations are all vital if Sir John is to establish an ex gratia scheme that will correct this injustice that has so incensed Members of the House.”
“That urgency is shared by me and by Sir John Chadwick, but my hon. Friend would agree that we do not want an ex gratia scheme that does not correct the injustices, which have been accepted by the Government and widely acknowledged on both sides of the House. My hon. Friend would also accept that Sir John has an enormous amount of information to go through, and I would rather that he proceeded with urgency but produced an ex gratia scheme that is right.”
“That anger is shared on both sides of the House, which is why I urge all Members to make representations to Sir John by this Friday. We have had a couple of good debates over the past few months, and it is important to keep up the momentum behind Sir John’s work. That is why he proposed such a short timetable for receiving representations about where injustices and hardship have been caused, and why I am glad that he will produce a document setting out his next steps in August. All Members want a speedy resolution now.”
“This is the kind of infrastructure project that we keep under constant review. It is also closely watched by regional Ministers through the work that I do with the Minister for Regional Economic Development and Co-ordination. We will look into the schemes that the hon. Lady highlights, and if they are being held up through a lack of information, we will make sure that steps are taken to accelerate these projects and get delays out of the way.”
“That is an argument that the chief executive and chairman of the Audit Commission would recognise. Indeed, fruitful conversations take place day to day and week to week between Ministers and the commission about how we can strengthen the role of local authorities in delivering what is a broad package of help, put in place and financed by this Government to ensure that this recession does not cut for long or deeply.”
“As the House will know, a wide range of measures is in place to ensure that we minimise the number of people who lose their home during this recession. I know that the Council of Mortgage Lenders has already revised down at least once the number of repossessions that it anticipates this year, and it acknowledges that it is the rapid action taken by the Government, and the range of help that has been put in place, that will help to deliver that lower number. Obviously, every repossession is a tragedy for the family concerned: we want to ensure that we act to keep such repossessions to an absolute minimum.”
“As the House will know, another place is looking in some depth at the whole question of the Barnett formula and how it should operate in the years to come. We will look very closely at what emerges from the Holtham commission, too. The next real bit of news will be the report from the ad hoc committee that was set up in another place.”