Queen's Speech - Treasury and Works and Pensions
During the debate on the Queen's Speech, Brooks Newmark speaks about the Statistics and Registration Service Bill and the burden on business of the collection of statistical information.
9.22 pm
Mr. Brooks Newmark (Braintree) (Con): After seven hours of patience, I am pleased to be able to participate in the final day of the Queen's Speech debate. I hope to abide by the principle that ought to apply to both regulation and legislation: less is more. The meat, or should I say the gristle, of this year's Gracious Speech is the Statistics and Registration Service Bill. As the Treasury Committee, on which I serve, discovered in its investigation of the independence of statistics before the summer break, there are some deep misgivings about the Government's proposals. Some of those misgivings, although happily not all, are reflected in the Bill that was published last Wednesday.
The quality of, and ease of access to, statistics forms the bedrock of administrative oversight and parliamentary scrutiny. When questioned about the structure and powers of an independent board, Lord Moser told our Committee that
"if one needs one word, it is 'scrutiny'; it is advising the public, advising Parliament."
We might be forgiven for thinking that the principle of economy, which ought to apply to regulation and legislation, ought not to apply to statistics, because a wealth of material is always to our benefit. However, less can be more when it comes to statistics, too. The Bill does not explicitly address the burdens associated with the collection of and access to statistical information. A study by the British Chambers of Commerce, published earlier this month and en titled "Red Tape: The Real Story", tackles exactly that issue. It contains a number of case studies drawn from real business. One of the first studies concerns the impact of Government statistics on business.
The real problem is that the proposed Bill is introspective, which is symptomatic of what is happening across the Government. Legislation is proposed without a clear view of the effect that it will have after it has passed through its parliamentary stages and gone into force in the wide world. The Treasury wants to make a splash in the press by overhauling the treatment of statistics, which is all well and good. However, we will no doubt have something to say about the details of the proposals when the Bill is debated in the House.
It is clear that irrelevant and inappropriate statistics are as burdensome on business and the economy as a whole as unnecessary legislation and even regulation. Chris Harrod, the chief executive of a sports equipment company, said in the British Chambers of Commerce study:
"as a small businessman I am regularly required to fill out forms by the Office for National Statistics. Many of the forms we are asked to fill out, like the Business Register Survey and the Monthly Enquiry into Production ask for the same information."
He said that the Government
"should either share data across departments as a matter of course or they should look at including default information. At the moment I spend hours of my time which should be devoted to other areas of my business filling in these forms."
The sharing of data has in itself become a minefield. Our Committee examined the problem in detail and the Government's response welcomed our recommendations on the sharing of data and the safeguards that must be in place before that can safely take place. I fear that the complex interactions among the Freedom of Information Act 2000, the Data Protection Act 1998 and the need to share administrative data will hamstring the Bill and add to the complexity faced by both the successor to the Office for National Statistics and business.
The British Chambers of Commerce annual burdens barometer has identified the cost to business of major regulations approved since 1998 as exceeding £50 billion and climbing well into the stratosphere. Some of us would have been present earlier this year when the hon. Member for Wolverhampton, South-West (Rob Marris) was good enough to introduce show and tell to the Chamber by unfurling the whole document and offering a line-by-line commentary of it. By happy coincidence, the subject of the first entry on the burdens barometer was the cost of the Data Protection Act, which has exceeded £6 billion since 1998. The hon. Gentleman said that the regulation
"Could be good, or could be bad."-[ Official Report, 24 April 2006; Vol. 445, c. 414.]
By equivocating, I assume that he meant that the intention behind the regulation might have been good, but that its implementation had been less than satisfactory.
The operation of the Data Protection Act is the subject of a further British Chambers of Commerce case study, in which another business man says:
"The DPA is a worthwhile piece of legislation but the process of registration is both futile for Government and time consuming for business. I do not see how registration assists government other than the revenue they take in initial notification fees and annual renewal fees."
We have registration processes that are futile, compliance that is time consuming and, most worryingly of all, regulation being used as a revenue-raising tool, rather than a way of preventing abuses. That is the story of red tape. Such things are the hallmarks of the Chancellor's marriage to stealthy taxation and unwieldy bureaucracy, which is paid for by the cost of falling productivity and crumbling competitiveness. The opportunity to chart our relentless decline through the medium of newly independent yet sketchy statistics is not much compensation.
Disentangling statistics from the Chancellor's coat tails is only the first step in ensuring that, in his words,
"fiscal decisions are fully transparent and accountable."-[ Official Report, 10 July 2003; Vol. 408, c. 1404.]
Independent statistics make fiscal decisions transparent, but they do not matter a jot to a Government who are not willing to see themselves as accountable.
Several years ago, the Chancellor called the private finance initiative
"a cynical distortion of public finance".
However, in the past 18 months or so, his own cynical PFI distortions have been unravelled by the ONS: £1.25 billion was added in August 2005; £5 billion was added in February 2006; and £4.95 billion was added in September 2006. Will the newly independent successor to the ONS continue to add piecemeal to the Government's balance sheet-a billion here, a billion there-or will there be a clean sweep for statistics and the Child Support Agency following this year's Gracious Speech?
The Chancellor's £5 billion annual raid on pensions has cost pensioners £100 billion. How will the independent board force the Government to confront the looming crisis of their own creation? The Government's spending on consultants reached £2.4 billion by 2005, over£2 billion more than when Labour came into government. How will the new board force the Chancellor to admit that results must follow investment?
How will the independent studies reduce the burdens placed on the most vulnerable in our society? The public sector is expanding and unelected quangos are blossoming while families and businesses alike are simply withering under the tax burden. What teeth will the new board have to deal with those problems? That is what we know without the benefit of truly independent statistics.
9.30 pm
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OTHER CONTRIBUTIONS TO THE DEBATE
Mr. Brooks Newmark (Braintree) (Con): It might help the Economic Secretary to know that there is something called the Laffer curve, and the evidence seems to show that, as Ireland has become more tax-competitive, its Government have raised more tax revenues.
Mr. Redwood: The increase in taxation in Ireland has been phenomenal, and the super-fast growth of the Irish economy stimulated by lower business tax rates has been the main factor. I have not heard any other possible explanation from the Government. It is some four or five months since I first raised the issue, and there is still no official Government position on why Ireland's growth has been three times that of the United Kingdom. Nor is there any answer to my supplementary question: why does Scotland do so badly, only growing at 13.5 per cent. under this Chancellor between 1998 and 2004, compared with 20 per cent. growth for the UK and 61 per cent. for Ireland? That seems to show that the current Chancellor's model of heavy public spending and public sector dependence in Scotland, which he seems to like so much, is particularly bad for the Scottish people. As we see in the parliamentary Labour party, many of Scotland's most talented people come to England in search of better jobs.
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Mr. Newmark: I support the hon. Lady's point that there should be target, but does she not believe that there should be annual targets for CO2 emissions for which the Government are accountable?
Helen Goodman: The debate about annual targets has been fully aired and the argument against them is that there would be too many blips and ups and downs. The weather could have an impact. That is why I would like targets to be set on a three to four-year basis.
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Mr. Newmark: I notice that the hon. Member for Blaydon (Mr. Anderson) is here and I know how passionately he feels about the coal industry. Tax incentives can play an important role. If we give tax incentives to carbon sequestration, that will give business the encouragement to invest in carbon capture, which will support our dying coal industry.
Mr. Weir: I entirely agree. I was not making the case that there should be no tax incentives, but the debate must go wider than tax. Coke sequestration is a good example. Mitsui Babcock, or Doosan Babcock as it is about to be, which is based in Renfrew, is a world leader in this field and has been putting the machinery into Chinese coal plants. Many of the new plants in China, despite what we are told, are sequestrating carbon and making a real attempt to try to come to terms with some of the climate change agenda. We need to think outside the box; all areas of Government need to think about how we tackle climate change.
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Mr. Newmark: Before the Chancellor became the Chancellor, he made a big to-do about ending means-testing. As soon as he became Chancellor, he failed to live up to his pledge. Surely the hon. Lady will recognise that many pensioners are not collecting their due because they find the means-testing process incredibly demeaning.
Ms Keeble: The Conservative party was very cruel to pensioners in running that nonsense about means-testing. The means test and the assessments that people have to undertake for pension credit are two completely different animals. People who went through the means-testing process know exactly how humiliating and degrading it was, but the process for claiming the pension credit was completely different. People could do it over the phone and talk it through.
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Mr. Newmark: Notwithstanding what the hon. Lady says, the fact of the matter is that up to 5 million pensioners are still not collecting what is their due, because they do not like the whole means-testing process.
Ms Keeble: Some people do not take the process up. I agree that that is an issue, just as it is an issue with the child trust fund. However, the figures for success show that the pension credit helps 1.9 million pensioners, of whom, significantly, 1.3 million are women. That is because it targets-[ Interruption.]
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Mr. Newmark: The reason why a more competitive tax base has worked in the Republic of Ireland is that lowering tax has resulted in more tax revenue being collected. That is the most important point.
Sammy Wilson: I think that the hon. Gentleman mentioned the Laffer curve earlier, about which I used to speak to my economics students all the time. I do not think that they understood it too well.
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Mr. Newmark: In fact, through clever devices, the Chancellor has been using off-balance sheet financing, which has increased so that today it is almost£1 trillion, compared with the £486 billion of on-balance sheet borrowing.
Mr. Dunne: As I have just said, off-balance sheet debt is of great concern and I thank my hon. Friend for highlighting the figure.