Andrew Sparrow 

Nick Clegg v Harriet Harman at PMQs: Politics Live blog

Andrew Sparrow’s rolling coverage of all the day’s political developments as they happen, including Robert Chote, the Office for Budget Responsibility, giving evidence to the Treasury committee about the autumn statement and Nick Clegg and Harriet Harman at PMQs
  
  

Nick Clegg at PMQs
Nick Clegg at PMQs Photograph: PA

Afternoon summary

  • Lord Mandleson, the Labour former business secretary, has said mainstream parties must learn to fight back against the arguments being used by populist parties like Ukip. In a speech to the IPPR thinktank he said:

Arguments about identity are very emotional. Arguments about migrants are very emotional. But we have to argue back.

We have forgotten how to make a case. We have forgotten what the arguments are.

We have lost our confidence, lost our bullishness and ability to push back against that emotion with equally charged, emotional, passionate beliefs of our own. And until we rediscover that ability then we are not going to recover or recover very quickly.

  • Alex Salmond, Scotland’s former first minister, has used an interview with the Spectator to set out the SNP’s three ambitions in a hung parliament. He said they were: “pursuing the redemption of the vow in full terms, sticking up for Scottish causes, and pursuing progressive politics with allies on things like the living wage or international issues when we have got a lot to say.” He confirmed that the SNP would not do a deal with the Tories in a hung parliament. And he also defended Prince Charles’ right to send letters to ministers containing advice. He said:

I don’t think I’ve met anyone with a greater love of Scotland than Prince Charles, or the Duke of Rothesay as we should call him. I know some newspapers get extremely upset and irritated by the messages he sends to ministers and I can confirm he does send messages to ministers. But I can also say I have never been upset about any of them. Most of them sound to me entirely sensible.

That’s all from me for today.

Thanks for the comments.

UPDATE AT 4.48pm: Nick Clegg has now released open letters answering the charge that he misled MPs at PMQs. (See 12.40pm.) This is what he says about his claim that Andy Burnham oversaw the privatisation of an NHS hospital.

On 26 March 2010, that is before the General Election and while you were still Health Secretary, the three organisations shortlisted for the contract to run Hinchingbrooke Hospital were Circle Health, Ramsay Health Care UK and Serco Health ... all of which are non-NHS organisations.

The NAO report of the bidding process published on 8 November 2012 ... clearly states that in December 2009 there were only 3 bidders left in the process – Circle Health, Ramsay Health Care UK and Serco Health. It says on page 20 that the “the two NHS trusts involved both withdrew at early stages of the process.”

When making your Point of Order, you may have been referring to the fact that the Serco bid included working with the Peterborough and Stamford NHS Foundation Trust. Given it is clear that the actual bidder was Serco, I suggest that you are stretching the boundaries of accuracy to their very limit.

And this is what he says about the charge that he wrongly said pensioner poverty went up under Labour.

I did not, at any point, claim that pensioner poverty “rose under the last government”. I said that it was “higher” under the Labour Government than it is now, after the reforms led by the Liberal Democrat Pensions Minister, Steve Webb MP, in the Coalition Government. These are very different things and what I said is entirely accurate.

In the letters he has released, he has not addressed the charge that he was wrong about women benefiting more than men from the increase in the basic rate tax threshold.

Updated

Poll shows strong support for Labour messages on the economy

ComRes has released some polling it has done for ITV on the autumn statement.

It found that, of the four tax measures in the autumn statement, the Google tax was the one that people were most likely to say was good for them personally (with a net score of +55 - those who say it will be good for them, 59%, minus those who say it won’t, 4%). The others are cutting stamp duty (+48), abolishing inheritance tax on ISAs (+47) and abolishing air passenger duty (+31). This is curious because the Google tax won’t actually benefit most people personally, unless they recognise the indirect gain they might get from the government getting a fairly minuscule increase in tax revenue. The tax change that most people are most likely to notice, the cut in air passenger duty, is bottom of the list.

But the poll is interesting because it shows strong support for two Labour messages on the economy:

The government is cutting public spending too much and too quickly: +19 (net score - those who agree minus those who disagree)

It would be better to slow the rate of spending cuts even if it makes it take longer to get the country’s finances back on track: +27

By contrast, two coalition messages on the economy do not have public support:

The way the government is going about cutting public spending is fair: -15

Things in this country are generally heading in the right direction: 0

(A third message, that the economy has been fixed, has a net approval rating of -56, but I did not include this in the list of coalition messages because ministers argue the coalition is on course to being fixed, not that it has been fixed.)

Updated

The Commons foreign affairs committee has published a short report on China’s decision to stop it visiting Honk Kong as part of its inquiry into the former colony. It says the government should be protested more robustly, and that the Chinese ambassador should have been summoned to the Foreign Office.

Here’s an extract.

We thank the FCO for its efforts to assist the committee and we welcome the contact it has already had with senior ministers and officials in China about the ban. However, we consider that the minister’s reply did not go far enough, given the gravity of the circumstances and the insult to the House of Commons and to the UK as a whole. We call on the government to respond more robustly to this unprecedented act by the Chinese government. We recommend that the FCO raise this matter with its partners in the European Union. In particular, we recommend that the government summon the Chinese ambassador in London to the Foreign Office, and make formal written protests to its counterparts in Beijing and Hong Kong.

Lunchtime summary

We have cut tax for 11.9m women - the gender pay gap for women under 40 has pretty well disappeared under this coalition. Under Labour, only one in eight of FTSE board members, under this government there are more women on FTSE 100 boards than ever before. The Labour party is becoming the Lance Armstrong of British politics - they have forgotten the better half of a decade of how they messed things

  • Cameron has lit a candle at a memorial to the victims of the Holocaust on a visit to the Nazi death camp of Auschwitz-Birkenau in Poland. As the Press Association reports, writing in the book of remembrance, Mr Cameron described Auschwitz as “this place where the darkest chapter of human history happened” and vowed that the world must “never forget”. During a 90-minute tour of the camp, the prime minister saw the train tracks which brought at least 1.1 million men, women and children - the majority of them Jews - to the camp and entered prison huts where they were held and gas chambers where many of them were murdered. Speaking later, he said his first visit to the camp had filled him with “an overwhelming sense of grief for all those who were killed simply because of their faith, their beliefs or their ethnicity”.
  • Yvette Cooper, the shadow home secretary, has said that refugees should be taken out of the government’s immigration target as it is clouding their consciences over helping vulnerable people. Speaking in the Commons during an urgent question, she called on the government to sign up to the United Nations programme to give asylum to the most vulnerable Syrian refugees. As the Press Association reports, Cooper said the government’s own scheme, which has so far accepted 90 refugees, is not working and stressed the UN is now asking for more help while ministers “do nothing”. James Brokenshire, the immigration minister, said Cooper’s assertion that decisions are being clouded by the net migration target was “actually not worthy to the debate”.

Updated

PMQs - Verdict from the Twitter commentariat

This is what political journalists are saying about PMQs on Twitter.

For Harman

For Clegg (up to a point)

General points

And here’s a link to a PMQs blog: Anoosh Chakelian at the Staggers says the deputy prime minister and his fellow Lib Dem ministers’ attempts since the autumn statement to distance their party from Tory economic policy was utterly destroyed during today’s skirmish.

On the World at One Lynne Featherstone, the Lib Dem minister, has said that she could be appointed to the cabinet in a future coalition government.

Here’s Sean Kemp, a former special adviser to Nick Clegg, responding to arguments o of the kind I was making in my previous post. (See 1.19pm.)

PMQs verdict

PMQs Verdict: Why was Nick Clegg quite so bad? He can be reasonably effectively at the despatch box, and today it is not as if he was caught out by surprise by Harriet Harman’s line of attack. Overnight she signalled that she was going to focus women’s issues today and this morning the Labour party even issued a press release from her on this topic.

What she didn’t do, though, was reveal in advance the precise questions she was going to ask. Clegg should have been able to guess the first one, about the lack of female Lib Dem cabinet minsters, and the sensible thing to have done would have been too concede the problem, and perhaps say something newsy about Lib Dem selection procedures. (The party has a long-standing problem getting women selected in winnable seats.) A real announcement from the despatch box almost always trumps what the opposition has to say. But he didn’t.

After that Harman raised some much trickier questions, all of which were good examples of how an opposition figure can use PMQs to highlight an unpalatable fact. What is the fall in sex discrimination cases since tribunal fees were introduced? 90% What proportion of the people gaining from cutting the top rate of tax were men? 85%. What proportion of those hit by the bedroom tax are women? Two thirds. Clegg did not really try to engage with any of these questions, but instead resorted to a broad-brush defence of the coalition’s general record, using claims that weren’t always factually robust. (See 12.40pm.) It was rather unimpressive.

Harman did not just win the exchanges comfortably. She also effectively countered Clegg’s Lib Dem differentiation strategy by getting him to defend the coalition’s record so unequivocally. Mostly Clegg sounded like David Cameron - except Cameron would have been funnier.

But that takes us back to the question: why was Clegg so poor? I’ve got two theories.

First, perhaps he just thinks it doesn’t count. Performing well at PMQs clearly does matter to Cameron, but Clegg has made no secret of that fact that he finds Westminster culture in general, and PMQs in particular, fairly awful and he may have decided there was not point spending a day and a half crafting his answers just so he could get a good write-up at 12.3opm.

Second, mentally, he may already be heading for the exit. Given the probability of a hung parliament, and the possibility that seat numbers could push Labour towards a coalition with the Lib Dems, you would have thought a shrewd Lib Dem leader might make an effort to keep relations cordial with the opposition. But today it was as if Clegg simply could not be bothered. One reason might be that he does not expect to be around for long after 7 May.

On a point of order, Gregg McClymont, the Labour MP, says Clegg misled MPs about Labour’s record on pensioner poverty. He should set the record straight.

John Bercow says these issues are a matter for debate. If he had to correct MPs when they said something wrong, he would be very busy, he says.

Andy Burnham, the shadow health secretary, says Clegg did not have a good outing on points of fact. Clegg accused Burnham of privatising a hospital. That was not true, he says. Burnham says he did not choose a private bidder to run Hinchingbrooke hospital. When it left his hands, there were three bidders, including an NHS one.

Bercow says it is up to Clegg to decide if he wants to correct the record.

Yvette Cooper, the shadow home secretary, rises to accuse Clegg of getting another fact wrong. He said more women than men gained from the rise in the basic rate tax threshold, she says. But the House of Commons library has produced figures showing that more men have gained.

Bercow repeats the point about it being up to Clegg to decide whether to correct the record.

Peter Bone, a Conservative, asks Clegg if he agrees with David Cameron that new immigration controls should be introduced.

Clegg says that he favours proper exit checks.

Labour’s Brian Donohue asks why oil price cuts are not reflected at the pumps.

Clegg says Treasury ministers have raised this with the oil companies.

Graham Allen, the Labour MP, asks a closed question about the Fixed-term Parliaments Act.

Clegg says it is too early to know what impact it will have. It will be reviewed in 2020.

Allen asks Clegg to commit himself, in his manifesto, to setting up an institute to study what can be done to prevent child sexual abuse.

Clegg says he agrees that more needs to be done to establish “what works” in terms of crime prevention.

Labour’s Ben Bradshaw says, if Clegg needed an operation in Devon, he would be denied it because he smokes. As would Eric Pickles because he’s too big.

That’s a bit harsh, says Clegg.

He says he disagrees with rationing in this way.

As he understands it, the Devon rule relates to people preparing for operations, he says.

Gregg McClymont, the Labour MP, says Clegg said earlier that pension poverty rose under Labour. It didn’t. It fell dramatically. What was Clegg’s source for that?

Clegg says under Labour pensioners got a 75p rise one year. And the coalition brought in the “triple lock” guaranteeing pension rises.

Robert Jenrick, a Conservative, says a quarter of cancer cases are only diagnosed at A&E. Cancer should be diagnosed first, not last.

Clegg says the NHS is seeing 51% more patients with suspected cancer than four years ago. But, where possible, the NHS should do more.

Labour’s Toby Perkins asks Clegg if he backs Labour’s plan to stop large companies charging small companies from being in their supply line.

Clegg says the revelations that have come to light on this in recent days are being investigated by Vince Cable, the business secretary.

Mark Spencer, a Conservative, says Sherwood NHS trust is in special measures. Labour’s PFI contract is to blame.

Clegg says PFI contracts are now costing the NHS £1bn a year.

Labour’s Geoffrey Robinson asks Clegg to use his influence in government to ensure it delivers on its promise to help victims of the contaminated blood scandal.

Clegg says he will look into this.

Clegg says there are fewer Neets (young people not in employment, education or training) in Sheffield than ever.

Labour’s Andrew Gwynne says Clegg has received donations from a firm, Autofil Yarns, that is moving jobs overseas. What does he think of that?

Clegg says he does not speak for the factory. Labour is bankrolled by the unions. They may have even written Gwynne’s question. Isn’t it time that Labour backed party funding reform?

Updated

Alan Duncan, a Conservative, asks Clegg to condemn the killing by the Israeli military today of a Palestinian minister who was just involved in a protest.

Clegg says the government will look into this. He does now know the details. But he appeals for restraint.

Clegg says 5% of contracts went to the private sector under Labour. Under this government it is only 6%.

Labour presided over sweetheart deals for private health firms.

Mike Thornton, the Lib Dem MP, says some of the most heart-wrenching cases in his surgery have involved people let down by mental health services.

Clegg says he has pushed for more money for mental health. He wants it to have parity with physical health.

Labour’s Gordon Banks says his party wants part of the Smith Commission report, allowing votes at 16 for Scotland, to be fast-tracked. Will Clegg back that?

Clegg says the government will stick to the timetable agreed. The government has over-delivered on its promises to Scotland. The Lib Dems back votes at 16, he says.

Snap PMQs verdict

Snap PMQs verdict: Virtuoso stitch-up job by Harman, with Clegg only making thing worse for himself by refusing to engage with her perfectly sound points.

Updated

Harman says most of those affected by the bedroom tax are women.

Clegg says it is time to call out Harman on Labour’s record. Youth unemployment, child poverty, pensioner poverty and income tax for middle income were higher. This side of the House has had to clear up the mess.

Harman says Clegg has demonstrated that he is out of touch with women’s lives. Clegg walks through the lobbies with the Tories. He briefs against them, but votes with them.

Clegg says the British people won’t trust Labour. Manufacturing jobs were lost faster under Labour than under Margaret Thatcher. And Andy Burnham is the only health secretary to privatise a hospital, he says.

Updated

Harman says there has been a 90% fall in the number of sex discrimination cases. What percentage of millionaires getting the top rate tax cut have been women?

Clegg says increasing the basic rate threshold has gone disproportionately to women.

Harman says those tax cuts have been wiped out by the impact of other cuts. Some 85% of people gaining from the top rate tax have been men. How many people affected by the bedroom tax are women?

Clegg says there are more women in the boardroom, and the gender pay gap has been virtually abolished for the under-40s.

Harriet Harman says it is good to see Clegg back in his place since he missed the autumn statement. Clegg has made seven cabinet appointments. How many have been women?

Clegg says Harman knows who he has appointed. But women have got things from this goverment they never got from Labour, such as better childcare and more flexible working.

Harman says Clegg is normally quite forthcoming when replying to questions about himself and women. Since tribunal charges were introduced, what has been the impact on sex discrimination cases?

Clegg says female unemployment rose under Labour. Women were given a 75p rise in the state pension. He cares more about those women than anyone around the cabinet table.

Nick Clegg says he spent one day in Cornwall last week (on autumn statement day). Labour MPs have been spending five years in cloud cuckoo land, he says.

Nick Clegg at PMQs

PMQs is about to start.

OBR at the Treasury committee - Summary

Here’s a summary of some of the key points from the Treasury committee hearing. I may have missed anything in the final few minutes because I’ve been busy with this.

  • The OBR said that the NHS would be “in dire straits” if it were not for immigration. Stephen Nickell, one of the three leaders of the OBR, told the committee:

In the health service, for example, some 35% of health professionals are migrants. So it is quite plain that if they weren’t there the health service would be in absolutely dire straits. That’s a special point.

Nickell also rejected the argument that Britain was full and that there was not enough room for immigrants.

One argument said we’re a small island, not much room. On the other hand, of course, there’s masses of room. The urbanised part of Britain occupies less than 10% of the surface area. The urbanised part of Surrey occupies less of Surrey than golf courses.

But he conceded that people did not like the consequences of development.

Since more immigrants mean more housing, more roads, more airports, more incinerators, more of this being required, and since the evidence would suggest that people by and large don’t like these things, especially if they are near them, that’s the key issue about immigration that people may wish to face up to.

He said that, overall, immigration did not have a particularly good or bad impact on the economy. But he said the impact on low-income workers was negative.

The pay of unskilled workers, particularly in the service sector, has been held back to some extent - not to a massive extent, but to some extent - by unskilled immigration.

  • Steve Baker, a Conservative MP, said he expected low interest rates to lead to “another horrible crash”.

I want to make one point if I possibly can. I’m really concerned that we are not focusing on the extent to which monetary policy is disco-ordinating the market for loanable funds, sending false signals about where we are in the production possibilities frontier, stimulating over-consumption and false investment. And I think we’re going to be caught out by another horrible crash as a result.

(So much for George Osborne’s claim that it is Labour policies that will bring “chaos” to the economy.)

  • The OBR said consumers had been living beyond their means. Robert Chote, the OBR chairman, said that growth had been fuelled partly by people using their savings. That was not sustainable, he said.

If you look at the relatively robust pace of growth over recent quarters, that has been reflected particularly in terms of the contribution from the consumer, in terms of people running down saving rather than having stronger income growth. We have assumed that it is not plausible [that this could continue.] If you look at the last year, the real consumption growth has been running further ahead of real wage growth than in almost any other year over the last 15 or 20 or so. Therefore in our forecast the main reason we expect the quarterly rate of growth to slow is that you see consumer spending moving more into line with income growth, and being less driven by the sort of decline in saving you are talking about.

Updated

Alok Sharma, a Conservative, goes next.

Q: Are attrition rates built into the forecasts?

Yes, says Chote.

Q: But you are putting an uncertainty rate on top of that? Does that mean you are doubling up on the qualifiers? Could these measures raise more?

Chote says the tax avoidance measures could raise more than forecast, but they could raise less too. That’s what the uncertainty estimate reflects.

Q: How confident are you that the tax avoidance measures in the autumn statement will produce as much as they say?

Graham Parker says the OBR is “pretty confident” that its central forecast for the amount of money that will be raised are reasonable. That does not mean it will be right. The measures could raise more money, or they could raise less. But it’s a central forecast.

Labour’s Andy Love goes next.

Q: You say revenues from tax avoidance measures are uncertain. Should they be adjusted to make allowance for this?

Chote says in practice this happens. An attrition rate calculation is included (making allowance for the fact that some of the revenue won’t be collected.)

Avoidance measures tend to be at the higher end of the uncertainty spectrum, he says.

Q: Should the Treasury do more to highlight the uncertainties?

Chote says that is not particularly the Treasury’s role. The OBR primarily consults the experts at HMRC.

Steve Baker, the Conservative MP, has been tweeting from the committee.

And he has also taken issue with Sky’s Ed Conway, who suggested earlier that the hearing was a bit dull.

Baker was talking about this exchange.

Q: Will wage inflation occur in the future?

Chote says the OBR was expecting to see wage growth?

There is a distinction between wage growth with productivity growth (which is good) and wage growth without productivity growth (which isn’t), he says.

Nickell says the OBR expects wage growth to rise.

Q: The ONS keeps revising its data. Is it doing a rubbish job?

Chote says for forecasters to complain about data is like sailors complaining about the sea.

Chote says immigration is not the only source of increased labour supply. We are also getting more older people staying on in the labour market.

As with immigrants, there is a skew here towards low-paid work, he says.

Nickell says, over the next 10 years, for the native population, immigration may be a little bit good, or may be a little bit bad. But “there isn’t, overall, that much in it.”

In the NHS 35% of health professionals are migrants.

If they weren’t there the health service would be in absolutely dire straits.

The argument boils down to people, he says.

Since more immigrants mean more housing, roads, incinerators, airports etc, and since people do not like these things - especially if they are near them - that is the key issue.

One argument says that we’re a small island and that there’s not much room.

But there’s masses of room. The urbanised part of Britain occupies less than 10% of the area.

And the urbanised part of Surrey occupies less land than the golf courses.

But these arguments do not get you very far, he says.

Most of what people object to arise because there are more people.

Mark Garnier, a Conservative, goes next.

Q: Economic forecasts get it wrong. Have you found one that has got it right over the last five years?

Chote says there was one economist, out of the 35 polled by the Treasury, who forecast that GDP would fall in 2008 or 2009. But the same forecaster and been forecasting that GDP would go down for the previous three years too.

Chote says the surprise was the borrowing fell as much as it did in the first two years of this parliament, when GDP growth was so poor.

And more recently the surprise has been how little borrowing has fallen.

Q: Would politicians be wise not do do what the chancellor did in 2010, which was to eulogise your forecasts as what would happen?

Chote says his advice to a politician would always be “Don’t bet the farm on the central forecast”.

He says the OBR does not have a temptation to engage in conviction forecasting.

There might be something to be said for conviction politics; but not for conviction forecasting.

Labour’s John Mann goes next.

Q: Has the OBR increased its productivity over the last four years?

Chote jokes that its reports have got longer.

Mann argues that, in that case, there are other areas of the economy where productivity cannot be measured.

Q: How does your productivity assessment make allowance for zero-hours contract?

Chote says it measures output per hour, as well as output per head.

Q: If you use zero-hours contracts, you do not end up “over-paying” as an employer.

Nickell says, in the data, hours mean hours worked.

Teresa Pearce, the Labour MP, goes next.

Q: Harold Macmillan said in 1951 that housing is essential to productivity. In London we have a housing crisis. Has anyone looked at the impact of this on productivity.

Not to my knowledge, says Nickell.

Q: Do you accept the lack of supply of housing affects productivity?

That’s plausible, says Nickell.

Chote says there is an impact on social security too. The housing benefit bill has gone up. The OBR looked at this in its welfare trends report, he says.

Q: Some councils are at breaking point because of the housing crisis, because of the amount being spent on failure. If you are living in a house that’s damp, and you don’t get any sleep, you won’t be very productive.

Chote says this is taking the discussion out of the OBR’s area.

Q: In your Economic and fiscal outlook, you said you were not convinced universal credit would deliver. Did you take into account the write-offs?

Chote says the OBR was not looking at the start-up costs?

Q: If it comes in late, it will cost more.

Chote says, ironically, delaying it saves money. The gainers will not gain until later. And the losers don’t have to be compensated. So there would be a net gain to the Exchequer. With other benefits, like employment and support allowance (ESA), it works the other way (ie, delays cost money).

Q: What are you concerns about deflation?

Chote says the OBR is assuming that CPI inflation will remain below target until 2017.

Q: What would be the long-term effect on the economy of having interest rates so low for so long?

Chote says he would hope to see spare capacity in the economy used up.

One problem for the Bank of England is knowing what the new “normal” rate of interest rates is.

Steve Baker says he is worried about this. He thinks we could be fuelling over-consumption, and heading for another crash.

Steve Baker, a Conservative, goes next.

Q: What are the major risks to your forecasts? And could the economy over-perform?

Chote says the OBR produces a central forecast. There is a 50% chance the economy will over-perform, and 50% that it will under-perform.

The biggest risk is that productivity will not pick up, he says.

There are other risks. But “how the productivity puzzle is going to resolve itself” and what that means for earnings is the biggest one.

If wages pick up without productivity growth, that would not be a good outcome.

Q: Christine Lagarde, the IMF managing director, recently warned about “the new mediocre”. Do you think this is right?

Chote says there is an argument that the economy will not return to its historic average.

But that would be a big call to make in the absence of evidence. The OBR is not making that assumption.

The European Commission is a bit more cautious, he says.

Andrew Tyrie takes over.

Q: In the last year of a parliament Treasury officials tend to “salt a little away”. You have not been affected by this, have you? [Tyrie is suggesting that the OBR might be unduly pessimistic about its forecast for future tax revenues.]

No, says Chote.

Chote says, if you look at different taxes, there are different trends in terms of revenues.

Fiscal drag could bring in more tax from income tax and stamp duty.

But with other taxes there are long-term trends pushing taxes down.

Nickell says credit constraints are easing.

Three years ago they thought that, by now, things would have got back to normal.

That has not turned out to be the case, he says.

Jesse Norman, the Conservative MP, is asking questions now.

Q: Why has productivity fallen?

Nickell says some of it is to do with the growth of part-time work. But that impact is minor.

He says he thinks the credit crunch has been the main problem. There has been a barrier to the launch of high-productivity firms.

And some people argue that the credit crunch has led to low-productivity firms surviving, zombie firms.

But he says he is more inclined to think the credit crunch restricted the expansion of high-productivity firms.

Stephen Nickell says the OBR believes we are not going to get the productivity back, but gradually the path of productivity will come back to its historic level.

The OBR does not have enough evidence to say that the long-term trend level of productivity has fallen. That would be a very big call to make, he says.

He says the OBR has a scenario where there is no recovery in productivity growth. The outcome, in that case, is “pretty dire”.

Q: Do you expect productivity to pick up?

Chote says the OBR expects it to pick up to normal levels.

Q: But not above trend?

Chote says the OBR is assuming a permanent loss.

Chote says, looking forward, he expects to see fiscal drag in the next few years pulling people into higher tax bracket.

The big picture is that there has been a drop in the tax-to-GDP ratio this year, for reasons that are permanent.

But other factors will increase the tax-to-GDP ratio in the future.

Tyries turns to tax.

Q: Is the downturn in revenues temporary or permanent?

Chote says the amount of tax generated by economic activity has fallen.

Nominal GDP growth has been more rapid this year than expected. But the bits that have outperformed have not been the bits - wage growth and consumer spending - that generate tax.

But there is also less revenue per pound of VAT, he says.

And more of the employment growth has been in relatively low-paid work.

He says the OBR is assuming that this will persist. In other words, this is a structural problem.

The mix of labour/income is more slanted to people who pay less income tax, he says.

Q: But will these people move up the earnings chain?

Chote says the OBR does not look at this.

Q: Your appointment comes up in September next year. What process will be in place?

Chote says his understanding is that the government wants to leave this for the next government.

Q: Do you see a case for some kind of continuity? Would it be helpful to allow you an extension?

Chote says, from a personal point of view, not knowing until June or July whether he will still have a job in September is not ideal.

If the chancellor were happy, he would be happy to carry on for a bit to provide some continuity.

Chote says the OBR was only told that the Treasury was allocating extra money to the NHS after it had produced is economic forecast.

In an “ideal world” that would not happen, he says.

Andrew Tyrie, the committee chairman, starts.

Q: Can you assure us that you are allowed to operate completely independently?

Yes, says Robert Chote.

He says the OBR gets all the information it needs from the Treasury.

OBR gives evidence to the Commons Treasury committee

The Treasury committee is about to take evidence from the Office for Budget Responsibility about the autumn statement.

The three OBR witnesses are:

Robert Chote, the OBR chairman

Stephen Nickell, a member of the OBR budget responsibility committee

Graham Parker, the third member of its budget responsibility committee

You can watch the hearing here.

In a written ministerial statement this morning (pdf) Patrick McLoughlin, the transport secretary has confirmed that the franchise to run the East Coast main line has been handed to Inter City Railways Ltd, a Stagecoach/Virgin joint venture. Michael Dugher, the shadow transport secretary, has described this as “a betrayal of taxpayers”. He said in a statement:

This decision is a betrayal of taxpayers and the travelling public. David Cameron has put privatisation ahead of the public interest. This whole rushed franchise process to re-privatise the East Coast Mine Line should never have happened.

East Coast has achieved top customer satisfaction ratings, established itself as one of the best train operating companies in the country, and will have returned over £1 billion to the Exchequer before privatisation.

It’s ridiculous that our own public operator was barred from running to continue to operate the line. Labour has called for a wholesale review of the franchise process. A different approach is needed – one that puts the public interest first, reverses the presumption against the public sector and properly stands up for passengers.

As the Guardian reports today, Sir Michael Wilshaw, the head of Ofsted, is publishing a report today saying that secondary schools in England are failing in increasing numbers, with more falling into special measures and tens of thousands more pupils attending schools condemned as inadequate.

Wilshaw was on the Today programme this morning. He explained why he thought secondary schools were increasingly failing.

I think it is a number of reasons. One is because transition from good primary schools to secondary schools is poor. The transition from the last stages of primary school to year 7 and 8 is often very poor and secondary schools are not consolidating on the gains that have been made in the last years of primary schools. And key stage two results are very good this year and we are not seeing that progress being maintained on the first years of secondary.

The culture of some of underperforming secondary schools is not good. Disruption is too common, low-level disruption is too common. They are not dealing with the most able children particularly well, or at the other end of the spectrum they are not closing the gap between free school meal pupils and those not on free school meals as well as primary schools. And careers education is particularly bad. So, a range of reasons why underperforming and failing secondary schools are not doing as well as they should be.

I’ve taken the quote from PoliticsHome.

For the record, here are today’s YouGov GB polling figures.

Conservatives: 32% (down 2 points from YouGov yesterday)

Labour: 32% (down 1)

Ukip: 15% (no change)

Lib Dems: 8% (up 2)

Greens: 7% (up 1)

Government approval: -25 (down 3)

According to Electoral Calculus, this would make Labour the largest party, but leave it five seats short of a majority.

David Cameron is abroad and so Nick Clegg is standing in for him at PMQs. This should be notable for two reasons. First, given the amount of time the Lib Dems are spending attacking the Conservatives at the moment, it will be something of a rarity to hear him actually defend the government (assuming that’s what he does). And, second, it’s quite possible that this will be his last time ever taking PMQs. He will be up against Harriet Harman at 12pm.

First, though, we’ve got the Robert Chote and his colleagues from the Office for Budget Responsibility giving evidence to the Treasury committee about the autumn statement. I will be covering that hearing in detail. This is what happened when the Institute for Fiscal Studies gave evidence to the committee yesterday.

Here is the agenda for the day.

10am: Robert Chote , chairman of the Office for Budget Responsibility, gives evidence to the Commons Treasury committee about the autumn statement.

12pm: Nick Clegg faces Harriet Harman at PMQs. Clegg is standing in for David Cameron, who is on a trip abroad.

12pm: Francis Maude, the Cabinet Office minister, attends the D5 summit of the five “most digitally advanced governments in the world”. Other founding members are South Korea, Estonia, Israel and New Zealand.

12.30pm: Lord Mandelson, the Labour former business secretary, gives a speech on Europe to an IPPR conference.

2.15pm: Robert Devereux, the Department for Work and Pensions permanent secretary, gives evidence to the public accounts committee about universal credit.

As usual, I will be also covering all the breaking political news from Westminster, as well as bringing you the most interesting political comment and analysis from the web and from Twitter. I will post a summary at lunchtime and another in the afternoon.

If you want to follow me on Twitter, I’m on @AndrewSparrow.

 

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