Morning press briefing from 13 May 2008
Briefing from the Prime Minister's Spokesman on: Cabinet, economy, housing market, Cabinet meetings, Draft Legislative Programme, knife crime and misc
Cabinet
The Prime Minister's Spokesman (PMS) began by giving a brief summary of Cabinet to the assembled press. Cabinet had met for an hour and 40 minutes that morning. There had been the usual update from Geoff Hoon on parliamentary business, there had been a brief discussion on the Draft Legislative Programme being published tomorrow and there was an update from the Foreign Secretary on the situation in Burma. Most of the Cabinet was spent discussing the economy in a discussion led by the Chancellor, where he emphasised the global nature of the economic situation we were facing at the moment - not only the global credit crunch, but also rising oil prices with the oil price at $125 a barrel, as well as rising food prices.
Asked what the mood was like in Cabinet, the PMS said the mood was focussed, businesslike and determined as always.
Economy
The Chancellor also updated Cabinet on his latest thinking relating to compensation for those affected by the removal of the 10p tax band and that would be the subject of his statement to Parliament this afternoon, where he would set out the latest state of thinking in advance of the Treasury Select Committee Inquiry.
As set out in the Chancellor's letter to the Treasury Select Committee last month, full details of the package should not be expected until the Pre-Budget Report. Put that today's statement would be an approach towards the subject, the PMS advised people to wait for the statement as he did not want to anticipate it.
Asked whether in terms of compensation, no one would receive anything until after the Pre-Budget Report, the PMS repeated that people should wait for the Chancellor's statement this afternoon, where he would set out his latest thinking on the matter. The full details would come in the Pre-Budget Report. Put that both the Prime Minister and the Chancellor had said that people would receive compensation more quickly than that, the PMS replied that that was the position set out in the Chancellor's letter to the Treasury Select Committee of the 23rd April, but he did not want to anticipate further the Chancellor's statement this afternoon.
Asked whether the Chancellor would be able to assure backbench MP's on the matter, the PMS reiterated that people should wait for the Chancellor's statement.
Asked if the timing of the statement was related to the by election at all, the PMS said that the timing of the statement was to enable the Government to set out its thinking in advance of the Treasury Select Committee Inquiry on the issue. Put that Ed Balls had said that it was due to the public's mood on the issue, the PMS reiterated that there was a Treasury Select Committee Inquiry and the Chancellor would be supplying further information on the Government's approach in advance of that. Asked if any backbenchers had been briefed on the statement, the PMS said not as far as he was aware.
Asked if there was any discussion in Cabinet about the price of oil or rising food prices, the PMS replied that clearly this was a global phenomenon that was affecting all countries. As the inflation numbers had shown this morning, it was affecting the UK as well as people would expect. We needed to continue to work with our international partners to put pressure on the oil producing countries in particular to see what more they could do to increase the supply of oil to bring the price down.
On food, the Prime Minister initiated an international engagement on the subject in advance of the G8 Summit in July. Asked how much of Cabinet was devoted to the economy and how much time was spent on 10p tax, the PMS said it was a general discussion on the economy that lasted around an hour. 10p was part of that but it wasn't a discreet part of the discussion.
Asked about inflation and if there would be any further announcements on liquidity, the PMS said that that would be a market-sensitive matter and was for the Bank of England to make a public comment on rather than the Government. On the inflation numbers, the PMS said that we were not normally in the habit of commenting on every specific economic statistic, except that it was clear that what was happening in relation to prices at the moment was that there had been a big increase in global food prices and a big increase in global fuel prices. This was why people were seeing in relation to the inflation figures that the main determinants of the increase were household utility bills, affected by the global oil price.
Housing Market
Asked if the discussion included anything on the housing market, the PMS confirmed that there had been some discussion of the housing market as well. Asked what the tenor was of those discussions, the PMS replied that because of the international credit crunch, mortgage availability was becoming more difficult, so this was a supply issue. It was therefore very different from the situation for example in the early 1990's, when because the economy went into recession and unemployment was very high, there was an issue around affordability. The issue in relation to the housing market now appeared to be very much on the supply side of the market and that was why the Chancellor, working with the Governor of the Bank of England had taken action to increase liquidity into financial markets in order to ultimately make it easier for people to get mortgages.
Put that a Government briefing paper had said that the housing market could lose up to 15% this year, the PMS said he would not comment on leaked documents. The key thing was that the Government did everything it could, in order to demonstrate and to act on the side of people who are affected by this. We saw for example, the announcement last Friday that Caroline Flint had referred to in Cabinet that morning; to make it easier for people to get legal advice should they be affected by repossessions.
The Prime Minister had talked about increasing shared equity to make home ownership more affordable for many people and no doubt there would be more announcements to help people affected by what was happening in the housing market in the weeks ahead.
Asked what the Government's view was on the housing market, the PMS replied that the Government's view would have been set out by the Treasury in the Pre-Budget Report, where they took a comprehensive look at what was happening in the housing market, as they did in the rest of the economy. We didn't provide daily public commentaries of what was happening in the housing market and he was sure the Treasury would provide their next assessment in the Pre-Budget Report.
Asked if a fall in house prices was something the Government welcomed, the PMS replied that it was a market. Therefore, the price is determined in the market, so it was not for the Government necessarily to take a view one way or the other. What the Government could do was to do whatever it could for people affected by changes in house prices. That could be when house prices went up and the Government could help people facing problems with being able to afford buying a house, which was why the Government had introduced shared equity schemes. It could also mean for example when people were facing difficulty paying their mortgage and that was why the Government made an announcement last week on helping people affected by repossessions.
Cabinet Meetings
Asked if there were any plans to hold Cabinet meetings around the country and not just in London, the PMS said there were no specific plans for that at the moment, but it was something the Prime Minister had said that he was open-minded on and it was something that was kept under review.
Asked if the Prime Minister could see advantages in Cabinet meetings being held outside of London, the PMS said that the Prime Minister could see the case for it and he had an open mind on the subject. However, we had no particular plans at the moment.
Draft Legislative Programme
Asked if the Draft Legislative programme was discussed at Cabinet, the PMS said there was a fairly brief discussion on it this morning.
Asked what the timing would be for the Prime Minister's statement, the PMS said there would be a statement to the House by the Prime Minister at 1230
Knife Crime
Asked if the Prime Minister was concerned about new sentencing guidelines stating that people caught with knives could escape with a fine or community sentence, the PMS made clear that the Sentencing Guidelines Council was an independent body. The guidelines they had issued were not saying that if you injure someone with a knife, you would get a fine; they were saying that there were a range of sentences and of course the most serious offences would be dealt with either by custody or given that these guidelines were for magistrates, the Crown Court.
Where a knife was used in a crime, the appropriate offence would be charged, for example, grievous bodily harm would carry life imprisonment. The Prime Minister thought that we needed to continue to look at what more we could do in order to discourage a culture of knife-crime in this country.
This was why the Government had doubled the maximum sentence for possession of a knife, we had introduced a new offence of using someone to mind a weapon, we had given school staff powers to search pupils for weapons, we had raised the minimum age at which a person could buy a knife from 16 to 18years and in the Violent Action Plan, published a few weeks ago, the Government said it would provide police with 100 portable knife arches and 400 search warrants. So of course, we would continue to look at what more we could do, but we had already done a lot of work to help tackle the culture of knife crime in this country.
The other issue that the Prime Minister had been talking about was the need for a presumption to prosecute. There were much more widespread fines or community orders in relation to knife crime, which unlike warnings which were previously more prevalent, do carry a criminal record. So the Government was continuing to tighten up sanctions relating to knife crime wherever it could.
Misc
Asked if political memoirs came up at Cabinet, the PMS said they did not.
Asked whether a referendum on Scottish independence was discussed at Cabinet, the PMS said that it hadn't come up.
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