Data on public expenditure per head in Scotland and England since 2008-09 can be found in the following table.

The information can be found in Table 9.2 in the Public Expenditure Statistical Analyses 2014 document[1].

[1] https://www.gov.uk/government/statistics/public-expenditure-statistical-analyses-2014

The Government response to the consultation “Freedom and Choice in Pensions”, which was published in July, sets out how the new pension freedoms will be enacted. The Government estimates that up to 18 million people will be able to benefit from the reforms.

The Government is committed to maximising value for money in all areas of public spending, and has introduced a programme to drive efficiencies and reduce wasteful expenditure. By 2014-15, departments working with HM Treasury and the Efficiency and Reform Group in the Cabinet Office will be saving £20 billion a year compared to 2009-10. Spending Round 2013 identified over £5 billion additional efficiency savings in 2015-16.

The Government sets clear principles and guidance for the management of public resources, including achieving value for money, in Managing Public Money. Ensuring value for money is the personal responsibility of each Accounting Officer. The methods by which civil servants determine the long run value for money of programmes are set out in The Green Book: Appraisal and Evaluation in Central Government.

The government currently offers a range of tax reliefs to encourage investment. These form an important part of the government’s growth strategy and its commitment to make the UK one of the best places to start, finance and grow a business in Europe.

To ensure the tax reliefs remain well-targeted, the reliefs are only available where certain conditions are met. The government keeps all these schemes under review to ensure that the reliefs continue to encourage investment in a well-targeted and effective manner.

Between April and May 2014, the Office of National Statistics have reported that the total UK trade deficit widened from £2.1bn in April to £2.4bn in May. This £0.4bn¹ increase was driven by a £0.2bn increase in total exports while imports increased more, by £0.6bn. Goods exports increased by £0.1bn while goods imports increased by £0.5bn - more than service exports and imports which both increased by less than £0.1bn.

Monthly trade data are often volatile and usually subject to revisions in later months. On a less volatile basis, in 2013 the total trade deficit decreased by £4.9bn to £28.5bn from £33.4bn in 2012. This was driven by a £10.4bn increase in total exports while imports rose by only £5.4bn over the same period.

Between April and May 2014, the ONS have reported that the total UK trade deficit widened from £2.1bn in April to £2.4bn in May. This £0.4bn¹ increase was driven by a £0.2bn increase in total exports while imports increased more, by £0.6bn. Goods exports increased by £0.1bn while goods imports increased by £0.5bn - more than service exports and imports which both increased by less than £0.1bn.

Monthly trade data are often volatile and usually subject to revisions in later months. On a less volatile basis, in 2013 the total trade deficit decreased by £4.9bn to £28.5bn from £33.4bn in 2012. This was driven by a £10.4bn increase in total exports while imports rose by only £5.4bn over the same period.

1 The £0.4bn increase is higher than the difference between the two deficits due to rounding.

The UK’s monetary policy framework, set out in the Bank of England Act 1998, gives operational responsibility for monetary policy to the independent Monetary Policy Committee (MPC). The Chancellor of the Exchequer has frequent discussions with the Governor of the Bank of England on a wide range of issues on the UK economy.

The independent Office for Budget Responsibility (OBR) has set out the basis for its forecasts of oil and gas tax revenues in the Fiscal Sustainability Report. The forecast shows that these tax receipts, as a share of GDP, are set to decline by 84 per cent over the forecast period. The government has not made a separate assessment of these forecasts.

The OBR has not published an assessment of what the fiscal position of a separate Scotland would be. However, other independent experts have estimated that in 2016-17, a separate Scotland would have a deficit (per person) of more than twice that of the UK.

HM Treasury has estimated that each person in Scotland is £1,400 a year better off in the UK. That’s equivalent to around two thirds of the total NHS budget in Scotland, or almost as much as Scotland’s entire education budget.

The OBR’s new, lower, oil and gas tax receipts forecast only make a separate Scotland’s fiscal position tougher. In the UK, as part of a larger country, we can pool resources and share risks. This means that public spending in Scotland can remain secure and stable, even as revenues from oil and gas are volatile.

The Government considered the impact of late payment on Small and Medium Enterprises in our discussion paper Building a Responsible Payment Culture. As a result we are working with industry to create greater transparency of payment practices and a more responsible payment culture. This will include a statutory requirement, via the Small Business Enterprise and Employment Bill, for large firms to publish their payment practices. In addition, we are committed to working with the Institute for Credit Management and businesses to strengthen the Prompt Payment Code.

The UK does not have an exchange rate target. The UK’s monetary policy framework, set out in the Bank of England Act 1998, gives operational responsibility for monetary policy to the independent Monetary Policy Committee (MPC). The MPC has the primary objective of maintaining price stability, defined as an inflation target of 2 per cent as measured by the twelve month increase in the Consumer Prices Index. Under the Government’s macroeconomic framework, the exchange rate is allowed to adjust flexibly, and movements in sterling are determined by market forces.

My Lords, the Government have taken a wide range of actions to tackle all forms of tax avoidance. The general anti-abuse rule, which this Government introduced, specifically seeks to tackle abusive tax-avoidance schemes. HMRC has provided examples of the arrangements that will be captured under this rule in its very detailed published guidance. A further example of aggressive tax avoidance is detailed on the front page of today’s Times.

The UK’s monetary policy framework, set out in the Bank of England Act 1998, gives operational responsibility for monetary policy to the independent Monetary Policy Committee (MPC). The Chancellor of the Exchequer has frequent discussions with the Governor of the Bank of England on a wide range of issues on the UK economy.

My Lords, the UK’s monetary policy framework, set out in the Bank of England Act 1998, gives operational responsibility for monetary policy to the independent Monetary Policy Committee,

the MPC. Decisions on setting bank rates are for the judgment of the MPC, with the aim of meeting the inflation target of 2% in the medium term.

Information on the repayment status of student loans is available in the Student Loans Company (SLC) publication ‘Student Loans for Higher Education in England, Financial Year 2012-13’.

The Amount of Total Public Debt outstanding (including loans not yet due for repayment) at the start of Financial Year 2012-13 including interest was £40,271.5m, rising to £46,590.4m by the end of Financial Year 2012-13.

The amount of debt written off or cancelled during the Financial Year 2012-13 was £27.0m. This figure is 0.07% of the Total Public Debt outstanding at the start of Financial Year 2012-13 and 0.06% of the Total Public Debt outstanding at the end of Financial Year 2012-13.

Write offs occur for policy reasons; when borrowers die, become permanently disabled or when their loan reaches age thresholds. An estimate of ‘bad debt’ has not been provided in the answer as there is no standard definition for this.

Statistics referring to the Financial Year 2013-14 will be published in June 2014.

The total amount of pre-2012 income contingent repayment student loan debt that Government intends to sell has not yet been determined. However, over a five year period, as announced at Autumn Statement 2013, sales are expected to generate between £10 billion and £15 billion in revenues, with a central estimate of around £12 billion.

The Education (Student Loans) (Repayment) Regulations 2009 set out the terms and conditions of income contingent student loans. This is also set out in the booklet Student Loans – a Guide to Terms and Conditions, the latest copy of which can be accessed at http://www.sfengland.slc.co.uk/media/666045/sfe_t_c_guide_1415_d.pdf Students are informed at the time of taking out their student loan that the regulations may change from time to time and this means that the terms of their loan may also change.

The information requested falls within the responsibility of the UK Statistics Authority. I have asked the Authority to reply.

Letter from Glen Watson, Director General for ONS, to Lord Barnett, dated May 2014.

As Director General for the Office for National Statistics (ONS), I have been asked to reply to your Parliamentary Question asking Her Majesty’s Government what estimate has been made of the value of the ‘grey economy’, which consists of legal activities but whose participants fail to pay tax or comply with regulations (HL6854).

The Government does not publish an estimate of the ‘grey economy’, although the national accounts compiled by ONS do include adjustments for undeclared income. As explained in chapter one of ONS’s, ‘Blue Book, 2013 Edition’, the adjustment for undeclared income in 2011 was £25.9 billion (approximately 1.7 per cent of GDP). ONS is currently working with HMRC to improve the accuracy of these adjustments. ‘Blue Book, 2013 Edition’ can be accessed at:

http://www.ons.gov.uk/ons/rel/naa1-rd/united-kingdom-national-accounts/the-blue-book--2013-edition/index.html

HMRC publishes estimates of the ‘tax gap’, which shows the difference between the amount of tax that should, in theory, be collected and what is actually collected. This includes estimates of the tax loss by behaviour, which includes the hidden economy, criminal activity, evasion, avoidance, error and non-payment.

HMRC estimates a total tax gap of £35 billion in 2011-12, which was published on 11 October 2013 in ‘Measuring Tax Gaps 2013’:

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/249537/131010_Measuring_Tax_Gaps_ACCESS_2013.pdf

For estimates of tax loss by behaviour, see page 11.

The Mortgage Style loans offered for sale had a face value of around £890 million.

The sale of the Mortgage Style Loan Book was value for money as the purchase price exceeded the value of retention to Government.

The real value of the book is below the face value of the loans because of the subsidised nature of the loans and their age. These loans attract low interest rates and have an earnings threshold for repayment. The age-related write off combined with the earnings threshold means some borrowers never repay.

The sale of Mortgage style Loans also allowed the Student Loans Company to focus on its core business of supplying income contingent loans to current students and collecting repayments from those loans

The Government is committed to supporting small and medium sized businesses and recognises their importance to the economy. Since 2010, the Government has introduced a number of

schemes aimed at improving access to finance for businesses, including the creation of the British Business Bank and the introduction of the joint Government and Bank of England Funding for Lending Scheme.

Decisions about whether to lend to specific individuals or businesses including the rate of interest charged, remain commercial decisions for banks and building societies.

The face value of the Department for Business (BIS) student loan book at 31 March 2013 (prior to the sale of the mortgage style book) was £46 billion. The carrying value, after allowing for impairments set aside for write-off and interest subsidy, was £31 billion.

The £160 million purchase price for the mortgage style loan book represented good value for money for the taxpayer, with the purchase price exceeding the value of retention to Government. Unlike the income contingent loans book, the mortgage style book is an old, closed portfolio whose value is deteriorating. Most borrowers repaying their loans on schedule have fully repaid by now. The vast majority of the loans sold are those where borrowers are currently not meeting their obligations under the terms of the loan agreement, or who are earning below the deferment threshold and so at present have no obligation to repay under the terms of the loans.