Tag: 1999

The press release issued by HM Treasury on 2 February 1999.

Chief Secretary Alan Milburn today outlined how the Government will drive forward the development of the Private Finance Initiative (PFI) and new forms of Public Private Partnerships (PPPs) in his first major speech on the subject.

Mr Milburn said that the Government will pursue a twin-track approach – improving and extending the PFI while alongside that developing and defining other forms of PPP.

Speaking at a Transport PFI Conference in London, Alan Milburn said:

“This Government has revitalised PFI. We have got PFI working in sectors like health where it had not worked before. We have come a long way in the last 21 months but recognise that there is more to do to make PFI and PPPs more generally a genuine national success story.

“We are pioneering new ways of doing things. New partnerships between the public and private sectors. A new understanding that improved public services and better value for money go hand in hand.

“This Government is committed to public private partnerships in general and PFI in particular. In the past, the dogma of the right insisted that the private sector should be the owner and provider of public services. And the left insisted this was all the responsibility of the state. The modern approach to public services rejects these arguments both of the old right and the old left.

“In many cases the best way forward is through new partnerships between the public and private sectors. Where each brings something to the table. Where we combine private sector enterprise experience with public service values. For this Government the key test is what works. We recognise that what the public want is better quality, more responsive public services. Quite rightly, they want their services to be both dependable and modern. Their concern – like the Government’s – is about outcomes not ownership.

“In developing and defining PPP models we will build on our success in getting PFI working. Ours will be a twin track approach. That means improving and extending the PFI and building on the reservoir of expertise that is growing by the day in both the public and private sectors in finding forms of PPP that best suit the specific needs of particular public services.

“We will be taking action to make PFI deals easier to complete. We are now looking at how to streamline the process of putting a PFI deal together. There is little doubt that the similarities between PFI deals means that both time and money could be saved by having more standard template contracts. We will publish a guidance paper on standard model clauses by the end of this month. And next month we will publish guidance on accounting treatment that will help determine the optimal level of risk transfer that will deliver value for money.

“We will continue to improve, identify and develop new opportunities and partnerships with both the public and private sectors. The Government is committed to taking forward a whole range of public private partnerships. That will of course include PFI but not to the exclusion of other forms of partnership. We are committed to making PFI work even better. But not all of our eggs will not necessarily be in the PFI basket. Again for us what counts is what works.”

The press release issued by HM Treasury on 2 February 1999.

A consultation document on new recognition requirements for exchanges and clearing houses is published by HM Treasury today. Announcing publication, Economic Secretary Patricia Hewitt said:

“We have said that we will publish the key secondary legislation to be made under the Financial Services and Markets Bill for consultation. We are consulting on these regulations well in advance so that we have time to get them right.”

The Financial Services and Markets Bill, published for consultation last summer, broadly carries forward the main features of the existing recognition and exemption regime for exchanges and clearing houses. To be recognised, an investment exchange or clearing house has to meet certain requirements. In future these will be contained in secondary legislation rather than on the face of the Act.

Ms Hewitt added:

“It is a key feature of the new legislation that it should be able to keep up with the fast changing financial markets. Putting the recognition requirements in secondary legislation will make it easier for us to respond to any market developments in this area.”

The deadline for comments on the consultation document published today is 30 April.

The press release issued by HM Treasury on 1 February 1999.

Northern Ireland is increasingly being seen as an excellent location in which to set up in business, Financial Secretary Barbara Roche said today.

Last year was a record year with over 0.5 Pounds billion of new investment flowing into the region providing for over 5,000 jobs. Speaking at the Interpoint Centre in Belfast at the Government’s Productivity Challenge Roadshow, Mrs Roche said:

“In recent years Northern Ireland has grown quicker than any other region in the UK, but there is still a long way to go to meet the productivity challenge. All of us must learn how to work better and improve our skills so that we can adapt to meet the demands of a modern economy.

“The Good Friday Agreement and the Chancellor’s 315 million Pounds initiative offer the stability businesses need to plan for the future.  We must ensure that we grasp this opportunity and build a world class economy in Northern Ireland”.

Throughout the 1990s the Northern Ireland economy performed well. GDP rose by 15.6% between 1989 and 1996, compared to 9.1% for the UK as a whole. Manufacturing output rose by 24% between 1990 and 1998, compared to the UK rate of 3.5%. Employment has grown while unemployment has been falling steadily.

Northern Ireland’s economic strategy is currently being reviewed to take account of changing needs and a draft report will soon be presented to the new Assembly for its consideration. This strategy will be a major building block to improving local productivity and generating future prosperity for Northern Ireland.

While in Northern Ireland Mrs Roche also visited Fast Engineering and Randox Laboratories in County Antrim.

The press release issued by HM Treasury on 29 March 1999.

A major Treasury study on the causes and scale of poverty and inequality in Britain and the best means of tackling it was launched today by Chancellor Gordon Brown, Social Security Secretary Alistair Darling and Minister for Public Health Tessa Jowell.

The six-month research study “Tackling Poverty and Extending Opportunity” contains shocking conclusions on the scale of poverty and inequality, and the passage of inequality from generation to generation.

The study, based on 1997 figures, shows:

• 12 million people in the UK – nearly a quarter of the population – live in relative poverty – almost three times the number in 1979;
• inequality rose by a third between 1977 and 1996 – almost unique among developed countries;
• inequality is passed from generation to generation – the children of the low paid are much more likely to be low paid.

It is the most extensive Government analysis yet of child poverty, showing that:

• 4 million children were living in poverty in 1995 – three times the number of 20 years ago;
• 2 out of every 5 children are born poor. Many of them born to families who were not poor before the birth of their child. As many as 1 in 6 families are pushed into poverty with the birth of a child;
• poverty damages a child’s life chances. By the time children are 22 months old there are clear social class differences in their rate of educational development and these differences continue to widen when children start school.

The study concludes that work and access to work is the key driver in Britain today and lack of work is the primary cause of poverty. It shows:

• the number of workless households has more than doubled over the last 20 years;
• work is the best route out of poverty – 8 out of 10 people who moved into work moved out of the poorest fifth;
• education is key to success in the labour market – what you learn is directly related to what you earn – half of people who have no qualifications are without a job.

Work history also has a profound effect on life chances of individuals and their children:

• in the mid 1990’s half of those leaving unemployment were unemployed again within the year;
• people get stuck in a low-pay, no-pay cycle. The number of men stuck in this cycle or on a long-term, low-paid job has doubled since the early 1980s from 1 in 14 to 1 in 7.

The findings in the Treasury report are backed-up by research published today by the Joseph Rowntree Foundation confirming that the Government is right to be concerned about persistent and scarring nature of poverty, particularly on children.

The paper highlights the strategy the Government is pursuing to tackle this poverty and inequality. The strategy covers investment in education to give poor children an equal chance to fulfil their potential, help for families, help to get into work and additional £6  billion a year in support for children. It includes:

• 375,000 people are already participating in the New Deal. It has already helped 55,000 young people, 6,000 long-term unemployed workers and 6,000 lone parents from welfare into work;
• reform of the tax and benefit system to make work pay and remove the unemployment and poverty traps for families with children. The Working Families Tax Credit will provide every family with children with a full-time job a guaranteed minimum income of £200 a week. It means working families will be £24 better off than if they were on Family Credit;
• increases in Child Benefit – by next year it will be worth £15 for the first child and £10 for the second and subsequent children;
• making sure that all children have the chance to thrive when they start school by providing £540 million for the Sure Start programme to deliver integrated services for children under 4 targeted at the areas of greatest need. Budget 99 announced further support for the very earliest stages of development with a Sure Start Maternity Grant to replace the Maternity Payment at double the rate (£200). Investing an additional £19 billion in education over the next 3 years to raise standards and narrow the performance gap.

As a result of these measures one and a quarter million people will be lifted out of poverty by the end of this parliament – 700,000 of them children. And the poorest fifth of families with children will be over £1,000 a year better off.

The press release issued by HM Treasury on 26 March 1999.

Chancellor Gordon Brown outlines Government strategy to tackle child poverty in Scotland.

A half a billion pound strategy to lift 60,000 children in Scotland out of poverty has been unveiled today by the Chancellor Gordon Brown.

The strategy will:

• tackle the problem of workless households and low pay for families:
• support families when they need it; and
• invest in health and family centres.
• The strategy follows a Treasury analysis of the scale and causes of poverty and inequality in Scotland. The analysis reveals a shocking picture of child poverty in Scotland. The picture, based on a snapshot of 1997 figures, shows:
• 41% of all Scottish children under 5 in poverty; and
• 60% of all children in a household where no-one has a job;

Unveiling the strategy the Chancellor said:

“In 1997, our analysis shows that this Government inherited a shocking situation of child poverty in Scotland. We must put an end to poverty being passed down from generation to generation and give all our children the best start in life.

“Our strategy to tackle child poverty is to support work but it is also to support families when they need it most. The evidence on child poverty also shows the need for early intervention to give very young children the best start in life. It also shows the need both for financial support and for proper support services – health, education and social services – to help families.

“We have allocated £42 million to local authorities to help give very young children in our most deprived areas a better start in life. Some of the money will be used to expand family centres which offer not only childcare facilities and play facilities but access to professional support for those who need it.”

Support will come from:

WORK

• +350 million for the New Deal in Scotland helping families make the move from welfare to work;
• the new Working Families Tax Credit which will guarantee a minimum income of +200 for families in Scotland. WFTC will benefit 140,000 Scottish families – 45,000 more that were previously entitled to family credit;
• introduction of the National Minimum Wage; and
• the new 10 pence rate of income tax, the cut in the basic rate to 22 pence and reform of National Insurance.

SUPPORT FOR FAMILIES

• increase in the rates of support for children under 11 (within WFTC and income-related benefits) by £5.75 over the next year;
• a new Sure Start Maternity Grant of £200 linked to contact with a healthcare professional;
• increases in Child Benefit – by next year it will be worth +15 for the first child and £10 for the second and any subsequent children;
• introduction of a new Children’s Tax Credit which will be worth up to £416 a year; and
• as a result of these measures spending on children in Scotland will increase by £500 million a year.

EDUCATIONAL DEVELOPMENT

• a £42 million investment to improve the provision of services for children in their early years;
• an additional £510 million will be invested in education in Scotland; and
• there will be new measures to raise educational achievement level of all children.
• The Chancellor made a speech to the Convention of Scottish Local Authorities at the Crieff Hydro Hotel.

The press release issued by HM Treasury on 17 March 1999.

A consultation document on the financial promotion regime under the Financial Services and Markets Bill is published by the Treasury today.

Announcing publication, Economic Secretary Patricia Hewitt said

“The regulation of the promotion of financial services is an important aspect of the new regulatory regime on which full consultation is needed. Now that shares, insurance and banking can be promoted on the Internet, the old rules on investment advertisements and cold calling are becoming out of date. We need a new regime of financial promotion that is technologically neutral and can quickly adapt to future changes. We want to be able to take the best possible account of the views of consumers, financial services firms and companies – particularly smaller companies – seeking to raise capital.

We have therefore decided to consult in two stages. This consultation paper sets out various aspects of the approach we propose for the new regime, in particular our approach to exemptions from the prohibition on financial promotion by unauthorised persons. We will take careful note of responses in our preparation of secondary legislation, which will then be published for comment in a further round of consultation. In drafting the secondary legislation we intend, wherever possible, to avoid unnecessary regulation.”.

Comments on the consultation document are sought by 30 April 1999. Following a consideration of responses, the Treasury will publish a further consultation document containing draft legislation setting out exemptions from the prohibition on unauthorised persons making financial promotions.

The press release issued by HM Treasury on 7 March 1999.

The Chancellor Gordon Brown tonight set out a four point plan to help the world’s poorest countries.

The four point plan is to:

• Cut the debt
• Increase the aid
• Give a billion
• Sell the gold.

Mr Brown also referred to his forthcoming Budget on Tuesday. He said:

“One theme of my Budget is the same as my theme tonight – that supporting families by supporting children is not only a good in itself but the best investment for any country in its future.”

The Chancellor went on to outline his four point plan for helping the world’s poorest countries. He said:

“To build anew we make four demands of Governments and of ourselves:

“These are a set of new and practical challenges to take out into the world – not just a call that might bring people to their feet – but a demand that must bring Government to their senses everywhere.

“It is now time not just to agree a Millennium target for the numbers of countries gaining debt relief, but for the actual and total amount of debt which will be wiped out, dramatically cutting the debts of the world’s poorest countries in a way that will allow them to borrow what they need in the future, in reasonable amounts, and at reasonable rates, which they can realistically expect to repay.

“Until last year, only a few billions of debt had been wiped out, tragically forcing too many countries to spend more in debt interest payments than they could afford.

“Our proposed reforms, if implemented by the major countries will, in 22 months, wipe out $50 billion of debt over the coming years, releasing resources from debt servicing for productive development.

“It is time to ensure that – as the UK has already been doing – all donor countries write off their aid loans to the poorest countries, debts that poor countries cannot and should not have to pay.

“It is also time to ensure that when a decision to relieve debt is agreed, countries do not have to wait three years – three more years of misery – but get the full benefit of debt relief immediately.

“Second to pay for the new fast track approach will require the sale of at least $1 billion of IMF gold”

“When the poverty is so immediate, the need so urgent, the suffering so intense…….”

“We cannot – we must not – bury the hopes of a quarter of humanity in lifeless vaults of gold.”

“Because debt reduction, poverty reduction and economic progress must go together, the billions saved from debt payments must not be wasted on weapons or lost to corruption but they must be invested in health, education and economic development.”

“Our goal, cutting in half the proportion of the world’s population living in absolute poverty by 2015 demands urgent action, indeed sacrifice, from the world’s richest countries.

“For our part the British Government will increase aid – by 28% in real terms or #1.6 billion over the next three years – and Clare Short will re-direct that aid to areas of urgent need.

“We should ensure that next year as we wipe out billions of debt at least $60 billion will go from rich countries, to poor countries, $60 billion for the healing of people, the teaching of children and the creation of economic opportunity.

“And just as Governments can do more. So can each of us as citizens.

“Today British people give #220 million a year to developing countries, nearly #450 million over a two year period. I want us to raise that to #650 million, or $1 billion before the end of the year 2000.

“To match the donations of every individual to third world charities we have set aside #60 million pounds in Millennium Gift Aid.

“The relief is to the end of 2000 – to mark the Millennium by asking people in this country to give more of themselves to those many who have little.

“For every #100 a family or individual gives, the Government will give an extra #30 – and make the money go further.”

“Now as never before our generation has, within its grasp, the means to eliminate abject poverty once and for all. We must seize it.”

The Chancellor praised the churches for their work:

“For your work from the human chain that enveloped Birmingham last year to the missionary work and sacrifice in the farthest corners of the globe every year, we thank you – for the width of the individual generosity you show, the breadth of the national campaign you have led, the sweep of your achievement so far.”

The press release issued by HM Treasury on 5 March 1999.

The operation of the FSA would be guided by the principle of a light touch where possible with protection where necessary, Chief Secretary Alan Milburn said today.

Mr Milburn was announcing the Government response to the extensive consultation on the Financial Services and Markets Bill, published in draft form in July 1998. Publication today of a progress report on the Bill confirms that the consultation has resulted in significant improvements to the draft Bill including:

– a framework for fair and transparent disciplinary procedures

– improving the requirement for the FSA to consult on and assess the cost of new regulations

– ensuring that the FSA is properly accountable, with annual public meetings and assessment of its performance against its objectives by practitioners as well as consumers.

Mr Milburn said:

“I am immensely grateful to the many organisations and individuals who took part in the consultation about the Bill.

“The consultation has revealed widespread support for our proposals and we have been able to take on board some significant suggestions for improvements to the Bill.

“By creating a single regulator the Bill will streamline regulation for the financial services industry while affording proper protection for the consumer. Our presumption is in favour of light touch regulation where possible with protection where necessary. I know
that Howard Davies who has made excellent progress in setting up the FSA fully shares these objectives.

“Overburdensome regulation would stifle innovation and increase consumer costs. The Bill will enhance the competitiveness of the industry while ensuring better protection for financial services customers.

“Nobody should be in any doubt that we will be tough on City crime, malpractice and abuse, and that we will give the FSA the powers it needs to deal with it.

“The changes we have made as a result of consultation will ensure that the FSA uses its powers responsibly and accountably.

“Our plans will enhance the City’s already good reputation and will make the FSA an international model for modern regulation.

” The Government’s progress report will now be sent to the joint committee established by Parliament to scrutinise the Bill. The Committee, chaired by Lord Burns and drawn from both the House of Lords and the House of Commons, met for the first time this week. It is due to finish its pre-legislative scrutiny at the end of April after which the Bill will commence its Parliamentary stages as soon as possible.

The press release issued by HM Treasury on 3 March 1999.

A four point plan to help relieve the debts and aid poverty reduction programmes in the world’s poorest countries was unveiled today by the Chancellor Gordon Brown and Clare Short, Secretary of State for International Development.

At a meeting in Downing Street, with representatives of the faiths, the Chancellor stressed that to improve the lives of people in the poorest countries required a mobilisation of the world community.

The Chancellor and the Secretary of State announced a four point plan:

CUT THE DEBT

A target for committing ourselves by the end of the year 2000 to reducing third world debt by a massive $50 billion. This reduction could be achieved by changes to the IMF/World Bank’s Heavily Indebted Poor Countries (HIPC) initiative to bring faster, deeper and wider debt relief.

BOOST THE AID

A call to the developed countries to increase its aid flows to poor countries to $60 billion by the year 2000 to help in social, health and education programmes to reduce poverty.

GIVE A BILLION

A challenge to non-governmental organisations to increase their aid to $1 billion by the end of the year 2000. The Government will be helping through Millennium Gift Aid which will allow charities to claim tax relief on donations of 100 Pounds to support educational and anti-poverty projects in the world’s poorest countries.

SELL THE GOLD

Supporting the sale of $1 billion of IMF gold to fund enhanced debt relief through the HIPC initiative.

The Chancellor said:

“The UK will go into the Millennium with targets to increase debt relief, international development assistance and charitable giving to the world’s poorest countries. Together, these proposals can go a long way towards helping to eliminate poverty in the developing world.

“But this will require a mobilisation of the world community – international organisations, governments in the developed and the developing world, charitable organisations and individuals.

“This will be a true partnership in action – a Millennium Challenge for all – so that as we enter the new century we take a major step towards wiping out unsustainable debt and poverty with it.”

NOTES TO EDITORS

1. Background on each of the four points of the plan: CUT THE DEBT; BOOST THE AID, GIVE A BILLION AND SELL THE GOLD are attached.

CUT THE DEBT

A UK Target For Reducing Third World Debt By $50 Billion By The Year 2000

Last week the Chancellor announced that the British government would be pressing for a new debt relief package in the run up to the Millennium. His proposals, if agreed to by the major countries, would involve a commitment by the end of 2000 to reduce the debt burden of the world’s poorest countries by $50 billion.

This massive reduction in the debts owed by developing countries to the developed world would be achieved through a number of different changes to existing debt relief mechanisms:

Changes to the IMF/World Bank’s Heavily Indebted Poor Countries (HIPC) initiative. The UK has secured a fundamental review of the HIPC initiative, which is due to take place this year. Alterations to HIPC proposed by the UK include:

Reassessing the current debt sustainability ratios in order to provide deeper and wider debt relief.

Shortening the timetable for debt relief. Countries currently only receive the benefits of debt relief after 6 years. We are pressing for this timescale to be halved in order to provide quicker debt relief for the most highly indebted countries.

IMF gold sales

Raising the ceiling on debt relief. The UK is pressing for all creditor countries (members of the Paris Club of official creditors) and International Financial Institutions to agree to go above the traditional 80% ceiling on debt relief where necessary.

The UK will be pressing for the resources released from debt repayments as a result of this initiative to be invested in health, education and poverty reduction programmes in the countries concerned. In this way, the governments of the developing countries themselves will be brought in to our Millennium challenge.

INCREASE THE AID

A UK Call For The Developed World To Increase Its Aid Flows To Poor Countries To $60 Billion By The Year 2000

Last year it was announced that the UK aid budget was to be increased by 28% in real terms, raising the budget to over 3 billion Pounds a year for the first time – implementing the British Government’s pledge to reverse the decline in development assistance.

However, the international trend is very different. Aid from Western governments to developing countries has been declining in recent years. Indeed, in 1997 there was a 14% decrease in aid flows from western governments to the third world.

That is why the Government will be pressing, as part of a Millennium Challenge, for the western community to step up its aid contributions to the developing countries. Our target will be for official development finance from western governments to governments of third world countries to be increased to $60 billion by the year 2000.

This increased finance to the poorest countries will also be reinforced by reductions in annual debt repayments as a result of our $50 billion debt stock reduction.

This aid target will enable us to tackle poverty effectively and to make a lasting difference to the lives of poor people. A key point to communicate in any campaign in this area is that debt relief, and the UK’s role in pushing for it, is only a part of the overall solution. Debt relief must be seen as one of a number of mechanisms that are being used to support those countries which are themselves committed to eliminating poverty and to increasing social expenditure, particularly on health and education.

GIVE A BILLION

A Challenge To UK NGOs To Increase Their Donations To Developing Countries To $1 Billion For The Millennium

The Chancellor and the Secretary of State for International Development have challenged UK NGOs to increase their aid flows to the world’s poorest countries by a similar proportion to the Government’s efforts on debt relief, raising the total to $1 billion over two years.

The Government is encouraging and facilitating the NGO target by introducing Millennium Gift Aid. This scheme provides for tax relief to be claimed by UK charities on donations of over 100 Pounds to support education, health and anti-poverty projects in the world’s poorest countries. This means that money donated goes further. Every 100 Pounds donated becomes 123 Pounds, or 140 Pounds. The relief is time-limited to the end of the year 2000. This is to take the opportunity presented by the Millennium to ask people in this country to give to those in poor countries who are less fortunate than ourselves.

Over 260 UK charities have already registered for Millennium Gift Aid.

Official statistics show that aid agencies are currently donating a total of $330 million in private aid flows every year. To raise that amount to $1 billion for the Millennium, NGOs together would have to boost their efforts by 100 million Pounds a year for two years.

This money should be put directly to work in the poorest developing countries.

SELL THE GOLD

A Campaign To Lobby The IMF To Sell Some Of Its Gold Reserves, Invest The Proceeds And Spend The Interest On Increased Debt Relief

The IMF holds several billions of gold. The UK has consistently argued that a proportion of this gold should be sold in order to pay for an enhanced Heavily Indebted Poor Countries (HIPC) initiative. To date, there has been no international agreement.

The UK would support the sale of at least $1 billion of IMF gold in order to fund an enhanced HIPC initiative, and more if necessary. The IMF gold would be sold and the money reinvested in an interest bearing asset. The interest would then be used to fund debt relief.

The press release issued by HM Treasury on 3 March 1999.

The Treasury announced today a research contract designed to identify and track major trends in flows and charges as the market for Individual Savings Accounts (ISAs) develops after the launch on 6 April.

The research will involve surveying ISA providers, including measuring the extent to which CAT standard products are sold. The Treasury invites firms approached by the consultancy conducting the research to assist this important exercise by providing data for the survey. This will not identify contributing firms by name.

To provide a baseline for the first year of the ISA, it will also involve conducting a similar assessment of the final weeks of the present market, including PEPs. The Treasury, Inland Revenue and Financial Services Authority will use the results of the research for policy evaluation. The research will be carried out by the McKinsey consultancy.