ANY QUOTES USED MUST BE ATTRIBUTED TO SKY NEWS, SOPHY RIDGE ON SUNDAY

SOPHY RIDGE: We are joined from Somerset by the Conservative backbencher, Jacob Rees-Mogg, thank you very much for being with us. I know you managed to listen to a bit of that interview and one of the things that really struck me from what the Chancellor was saying was that if there isn’t a deal, he said that he’d have to set out a new budget next year and actually strike out in a different direction with the economy. What do you make of that, is that something you’d welcome or is that something that worries you?

JACOB REE-MOGG: Well I would have thought it would be better to take the opportunities ahead of us now rather than waiting. This doesn’t sound like George Osborne’s punishment budget, do you remember that we were going to get a punishment budget immediately after the referendum if we had the audacity to vote to leave? This sounds like an approach where policy decisions would be made to embrace Brexit and I’d be very much in favour of that being done on Monday rather than waiting a few months.

SR: Does it concern you though, from what Philip Hammond was saying there, he was talking about actually setting out some of the more specific details in the spending review next year. You’d like to see more happening right now, are you worried that perhaps the budget might be a bit of an non-event?

JACOB REE-MOGG: Well with the lack of a majority I think the budget will not be enormously radical, I think that’s pretty widely accepted. I thought a lot of what the Chancellor was saying in your very interesting interview was important and would be beneficial for the economy but I think we should be making announcements now about how we would deal with leaving on World Trade Organisation terms. For instance, why don’t we get rid of all tariffs on goods that we don’t produce in this country on 29th March 2019 to show that we are open to the world, that we are going to be a global nation rather than a peripheral European nation?

SR: Do you think that the Chancellor could be a bit of an ally in that or do you think that he is someone who perhaps is [inaudible] the benefits of Brexit?

JACOB REE-MOGG: Oh look, the Treasury has been the bastion of Remainerism since the referendum and indeed before. It came out with all these lunatic forecasts before the referendum as to what would happen purely on a vote to leave. Bear in mind the Treasury said there would be 800,000 job losses potentially, just on voting to leave, before anything had happened so the Treasury has rather embarrassed itself, has a lot of egg on its face from getting its Brexit related forecasts so wrong so far and I think there is an element within the Treasury that is still grumpy about Brexit and that’s a pity.

SR: At the same time though, from the Chancellor’s interview, it may be that he is – of course I’m speculating here – he may be talking about actually seizing the opportunities of Brexit if there is a no-deal, as you would see as seizing the opportunities, others would see it perhaps as trying to deal with some of the economic issues of Brexit, by perhaps lowering taxes, trying to attract business, trying to change regulations. Is that something that you’d welcome or do you feel it may actually put off voters on the centre ground?

JACOB REE-MOGG: I think that approach is something the government should be doing anyway, that we want to be a competitive low tax economy open to the world and it is really interesting that the Treasury did a dynamic assessment of the types of revenue that would come from cutting Corporation Tax and reduced Corporation Tax from 28% to 19% and has seen the revenue increase by over 50% so lower tax rates can lead to more tax revenue, helping both the economy and improving public services. Now the Chancellor did talk about this some time ago when he said that one of the options was for the UK to be more like Singapore and although that’s not a perfect comparison because Singapore is a small city state, there are lessons we can learn from other countries about the economic approach we could take. Look what’s happened in America with the significant tax cuts a year ago and an absolutely booming economy. If you cut taxation you can have more money available for public services, a lower deficit and better economic growth. So I think that’s an opportunity that should be taken regardless of Brexit.

SR: … that doesn’t work, that means less money doesn’t it, that means ending austerity may become more difficult to do now and after ten years of austerity many people are absolutely desperate basically for the belt tightening to be loosened.

JACOB REE-MOGG: No, dare I say there are two things that mustn’t be confused here. One is the total tax taken, the other is tax rates. You saw with Corporation Tax which is a very close example in time but you’ve seen it with other rates in the past, that a lower rate can lead to a higher tax take providing more money for public services at the point at which you do it. If you look at the reverse, you will see that the very high rates of Stamp Duty have lowered the tax take, so tax take and tax rates do not go hand in hand and that is not a long-term issue, it’s an immediate issue and I would be advocating looking at rates, doing dynamic assessments of the effects that changing rates will have so that you get lower rates where they work and they produce more revenue, which I think would happen incidentally with Stamp Duty too.

SR: Now of course not long to wait until we know more about what’s in the budget. We’ve heard some announcements around things like high streets, around roads, what would you like to see in the budget tomorrow?

JACOB REE-MOGG: Well speculating on the budget 24 hours before it’s out is a bit of a fool’s errand but I would like to see the Chancellor make announcements getting us absolutely ready for leaving on 29th March, so as I said cutting customs duties on all goods that we don’t produce in this country for example could be something we could do, cutting the VAT rates on products where we’re forced to have VAT rates because of EU regulation so they would go. So what are we talking about? Domestic fuel, women’s sanitary products, solar panels and things like that, where there’s a clear advantage to not having VAT on them.

SR: Now in last weekend’s papers we heard some pretty ugly language directed towards the Prime Minister – killing zones, talk of the knife being twisted – I mean it was pretty lurid violent imagery. Were you disturbed to read the comments of some of your colleagues and what would be your message to them?

JACOB REE-MOGG: Well my message would be that politics can be discussed in a robust but polite way. The Prime Minister is very good at this, she makes her views very clear and I think that’s how politics should be carried out. I’m afraid I think these terms are rather juvenile and indicate a lack of seriousness about politics. Politics is not war, politics is a democratic debate to try and carry the country along with whatever policies are being advocated and to talk of it in terms of war zones and things like that is frankly pretty silly.

SR: And just before you go, Mr Rees-Mogg, last week I spoke to some Young Conservatives in Cambridge and they were basically talking about you in rather glowing terms saying you should be the person who should be the next leader of the Conservative party. Would you rule out running?

JACOB REE-MOGG: Did you manage to find my six children in Cambridge because I can only think they’d be the young people who would advocate such a view. You are very flattering but no, my ambition is purely for Brexit to be delivered, it’s not personal, it’s about the policy being delivered correctly and so I’m not a candidate, there isn’t a vacancy and I wouldn’t see myself as a serious candidate anyway as a backbench MP. But thank you, it’s very flattering, thank you.

SR: Well it wasn’t from me, so there you go! Thank you very much. Let’s be clear! Thank you very much for your time.