House of Commons

Thursday 17th May 2012 Commons Chamber

Thursday 17 May 2012

The House met at half-past Ten o’clock

Prayers

Thursday 17th May 2012 Commons Chamber

[Mr Speaker in the Chair]

Oral Answers to Questions

Thursday 17th May 2012 Commons Chamber

The Secretary of State was asked—

[Diana Johnson (Kingston upon Hull North) (Lab)]

1. What assessment he has made of the effect of changes to the feed-in tariff on the number of solar PV installations in the last 12 months.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

In the last 12 months, there have been approximately 270,000 photovoltaic installations registered on the microgeneration certification scheme database, against a forecast of just 35,000 installations when the scheme was launched in 2010. Moreover, having substantially reduced the cost of each installation to electricity bill payers, the coalition is now in a position to significantly expand the ambition of the feed-in tariffs scheme.

[Diana Johnson]

Following the chaotic cut to the feed-in tariff, there has been a 90% fall in solar panel installations, and 6,000 jobs have gone in the industry, including more than 100 in my constituency of Kingston upon Hull North. Does not the Government’s mismanagement and this debacle mean that the industry could be strangled at birth? It also puts at risk investment in the renewables industry, which is so important to areas such as Hull.

[Mr Davey]

I am surprised the hon. Lady reaches that conclusion. Since the 21p tariff came in 10 weeks ago, there have been more than 26,000 installations with 86 MW of capacity, which is equivalent to the installation rate achieved in August 2011, when the tariff was at 43p. The installation rate in the period is 1.7 times what it was in the same period last year.

[Mr Philip Hollobone (Kettering) (Con)]

Feed-in tariffs are not the only way to encourage solar PV installations. Can more be done with building regulations, especially to encourage solar to be built in to new-build properties at the start?

[Mr Davey]

I am sure local authorities will look at that proposal, but the key thing is to ensure that our new, more stable and predictable regime supports the solar industry, as we believe it will. We need to ensure that the message goes out that the solar industry is back in business and on a sound footing. There will be many more solar installations compared with what happened under the solar installation regime we inherited from the Labour party.

[Caroline Flint (Don Valley) (Lab)]

Last week, just 900 installations took place and two thirds of businesses had empty order books, but my question is about the Government’s next round of cuts to solar, which is due on 1 July. Last night, the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker), tweeted:

“Having listened carefully to industry, we are looking at scope for pushing back a little the next proposed reduction in the #solar tariffs”.

The truth is that the Government have missed the deadline legally required to provide notice to Parliament for the next round of cuts to come into force. Is not the Government’s incompetence the real reason why they are backtracking?

[Mr Davey]

The right hon. Lady seems to think that we should not listen to the industry, but I do. We are considering tweaking the start date for the next tariff reduction—if we change it, it will be a tweak, not a massive change. She needs to understand that the changes that we have consulted on and are introducing will bring stability and mean that we have solar power for the many, not the few.

[Caroline Flint]

There will be laughs echoing outside the Chamber at the Secretary of State’s suggestion that the Government have been listening to the industry, but my question was about parliamentary procedure. Parliamentary procedure requires that due notice must be given in advance of the cuts being brought into force on 1 July. My understanding is that the Department has missed—legally—the deadline required. Will the Secretary of State therefore confirm whether the Department has missed the deadline required to give notice to Parliament? If it has, it is absolutely the truth that the Government cannot legally impose the cuts on 1 July. Why does the Secretary of State not just own up, end the uncertainty and commit to scrapping the next round of cuts on 1 July?

[Mr Davey]

The right hon. Lady started by saying that the industry will be laughing, but Paul Barwell, the chief executive of the Solar Trade Association, said in The Independent on 9 May 2012:

“The current 21p subsidy can actually give a return up to 10 per cent, tax-free, index-linked, for 25 years, making it one of the most attractive investments around.”

That is what the industry is saying. The Government will abide by all the procedures required by the House and lay the regulations when required.

[David Rutley (Macclesfield) (Con)]

2. What progress his Department has made on the introduction of the green deal.

[Tom Brake (Carshalton and Wallington) (LD)]

3. What progress his Department has made on preparatory work on the green deal.

[Damian Hinds (East Hampshire) (Con)]

6. What progress his Department has made on the introduction of the green deal.

[Amber Rudd (Hastings and Rye) (Con)]

18. What progress his Department has made on the introduction of the green deal.

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

The green deal is a flagship policy for the coalition. We are making good progress towards the introduction of the green deal this autumn. We are determined to have a solid framework in place for this transformational scheme, which will enable the green deal market to grow right through to the next decade and beyond.

[David Rutley]

Macc2020, an active and energetic community group in Macclesfield, has effectively used a local energy assessment fund to stimulate take-up of the green deal among home owners and to promote local small and medium-sized enterprises associated with energy efficiency. Does my hon. Friend agree that that is the right approach given that economic development potential?

[Gregory Barker]

Absolutely. Macclesfield is a terrific example of community activity. That is exactly the kind of approach we want to see followed across the whole country. It will help get the green deal off to a strong start. It is great that my hon. Friend’s constituency is blazing a trail, and I congratulate everyone involved—perhaps he will do so in person on my behalf—on taking advantage of the DECC LEAF scheme to such good effect.

[Tom Brake]

I have had a very positive meeting on the green deal with Sutton Seniors Forum, Ofgem and the Minister of State, Department of Health, my hon. Friend the Member for Sutton and Cheam (Paul Burstow). One issue that arose was the importance of providing clear information to people, particularly senior citizens. What do the Government intend doing on that front?

[Gregory Barker]

We already have a lot of information on our website, but obviously the scheme has not been launched yet and we still have some way to go. The level of consumer information will be stepped up in the autumn to coincide with the launch, when there will be a call to action on the green deal. We are keen to ensure that pensioners and every other part of society are fully briefed on the opportunities presented by the green deal.

[Damian Hinds]

Like Macc2020, Energy Alton in my constituency has done a great job in blazing a trail for the green deal. What can be done now to ensure that local small businesses in East Hampshire benefit fully from the business opportunities?

[Gregory Barker]

My hon. Friend is right to raise the issues of small and medium-sized enterprises, which will be critical to delivering the green deal at a variety of levels in the economy. We have taken measures to reduce the barriers to SMEs, after working closely with them in preparing the green deal legislation, and we continue to engage closely with the small business sector.

[Amber Rudd]

My hon. Friend has been kind enough to visit Hastings on several occasions, as he is a neighbouring MP, and will be aware that many of my constituents live in housing association property. How will the green deal benefit residents in housing associations?

[Gregory Barker]

Absolutely. I know that my hon. Friend is a terrific advocate for Hastings, and I can assure her that social housing will be among the first to benefit from the green deal revolution. Dedicated funding within the £1.3 billion of energy company obligation subsidy will be focused on the most deprived areas of the country, so I would expect areas such as Hastings to be among the first to see the benefits. With her as its MP, I am sure it will.

[Dame Joan Ruddock (Lewisham, Deptford) (Lab)]

Will the Minister explain what happened to the 30,000 people who applied for help through Warm Front last year? Despite an underspend, they did not get anything. Will he apologise to them for having to wait for this much heralded green deal and will it actually be delivered to the very poorest? I doubt it.

[Gregory Barker]

I am pleased to say that since I became Minister in the right hon. Lady’s place, the number of complaints about Warm Front has reduced substantially. She will know that there was a massive complaint bag about Warm Front while she was in office. We have not seen that since I entered office. Of course we will continue to run Warm Front though next year. It remains part of a suite of measures to tackle fuel poverty, and we remain committed to doing much more.

[Barry Gardiner (Brent North) (Lab)]

In the interests of transparency, will the Minister share with the House the benchmarks he has set for the uptake of the green deal scheme in the first to third years and what emissions reductions he has set as the benchmarks for the success of the scheme?

[Gregory Barker]

We have to get away from this target mania that existed under Labour and understand that this is not some sort of Stalinist five-year plan. We are unleashing the power of the private sector, and as a result we will be far, far more successful than any of these top-down Whitehall programmes initiated under the previous Government.

[Caroline Lucas (Brighton, Pavilion) (Green)]

There is real concern that under green deal plans there is not enough money for fuel poverty. Will Ministers reconsider the possibility of recycling revenue from the carbon floor price and EU emissions trading scheme revenue into the ECO pot to top it up and to prevent the poorest customers from cross-subsidising rich customers?

[Gregory Barker]

The hon. Lady raises a serious point. I listened to what she said in the Energy Public Bill Committee, to which she made a constructive contribution, about how we should design the ECO and use it to tackle fuel poverty more effectively. More than half the £1.3 billion of ECO subsidy will be targeted at the fuel poor through various streams, which should go a long way to meeting her concerns about the need to ensure that the fabric of our housing and the improvements to it have the fuel poor at their heart.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

I have listened carefully to what the Minister has said. The launch of the green deal is just five months away, yet we are still waiting for the secondary legislation to be published. Energy companies do not know whether they are going to be ready for the launch, no green deal assessors have been trained, no detail is available on the interest rate, and the Government’s wildly optimistic predictions on jobs and take-up are constantly being downgraded. The Minister said a moment ago that he did not believe in targets, yet only about 12 months ago he was saying that 14 million homes would be covered by the green deal by 2020. We now know that No. 10 is also worried about it, and is calling on the Cabinet Office to try to prevent this impending car crash. How will the Minister ensure that the interest rate is low enough to make sure that the green deal is a good deal for consumers?

[Gregory Barker]

I thank the hon. Lady for that speech. The fact is that the green deal is on track, and we will be publishing the secondary legislation very shortly; it will be done and dusted before the summer recess. We had an excellent meeting yesterday with the Prime Minister and the Deputy Prime Minister in which we reviewed the whole green deal programme, and I am glad to report that we are all on track.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

4. What steps he is taking to help households with their energy bills.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

The Deputy Prime Minister recently announced an agreement with energy suppliers to ensure that all consumers have good information on their supplier’s best tariff. This builds on previous actions by the Government to help people to control their bills, and complements Ofgem’s proposals in the retail market review to protect consumers. We are also encouraging consumers to harness their collective purchasing powers.

[Debbie Abrahams]

I thank the Secretary of State for his reply. In my constituency, 6,563 over 75-year-olds would benefit by £200 a year from being put on the lowest tariff. I appreciate what the Government are doing, but many of those people are unable to access online facilities easily. What else can the Government do to ensure that they benefit from these measures?

[Mr Davey]

Thanks to the deal that we have negotiated and that the Deputy Prime Minister has announced, those pensioners in the hon. Lady’s constituency will be written to every year by their energy supplier and advised of the best tariff for them. Furthermore, because of the warm home discount for which this Government have legislated, 600,000 of the poorest pensioners in the country are getting a direct discount of £120 off their energy bills. That is real action.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

Will the Secretary of State commend the work of the Energy Saving Trust on reducing household bills? Will he also point it in the direction of reducing the cost of heating water, as a means of reducing overall energy costs, by heating only the water that a household needs to use each day?

[Mr Davey]

My hon. Friend is right to pay tribute to the work of the Energy Saving Trust. It does a huge amount of work on providing information, advice and support to a whole range of people, particularly the most vulnerable, and I am sure that it will have heard her welcome comments.

[Bill Esterson (Sefton Central) (Lab)]

If the Secretary of State is serious about the green deal, why will he not ensure that the energy companies have to put the 9,914 pensioners over the age of 75 in my constituency, and others around the country, on to the lowest tariff?

[Mr Davey]

I think the hon. Gentleman is mixing up the green deal with the action that we are taking to help people with their consumer bills. The warm home discount, which targets the 600,000 poorest pensioners, is one of the most effective ways of providing that help. Under the scheme proposed by Labour, some of the wealthiest pensioners would get the discounts, and I am afraid that that shows that it is no longer the party of the many.

[Sir Robert Smith (West Aberdeenshire and Kincardine) (LD)]

I very much welcome the move to ensure that the market works as efficiently as possible, so that consumers pay no more than is necessary. Should we not make it clear to consumers, however, given the amount of investment that needs to be made in our energy infrastructure, that future generations will have to pay a higher price to ensure that we can keep the lights on in a low-carbon way?

[Mr Davey]

My hon. Friend is right to say that we face a big investment challenge in this country. That is why, in the Gracious Speech, Her Majesty announced that we would be legislating for electricity market reforms to bring forward that investment, but at the lowest possible cost.

[Jim Shannon (Strangford) (DUP)]

People have real concerns about energy prices. They also have real concerns about the amalgamation of energy companies—be they electricity, gas or oil companies—and the control of prices that results from that. What assurances can the Minister give us that the Government will always be the protector of prices for the consumer?

[Mr Davey]

The hon. Gentleman is right. Energy bills are a real concern for many households around the country. That is why we are taking the action we are. He refers to consolidation in the sector. That certainly happened under the last Government. What we are doing is trying to make sure we can get more competition into the sector. We have seen Ofgem’s proposals for dealing with liquidity in the wholesale markets, while the work I am leading on collective switching is intended to enable consumers to generate more competition. Competition is what we want to see.

[Tessa Munt (Wells) (LD)]

5. What discussions he has had with the Secretary of State for Communities and Local Government on the potential long-term community benefits of the Hinkley Point C nuclear power station and other major infrastructure projects.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

I have regular discussions with other Government Departments, including the Department for Communities and Local Government, on how to ensure that local communities hosting new nuclear power stations benefit in the long term from these large and nationally important projects. The Government will announce our conclusions shortly.

[Mr Speaker]

I call Tessa Munt.

[Tessa Munt]

rose—[Laughter.]

[Mr Speaker]

Was it something I said? I hope not. We look forward to hearing the hon. Lady.

[Tessa Munt]

Thank you very much, indeed, Sir.

The Minister will know of my concerns about the long-term impacts of both the Hinkley Point project and the National Grid’s proposals to put pylons across the Somerset Levels, when we would naturally prefer that it was done underground. Has the Minister had distinct discussions about the crucial importance of business rate retention for the benefit of the local communities? Will he meet me and representatives from local authorities in my area to discuss this further?

[Charles Hendry]

The humour arose because I inadvertently sat on the Secretary of State, which shows our commitment to work seamlessly together in this coalition! My hon. Friend makes an important point. We recognise that EDF has already committed about £90 million for a section 106 agreement, but we recognise, too, the need for greater signals for the long-term benefit of the community from those who deliver nationally important projects.

[Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)]

I will endeavour not to sit accidentally on either of my Front-Bench colleagues this morning. One of the claimed community benefits of Hinkley Point is the ability to create and maintain highly skilled jobs. Will the Minister give his reaction to the comments of Citigroup in response to the reports of construction costs at Hinkley increasing by 40%, suggesting that an already very challenging programme might be reaching the point of impossibility?

[Charles Hendry]

The hon. Gentleman nearly did sit on his right hon. Friend the Member for Don Valley (Caroline Flint). He makes an important point. We are in close conversations with EDF and other potential developers of nuclear plants and we recognise that they have to be delivered in a cost-efficient way. We do not recognise the figures in the Citibank report, but we will continue to work with the company to ensure that this low-cost, large-scale, low-carbon source of generation can be part of the future energy mix.

[Tom Greatrex]

I am grateful to the Minister for that response. I am sure he will also be aware of the evidence that Volker Beckers, the chief executive of RWE npower, gave to the Energy and Climate Change Committee earlier this week. He explained that the company was pulling out of the Horizon joint venture because continuing

“would have meant a downgrading and we could not afford to do that”.

Given the report from Moody’s suggesting that if EDF were to continue with Hinkley and, indeed, Sizewell, it would be at risk of having its credit rating downgraded, how concerned is the Minister about the prospects for nuclear new build in the UK?

[Charles Hendry]

The hon. Gentleman provides a partial quote, in that Volker Beckers also said that this was a result of German Government policy and of the constrained balance sheets that resulted from the nuclear levy in Germany, and that RWE is selling off £7 billion-worth of assets worldwide, making a further €2 billion-worth of cost reductions elsewhere. Essentially, this is part of a global restructuring of the company. We continue to believe that the measures we are putting in place through market reform—more detail will be published very shortly—will create the right environment for investment in our low-carbon infrastructure for the future, which is so critical for our energy security.

[Mr Tim Yeo (South Suffolk) (Con)]

Does my hon. Friend agree, however, that there is no prospect of a new nuclear power station at Hinkley Point or anywhere else in the UK until we have absolute clarity about the contracts for difference regime? That clarity must extend to the credit status of the counter-party, compliance with the EU state aid regime and the setting of the strike price. Will the Minister tell us when we will have that clarity?

[Charles Hendry]

I can give my hon. Friend the assurance that the clarity he seeks will be published very shortly, within the next few days. When we publish the Bill, we will publish a further technical update, which will provide much of the information for which he asks. We have been very keen that the Bill goes through the process of pre-legislative scrutiny, so that his Committee, the Opposition Front-Bench team and others can contribute actively to it.

[Mr Edward Leigh (Gainsborough) (Con)]

7. What steps he is taking to listen to a diversity of views on the causes of change in the Earth’s climate.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

My Department considers many views on the causes of climate change, and I encourage my officials to take all available scientific evidence into account when developing policy. However, the fact that we are open to a range of views does not mean we ascribe equal value to each.

As with all scientific endeavour, climate science involves uncertainties, but it is considered very likely that human activities are the major cause of current climate change, and compelling evidence shows that climate change brings major risks for us all. It would be deeply irresponsible not to act decisively and urgently to deal with climate change in the United Kingdom and globally.

[Mr Leigh]

I am no scientist, and I do not know the truth about the controversies that are raging around global warming, although I note that Dr James Lovelock wrote recently that, in his view, temperatures had remained broadly constant over the last 12 years. I do not know whether that is right or wrong; what I do know is that before we spend trillions of pounds on reining in our competitive economy and desecrating our country with wind farms, we should actually listen to a range of views.

[Mr Davey]

I know that, as a former distinguished Chair of the Public Accounts Committee, the hon. Gentleman wants to take evidence and science into account, and that he understands risk and probability. The case for action is overwhelming, whether it is made by the Intergovernmental Panel on Climate Change or the Stern review.

[Mr David Hanson (Delyn) (Lab)]

8. What assessment he has made of the change in the number of solar panel installations since he announced changes to the feed-in tariff.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

When we announced proposals to reform the feed-in tariffs scheme for solar PV at the end of October 2011, approximately 126,000 solar PV installations were registered on the microgeneration certification scheme database. Since then, an additional 190,000 installations have been registered. In the 10 weeks since the introduction of new tariffs for small-scale installations on 3 March, more than 26,000 solar PV installations have been registered. That is equivalent to the installation rate in August last year.

[Mr Hanson]

I hear what the Secretary of State says, and I heard what he said in response to my hon. Friend the Member for Kingston upon Hull North (Diana Johnson) and my right hon. Friend the Member for Don Valley (Caroline Flint), but I can tell him that in my constituency there has been a catastrophic collapse in the demand for feed-in tariffs. It has been particularly catastrophic for small businesses which have invested many thousands of pounds of their own money in what would have been a very positive regime. Will the Secretary of State clarify, very soon, what will happen after July, so that my constituents who have invested money in this scheme can ensure that they will still have their businesses in October and at the end of the year?

[Mr Davey]

We will respond to the consultation very shortly, but I can tell the right hon. Gentleman that installation rates are already increasing, although there was a downturn after the introduction of the new tariff. I think there is a sunny future for the solar industry.

[Kelvin Hopkins (Luton North) (Lab)]

We are soon to see a new generation of highly efficient solar panels, and we are also soon to see efficient domestic battery storage technologies. Combining that with a mass programme of insulation and a Severn barrage would remove the need for nuclear generation. Will the Government think again about the need for it?

[Mr Davey]

The uncertainty surrounding climate change, and surrounding all technologies, is such that it would be irresponsible not to pursue every possible low-carbon technology. The hon. Gentleman is right to suggest that renewables have a positive future, as does solar power. We propose to deliver an additional 620,000 installations at a cost of just £500 million by 2015—that is, to deliver nearly three times as many installations as were delivered under the old scheme, at a third of the price.

[John Robertson (Glasgow North West) (Lab)]

9. What recent discussions he has had with the Scottish Government on the effect of potential Scottish independence on energy policy.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

I have had no recent discussions with the Scottish Government on the effect of potential Scottish independence on energy policy. The UK Government’s position on the independence debate is clear: Scotland is stronger in the UK, and the UK is stronger with Scotland in it.

[John Robertson]

I think that a few people will have been slightly disappointed by the Secretary of State’s answer. According to evidence given to the Select Committee on Energy and Climate Change by Peter Atherton of Citigroup Global Markets, investment in Scottish renewables in an independent Scotland would be “highly questionable”. Given that other companies are also saying that they are withholding investment, should not a referendum on Scottish independence be held now rather than later, for the good of energy in this country?

[Mr Davey]

The hon. Gentleman knows the position of Her Majesty’s Government. He knows that we would like a referendum to be held sooner rather than later. We are very committed to ensuring that there is investment in the UK’s energy infrastructure, whether it takes place in Scotland, England, Wales or Northern Ireland. However, some people are saying that uncertainty about an independent state is putting off some investors, and that is one reason for thinking that the independence referendum should be held sooner rather than later.

[Alec Shelbrooke (Elmet and Rothwell) (Con)]

10. What steps he is taking to reduce domestic energy bills.

[Karl MᶜCartney (Lincoln) (Con)]

13. What steps he is taking to reduce domestic energy bills.

[Graham Stringer (Blackley and Broughton) (Lab)]

17. What steps he is taking to reduce domestic energy bills.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

The Government are committed to reducing domestic energy bills, and have put energy efficiency at the heart of their energy policy. The green deal will drive the take-up of energy efficiency measures in homes, helping to reduce energy bills. In addition, the roll-out of smart meters will further reduce energy use. Vulnerable customers will also benefit from the warm home discount, which is worth £1.1 billion over four years.

[Alec Shelbrooke]

My right hon. Friend will be aware from his constituency, as I am aware from mine, of the pressure that people are coming under with their fuel bills. Will he outline for my constituents, as well as everybody else’s, what the electricity reform Bill will do to help keep costs down?

[Mr Davey]

My hon. Friend is quite right to point to the fact that one reason for bringing forward electricity market reform and the energy Bill is to ensure that we meet this country’s energy infrastructure needs, which are huge, as we see 20% of power plants coming offline over the next decade and the need to make the transition to low-carbon energy. That is a huge challenge, which could be very expensive for consumers. One of the reasons we need to reform the electricity market is therefore to ensure that that infrastructure investment can be made at the lowest cost imaginable.

[Karl MᶜCartney]

Can my right hon. colleague update the House on his Department’s progress in cutting red tape for small energy suppliers to help increase competition in the market and thereby keep prices down for my constituents in the city of Lincoln?

[Mr Davey]

I am grateful to my hon. Friend for that question. There are two things I would point him to. We are helping small suppliers to compete by increasing the customer threshold for participation in schemes such as CERT and CESP—the carbon emissions reduction target and the community energy saving programme—and the warm home discount scheme. Ofgem is currently consulting on proposals for a mandatory auction in the wholesale electricity market to improve liquidity, and has recently completed a consultation on tariff simplification. All these measures will, we believe, help small suppliers in my hon. Friend’s constituency and elsewhere.

[Graham Stringer]

Will not the biggest impact on reducing domestic energy bills be achieved by bringing shale gas online as quickly as possible?

[Mr Davey]

I do not think so. We had a seminar at No. 10 recently, which the Prime Minister participated in, along with myself and the Business Secretary. We heard from experts in the shale gas industry who had been working in America and looking at the major opportunities in places such as Ukraine and China. They were clear that it would take some time for shale gas to be exploited in the UK. They were also clear that we needed strong regulation to proceed and that the shale gas reserves in this country are not quite as large as some people have been speculating.

[Andrew George (St Ives) (LD)]

Given that so few large companies took part in last week’s big switch, does my right hon. Friend agree that we should be concerned about the responsiveness of large companies to customers’ concerns? What can the Government do to ensure that all companies engage with any such initiative in future?

[Mr Davey]

At least three of the big six were involved. I thought that the way in which the reverse auction was conducted by the consumer association Which? was a real success, and I am delighted that my hon. Friend noticed it. It brought a saving of £25 million to consumers who were part of that collective switch, with an average saving of £120. It was therefore a success, and I want to see more energy companies getting involved in such schemes.

[Thomas Docherty (Dunfermline and West Fife) (Lab)]

11. When he expects to conclude the assessment of bids for funding of carbon capture and storage projects.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

Bidders were required to register their interest in the carbon capture and storage commercialisation programme with the Department by 13 April, and must submit bids by 3 July. Once bids are submitted, a full and thorough assessment will be carried out, and decisions on which projects to support will be taken in the autumn.

[Thomas Docherty]

I am grateful for that answer. Obviously the Minister will know that we in the UK have vast reserves of untapped coal, including much in Fife. Will he try to ensure that the opportunity for clean-coal technology is not lost in the current process, and will he find the time to come to Fife and see our technologies first hand?

[Charles Hendry]

I would always be delighted to find a chance to go to the hon. Gentleman’s constituency. As he knows, I fought Clackmannan in the 1983 election. They did not see the need for my presence there at that time, but finding other reasons to go back would be a great pleasure. We see this issue as an important part of coal policy, and we want it to provide a long-term future for coal in the energy mix. There are tremendous resources around the United Kingdom, and the work being done in his constituency and elsewhere is important to that process.

[Mr Mark Spencer (Sherwood) (Con)]

22. The Minister also fought a seat in Mansfield, very close to Thoresby colliery. If he wants to come half way up the country, he might come to see the good work going on at Thoresby colliery. I hope that he can assure the House that when the clean coal technology is developed, it will give this country a great future of energy reserves.

[Charles Hendry]

I did eventually work out that fighting mining seats was not the best way to get elected to this House; it is more accurate to say that they fought me, rather than I fought them. Many areas around this country have tremendous resources that can benefit from this technology and, in addition, great technological skills that we can bring forward in this process. This is a world-class, world-leading competition, and it is a very exciting time for this industry.

[Mr Speaker]

The Minister of State is a self-effacing fellow. If memory serves me correctly, although he was unsuccessful in Mansfield he did lose in 1987 by only 56 votes, and I think the House ought to know that.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

I welcome the progress on carbon capture and storage, a technology with great potential. Will the Minister also update us on another clean coal technology being pioneered in Newcastle, underground coal gasification?

[Charles Hendry]

I have yet to be tempted to fight a seat in Newcastle, but these opportunities may still happen. I was grateful for the chance to meet the hon. Lady and some of the team from Newcastle university—they and others are doing very important work in this area. We are still looking at some of the work, and I have a meeting coming up with one of the major global companies, Linc Energy, to try to understand more fully and effectively the work that it is doing in this sector. We think that it can be a player, but it is not in the forefront for the first stage of carbon capture and storage projects, because of the current stage of the technology.

[Tony Baldry (Banbury) (Con)]

It is estimated that carbon capture and storage technology could support an amazing 100,000 jobs by the end of the next decade, so does my hon. Friend agree that speed is very much of the essence if we are to maximise the huge opportunities that this technology offers?

[Charles Hendry]

I agree strongly with my hon. Friend, and the reason why we have brought forward this competition with the speed that we have—three months for submissions to be made and another three months or so before the final outcome is known—is the importance of speed. Work is going on around the world to try to deal with this. We think that with £1 billion up front and £125 million for research and development, and through our new market reform structure—a long-term mechanism for supporting that industry—we can move this from being a few pilot projects to an industry.

[Dr Julian Huppert (Cambridge) (LD)]

12. What support he plans to provide for Cambridge retrofit and other schemes to improve the energy efficiency of existing buildings.

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

I am very glad to report that my Department is already working closely with the Cambridge retrofit project, which is just the sort of ambitious city-wide retrofit programme the green deal is designed to support.

[Dr Huppert]

I thank the Minister for that comment. The Cambridge retrofit is an excellent programme that will make a huge difference. How will the Government ensure stability of energy and climate policies in the long term, so that investors are willing to put finance into major schemes such as the Cambridge retrofit?

[Gregory Barker]

My hon. Friend raises a good point. We know what investors want. They want TLC—transparency, longevity and certainty. Unlike previous short-term or stop-go policies, such as the carbon emissions reduction target and the community energy saving programme, the green deal is designed to run well into the 2020s, giving investors exactly the sort of longevity and certainty they need.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

14. What discussions he has had with the chair of the Environment Agency on induced hydraulic fracturing.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

I very much welcome the comments made by the chair of the Environment Agency. I believe he is correct in assessing that, subject to rigorous regulation and monitoring, hydraulic fracturing can safely be used in the UK for shale gas exploration. I also agree on the need to proceed with caution. Fracking should be carried out only under close regulatory control, to ensure that risks are minimised and the environment is fully protected.

[Mr Sheerman]

It is a relief to know that mentioning the abbreviation “fracking” is within the House rules. Many of us believe that fracking has real potential for energy security, and although we should proceed with it carefully, it could be of huge benefit to this country. Please, do ignore some of the siren voices in the environmental lobby and get on with doing it in a cautious but determined way.

[Charles Hendry]

The hon. Gentleman is absolutely correct, because we cannot ignore what is happening elsewhere around the world. The gas price in the United States is now one quarter of that in Europe and one seventh of that in Asia, so this is a game-changing technology. However, our commitment is absolutely clear: for this to go ahead, we have to have the tightest regulatory controls and the greatest focus on environmental protection. This is a densely populated island, we have to have public support for this technology going forward and we intend to go about this in a very constructive way, involving all the expert opinion we can.

[Mr Dennis Skinner (Bolsover) (Lab)]

Is there not another side to all this? Does not the process use a vast amount of water and involve chemicals as well? It runs counter to all this green deal talk that we hear so often. Will the Minister ensure that all those reservations are taken fully into account?

[Charles Hendry]

Let me give the hon. Gentleman an absolute assurance that all those issues will be completely taken into account. The fluid used is 99% water and there are already very strict controls on how it is used and on what happens after it has been through the process. There are very strong regulations, too, on how the fracking activity is separated from the water table and they are often several thousand feet apart. All those issues will be considered with the greatest care before we go forward. We believe that this technology has real potential, but it must be used in the safest possible way.

[Simon Wright (Norwich South) (LD)]

15. What steps he is taking to support combined heat and power biomass gasification plants.

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

We see a big role in the future for combined heat and power gasification plants. The coalition has introduced the renewable heat incentive to support exactly that type of technology and will shortly publish details of future subsidies for renewable electricity under the renewables obligation. Furthermore, DECC’s UK renewable energy road map clearly sets out the actions we are already taking to remove non-financial barriers to deployment.

[Simon Wright]

The university of East Anglia campus in my constituency is able to receive considerable heat and power from its unique biomass gasification plant, which is the first of its kind in the UK. When sustainable syngas cannot be produced due to the maintenance cleaning cycle, the boiler switches to natural gas. However, dual fuel plants are ineligible to receive renewable heat incentive payments. Will the Minister consider whether the RHI guidance could be made more flexible further to encourage investment in innovative low-carbon technologies?

[Gregory Barker]

My hon. Friend raises a good point and we are keen to be as flexible, pragmatic and ambitious as possible. I can confirm that the Government will explore the inclusion of dual fuel biogas and fossil fuel installations within the RHI and I thank him for his idea.

[Joan Walley (Stoke-on-Trent North) (Lab)]

16. What his policy is on investment in new nuclear power.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

New nuclear power will have a vital role to play in our energy mix alongside other low-carbon forms of generation provided it can be delivered in a way that provides value for money for consumers and that is consistent with the coalition Government’s commitment to no public subsidy.

[Joan Walley]

I thank the Minister for that reply. Given the uncertainties about future investment, will he give us again an absolute assurance that if it is to be delivered, there will, as the coalition agreement requires, be no subsidy and no hidden subsidy, either?

[Charles Hendry]

I refer the hon. Lady to the statement we made in October 2010 about exactly how we define subsidy and what would be meant by that commitment. We are absolutely clear that this technology must stand on its own feet. The process for taking it forward is designed to ensure that that is the case and it will be very transparent. We recognise that higher costs are associated with low-carbon technologies than with high-carbon technologies, but we remain firmly committed to that statement.

[Harriett Baldwin (West Worcestershire) (Con)]

19. May I put on record, Mr Speaker, our admiration of your awesome knowledge of electoral history? Nuclear power is an important source of stable energy in this country and press reports about the ability to continue to have 20% of our power coming from nuclear energy have been worrying. Will the Minister repeat his reassurances that 20% of our energy will continue to come from nuclear power?

[Charles Hendry]

Your knowledge, Mr Speaker, is sometimes not so much awesome as scary and I find that you know more about my electoral history than I do.

I can give my hon. Friend that assurance. We believe that the initial role of new plants will be to replace the old plants that are coming out of commission. We do not have a set Government target for delivery, but the industry thinks that it can deliver 16 GW of new nuclear power by 2025. We have identified the eight sites where that will go forward and, taking forward the work of the previous Administration, we have created the most attractive regime anywhere in Europe for new nuclear investment.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

20. The Minister has mentioned the target of 16 GW by 2025 that the industry states it can provide, but the industry clearly is not in a position to provide that given recent developments. What work has he undertaken to revise his estimate, particularly in relation to the national planning statements, of the number of gigawatts that will be provided over the coming period through nuclear power?

[Charles Hendry]

I would take the hon. Gentleman to task on this. The two consortia that continue to go forward as planned—the EDF-led one and the one in Cumbria—are looking at 9.7 GW. The Horizon one—I have strong hopes that new investors will come in and take forward that programme—will deliver an additional few gigawatts as well. I firmly believe that, following on from the work of the previous Administration, we have created a very attractive regime for people from around the world to look to be part of the nuclear renaissance in the United Kingdom. We cannot do this without international investment and we recognise that we need to create the right framework for that to come forward.

[Alex Cunningham (Stockton North) (Lab)]

21. What steps he is taking to help households improve their energy efficiency.

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

The launch of the green deal this autumn will put in place the biggest and most ambitious energy efficiency programme Britain has ever seen. Furthermore, we anticipate that our electricity market reforms will create further opportunities for large-scale investment in energy efficiency projects.

[Alex Cunningham]

Last year, nearly 30,000 households that applied for help through Warm Front were turned down even though the budget had an underspend of more than £50 million. Will the Minister take this opportunity to apologise to all the families who were left in the cold last winter because of his Department’s incompetence?

[Gregory Barker]

We need to send a very clear message from this House that Warm Front remains open. Certainly, the scaremongering from the Opposition last winter that Warm Front had closed and was no longer available was extremely unhelpful. That was coupled with a very mild winter, but one message that I want to get over is that Warm Front remains open and that those who think they can benefit from it should definitely apply.

[Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)]

T1. If he will make a statement on his departmental responsibilities.

[The Secretary of State for Energy and Climate Change (Mr Edward Davey)]

As the hon. Gentleman will know, my Department’s key objectives are to have secure, clean and affordable energy and we have been working hard on those objectives. The energy Bill measures to reform the electricity market are very important for that. We hosted the clean energy ministerial very recently, which was attended by Ministers from 23 leading economies, and we worked together on clean energy technologies. I was particularly pleased to see that Professor John Hills’ report—the independent review of fuel poverty—was published.

[Gregg McClymont]

I thank the Minister for that answer. Last week it was Centrica and this week it was Scottish and Southern Energy announcing record profits at a time when household bills continue to rise. In those circumstances, why will not the Government insist that the big six must write to customers telling them what is the cheapest tariff rather than directing them to the phone or the internet, where there is no guarantee that they will get the right information?

[Mr Davey]

I do not think the hon. Gentleman has been listening. The Deputy Prime Minister announced the deal we have struck with the six big energy providers. They are now committed to writing every year to their customers telling them what is the best tariff for them.

[Mary Macleod (Brentford and Isleworth) (Con)]

T2. Under the previous Labour Government the number of households living in fuel poverty rose to almost 6 million. What are this Government doing to help the poorest households in my constituency?

[Mr Davey]

We are doing a huge amount, from the warm home discount to the push on collective switching. My hon. Friend will know that today’s figures on fuel poverty show a fall of 0.75 million, but we should not celebrate that because those figures are based on the current measure of fuel poverty. If they were recalculated using the methodology proposed by John Hills, the fuel poverty figures would stand still. There can be no room for complacency; we have to redouble our efforts to tackle fuel poverty.

[Caroline Flint (Don Valley) (Lab)]

This week, we learned that the Foreign Secretary—for whom I understand the Minister of State, Department of Energy and Climate Change, the hon. Member for Wealden (Charles Hendry) was once the chief of staff between elections, just to add to his biography which we are learning about today—does not think the Government are doing enough to support the low-carbon economy. I absolutely agree with him. We also learned that the Energy Secretary and the Business Secretary wrote back urging caution. It was bad enough when the Chancellor was talking down the green economy, but for him to be joined by the Energy Secretary absolutely beggars belief. Is not the Foreign Secretary right that unless Britain shows strong leadership on the green economy, there is no hope of securing international agreement on climate change?

[Mr Davey]

Unlike the right hon. Lady, I have read the letter from the Foreign Secretary and I wrote the letter to the Prime Minister. They are very positive about what we want to do on low carbon technologies and climate change in this country and abroad. We are leading the way.

[Gordon Henderson (Sittingbourne and Sheppey) (Con)]

T4. Despite assurances from my hon. Friend the Minister, small double-glazing companies in my constituency still feel that they are being elbowed out of green deal work by larger national companies. What more can my hon. Friend say to reassure small and medium-sized enterprises in Sittingbourne and Sheppey that they will be able to access green deal work?

[The Minister of State, Department of Energy and Climate Change (Gregory Barker)]

Of course, the green deal has not actually started yet; it will not be launched until the autumn and we have yet to see the full framework, but I can assure my hon. Friend that we have already taken several steps to make it easier for SMEs to engage in the green deal across the board. We shall continue to work with SME working groups to ensure that there is maximum availability of the green deal and the ECO—the energy company obligation—for SMEs, who will be vital for their delivery.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

T5. The Minister will be aware that although the ECO will be delivered in Scotland by the Scottish Government, the underlying legislation applies to England, Wales and Scotland. Given concerns about how the green deal will be implemented, what steps are the Government taking to ensure that my constituents and those of other Scottish MPs get full benefit from the ECO when it is finally brought into effect?

[Gregory Barker]

The hon. Gentleman will know that we are still finalising the details of the ECO, but I should be happy to meet him to reassure him that the scheme really will benefit the whole country.

[Julian Sturdy (York Outer) (Con)]

T6. As high energy bills continue to affect local households in my constituency, can the Minister outline what the Government are doing to improve the UK’s long-term energy security problems? If energy security is not addressed—I stress that it is a long-term issue—energy bills will continue to soar.

[Mr Davey]

My hon. Friend is exactly right. Later this month when we publish the energy Bill, he will see that we have very ambitious electricity market reforms to deliver, among other things, energy security in the future. We need investment of £110 billion in our energy infrastructure over the next decade. That is a real task, and we need to make sure that there are incentives to bring forward that low-carbon investment.

[Angela Smith (Penistone and Stocksbridge) (Lab)]

T8. Speaking in the House on 9 February, the Minister of State, Department of Energy and Climate Change, the hon. Member for Bexhill and Battle (Gregory Barker) said he expected to see“steady growth in the number of people who will be employed”—in the solar industry—“until 2015 and beyond.”—[Official Report, 9 February 2012; Vol. 545, c. 479.]Why then have 6,000 people in the solar industry lost their jobs since last summer?

[Gregory Barker]

We have now put the whole solar industry on a much more stable foundation. We shall shortly be publishing our plans for a feed-in tariff system that really can go forward into the next decade and beyond, with a real sense of ambition. It is affordable, it is ambitious and it will bring real clarity to the industry.

[Dr Julian Huppert (Cambridge) (LD)]

T9. Earlier, the Secretary of State mentioned the excellent Which? big switch scheme to save people money. What I particularly like about it is the fact that it is based on co-operative action—individuals choosing voluntarily to work together rather than a statist top-down approach. Does my right hon. Friend share that view and what support was he able to give?

[Mr Davey]

I am grateful to my hon. Friend for his question. He will know that when I was at the Department for Business, Innovation and Skills, I stimulated a huge amount of research and work on collective purchase and co-operative principles so that together we can purchase not just energy but other things more cheaply. I asked if the Department had any detailed research, because I thought the previous Government, who were supposed to be in favour of collective and co-operative principles, might have done some—they had not.

[Barry Gardiner (Brent North) (Lab)]

In his preparation for COP 18, what analysis has the Secretary of State made of Professor Sir David King’s proposals for common but differentiated cap and trade schemes, using the human development index as an appropriate measure?

[Mr Davey]

We are taking forward a lot of analysis, not just on that scheme, but on a number of other things. COP 18 in Doha at the end of the year will be really important; I met the Deputy Prime Minister of Qatar recently, to discuss how we can make sure that it is a successful set of discussions.

[Jeremy Lefroy (Stafford) (Con)]

T10. What discussions is my hon. Friend having with energy-intensive industries such as ceramics and steel, which are key employers and exporters, to ensure that their prices are competitive with countries such as Germany and France?

[Gregory Barker]

We are very much engaged with all the energy-intensive industries, because we are absolutely determined in DECC to ensure that decarbonisation does not lead to de-industrialisation. On the contrary, if we are smart the low-carbon transition should enhance our competitive position. But that does mean being sensitive to the burdens that we place on manufacturing industry. We are starting with a package of compensation worth £250 million for energy-intensive industries, but that is only the beginning of a much more nuanced and ambitious policy.

[Caroline Lucas (Brighton, Pavilion) (Green)]

Will the Secretary of State join me in congratulating Brighton energy co-op on its launch last night of the first community generation scheme in Brighton? What is he doing to ensure that the electricity market reform proposals will properly support community energy schemes, particularly those by co-ops, housing associations and local authorities?

[Mr Davey]

I can congratulate the scheme in the hon. Lady’s constituency. It shows that under the new regime of solar feed-in tariffs that we have introduced, there are still many communities that are going forward and making those investments. That belies much of the criticism we have heard in the House today. I can assure the hon. Lady that we want to continue to encourage such community schemes in our future policies. Quite a lot of those schemes will still get the more standard and common renewable obligation approach support. Some of those community schemes will not have to go to the larger-scale contracts because of the difference in the electricity market reform.

[Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)]

Will Ministers redouble their consistent and very welcome efforts of the past couple of years in support of the onshore manufacturing sites for offshore wind turbine production—not least sites like Kishorn in my area, which I raised with the Minister’s predecessor—which have lost out in enterprise zone status, and therefore find themselves at a bit of a competitive disadvantage over the next five years? I am sure that a summer recess ministerial visit to Kishorn and the west highlands would be most welcome and would boost morale.

[The Minister of State, Department of Energy and Climate Change (Charles Hendry)]

My right hon. Friend will, I am sure, be delighted to know that I am already planning that. We are looking at a visit to Nigg before going on to Shetland and doing other parts of Scotland at the same time. I am delighted to have the chance to take part in that process. We should absolutely celebrate the way that some of our great, historic industrial facilities, built for the oil and gas industry, have been given new opportunities and a new lease of life, as they start to build the infrastructure that will be necessary for our renewable future.

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Have Welsh Government Ministers requested at any point that they should have the final say in whether fracking developments take place on Welsh soil?

[Charles Hendry]

As the hon. Gentleman will be aware, decisions on energy infrastructure matters for Wales are made on a nationwide basis. We know that that is what the industry looks for. But of course, in that process there has to be local authority planning consent for the specific project. There has to be approval by the Environment Agency and its equivalents in Wales and Scotland, if the project is taking place there, and by the Health and Safety Executive. All the appropriate bodies are involved in that process.

[Ian Swales (Redcar) (LD)]

I welcome the current carbon capture and storage competition. As the Tees Valley has 18 of the top 30 UK carbon emitters, I am sure the Minister will agree that its bid has a lot to commend it. Will he ensure that the needs of heavy industry are given due weight alongside the needs of energy generators?

[Mr Davey]

I am grateful for my hon. Friend’s question. I know he does a huge amount to support industry in his constituency. I can tell him that in the competition that we announced at the beginning of last month, we were very clear that we wanted to encourage clustering, so after listening to the industry we were encouraging change. Bigger pipes are needed, so that more than one power plant can take part in those schemes with other industries that emit a lot of carbon.

[Ian Lavery (Wansbeck) (Lab)]

Coal will continue to provide between 27% and 50% of electricity in the UK for the foreseeable future. Can the Minister explain what Government support will be given to the British deep-mined coal industry to prevent it from extinction in the next few years?

[Charles Hendry]

The most important thing that we can do for the coal mine industry is to show that there is a continuing role for coal in the generating mix. We are all clear that we cannot have unabated coal in the mix in the future, and new plants will need to be equipped with carbon capture and storage technology. That is why the competition that we are launching here to put the United Kingdom at the forefront of the development of CCS technologies offers the best possible future for coal to have a long-term role in the energy mix going forward.

[Andrew George (St Ives) (LD)]

Further to the question asked by the hon. Member for Sittingbourne and Sheppey (Gordon Henderson), Warm Front was, in my view, undermined by the extortionate charges of a small cartel of suppliers. Given that only 22 companies are so far among the providers for the green deal, can the Minister assure us that local fitters and local suppliers can be part of the programme, so that costs are competitive?

[Gregory Barker]

My hon. Friend has hit the nail on the head. Previous programmes were monopolistic, did not offer real choice and were not open to real competition. The green deal will change all that. We are going to have genuine competition, real choice and real ability for local players to come into this exciting market.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

The Secretary of State knows that if we are to get energy security and diversity, we have to invest now in big infrastructure projects, but he knows also that nimbyism, often so rampant in the questions put in this Chamber, is a great barrier to planning permission. What is he going to do about planning for decent infrastructure to achieve those objectives?

[Mr Davey]

The hon. Gentleman knows that this House passed a relevant national planning statement and that the Department for Communities and Local Government produced the national planning policy framework. The hon. Gentleman must recognise that there is a balance to be struck between the need to make sure that the local democratic voice is heard and the need for the types of investment that both he and I support. There is a balance, but we are determined to ensure that, with electricity market reform, we get the investment needed in this country.

Business of the House

Thursday 17th May 2012 Commons Chamber

11:31

[Ms Angela Eagle (Wallasey) (Lab)]

Will the Leader of the House give us the business for next week?

[The Leader of the House of Commons (Sir George Young)]

The business for next week will be:

Monday 21 May—Remaining stages of the Local Government Finance Bill.

Tuesday 22 May—Remaining stages of the Financial Services Bill, followed by Third Reading of the Civil Aviation Bill.

Wednesday 23 May—Second Reading of the Electoral Registration and Administration Bill, followed by a European document relating to the proceeds of crime.

Thursday 24 May—Motion on the Whitsun recess Adjournment.

[Ms Eagle]

I thank the Leader of the House for his announcement of next week’s business, and I congratulate my hon. Friend the Member for North East Derbyshire (Natascha Engel) on her re-election unopposed to the Chair of the Backbench Business Committee.

Analysis of last week's Queen’s Speech has demonstrated that this Government have already run out of ideas. Of the 19 announced Bills, three are carry-overs from the previous Session, and now we learn that the passage of as many as five of the new Bills might be delayed until the next Session, making this by far the slimmest Queen’s Speech in living memory. Will the Leader of the House tell us why?

Today is the international day against homophobia and transphobia, and it is right that we mark it in this House. There are five countries where people can be sentenced to death for being lesbian or gay, and 76 where it is still illegal. We should pay tribute to all those who are bravely campaigning for equality around the world.

Will the Leader of the House arrange for the Equalities Minister to make a statement on the Government's proposals for equal marriage? This weekend, the Defence Secretary said that it was “not a priority”, and the Under-Secretary of State for Education, the hon. Member for East Worthing and Shoreham (Tim Loughton), said that he is “totally opposed”, but across the country there are couples who want to know whether to have a civil partnership, or to wait until the law is changed. What they do not want is to be in limbo while Conservative MPs fight among themselves and the Government prevaricate. The Prime Minister has said it is an important matter of equality. I agree. Will the Government now commit quickly to introducing legislation on equal marriage?

The whole House will be concerned about the eurozone crisis. On Monday, the Chancellor said

“the open speculation from some members in the eurozone about the future of some countries in the eurozone…is doing real damage across the whole European economy”—

only for the Prime Minister to indulge in precisely that speculation two days later. The Government’s plan A has pushed us back into recession. It has failed in Britain and it is now failing across Europe. Instead of manoeuvring to blame Europe for his failed economic policy, the Prime Minister should be pushing for a solution to the eurozone crisis.

At the election, Government Members promised not to cut front-line services, but that is exactly what the Home Secretary has done. More than 5,000 police officer jobs have been cut. When she spoke to the Police Federation conference yesterday, the right hon. Lady insisted the podium be shifted, because she did not want to be filmed in front of a conference slogan opposing police cuts. She can shift the podium and the camera angle, but she cannot shift the responsibility. Will the Leader of the House arrange for the Home Secretary to make a statement on police numbers so that she can explain what happened to their manifesto promise not to cut front-line staff?

While the Home Secretary is at it, she could also explain the ongoing immigration shambles at Heathrow. Every week we hear reports of thousands of people stuck at immigration and passengers queuing for hours while immigration desks are closed. It takes something when even Joan Collins feels the need to tweet from the queue that the Home Secretary should get a grip. And it is not just the Home Secretary; the Immigration Minister’s justification for the shambles at Heathrow’s border control was that it was the result of the wrong type of wind. What is it about this Government and the weather? First they blamed the economy’s performance on the snow, then the excuse was the wrong type of rain, and now we have the wrong type of wind. May we have a statement on the ministerial code? Does the Leader of the House intend to amend the code to say that Ministers are responsible unless they can blame the weather or, perhaps, their special advisers?

At Justice questions this week neither the Secretary of State nor his deputy were present. The ministerial code states that Ministers are accountable to this House, so they should at least turn up for departmental questions rather than leaving it to junior Ministers and Whips to do their work for them. Will the Leader of the House undertake to make sure that senior Ministers are present for oral questions in future?

Justice Ministers dodge their responsibilities to the House, the Home Secretary refuses to take responsibility for her police cuts, the Immigration Minister refuses to take responsibility for the shambles at Heathrow and the Chancellor refuses to take responsibility for a double-dip recession made in Downing street. What a way to start the new parliamentary Session.

[Sir George Young]

May I begin in a conciliatory way by congratulating the hon. Lady on her promotion to the chair of her party’s national policy forum? We hope that she can do that without becoming a part-time shadow Leader of the House. I know that she will bear in mind what her leader said on 10 January:

“in these times, with less money, spending more on one thing means finding the money from somewhere else.”

That is something her colleagues seem to have forgotten. Her previous job was shadow Chief Secretary to the Treasury, so she will want to bring some financial discipline to her party’s policies if they are to have any credibility with the electorate.

The hon. Lady asserted that there were not enough Bills in the Queen’s Speech. If she looks at earlier Queen’s Speeches, she will find that the number of Bills introduced in this Session is not dissimilar to the number introduced in the 2005, 2006 and 2007 Sessions. She will also find that three Bills are being carried over from the previous Session. We are not going to do what the previous Government did, which was to bring so much legislation to the House that they were unable to process it properly. As I have said before, the House is not simply a legislation factory. We are not going to make their mistake of imposing too many ill-considered and ill-drafted Bills on the House.

The hon. Lady mentioned that today is a day to celebrate equality. Had Mr Speaker been in the Chair, I would have commended the article he wrote for today’s copy of The Independent. Today is international day against homophobia and transphobia. The Government are strongly committed to advancing equality and want to ensure that public services are accessible to all and free from discrimination. She will know that we have lifted the ban on civil partnerships taking place on religious premises and are currently consulting on how to implement equal civil marriage. We are continuing to remove barriers and tackle prejudice.

On the economy, the hon. Lady will know that we are about to debate economic matters on an amendment tabled by the Opposition, but I have to say that her policies would increase this country’s debt and provide no solution to its problems whatsoever.

On policing, I remind the hon. Lady that before the election the then Home Secretary was asked whether he could guarantee police numbers, and he said “No.” I remind her also that the Labour party has now endorsed cuts of £2.1 billion to the police budget, and the official Association of Chief Police Officers response, from Chief Constable Peter Fahy, stated that

“the effectiveness of policing cannot be measured by the number of officers alone but by reductions in crime and increases in public confidence.”

It is an inconvenient truth for the hon. Lady that, although she might suggest that crime is going up, official figures show that police-recorded crime has fallen by 3%.

Turning to immigration, I note that we inherited a shambles at the UK Border Agency, which we are putting right. The hon. Lady will welcome the Immigration Minister’s announcement before the Home Affairs Committee of an additional mobile unit at Heathrow to cope with the delays to which she refers.

I am astonished that the hon. Lady mentions the absence of the Lord Chancellor from oral questions. She was a Minister herself, and she will know that occasionally Ministers have responsibilities other than in the House. The Lord Chancellor, in line with precedent, wrote to Mr Speaker and to the shadow Lord Chancellor to explain that he would not be at oral questions but at an international legal forum in Russia. I am sure that he would have preferred to have been here, because he enjoys his time at the Dispatch Box, but I commend the performance of my hon. Friend the Member for North West Cambridgeshire (Mr Vara), who was an understudy for the Lord Chancellor and not only kept the balls away from the wicket but swept many of them to the boundary.

Finally, I say to the hon. Lady that it is a fortnight since the Labour party candidate was defeated in the election for Mayor of London, and less than two months since the hon. Lady’s party lost Bradford West, so any triumphalism on her part is very premature.

[Angie Bray (Ealing Central and Acton) (Con)]

A new report by a former president of the British Veterinary Association states that more than 25% of meat sold in our shops comes from animals that have not been stunned before slaughter. That figure exceeds easily the needs of our communities with special religious requirements, and it suggests that some abattoirs are cutting corners and costs. May we please have a statement from the Department for Environment, Food and Rural Affairs on the measures in place to protect our animal welfare laws, and on whether any new measures are needed to ensure that we enforce them properly?

[Sir George Young]

My hon. Friend raises an important and sensitive issue. Obviously, ideally, all animals should be stunned before slaughter, but she will recognise that there are religious issues here and that people have a preference to have their meat presented differently. We will, however, consult on measures to improve the welfare of animals slaughtered in accordance with religious rites when we consult on measures to implement regulation 1099/2009, which comes into effect on 1 January next year. The regulation deals specifically with the protection of animals at the time of killing, so there will be an opportunity for my hon. Friend to influence the decision-making process later this year.

[Natascha Engel (North East Derbyshire) (Lab)]

rose—

[Sir Bob Russell (Colchester) (LD)]

We’re all on your side.

[Chris Bryant (Rhondda) (Lab)]

Come and join this side, then.

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Mr Bryant, please, can we just calm down a little? Both sides get irritated and no one wants to see anyone irritated. Can we offer the hon. Lady our congratulations as well?

[Natascha Engel]

Thank you very much, Mr Deputy Speaker.

I thank the Leader of the House for the announcement of the pre-recess Adjournment debate next Thursday. Had the Backbench Business Committee been in existence at that point, I am sure we would have looked at scheduling a pre-recess Adjournment debate on that day, given that the previous pre-recess Adjournment debate was on assisted suicide. I am therefore grateful to the Leader of the House for doing that.

I pay tribute to the outgoing members of the Backbench Business Committee: the hon. Members for Kettering (Mr Hollobone), for Shipley (Philip Davies) and, especially, for Wellingborough (Mr Bone). Without them, the Committee would not be what it is today, and I am sad to see them leave, but I welcome the hon. Members for Nuneaton (Mr Jones) and for Harrow East (Bob Blackman)—and indeed the hon. Member for Southend West (Mr Amess), who is the greatest champion in the House of the pre-recess Adjournment debate, so next week’s will be a fitting start for him. Given that the Committee is still entirely English in composition, I hope that by the end of the Session we can look at having membership from the minority parties in order that we can become a UK Backbench Business Committee instead of being solely English.

[Sir George Young]

May I repeat what I said last night in congratulating the hon. Lady on her re-election? I am grateful to her for endorsing our decision to have a conventional pre-recess Adjournment debate next Thursday, to which my hon. Friend the Deputy Leader of the House will respond. She paid tribute to the outgoing members of the Backbench Business Committee. I am not sure whether it would enhance her reputation if I endorsed that, because the whole point of the Committee is to choose subjects that the Government would not normally have chosen, and it certainly did that under the previous regime. I look forward to working with her and newly elected colleagues during this Session, and to taking forward some of the ideas that we have shared about how we get some certainty into some of our conventional debates. I think she will understand that her party is slightly better placed than mine in being able to put Scottish Members on to the Committee. However, we have changed the Standing Orders to enable other Members to attend, and I hope that that is a move in the right direction.

[Sir Bob Russell (Colchester) (LD)]

In a written parliamentary answer dated 8 March, I was told by the Independent Parliamentary Standards Authority:

“Under our publication scheme, we proactively publish the minutes of meetings of IPSA’s Board.”—[Official Report, 8 March 2012; Vol. 541, c. 839W.]

Thirty minutes ago, under the heading “Transparency—Minutes of board meetings”, the IPSA website revealed that the last recorded publicly accessible minutes were for its meeting on 30 January. Knowing how keen IPSA is on every i being dotted and every t being crossed, either it has not met for three months or it is not honouring what it should. Bearing in mind that a public consultation is going on as to what the public feel is the role of an MP, should we, as MPs, not have a debate on this?

[Sir George Young]

My hon. Friend is a member of the Speaker’s Committee for the Independent Parliamentary Standards Authority, and he will know that on Tuesday morning there is a meeting between SCIPSA and IPSA—I am sorry about all these initials—where he will have an opportunity to put to the chairman of IPSA the question he has put to me. The chairman of IPSA will now have notice of what is coming and will have in his breast pocket the answer to the question, with specific details of when his board last met.

[Mr Dennis Skinner (Bolsover) (Lab)]

Whatever happened to the Tory announcement of the school building programme? Several months ago, the Secretary of State for Education, in an answer to me about Tibshelf school in my constituency, said that the statement would be made and that Tibshelf would almost certainly be one of the schools selected. Several months have passed and nothing has happened. Is this programme in the long grass with the equality programme, care of the elderly, building houses, the green deal, and all the rest of it?

[Sir George Young]

We intend to announce this month which schools will be rebuilt through the priority school building programme. It has been necessary to make specific checks, with site visits, on the condition of all the schools that applied, and we want to get it right. An announcement will be made shortly, and the first schools that are rebuilt through this programme will open as scheduled in 2014.

[Mr Laurence Robertson (Tewkesbury) (Con)]

Is the Leader of the House aware that the 44th meeting of the British-Irish Parliamentary Assembly took place in Dublin on two days this week, attended by many right hon. and hon. Members from this House and another place, and from the Irish Parliament, including the Taoiseach? Today the Dáil is debating that meeting and hearing reports of our discussions on trade, transport, Northern Ireland, and environmental policies. Would it be helpful to this House, and perhaps to another place, if time were made available for us to report on the proceedings of the British-Irish Parliamentary Assembly?

[Sir George Young]

I applaud the work that my hon. Friend does as Chair of the Northern Ireland Committee and his involvement in the group he mentions. If the Committee did a report on these issues it could provide a route for their finding their way into a debate through the Liaison Committee. Alternatively, he could apply to the newly established Backbench Business Committee for a debate on the subject, or he might find it possible to speak about it at next Thursday’s pre-recess Adjournment debate and get a response from my hon. Friend the Deputy Leader of the House.

[Ann Clwyd (Cynon Valley) (Lab)]

I am sure that the Leader of the House will agree that good communications between Members and their constituents are important. For the past three days, the telephone in my constituency office has been out of action. I do not know whether anybody else has faced the exasperation of trying to contact BT recently. I spent three quarters of an hour on the telephone yesterday, trying to get hold of somebody to talk to about the problem. My office has spent three days trying to get hold of a person to correct the fault. BT was privatised by the Conservative Government in 1984. It made a profit last year of £2.4 billion. Surely somebody can look at this problem, given the difficulties it is causing Members and their constituents.

[Sir George Young]

I am sorry to hear of the problems that the right hon. Lady faces in her constituency office. I have always found Clova Fyfe, who works for BT, enormously helpful in solving constituency problems. I will bring to her attention the difficulties that the right hon. Lady faces in her constituency office and see whether they can quickly be put right.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

A lot of Members want to catch my eye and I want to call them all, so speedy questions and shorter answers are required.

[Karen Bradley (Staffordshire Moorlands) (Con)]

I am sure that I am not alone in having a significant amount of constituency casework concerning the family courts system and the failings that my constituents find in dealing with that service. Will the Leader of the House find time for an urgent debate to reassure my constituents that all that can be done is being done to reform that system?

[Sir George Young]

My hon. Friend will know that we will introduce a children and families Bill that will address some of the issues about which she is rightly concerned. It will, we hope, create a time limit of six months for the completion of care cases, and will focus on issues that are essential in deciding whether a court order is made. There will be other issues in the Bill, but I would be testing your patience, Mr Deputy Speaker, if I read them out. This matter is a priority for the Government and it was in the Queen’s Speech.

[Lindsay Roy (Glenrothes) (Lab)]

May we have a debate in Government time about military procurement, and in particular about how robust the tendering process is and how due diligence is progressed? In part, this request was prompted by the experience of a company in my constituency that makes military garments. It tendered a significantly lower contract price than a Spanish company called Iturri. Iturri won the contract and then offered to subcontract the entire business to the company in my constituency at the significantly lower price.

[Sir George Young]

I take it that it was a contract in which the Ministry of Defence was the prime purchaser.

[Lindsay Roy]

indicated assent.

[Sir George Young]

I will raise the issue with the Secretary of State for Defence to see whether there has been any irregularity, and ask him to write to the hon. Gentleman.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

May we have a debate on trade? For 13 years under the previous Government, the automotive sector was in a trade deficit. In just two years, that has become a trade surplus. Given the good news today of Vauxhall Motors’ further investment in UK manufacturing, it is important that the House holds such a debate so that it understands how we are rebalancing the economy.

[Sir George Young]

I am grateful to my hon. Friend. I notice that the hon. Member for Wallasey (Ms Eagle) did not mention the good news at Ellesmere Port, which has secured 2,100 jobs and paves the way for another 700 as the plant moves from two shifts to three. My hon. Friend makes a good point that emphasises our success in rebalancing the economy away from an over-reliance on financial services, back to manufacturing. He makes the point that a number of major motor manufacturers are investing in this country. Crucially, some of the components suppliers are also moving back to the UK, so we are getting the benefit of the whole supply chain.

[Alison Seabeck (Plymouth, Moor View) (Lab)]

I am sure that the Leader of the House will want to listen to the catalogue of disasters that has affected my constituent, Mr Garnett Smith. He has a problem with HMRC, which keeps taking money from two separate employer relationships that he has. On 31 January, I wrote to HMRC and the Exchequer Secretary to the Treasury. By 18 April, there was no reply so I chased it up. I was told that I would have a reply on 20 April, but there was no such reply. I contacted the Exchequer Secretary again on 8 May and was told that an electronic copy was coming. On 16 May, there was still no response. My constituent is still having money withdrawn from his account. Will the Leader of the House please ask a Treasury Minister to come to the House to explain whether his Department is incompetent or just does not care about my constituent?

[Sir George Young]

Of course Treasury Ministers care about the hon. Lady’s constituents. The Chancellor of the Exchequer will be at this Dispatch Box in a few moments’ time. Rather than waiting for a debate, if she lets me have her constituent’s details I will see that the appropriate Treasury Minister gets on to the case. If there is an injustice and money is being wrongly withdrawn from an account, we will see that it is stopped straight away.

[Jason McCartney (Colne Valley) (Con)]

The Government are investing heavily in rail infrastructure across the north, with the electrification of the trans-Pennine route. The big decision is coming up on the funding of the northern hub rail investment programme, which would stimulate 20,000 to 30,000 jobs across the north. May we have yet another debate on the fully funded northern hub project, focusing in particular on the support that the scheme is getting from local enterprise partnerships and the private sector?

[Sir George Young]

That is an important project. My right hon. Friend the Secretary of State for Transport spoke in the debate yesterday on transport-related issues. I cannot promise another debate in the near future. My hon. Friend will know that we have agreed to fund Network Rail up to a maximum of £130 million to implement the package to which he refers. The investments to increase capacity and speeds on the Sheffield to Manchester line, and to increase speeds on the Manchester to Bradford via Rochdale and Halifax line and the Manchester to Preston via Bolton line are subject to value for money being confirmed, but they are a demonstration of our commitment to infrastructure, particularly in my hon. Friend’s part of the country.

[Chris Bryant (Rhondda) (Lab)]

On 15 March, the Government tabled a series of changes to the immigration rules. Some of them are perfectly sensible, but some of us fear that others of them will lead to a new generation of domestic workers living in virtual servitude. They will come into force if, after 40 days, no motion has been tabled in this House to oppose them. We have prayed against them. I know that the Government have difficulty working out when 40 days will lapse, but they will lapse tomorrow. The Government have therefore failed to provide an opportunity for us to debate the matter. Will the Minister for Immigration delay the implementation of the changes until we have had a proper debate?

[Sir George Young]

The procedure that we have adopted is exactly the same as that which the hon. Gentleman adopted when he was Deputy Leader of the House.

[Tim Farron (Westmorland and Lonsdale) (LD)]

The decision of the right hon. Member for Neath (Mr Hain) to reorder his priorities may or may not be a welcome development for the Leader of the Opposition, but it is a welcome development for those of us who are concerned about making the best use of tidal and hydro energy schemes. Will the Government make time for a debate in the House on the need for investment, both private and public, in tidal and hydro barrage schemes, not just in the Severn estuary, but at Morecambe bay, so that we can create clean, green energy on a massive scale, as well as thousands of jobs?

[Sir George Young]

Those are important issues and are part of our agenda to diversify the supply of electricity generation. We had a debate yesterday on Department of Energy and Climate Change-related issues and we have just had questions to the Secretary of State for Energy and Climate Change and his team of Ministers, so I cannot promise another immediate opportunity to address these issues. Later in the Session, there will be a Bill on electricity market reform, which may be an opportunity for my hon. Friend to develop his theme.

[Kate Green (Stretford and Urmston) (Lab)]

The Leader of the House and the shadow Leader of the House have noted that today is the international day against homophobia and transphobia. Will the Leader of the House arrange for a debate on tackling homophobic bullying in schools, because my constituents report that it remains a significant problem?

[Sir George Young]

That is an important issue. I wonder whether it would be appropriate for the hon. Lady to make an early application to the Backbench Business Committee to see whether we could have a debate on bullying in schools and the particular type of bullying to which she has referred. We can be proud that the UK has been recognised as the No. 1 country in Europe for lesbian, gay, bisexual and transgender rights by the International Lesbian and Gay Association.

[Andrew Bridgen (North West Leicestershire) (Con)]

May we have a statement on how this Government are helping hard-pressed households by freezing council tax? That is something that the last Labour Government completely failed to do. Indeed, council tax more than doubled during their time in office. I am pleased that it is not only the Government who are delivering on council tax pledges, but my district council of North West Leicestershire, which is freezing council tax for the third successive year.

[Sir George Young]

I am grateful to my hon. Friend for reminding the House that the compounded saving of two years’ freeze is worth up to £147. I pay tribute to those local authorities that have been able to make sometimes difficult decisions to pass those benefits through. He also contrasts the record of the coalition Government in our first two years with the record of the previous Labour Government, under whom, as he said, council tax doubled.

[Mr Andrew Love (Edmonton) (Lab/Co-op)]

Has the right hon. Gentleman seen the report by three independent housing organisations on the emerging housing crisis? The report confirms that, last year, only 109,000 homes were completed, which is much less than the 140,000 homes completed on average under the previous Government, and less than half the number that the Government know would meet demand. Homelessness is also on the increase—it is up 27%—and more than 600,000 are affected by overcrowding. Home building, therefore, is a win-win situation: it will increase growth, which the Prime Minister will talk about today. Will the Leader of the House provide Government time for a debate on housing and how we achieve better economic growth?

[Sir George Young]

As a former Housing Minister, I take a close interest in this matter and have seen the report to which the hon. Gentleman refers. We inherited a not very positive record from the previous Government: the lowest peacetime house building since the 1920s. I am sure he will welcome our affordable homes programme, which is set to exceed expectations and deliver up to 170,000 affordable homes and a £1.3 billion investment to get Britain building. I hope he will also welcome what we have done to enable planning decisions to be made more quickly, to make public land available to house builders, and to help first-time buyers. I hope, too, that he will welcome our fiscal decisions, which, crucially, enable interest rates to remain low, helping first-time home buyers.

[Alun Cairns (Vale of Glamorgan) (Con)]

Earlier this week, the Minister of State, Department for Education, the hon. Member for Brent Central (Sarah Teather), who has responsibility for children and families, responded to the Green Paper on special educational needs, which is an area of policy that has been ignored for far too long. Parents must battle for their children’s rights to receive the education they need. May we have a debate on this important area of policy so that we can push progress much more quickly?

[Sir George Young]

I would welcome such a debate. The Government are committed to a draft Bill on that matter, so there will be an opportunity to take things forward. We want to ensure that services for disabled children and young people, and those with special educational needs, are planned and commissioned jointly by local authorities and clinical commissioning groups. We want to give children who have challenges a much squarer deal than they have at the moment. When the Bill is introduced, there will be an opportunity to outline Government policy.

[Anas Sarwar (Glasgow Central) (Lab)]

I am sure all hon. Members would like to join me in congratulating the Glasgow Labour party on its success in the Glasgow city council elections last week, which helped to crash the Scottish National party separatist juggernaut into the ditch. One reason for that success was the innovative policies that Glasgow Labour introduced, including a £25 million jobs guarantee scheme. Given the ongoing crisis of youth unemployment, may we have an urgent debate in the House on that issue?

[Sir George Young]

If the hon. Gentleman looks at the amendment to the Queen’s Speech that has been tabled, which we are about to debate, he will see that unemployment is specifically mentioned. The answer—this is probably the first time I have been able to say this—is that yes, I can grant a debate on the subject to which he just referred, and it will start in about 20 minutes’ time.

[Andrew Jones (Harrogate and Knaresborough) (Con)]

Please may we have a debate on encouraging entrepreneurialism in young people in schools and colleges? Last week, I was a dragon at a “Dragon’s Den” event at Harrogate college and was impressed by the ability, pitches and enthusiasm of the young people I met. Across our country, young people just need the opportunity in our education system to understand the excitement and rewards of a career in business.

[Sir George Young]

I commend what my hon. Friend has done, but I cannot think of anyone less like a dragon than him. It is important that schools do more to prepare children for the financial challenges in life. Some schools have started schemes whereby pupils are given a relatively small sum of money and challenged to grow it—there have been real successes from that, and there is an encouraging increase in self-employment among young people. I applaud my hon. Friend’s initiative in encouraging young people in his constituency to become attuned to financial matters, and I hope that many of them turn out to be budding entrepreneurs.

[Mr John Spellar (Warley) (Lab)]

On Tuesday, my right hon. Friend the Member for Cynon Valley (Ann Clwyd) raised the issue of how the principles of the Rehabilitation of Offenders Act 1974 are being undermined by Criminal Records Bureau checks, because people’s lives are being blighted for ever by offences or even cautions that took place years and sometimes decades earlier, often in people’s unruly youth. In view of the utterly complacent reply my right hon. Friend received from the hon. Member for North West Cambridgeshire (Mr Vara), who was answering as a Minister, may we have a debate to expose and hopefully remedy this ongoing injustice?

[Sir George Young]

The rehabilitation of offenders legislation has, I believe, recently been reviewed, but I will take on board the point the right hon. Gentleman makes and see whether further tweaks are needed to ensure that people are not unjustly penalised, when they seek employment, for relatively trivial offences that happened some time ago. I will raise the matter with the Home Secretary.

[Mr Matthew Offord (Hendon) (Con)]

Given that elected politicians in the Democratic Republic of the Congo have rejected £790 million of UK aid, claiming that it is a guilt payment so that British companies can secure access to offshore mining interests, may we have a debate on the commitment to spend 0.7% of gross domestic product on overseas aid?

[Sir George Young]

The commitment to international aid spending was discussed at some length by hon. Members on both sides of the House on Tuesday, in a debate to which my right hon. Friend the Secretary of State for International Development responded. On the specific issue my hon. Friend mentions, I am not sure it would be right to withhold support to the DRC—the aid we give reaches very poor people, who would be deprived of the assistance they need—but I will draw his concern to the attention of my right hon. Friend.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

The Leader of the House will be aware that small and medium-sized businesses in my constituency are eager to respond to the Government challenge to export more to Brazil, Russia, India and China, but has he also seen Lord Digby Jones’s remarks that UK Trade & Investment, which is an arm of the Foreign Office, has been devastated? What help can we give small and medium-sized businesses in constituencies such as mine to help them to export to BRIC countries?

[Sir George Young]

UKTI has not been “devastated”. I was in touch with it recently when it held a seminar specifically for small and medium-sized enterprises that wanted to export. The seminar was well attended and found to be of great value by those who came along. I could not praise more highly the input of UKTI to that initiative. I would encourage hon. Members who have not already done so to contact UKTI and have a similar seminar in their constituencies.

[Harriett Baldwin (West Worcestershire) (Con)]

Another hidden and scandalous form of discrimination in this country is the reluctance of businesses—often small businesses—to hire women of child-bearing age because they fear that they will take maternity leave. May we therefore have a debate on shared parental leave and the importance it will have in ensuring that that form of hidden discrimination ends?

[Sir George Young]

I applaud what my hon. Friend says. It is indeed the Government’s policy to move towards more flexible parental leave so that parents can share caring responsibilities. We are working with businesses to create a more flexible system of parental leave. Under our proposals, parents will be given the choice to determine how they take leave for child care. They will be able to divide the majority of the leave into blocks to suit their work needs, and to split leave between them. I hope that will remove some of the barriers to which my hon. Friend refers.

[Bridget Phillipson (Houghton and Sunderland South) (Lab)]

Last year, I raised with the Leader of the House the tragic case of Joe Arthur, my constituent who was killed while on holiday in Greece in 2006, and the family’s fight for justice. This week, the family have again been out to Greece, and yet again the trial has stalled. Will the Leader of the House arrange for me to meet urgently a Foreign Office Minister to discuss what further assistance can be offered to the family, because that situation simply cannot be allowed to continue?

[Sir George Young]

I am very sorry to hear of the problems that confront the hon. Lady’s constituents. It so happens that a constituent of mine was killed in Greece last year, and their family is having exactly the same problems of finding out when the trial is to be held and what status and role they will have in the proceedings. I will raise the matter with a Foreign and Commonwealth Office Minister and ask him to contact her and see what assistance we can give to the family in the tragic circumstances she has just mentioned.

[Philip Davies (Shipley) (Con)]

I very much support the Government in putting public sector pensions on an affordable and sustainable footing. In that spirit, may we have a debate on the pension contributions of judges? Judges are being asked to make a contribution of just 2% towards their pension, which is neither affordable nor sustainable. Surely my right hon. Friend agrees that it is wrong that judges pay less in total towards their pensions than other public sector workers, who are being asked to pay increased contributions?

[Sir George Young]

There will be an opportunity to debate this matter. We are committed to introducing legislation on public service pensions, which will certainly embrace judges, and my hon. Friend will have an opportunity to propose the necessary amendments to the legislation, if he finds we have not responded. We are aware of this issue, however, and there will be a Bill designed to address it.

[Bill Esterson (Sefton Central) (Lab)]

Yesterday, the Prime Minister was asked about the cut in the number of front-line police officers but answered by talking about the proportion. Will the Leader of the House impress on his colleagues the importance of answering the question asked, not the one they would rather have been asked? Next time, therefore, the Prime Minister might give the right answer, which, to clarify, is more than 5,000.

[Sir George Young]

With respect, that is a game that we can play as well, having listened to previous Prime Ministers for 13 years. One of my colleagues actually wrote a book compiling not only the failures to answer questions but the inaccurate answers that a previous Prime Minister gave. The Prime Minister always answers questions as accurately, honestly and openly as he can, and I would rebut any criticism of his performance at the Dispatch Box.

[Greg Mulholland (Leeds North West) (LD)]

Despite having the Scottish Parliament and the Welsh and Northern Ireland Assemblies, we continue to have Scottish, Welsh and Northern Ireland questions in the House, which are often dominated by English MPs asking questions provided by the Whips Office. If we are to continue with this, is it not time to have English questions, too, so that English MPs can raise questions important to the English people?

[Sir George Young]

The principle of oral questions is that the House should have the opportunity to hold Secretaries of State and Ministers to account. That is why there are separate Northern Ireland, Scotland and Welsh questions. English Ministers, of course, have to answer for English-related matters when at the Dispatch Box. If the House wants to hold the Government to account, the best way to do it is by a series of departmental questions, which is what we have now.

[Diana Johnson (Kingston upon Hull North) (Lab)]

Following the publication of the BBC Trust’s latest savings plans, will the House have an opportunity to debate the plans, particularly the plans for local radio? I ask because there are many excellent local services, including Radio Humberside in my constituency, and this week, the radio show, “Beryl and Betty”, with Beryl Renwick, aged 86, and Betty Smith, aged 90, won the Sony gold award for excellence.

[Sir George Young]

The BBC is an independent organisation and is responsible for allocating its funds and finding savings. If the hon. Lady wants to apply to the Backbench Business Committee for a debate on how the BBC is organised, I am sure she will get a warm reception from its newly elected members.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Earlier this week, the all-party group on pharmacy published a report after a six-month inquiry into prescription medicine shortages. The difficulty is that patients cannot always get them. May we have a debate, or at least a ministerial statement, to find out what the Government propose to do about this awful situation?

[Sir George Young]

I applaud my hon. Friend’s work as vice-chairman of the all-party group, which I understand was founded by the Deputy Leader of the House. About 900 million prescriptions are issued each year for about 16,000 medicines, some of which, as my hon. Friend said, are in short supply. The Government will want to respond to the report. Contingency arrangements are in place whereby if a pharmacy cannot get a medicine from the wholesaler, it can go direct to the supplier. We do all that we can to prevent shortages, but as I said, we will want to respond to the suggestions in his report.

[Jessica Morden (Newport East) (Lab)]

Please may we have a chance to debate the Government’s thoughts on regional pay? Last week, the Welsh Government produced an excellent response to the Government’s consultation, and it would be fantastic to have an early opportunity to articulate just how unfair, divisive and damaging these proposals will be for areas such as Newport in my constituency.

[Sir George Young]

It might be in order for the hon. Lady to raise that issue on the amendment that her party has tabled to today’s debate. The Government are consulting on the matter, and I welcome the contribution to that process to which she referred. I think that the consultation ends later this year, at which point it might be sensible to have a debate to indicate where the Government are going, having initiated the consultation process, and to see whether there is a case for differential rates of pay in the public sector to reflect regional cost variances.

[Glyn Davies (Montgomeryshire) (Con)]

There is an encouraging increase in the number of organs being made available for transplant, particularly organs such as kidneys, from live donors. Today, an 83-year-old man made a successful kidney donation. Will the Leader of the House ensure an early opportunity for us to discuss this matter and build on the willingness of these wonderful people to donate during their lifetimes?

[Sir George Young]

It so happens that Nicholas Crace, the man to whom my hon. Friend refers, is a constituent of mine living in Overton, and I applaud what he has done. I hope that all hon. Members carry a donor card so that if any accident did befall them, they might be of some help to others. I cannot promise an early debate on this important issue, but again it might be a subject for a Backbench Business Committee or Adjournment debate.

[Jim Sheridan (Paisley and Renfrewshire North) (Lab)]

May we have a debate on consumer protection? The Leader of the House will be aware that many of our constituents the length and breadth of the country would like to come to the capital to celebrate the Queen’s jubilee, but the costs are prohibitive—nowhere more so than on Dolphin square, where many hon. Members reside, where people are now charging £275 for one night’s accommodation. That is double what they normally charge. It is exploitation and should be condemned from the highest level of Government.

[Sir George Young]

I understand the concern of the hon. Gentleman’s constituents, who find they might be priced out of coming to London for some of the jubilee celebrations or Olympics. There will be an opportunity next Thursday to cross-question Ministers in the Department for Business, Innovation and Skills, who have responsibility for consumer protection, on this issue. I will, however, raise the matter with my right hon. Friend the Business Secretary to see what action we can take to help.

[Julian Smith (Skipton and Ripon) (Con)]

Grahame Maxwell, chief constable of North Yorkshire police, was only the second chief constable in British policing history to be found guilty of gross misconduct. This week, he walked away with a payout of £250,000. As part of the Government’s excellent policing reforms, may we have a new rule—if a police chief is found guilty of gross misconduct, he should be kicked out and receive no money?

[Sir George Young]

I shall raise that with the Home Secretary. Whether people should lose, in some cases, pension entitlement for committing a crime is an issue across the public sector. I will raise this specific issue with my right hon. Friend the Home Secretary, however, and see whether we have any plans to change the regime.

[Nick Smith (Blaenau Gwent) (Lab)]

On Monday, the Defence Secretary confirmed that the number of British troops would fall from 102,000 to 82,000 by 2020. A decision on where the axe will fall is expected soon. The people of Wales are rightly alarmed at the prospect of losing 1st the Queen’s Dragoon Guards—the Welsh cavalry—which is the UK’s most senior front-line force. May we have an urgent debate so that all Members can feed into this review?

[Sir George Young]

The Secretary of State indicated, I think, that the total Army numbers would be about 120,000, of which about 80,000 would be regulars and 40,000 reserves. The exercise of configuring individual units and regiments is under way, and I know that my right hon. Friend will want to keep the House informed. There are regular debates on defence, and a set-piece debate is sometimes provided by the Backbench Business Committee, so there might be an opportunity to discuss the matter on one of those occasions.

[James Morris (Halesowen and Rowley Regis) (Con)]

There are 25,000 more people in work in the west midlands than there were a year ago, but one of the key problems for people getting into employment is affordable and accessible child care. May we have a debate on what the Government are doing to improve accessibility to child care so that people in families can get back into work?

[Sir George Young]

This is an important issue. My hon. Friend will know that we have increased the entitlement to free education and care for three and four-year-olds to 15 hours a week and extended it to disadvantaged two-year-olds. He will also know that under universal credit—I am delighted to see my right hon. Friend the Secretary of State for Work and Pensions here—there will be greater support for child care when we remove the so-called 16-hour rule and enable those working less than 16 hours a week to access child care.

[Bob Blackman (Harrow East) (Con)]

In a few weeks’ time, London will play host to the Olympics and Paralympics, which we will all celebrate. During the games, it will be the 40th anniversary of the Olympics’ darkest hour when, in 1972, 11 members of the Israeli team were brutally murdered. So far, the Olympic movement has failed to honour their memory or provide closure for their families. Will my right hon. Friend allow a statement to be made to the House on this matter? There is widespread support across the House for a one-minute silence to be held during the games to commemorate those who were murdered.

[Sir George Young]

My hon. Friend raises an important matter in reminding us of the tragedy that took place 40 years ago. I would like to raise his suggestion with my right hon. Friend the Secretary of State for Culture, Olympics, Media and Sport and, possibly, with Lord Coe, who is in charge of the arrangements. Any commemoration involving a period of silence in the House would be a matter for Mr Speaker, who I am sure will read the record of what my hon. Friend has just said.

[Simon Kirby (Brighton, Kemptown) (Con)]

Will my right hon. Friend find time for a debate on saving our historic lidos and on involving our communities in that process? I should very much like to see such activity taking place in relation to the Saltdean lido in my constituency.

[Sir George Young]

I commend my hon. Friend’s initiative in saving the lido in Brighton. I cannot promise a debate on the matter, but I will ask the Secretary of State for Culture, Olympics, Media and Sport whether there is a role for him to play in this movement. My hon. Friend might also like to contact the Backbench Business Committee about holding a debate, as I am sure that there are other hon. Members who share his concern.

[Jeremy Lefroy (Stafford) (Con)]

May we have a debate on the importance of collaboration between universities and business in supporting growth? Staffordshire university has just been specially commended by the Higher Education Funding Council for England for its work led by Sandra Booth and her team.

[Sir George Young]

I commend what is happening in my hon. Friend’s constituency. It is important for universities to be in touch with business so that they can focus their courses on the skills that industry needs, and I am delighted to hear of the collaboration taking place in Staffordshire.

[Mr David Nuttall (Bury North) (Con)]

May we please have a statement on the UK system of measurement, to enable the Government to confirm—I hope—that this country will continue to have the freedom to use the traditional imperial system of weights and measures, and not be forced any further down the road of compulsory use of the metric system, which has been recently suggested by a former Leader of the House of Commons, the noble Lord Howe?

[Sir George Young]

In this case, there is no solidarity between the Leaders of the House, and I can assure my hon. Friend that the Government are committed to retaining imperial units in all the areas in which they are currently legal units for trade. This includes retaining imperial units for use in dual labelling for as long as people find them useful.

[Mr Marcus Jones (Nuneaton) (Con)]

Having owned several Vauxhall Astras in the past, I am delighted to hear of the commitment by General Motors to retaining and creating jobs in Ellesmere Port. However, with car manufacturing now firmly in the ascendancy, I fear that we might have the potential for a skills gap. May we therefore have a statement from the Education Secretary to tell us what more the Government can do to promote manufacturing in schools so that we can enthuse more young people to take up such careers?

[Sir George Young]

I applaud my hon. Friend’s suggestion that we reawaken in young people an interest in a career in manufacturing. I know that the Minister for Further Education, Skills and Lifelong Learning, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes) will be interested in taking this dialogue forward. I commend the number of Vauxhalls that my hon. Friend the Member for Nuneaton (Mr Jones) has had, although I am not sure why he needed so many. Today’s announcement by General Motors of the move from two shifts to three is indeed good news for Merseyside, as is the confirmation that the new Astra will be built in the UK.

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

May I add my congratulations to the hon. Member for North East Derbyshire (Natascha Engel) on being returned unopposed to the chairmanship of the Backbench Business Committee? May I also ask the Leader of the House for an early debate in Government time on guidance on how the national planning policy framework is to be applied by local councils? There seems to be a lot of confusion among planning authorities over the circumstances in which a planning application may be called in, and I do not think that the questions of regional and national importance are fully understood. An early debate on this matter would be most helpful.

[Sir George Young]

We had a debate on the national planning policy framework in the last days of the previous Session, so I cannot promise another in the near future, but my hon. Friend raises an important issue which I will share with Ministers at the Department for Communities and Local Government. I will also ask the Secretary of State to write to her to try to address the particular concern that she has raised.

[Mike Crockart (Edinburgh West) (LD)]

May I ask the Leader of the House to arrange for a statement from a Minister in the Department for Work and Pensions on any ongoing improvements to the work capability assessment and its related appeals process? With official figures showing that only a third of appeals are successful, rising to 70% for those helped by citizens advice bureaux, and with six to 12 months’ delays in receiving the results of appeals, far too many of my constituents are still being left without support, for entirely dubious reasons.

[Sir George Young]

I understand my hon. Friend’s concern. He will be aware that my right hon. Friend the Secretary of State for Work and Pensions is in his place, and that he will respond to the debate later today. Perhaps he will refer, in his wind-up speech, to the Harrington reviews that are now under way, and that have been set up specifically to address the issues to which my hon. Friend refers. I know that my right hon. Friend will do what he can to allay those concerns.

Point of Order

Thursday 17th May 2012 Commons Chamber

12:25

[Caroline Flint (Don Valley) (Lab)]

On a point of order, Mr Deputy Speaker. Yesterday, in response to a question from my hon. Friend the Member for Ynys Môn (Albert Owen), the Energy Secretary said:

“Let me give the hon. Gentleman one exact policy, for which Labour never legislated: the warm home discount”.—[Official Report, 16 May 2012; Vol. 545, c. 561.]

He repeated the same point earlier this morning in Energy and Climate Change questions. The truth is that it was the Energy Act 2010, which was passed by the last Labour Government, that enabled the warm home discount scheme to be set up. Will you advise me on how the House can get such matters corrected on the record, to ensure that nobody is left ignorant of the true state of affairs?

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I can say that that is not a point of order for the Chair, but the right hon. Lady has corrected the record in the statement that she has just made.

Debate on the Address

Thursday 17th May 2012 Commons Chamber

[6th Day]

Debate resumed (Order, 16 May).

Question again proposed,

That an humble Address be presented to Her Majesty, as follows:

Most Gracious Sovereign,

We, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

Jobs and Growth

Thursday 17th May 2012 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

I inform the House that the Speaker has selected the amendment in the name of the Leader of the Opposition. Standing Order No. 33 provides that, on the last day of the debate on the motion for the Address to Her Majesty, the House may also vote on the second amendment selected by the Speaker. The Speaker has selected the amendment in the name of Angus Robertson for that purpose. The vote on that amendment will take place at the end of the debate, after the amendment in the name of the Leader of the Opposition has been disposed of.

12:27

[Ed Balls (Morley and Outwood) (Lab/Co-op)]

I beg to move an amendment, at the end of the Question to add:

‘but regrets that whilst the UK economy is in recession, long-term unemployment is at its highest level since 1996 and one million young people are out of work the Gracious Speech contains no measures to address this crisis; notes that Britain will pay a long-term price for a prolonged period of slow growth and high unemployment; further notes that France, Germany and the Eurozone as a whole are not in recession while in the USA, where the Government has to date taken a more balanced approach to support economic recovery, the economy is now one per cent bigger than before the global financial crisis, while the UK economy is now 4.3 per cent smaller; recognises the criticism expressed by business leaders that your Government has not come forward with an adequate plan to boost economic growth; believes that cutting spending and raising taxes too far and too fast is self-defeating as slow growth and higher unemployment means that your Government is now set to borrow £150 billion more than planned; and calls on your Government to introduce a fair and balanced deficit plan, with measures to stimulate economic growth and job creation which are essential to get the deficit down, including a tax on bank bonuses to fund a guaranteed job for every young person out of work for more than a year, a temporary cut in VAT, a national insurance holiday for small firms taking on extra workers, and bringing forward infrastructure investment to strengthen the economy for the long-term.’.

It is a great honour to open the final day of this Queen’s Speech debate, and to do so in this very special diamond jubilee year. But I have to say how disappointing it is, with our economy now pushed into recession, the eurozone crisis deepening, and businesses and families up and down the country crying out for a plan for jobs and growth, that we are today debating what is widely regarded to be a disappointing and directionless Queen’s Speech programme from a Tory-led coalition that has, frankly, lost its way.

What a change this is from two years ago. When the Chancellor of the Exchequer spoke in the debate on the Government’s first Queen’s Speech, four weeks after the general election and two weeks before his first Budget, he was bursting with hubris. He was so sure of himself that, when the then shadow Chancellor, my right hon. Friend the Member for Edinburgh South West (Mr Darling), and many other hon. Members on this side of the House asked whether the Chancellor planned to bring forward immediate and deep tax rises and said that spending cuts might choke off the recovery, the Chancellor dismissed those concerns out of hand. He was confident that his plan would

“deal with our debts, set our country on a brighter economic course and show that we are all in this together.”—[Official Report, 8 June 2010; Vol. 511, c. 206.]

What a difference two years makes.

“We are all in this together”: we do not hear that line any more—not from a Chancellor whose Budget decisions have hit middle and lower-income families harder than those on the highest incomes. His Budget decisions have hit women harder than men and families with children harder still. The Institute for Fiscal Studies confirms that his Budgets have been regressive and will see child poverty rise. Last month’s omnishambles of a Budget included decisions to raise taxes on caravans, charity donations, church repairs, pensioners, pasties and petrol, but to have a top-rate tax cut only for the richest—a £3 billion tax cut, which will give 14,000 of the richest people in our society earning over £1 million an average tax cut of £40,000 a year. Millions are paying more in tax to pay for a tax cut for millionaires. No wonder the Chancellor and the Prime Minister can no longer bring themselves to say that “We are all in this together”.

Let me remind the Chancellor of what the chair of the Conservative Association in Harlow said last week:

“The voters are disillusioned with Cameron himself. They don’t like the fact that he did not keep the 50p tax. People feel he is not working for them.”

Apparently, the Chancellor was advised precisely not to cut the top rate by his own Downing street pollster, Mr Andrew Cooper. Let me say to the Chancellor that, in my experience, disregarding the wise advice of someone called Cooper can be a very dangerous course to take.

[Mark Pritchard (The Wrekin) (Con)]

Given the right hon. Gentleman’s closeness to the new French President Mr Hollande and given that the shadow Chancellor mentioned the top rate of tax, does he think that the dash for growth will be enhanced or hindered by the introduction of a 75p top rate?

[Ed Balls]

I do not think that introducing a 75p tax rate in Britain would be the right thing to do at all. That is not our policy, but I do not think that cutting the top rate from 50p to 45p will be good for jobs, growth or fairness either.

[Richard Harrington (Watford) (Con)]

I am listening with some perplexity to how the shadow Chancellor referred to the Budget as one for rich people, because I have calculated that in my Watford constituency, nearly 4,000 people have been taken completely out of tax by the increase in the personal allowance. I am sure that the right hon. Gentleman will join me in congratulating the Chancellor on such an excellent measure.

[Ed Balls]

The hon. Gentleman might need to go back to the drawing board because the Institute for Fiscal Studies has shown that last month’s measures will, as a result of cuts to tax credits, mean tax rises for the average family with children in his constituency—and that is even before taking the rise in VAT into account and it does take the personal allowance rises into account. The fact is that taxes have gone up for low-income families, they are going up for the middle classes, and it is only the highest earners in the hon. Gentleman’s constituency that are getting the tax cuts.

[Mr Brian Binley (Northampton South) (Con)]

Is it not true—the shadow Chancellor is a straightforward man—that the previous Government set out a trap for this Government, not really wishing for a rise to 50%, but carrying it out just before the last election in a crude attempt to catch this Government out?

[Ed Balls]

I am always a close student of the hon. Gentleman, and I noted that he did not advocate the reversal of the 50p rate as the right thing to do, so I am not sure what his constituents thought about that. I recently read some of his other remarks. In March, for example, the hon. Gentleman said:

“The Chancellor has been consistently advised of the importance of macro-measures to stimulate growth in the private sector. So why are these not being implemented?”

Why, indeed? He continued by saying that the Prime Minister

“needs to wake up and smell the coffee. This is a major setback for the Conservative party.”

That is quite right.

[Mr Binley]

rose—

[Ed Balls]

If the hon. Gentleman wants to intervene again, I have plenty more!

[Mr Binley]

I know he has. Now will he answer my question?

[Ed Balls]

The right thing to do after the financial crisis was to do things in a fair way. That is why the 50p tax rate was right at the time. The reason why the Budget has gone down so badly is that lowering the 50p rate was seen as so unfair. The hon. Gentleman was right just a few days ago when he said in his blog that the Government have a communication problem and are over-confident. He said:

“The manner in which Downing Street fires out policies and expects us to agree and applaud without question certainly smacks of a sense of superiority.”

Quite right again—a very interesting remark.

[Several hon. Members]

rose—

[Ed Balls]

Let me make some more progress; I will allow more interventions in a few moments.

As for the Chancellor’s promise of “a brighter economic future”, it is not just that his economic plan has been so unfair, but that it has failed completely. On the recovery being secured, our economy has not only flatlined for 18 months, but has contracted. As to a private sector-led recovery, confidence is down, business investment has been revised down and since June last year, we have lost more than 100,000 public sector jobs, but the private sector has created only half that number of private sector jobs. As for the Chancellor’s absurd claim that Britain is a safe haven, we are in recession. What kind of safe haven is that?

The Chancellor will try to claim today that it is the eurozone crisis that has blown him so badly off course. I will return to the eurozone crisis in a moment, but trying to blame that crisis for the UK recession flies in the face of the facts. This is what the Chancellor said in his autumn statement:

“if the rest of Europe heads into recession, it may prove hard to avoid one here in the UK.”—[Official Report, 29 November 2011; Vol. 536, c. 799.]

But it is the eurozone that has avoided recession and the UK that has plunged back into it. [Interruption.] Even The Sun—not known as a big supporter of Labour, but a big supporter of the Chancellor over the last few years—wrote only yesterday—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. Government Front-Bench Members can do a little better by listening to what is being said. I am sure that they will want to listen to the shadow Chancellor in the same way that they will want Members to listen to the Chancellor later.

[Ed Balls]

They should listen to The Sun, Mr Deputy Speaker. It said yesterday:

“George Osborne can no longer blame Eurozone woes for our double-dip recession.”

It is a recession made in Downing street—even The Sun agrees with that.

[Brandon Lewis (Great Yarmouth) (Con)]

While the shadow Chancellor is busy doing down the British economy, will he not equally recognise the fact that in areas like Great Yarmouth, which Labour left as one of the most deprived in the country, we are seeing hundreds of millions of pounds of investment from and in local companies, put in by organisations and countries like Japan, so that the jobs are growing in the enterprise zones?

[Ed Balls]

In the hon. Gentleman’s constituency, youth long-term unemployment is rising, long-term unemployment generally is rising, families’ taxes are rising and only the top-rate taxpayers are seeing a tax cut. Investment was revised down last year and the year before that, and our economy is in recession because of the policies that the hon. Gentleman continues to support. I think he owes his constituents an apology.

What should we make of setting our economy on a brighter economic course and the observation that “We are all in this together.” Even on his claim that he would “deal with our debts”, the Chancellor is failing that test, too. No growth since the spending review and rising long-term unemployment mean that he is now borrowing £150 billion more than he planned. This is more borrowing than in the plans he inherited, and his pledge to balance the books by 2015 is in tatters. At the end of this Parliament, our national debt will not be lower than the level he inherited, but higher than the level he inherited.

[Andrew Bridgen (North West Leicestershire) (Con)]

The shadow Chancellor has used many quotes in his opening speech, so let us see whether he agrees with this one from Mervyn King, the Governor of the Bank of England, whom Labour appointed. He said that this Government demonstrated a

“textbook response to the situation”—

the economic mess we inherited from the previous Government.

[Ed Balls]

The Governor of the Bank of England was confident two years ago that the Chancellor was making the right calls on the pace of deficit reduction. Unfortunately, it has turned out that the Governor of the Bank of England and the Chancellor of the Exchequer have both got that wrong. We had gone back into recession even before the eurozone crisis. Let us consider recent entries from the website of the hon. Member for North West Leicestershire (Andrew Bridgen). They show him “criticising cuts” to “local health centres”, and reveal his wish to “Save Moira Fire Station” and for the “replacement” of local bus services. I am not sure that all that is entirely on message. Yet the Chancellor and the Prime Minister are still clinging to the view that they are right and everyone else is wrong. In his speech today, the Prime Minister seemed to be trying to claim that the choice between austerity and growth was a myth. [Interruption.] I think that the Chancellor should listen to this, because I am about to explain why he has got it so badly wrong. He should listen and learn, Mr Deputy Speaker, listen and learn.

If the Prime Minister meant that we should not choose between policies for growth and policies for deficit reduction, he was right. I agree. In fact, that is exactly what Lord Mandelson and I argued in our joint article in Monday’s Guardian. We argued for action now to boost jobs and growth, alongside tough medium-term deficit reduction plans. But that is not what the Prime Minister was saying today. He and his Chancellor are still clinging to the mistaken and, now, increasingly discredited view that cutting spending and raising taxes faster to cut the deficit is the route to economic growth, when all the evidence is to the contrary. Trying to cut the deficit faster has not boosted growth in recession; it has choked off confidence, unemployment is up, and we are borrowing more than he planned, not less. If the Prime Minister is really claiming that he is on the right course, he is even more complacent and out of touch than I thought.

[James Morris (Halesowen and Rowley Regis) (Con)]

Does the right hon. Gentleman not agree that economic policy is about credibility? Would he not have more credibility if he told us how he would cost his so-called plan for jobs and growth?

[Ed Balls]

Credibility is about getting things right, not about getting them wrong. We were told that we were out of the danger zone and that the recovery had been secured, but what has happened? Plan A failed in Britain and in the eurozone too, and it is the very plan that the Chancellor has been urging on us. What did he say to The Daily Telegraph in August last year? He said:

“Britain is leading the way out of this crisis”,

and

“The eurozone must follow our lead and act decisively”.

The Prime Minister is off to the G8 summit this weekend. The only countries in recession that will be represented there are Italy and Britain. How are we leading the way? The fact is that the austerity policies that are failing in Europe are the very same policies that have failed in Britain, and which the British Government have been urging the German Government to urge the eurozone to stick with. That is the reality.

Opposition Members have consistently argued that it will not work for all countries to try to reduce their deficits at the same time, that tough medium-term plans to cut the deficit will work only if Governments also put in place a plan for jobs and growth, and that a time when a global hurricane is brewing is precisely not the time at which to rip out the foundations of the house here in Britain.

[Richard Fuller (Bedford) (Con)]

rose—

[Penny Mordaunt (Portsmouth North) (Con)]

rose—

[Ed Balls]

I will give way first to the hon. Member for Bedford (Richard Fuller). We have nothing in the file for him, because unfortunately we were unable to find anything interesting that he had said during the last two years.

[Richard Fuller]

I appreciate the compliment from the right hon. Gentleman, who has often demonstrated that he does not have a sound grip on economics. He is continuing to say something that I do not think is correct: he is continuing to compare austerity policies with growth policies. Does he not accept that growth is an outcome, which all policies are intended to achieve, and will he have the honesty to answer the question put to him by my hon. Friend the Member for Halesowen and Rowley Regis (James Morris) and cost his plans?

[Ed Balls]

The right course is to take a balanced approach that combines medium-term deficit reduction with getting jobs and growth moving. The problem with austerity is that it chokes off jobs and growth and ends up costing more in spending, more in unemployment and more in borrowing. We have set out a clear alternative. We have said “Repeat the bank bonus tax, and use the money to create jobs.” We have said “Rip up the failed national insurance cut introduced by the Chancellor, and use the money for a tax cut for small businesses.” We have said “Yes, cut VAT by £12 billion for a year to get the economy moving.” We have not said how many shovel-ready infrastructure projects can be launched, because we do not have the details.

The Prime Minister says that you cannot borrow your way out of a debt crisis, but unless you grow, your debts get bigger and your deficits get worse. That is what the Chancellor has proved over the last two years. It is not only the Labour party that is advancing that argument. Only last week, the managing director of the International Monetary Fund said:

“We know that fiscal austerity holds back growth and the effects are worse in downturns... so the right pace is essential”.

Even the head of the European Central Bank is now pressing for a jobs and growth plan.

The Prime Minister and the Chancellor must wake up to the fact that our economy has not grown on their watch for a year and a half. Instead of trying to divert the blame for their failure and using the eurozone as an excuse for Britain's problems, they must admit that they got it wrong—that they gave the eurozone the wrong advice—and start pushing for the right solution to the eurozone crisis. I agree that there should be a proper role for the European Central Bank and a greater emphasis on fiscal burden-sharing, but there should also be a change of course on austerity, because only a balanced plan that puts jobs and growth first will succeed in getting the deficit down. When the International Monetary Fund, the OECD, the European Commission, the European Central Bank and even the United States are urging policies for jobs and growth, this Chancellor and this Prime Minister are looking increasingly isolated and out on a limb.

[Penny Mordaunt]

Since April 2010, in my constituency the number of job vacancies has risen by 316%, the number of apprenticeships has doubled, the number of jobseeker’s allowance claimants has fallen by 12%, and the number of claimants aged between 18 and 24 has fallen by 15%. Those are the facts. I understand why the right hon. Gentleman does not want to give Ministers any credit for that, but will he stop talking down the businesses and entrepreneurs in Portsmouth who have made it possible?

[Ed Balls]

I am sure that the hon. Lady and I can agree on one thing. There has been a 130% rise in long-term youth unemployment—unemployment lasting more than six months—in her constituency over the last year. [Interruption.] It is up by 129% in her constituency, and that is really worrying. Constituencies of Members on both sides of the House saw the damage done by long-term youth unemployment in the 1980s, and we should act to prevent a repeat of that rather than being complacent.

[Stephen Hammond (Wimbledon) (Con)]

Twice so far in his speech, the right hon. Gentleman has said that the problems in the UK are nothing to do with the eurozone. Will he therefore disown the remarks of the shadow Chief Secretary, the hon. Member for Leeds West (Rachel Reeves), who said last week that the eurozone was having a major impact on British businesses and British families?

[Hon. Members]

“Yes? Yes?”

[Ed Balls]

Calm down. Calm down, or we will start a debate about Remploy.

Of course the eurozone crisis is very serious and very dangerous for our economy and for all economies. That is why our Prime Minister and Chancellor should be at the table leading debates about the solution rather than carping on the sidelines, sitting like a teenager in the front of the car with headphones on while the crisis happens around them.

These are the facts. Last year, eurozone growth was faster than British growth and was revised up. Our growth was slower and was revised down. Last year, it was only the eurozone that prevented the British economy from going into recession earlier. Our domestic economy, excluding exports, was actually in recession for pretty much all of last year. The eurozone economy was growing when the British economy went into recession. Even today, the eurozone is not in recession and the British economy is. [Interruption.] The welfare Secretary has made a career of blaming Europe for everything that goes wrong in Britain, but I am afraid that this is a recession made in Downing street.

The Chancellor will also try to claim today—[Interruption.] Calm down. The Chancellor will also try to claim today that all this pain will be worth it in the end. However, we are paying a long-term price for the failures that we now see around us—the national debt higher; living standards down; long-term youth unemployment becoming entrenched; more than 24,000 companies out of business since he became Chancellor; investment plans cancelled or diverted overseas; our economy weaker; and capacity lost. I very much fear that when the economy finally recovers, as it eventually will, it will be more prone to inflationary pressures than otherwise, because of the failures of this Chancellor.

[Mr Marcus Jones (Nuneaton) (Con)]

The right hon. Gentleman has mentioned exports. Does he not welcome the growth in exports and the new jobs being created at Jaguar Land Rover, Vauxhall, Nissan and Toyota, to mention but a few? Is he not sorry, and should he not say sorry to the British public, that 1.7 million manufacturing jobs were lost in this country on his party’s watch? Companies such as LDV, Peugeot and Rover closed down manufacturing while he was in government.

[Ed Balls]

Of course I welcome the improvements that we have seen in manufacturing, and I think we could have a cross-party consensus that the previous Government’s decision to set up the Automotive Council and provide long-term strategic leadership has made a huge difference to the prospects for car investment in our country. Nissan; Rover—we made great progress. That progress is being continued, and we should all welcome that. However, I have to say, for all the complacency that we just heard in that intervention, is it any wonder that business organisations—[Interruption.] Government Members should listen.

[Graham Jones (Hyndburn) (Lab)]

Would my right hon. Friend include the car scrappage scheme as well?

[Ed Balls]

The car scrappage scheme, the cut in VAT and the action to support Northern Rock and RBS were important decisions that stopped our economy going into depression. They were all opposed by the Conservatives. That is the reality.

[Mr Marcus Jones]

Will the right hon. Gentleman give way?

[Ed Balls]

No. [Laughter.] Go on then.

[Mr Jones]

I am grateful to the right hon. Gentleman. He seems to be enthused about the car scrappage scheme and what a roaring success it was. Will he therefore explain why Jaguar Land Rover sold about 12 additional cars as a result of that fantastic policy?

[Ed Balls]

We were very proud of the investment that Jaguar Land Rover put into the west midlands as a result of the progress made and the support from Advantage West Midlands.

[Mr Jones]

rose—

[Ed Balls]

I think hon. Members will find that businesses in the west midlands will all agree that the abolition of Advantage West Midlands was one of the most stupid and short-sighted decisions made by this Government so far.

[Mr Jones]

rose—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. You have done very well so far, Mr Jones. Don’t overstep it.

[Ed Balls]

The economy is in recession and they hate it, and so do business organisations up and down the country. Is it any wonder that businesses have been so disappointed and upset by the Queen’s Speech of just two weeks ago? Let me quote the director general of the British Chambers of Commerce:

“There is a big black hole when it comes to aiding business to create enterprise, generate wealth and grow.”

Quite right, Mr Deputy Speaker.

There will be some parts of the Queen’s Speech dealing with Treasury matters which we will support. On banking reform, we will look forward to supporting legislation to strengthen capital ratios and promote competition, although it is now nine months since the final report of the Vickers commission, and we are still waiting for a response from the Chancellor of the Exchequer. However, after 18 months of flatlining, with our economy now in recession and business investment depressed, the question I ask—it is the question British business is asking too—is this. Where is the plan in the Queen’s Speech to restore confidence and promote business investment and jobs in Britain?

With net lending falling month on month—according to the Bank of England it has been down every month for over two years now—where is the action in the Queen’s Speech to promote small business lending? With youth unemployment now at a record high, and with yesterday’s figures confirming that long-term unemployment among young people is still rising, where is the legislation in the Queen’s Speech to get our young people back to work? Where is the legislation to repeat the bank bonus tax to fund a jobs guarantee for young people—or, for that matter, to cut taxes for small businesses hiring new workers, or to help the construction sector with a temporary cut in VAT? Our economy has ground to a halt and our construction sector is in great distress. Where is the plan to support jobs and growth by bringing forward new infrastructure projects? Where is the legislation to make our economy stronger and fairer for the future? Stronger corporate governance; a business investment bank; progress on high-speed rail; reforms in our universities to promote innovation—all are completely absent from this Queen’s Speech.

[Fiona O'Donnell (East Lothian) (Lab)]

Does my right hon. Friend agree that young people in Scotland are facing the double whammy of a coalition Government who are complacent and a Scottish National party Government who are cutting further education funding?

[Ed Balls]

I understand my hon. Friend’s concerns at the lack of a youth jobs plan in Scotland. We can understand that from the Conservatives, because they abolished the future jobs fund, but people will find it hard to understand why the Scottish National party Administration in Scotland have failed so woefully to do anything to tackle the challenge of youth unemployment.

[Graham Evans (Weaver Vale) (Con)]

The right hon. Gentleman referred to investment in this country in manufacturing. Does he agree with General Motors, which has specifically thanked the Government for making the UK a great place to invest in manufacturing and business? Indeed, General Motors has announced today that it will be manufacturing the new Vauxhall Astra at Ellesmere Port, very close to my constituency, providing 700 new jobs and securing thousands of jobs in the supply line. Does he welcome that?

[Ed Balls]

Of course I welcome that. It is good to have more jobs in Britain. The thing that worries me is the 164% rise in long-term youth unemployment in the hon. Gentleman’s constituency. That is a very great concern.

[Alun Cairns (Vale of Glamorgan) (Con)]

rose—

[Ed Balls]

I will make some progress.

Is it not the reality that we have an economy in recession and a Queen’s Speech that entirely failed to deliver on growth, jobs and investment? The Chancellor’s economic strategy is now in tatters, but have we had any admission in recent weeks that he got it wrong? We have had none. The Foreign Secretary says that British business needs to work harder, but it is this Chancellor who needs to work harder to get things right.

[Andrew Selous (South West Bedfordshire) (Con)]

rose—

[Ed Balls]

I will not give way.

Let me say this to the Chancellor. We all know why he has wanted to be a part-time Chancellor: in order to make room for his other role as the Conservative party’s part-time political strategist. But with the Budget botched, the Queen’s Speech a flop, the local elections a disaster for his party, and the economy back in recession, it is now dawning on all of us—I think it is dawning on many Conservative Members too—that he is not a very good Chancellor and not a very good political strategist either. Although should we really be surprised? This is the Chancellor who claimed to his colleagues that hiring Andy Coulson would be a triumph; that taking away child benefit from middle-incomes families would be a masterstroke; that saying that the economy was “out of the danger zone” was smart forecasting; and that cutting the top rate of tax in this Budget would wrong-foot Labour, and outfox his leadership rival Boris Johnson too. With judgment like that, perhaps the Conservative party does not need just a new political strategist; perhaps it needs a new Chancellor too.

[Andrew Selous]

Will the right hon. Gentleman give way?

[Ed Balls]

No, I will not.

What an eight weeks it has been! The transformation has been startling, with the Chancellor’s long-held dreams turning to dust. He dreamed that his brilliant economic plan would bring unprecedented growth and finally deliver a Tory majority in 2015, and that a grateful Prime Minister would then stand aside, as he was finally cheered into 10 Downing street. How far away those dreams seem now!

[Andrew Bridgen]

Will the right hon. Gentleman give way?

[Ed Balls]

I will not.

Last month YouGov asked 1,800 people whether they thought the Chancellor was very well suited to the job of Prime Minister. How many said yes? Just 1% did—18 people only. The question we must ask is this: who on earth were those 18 people? After that Budget, they must be vegan, health freak, cyclist millionaires who passionately hate cars, pasties and caravan holidays, and think that pensioners get a cushy deal. So, other than Steve Hilton, who are the other 17? Is this not the truth: that the Chancellor’s plan has failed, and he has been exposed not simply as unfair and out of touch, but as incompetent? This part-time Chancellor needs a new economic plan for jobs and growth. This part-time political strategist urgently needs a relaunch for him and for the Prime Minister. This Queen’s Speech delivers neither a new economic plan, nor an urgent relaunch. He and the Prime Minister should go back to the drawing board and think again.

13:00

[The Chancellor of the Exchequer (Mr George Osborne)]

I rise to support this Queen’s Speech, and I will say something about the Treasury Bills on banking and pensions that feature in it. But first I had better address, head on, the complete nonsense we have heard for the past 30 minutes. Given the claim by the right hon. Member for Morley and Outwood (Ed Balls) that the eurozone has had no impact on the economic difficulties in Britain, and his claim that his 13 years in government did nothing to lead to the debt and the deficit that this Government are trying to clear up, it is no wonder that there were some rather long faces on the Opposition Benches—[Hon. Members: “Where?”] Over there.

My hon. Friend the Government’s Treasury Whip has just received a text from a Labour Whip saying, “Please, please come to the Chamber for the start of the final day of the Queen’s Speech debate. Ed Balls is opening for us and really needs his support.”

[Lyn Brown (West Ham) (Lab)]

rose—

[Mr Osborne]

I give way to the lady who sent the text.

[Lyn Brown]

May I explain to the hon. Member for Chelsea and Fulham (Greg Hands), who is sitting over there, that we have a very different and more effective way of whipping those on our Benches than he clearly has on his? Finally, as with everything to do with the economy, the Chancellor needs to pay more attention to detail, because that was not the right reading of the text. Indeed, it was not accurate, like much else he does.

[Mr Osborne]

The Labour party certainly does have a different whipping operation: it sends all its information to the other political parties.

Let us get back to discussing the economy. The central argument that the shadow Chancellor was trying to make, and the argument he makes in the amendment, is that the British economy is not as strong as the German economy—that is what we are all being asked to vote on tonight. He is absolutely right about that. The British economy is not as strong as the German economy, and I will tell hon. Members why. It is because for the past decade, in the good years, Germany fixed the roof when the sun was shining and he did not when he was in government.

I will tell hon. Members what happened when the right hon. Gentleman was in government. Over the decade before the crash, Germany maintained its share of world exports while Britain’s share almost halved; Germany was selling more than £10 billion of goods a year to China while Britain was exporting one fifth of that—indeed we were exporting more to Ireland than to Brazil, India, China and Russia put together; and Germany’s manufacturing sector grew by 34%, whereas our manufacturing sector not only did not grow but halved as a share of our total output, while our over-leveraged banking sector grew by 100%. Germany, after years of sustainable economic growth, entered the financial crisis with a budget surplus. Britain, in the years that he was in charge, led a debt-fuelled consumption that drove an expansion in deficit and in debt. Under Labour we entered the financial crisis with the largest budget deficit in the G7 and left it with the largest in the G20.

Instead of making us more like Germany, the right hon. Gentleman made us more like Greece when he was in the Treasury. Britain’s economy became over-borrowed, unbalanced and unsustainable. The person more responsible for that than anyone else active in politics today, the person who encouraged the borrowing, dismantled the banking regulation and gambled the futures of 60 million people on the City of London, is sitting right over there—the shadow Chancellor. It is the people on this side of the House who are clearing up the mess he left behind.

[Andrew Selous]

Does the Chancellor agree that one of the infrastructure failures left by the previous Government was the lack of direct flights from this country to the big, growing cities of China—there are many more flights from German cities to China—and that the Government will put that right in due course?

[Mr Osborne]

I certainly think that a lack of airport capacity is a challenge for this country, but one of the good things that may emerge from the bmi merger is that more slots may become available at Heathrow to open up routes to those cities in China. My hon. Friend makes the very good observation that we have to do much more to expand our exports and our links with the Chinas and Indias of this world. One of the good things that has happened in the past few years is that our exports to China and India are up by a third, and we need to see more of that.

In his speech, the shadow Chancellor dismissed the Governor of the Bank of England as plain wrong. Who appointed the Governor? Did the recommendation ever come across the desk of the shadow Chancellor when he was the political adviser in the Treasury? [Interruption.] We will find out. Yesterday the Governor said:

“We have been through…the biggest downturn in world output since the 1930s, the biggest banking crisis in this country’s history, the biggest fiscal deficit in our peacetime history, and our biggest trading partner, the euro area, is tearing itself apart”.

My message to the House today is that addressing those problems is not easy, but nor is it impossible. I will come on to talk about the eurozone, but first we must put our own house in order, and we are making progress on doing so.

[John Hemming (Birmingham, Yardley) (LD)]

Tony Blair says in his memoirs that from 2005 onwards Labour

“was insufficiently vigorous in limiting or eliminating the potential structural deficit”.

Does the Chancellor agree?

[Mr Osborne]

I agree with Tony Blair on that and, indeed, on his views on the shadow Chancellor.

[Chris Bryant (Rhondda) (Lab)]

One of the difficulties is that some of the cuts that the Government have made are counter-productive in terms of trying to deliver economic growth. The Chancellor referred to this country’s relationship with India. I think that everybody in this House agrees that we need to do more business with Brazil, India, Russia and China. However, if their businessmen find it impossible to get a visa to get into this country or they encounter massive queues when they arrive at Heathrow because of the enormous cuts to the UK Border Force, they are not going to want to do business with this country. Stop cutting off our nose to spite our face.

[Mr Osborne]

There have been queues at Heathrow for far too many years, and of course those queues need to be addressed—[Interruption.] There have been queues for years. I agree with the hon. Gentleman that we need a visa regime that offers support to enterprising individuals—entrepreneurs, people who can bring real skills and value to this country—to come here, and that is precisely what the visa changes we have made will allow. But I have to say that we can have a visa regime that allows in the brightest and the best only if we can command public confidence that we are in control of our borders and that we have a cap on immigration numbers. Remarkably, not only has the Labour party set itself against a cap on benefits, which it will come to regret, but it has opposed the cap on immigration, and that is a huge mistake.

Let me discuss the progress we are making. As the Governor of the Bank of England reminded us, we inherited the largest budget deficit in peacetime but two years into this Government, we have cut the deficit by more than a quarter. In 2010, the state consumed 48% of national income in this country. Today, it consumes 43%. We took office when Britain’s market interest rates were the same as Spain’s. Two years later, our market rates are the lowest in our history and Spain’s are more than 6%. That is the practical benefit our fiscal credibility has brought.

When we came to office, manufacturing had been withering for years, but after two years this country is exporting more cars than it imports for the first time since 1976—the last time a Labour Government bankrupted this country and went begging to the IMF. Today—as Government Members have mentioned, but, strikingly, Opposition Members have not—we hear that when faced with the choice of which plant to invest in General Motors has chosen Ellesmere Port, in the county that I represent, Cheshire, as the site of their future. That is a successful industrial strategy at work, with Ministers, management, employees and employers working together to secure investment.

The chairman of Vauxhall has just said that the Government have put a strategy in place to attract inward investment and support manufacturing, which all helps to make the UK a great place to build cars.

[Richard Burden (Birmingham, Northfield) (Lab)]

We all applaud the deal at Vauxhall Ellesmere Port and I am glad that the Chancellor managed to get out—almost through gritted teeth—some acknowledgement of the contribution of the work force and the trade unions in achieving that. Does he speak to motor manufacturers? Does he know that what he has said about the great work they are doing being export-led is linked to the problems? Does he know what is happening to commercial vehicles and the problems the motor industry has in that regard? Finally, is he going to do anything about Lola, one of the most successful performance engineering companies in this country, which went into administration this week?

[Mr Osborne]

British car companies and their supply chain are doing incredibly well exporting their cars around the world as well as selling them at home. Instead of talking down an industry that is so important to the west midlands and to the rest of the country, the hon. Gentleman should be celebrating not just the decision about Ellesmere Port but the expansion of Nissan in Sunderland and the great news we have had about Jaguar Land Rover in Wolverhampton. Those are real success stories and those companies—Nissan, Jaguar Land Rover and Tata—have choices about where to invest all over the world. They could put that money anywhere but they are choosing to invest in the United Kingdom. We should be celebrating that fact today.

[Huw Irranca-Davies (Ogmore) (Lab)]

The company that the Chancellor has missed off the list is, of course, Ford in Bridgend, which has just had new investment. I must point out, however, that that investment was also there under the Labour Government over successive years. On Spain, will the Chancellor explain why in quarter 3 in 2009 to quarter 3 in 2010 growth in the UK was 3.2% and flatlining in Spain, whereas now it is 0.2% in Spain, which is much-maligned for obvious reasons, and we are in recession? What has happened in the first two years of his chancellorship to put us back behind Spain?

[Mr Osborne]

For a start, as of today Spain is in recession, so I am not sure that the hon. Gentleman’s point has a huge amount of force. This claim, which I guess is made only by Opposition Members whom I am looking at now, that the Labour party somehow bequeathed the new Government some enormous golden economic legacy and that we were incredibly fortunate to inherit this massive budget deficit and totally unbalanced economy with no real plan to deal with that debt or deficit—not that we have heard a plan today, either—is absolute nonsense.

We have also had the good news this week, which was of course not mentioned by the shadow Chancellor, that for the second month in a row unemployment has fallen and employment is up. We have 400,000 more people employed than two years ago, and 190,000 fewer people on welfare rolls. Yes, it is an exceptionally difficult economic time and the legacy of debt and disinvestment is a heavy one, but the tough decisions we are making are moving Britain in the right direction.

[Mr Mark Spencer (Sherwood) (Con)]

I too welcome the improvements in the manufacturing sector of the automotive industry. Does my right hon. Friend recognise that in the food and drinks sector, which is also in manufacturing, there have been enormous increases in the number of jobs and of exports?

[Mr Osborne]

I certainly do. Part of the work we published last autumn specifically supported what we can do in that sector. We are not ashamed to identify sectors where Britain has a competitive advantage and to see what we can do to enhance it.

[Ms Karen Buck (Westminster North) (Lab)]

Does the Chancellor not recognise that although everyone welcomes an increase in employment, wherever it comes from, this country has a crisis of underemployment and of people seeking full-time hours that they cannot get? It would have major implications for, among other things, the welfare bill, which his right hon. Friend the Secretary of State for Work and Pensions has quite rightly committed to trying to bring down, if we could help people work the hours they wish to work.

[Mr Osborne]

Of course we want to help people who are working part time to work full time, if that is what they wish, but four fifths of the people who have taken part-time jobs wanted to work part time. We absolutely must help the fifth who want to turn them into full-time jobs, but I would hope that the hon. Lady, too, welcomes the good news that unemployment has fallen.

[Ed Balls]

On that point, will the Chancellor confirm that the total number of hours worked in our economy is now lower than it was two years ago?

[Mr Osborne]

As I was explaining, four fifths of those who work part-time are getting the part-time work they want. The right hon. Gentleman should celebrate the fact that 400,000 more people are employed than was the case two years ago. Why not get up and welcome that?

If the Opposition’s argument is that we need to do even more, I agree. In the past six weeks alone, we have opened 24 enterprise zones around the country, cut businesses tax to one of the lowest rates in the world, increased support for small business research and development, reformed employment law in the teeth of Labour opposition to double the period before unfair dismissal claims can be made, reinvigorated the right to buy, launched NewBuy mortgage schemes, awarded ultra-fast broadband grants to 10 of our largest cities, frozen council tax across England, launched a £20 billion national loan guarantee scheme that is already delivering cheaper loans to hundreds and thousands of businesses, and increased the personal allowance to cut tax for 20 million working people and lift 1 million of the lowest paid out of tax altogether, with another 1 million to come. That is just in the past six weeks.

Yes, the Government must work harder and do more. The world does not owe this country a living. We will do that, but we have done a great deal already.

[Fiona O’Donnell]

What does the Chancellor say—apart from “Work harder”—to SMEs in my constituency that tell me that the single greatest contribution his Government could make to economic growth and the creation of jobs is to cut VAT?

[Mr Osborne]

This is what we have done for small businesses: we have cut the small companies tax rate, which was going to go up under the plans that we inherited and which the Labour party voted for in the previous Parliament; we have got rid of Labour’s jobs tax; and we have frozen the business rates. We will check the record carefully, of course, but I think that in his speech the shadow Chancellor was advocating an increase in national insurance.

[Ed Balls]

indicated dissent.

[Mr Osborne]

When my hon. Friends pressed him to explain how he would pay for his package, he said, “We wanted to see national insurance go up.” If he wants to correct the record, he can tell us whether he wants national insurance to go up to pay for his package.

[Ed Balls]

The Chancellor allocated £500 million for a national insurance tax cut for new firms that were taking on new workers. It has totally flopped and failed, with very little take-up. I said that we should use that £500 million to help existing small firms to take on new employees—a plan that would work, rather than a plan from this Chancellor that is failing. That says it all.

[Mr Osborne]

So the short answer is yes, he wants higher national insurance for businesses. How on earth will that help companies in the current economic environment? As I have said, we need to do more. We need to help to get more credit to businesses and to housing and infrastructure. We are going to use Britain’s low interest rates to work for us all and we are going to do more to reform our banking system—the epicentre of what went wrong when he was the City Minister.

[Ed Balls]

Why does the Chancellor not bring some clarity to the debate by telling us how many businesses have actually been helped by his national insurance rebate scheme for small businesses? Was it the hundreds of thousands he promised? Will he give us the actual number?

[Mr Osborne]

I can tell the right hon. Gentleman that 15,000 businesses have been helped by that scheme. The economic policies that he has drawn up would hurt millions of businesses. What the Labour party wanted and what he campaigned for was an increase in national insurance for all firms and we stopped that.

[Richard Fuller]

On that point, will my right hon. Friend note that last month we had the largest number of new company formations in my constituency of Bedford? One reason for that is that they want stable, low, long-term interest rates, which this coalition’s policies are delivering.

[Mr Osborne]

My hon. Friend is absolutely right. That is precisely what businesses need—a stable economic environment in which we are not exposed to some of the financial problems that some eurozone countries face at the moment. The low interest rates and the credibility that our policy bring help every business, not only in Bedford but around the country.

[Andrew Bridgen]

Does my right hon. Friend agree that just as we need to rebalance our economy away from over-reliance on the public sector, we also need to rebalance our exports away from over-reliance on the eurozone at the moment? The latest figures suggest that this is already happening, with UK exports to non-EU countries up by 12% while those to the EU remain flat.

[Mr Osborne]

I agree with my hon. Friend that we need to diversify where our exports go, not just because of the problems in the eurozone but because this country should be taking greater advantage of the extraordinary growth in the Asian economies. It remains a staggering fact that we were exporting more to Ireland than we were to Brazil, Russia, India and China put together.

[Several hon. Members]

rose—

[Mr Osborne]

Let me make some progress and then I will take some more interventions. I want to say something about some of the Bills in the Queen’s Speech, as we are debating the Queen’s Speech. I want to talk particularly about the banking reforms—something else that the shadow Chancellor mentioned in only half a sentence, so we have no idea whether he supports the reforms or not. [Interruption.] Perhaps he can intervene and tell me when I have made these points.

First, we have the Financial Services Bill, which was carried over from the previous Session. It already seeks to rectify one of the greatest errors of policy making—the decision that the Labour party took in 1997 to remove banking supervision from the Bank of England. The Governor of the Bank commented on that in his lecture on the “Today” programme the other day. That Bill, which is crucial, brings prudential supervision back under the control of the Bank of England, giving it new powers to monitor the build-up of dangerous levels of debt and asset bubbles and to deal with them rather than, as last time, letting disaster strike.

In this Queen’s Speech, we prepare to go further and address the structure of banking itself. We will introduce the Bill that implements the reforms proposed by Sir John Vickers and his Independent Commission on Banking that ring-fences retail banks from the riskier investment banking arms and provides more loss-absorbing capacity so that private investors will bear losses, not the taxpayer. Taken together, those Bills seek to give Britain a safer, more competitive banking system and will allow our country to have successful banks with a global reach while better protecting the taxpayer at home should one of those banks fail. I hope the Bills will command broad support across this House.

I hope that the Bill to reform public service pensions also commands broad support across the House. After all, those reforms are based on the proposals of the Labour former Pensions Secretary, John Hutton. They provide for generous pensions and security in retirement for hard-working public servants that are quite frankly beyond the reach of almost all in the private sector.

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

Can the Chancellor really justify asking fire brigade workers, who undertake some of the most high-risk tasks in our society, to pay 13% of their income towards their pension?

[Mr Osborne]

We have to have public sector pensions that are affordable. The truth is that people are living longer in retirement, which is a good thing, and that if we want to maintain generous pension provision for firefighters and others we have to make reforms that mean the country can afford that. So, the answer to the hon. Gentleman’s question is yes, and we have been in a long and good negotiation with the Fire Brigades Union and others on those reforms. As I have said, we seek to make public sector pensions affordable and it is pretty striking if the tone of interventions from the Opposition is going to be that we do not have support for this far-reaching reform that will put public service pensions on a sustainable footing. Opposition Members are going to have to ask themselves whether they speak in this House for their tax-paying constituents or for the unions that sponsor them.

We look forward to hearing, in the wind-ups, from the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), whom we welcome to his place. Perhaps he will tell us what Labour’s attitude to these Bills will be. We are sorry that he has been removed from his role as Labour’s policy chief. He is yet another Labour politician who has found that their career takes a knock when they try to tell their party some hard truths. He did extremely well in his new job of handing notes to the shadow Chancellor as he spoke today, but there was a time when he wrote his own notes rather than just handing them. There was the time when he wrote that note saying, “I’m sorry, there’s no money left”, but his party’s only message is to spend and borrow more. To be fair to him, he is the politician who tried to tell Labour to get serious about welfare reform and about dealing with the deficit. He was famous in my Department for the very precise memo he sent to civil servants on how to prepare his morning cappuccino and his afternoon espresso. How ironic that what did for him was his attempt to get Labour to wake up and smell the coffee. [Laughter.] I have to say that it was quite late last night when I thought of that one.

Who replaces the right hon. Gentleman as policy chief? The new policy chief for the Labour party is the hon. Member for Dagenham and Rainham (Jon Cruddas). We did some research on how he might approach the job and we found these illuminating remarks from a few weeks ago:

“What interests me is not policy as such; rather the search for political sentiment, voice and language; of general definition within a national story. Less ‘The Spirit Level’, more ‘What is England’.”

Well, that is clear then. Perhaps when the Opposition find out “What is England” they will let us all have the answer. The striking thing is that there is no policy from the Opposition at a time when tough decisions need to be taken about our country’s future and when far-reaching reforms need to be made to secure its prosperity.

[Mr Geoffrey Robinson (Coventry North West) (Lab)]

The Chancellor is back on politics, where he is happiest. He got through some parts of the Queen’s Speech in about three paragraphs or sentences, I think. On policy, why will he not listen for once and do what we are saying? Why will he not extend to all small companies taking on new workers the national insurance discount, which is nowhere near being taken up yet, instead of dismissing that suggestion? It is a good idea, so why does he not take it on? Why does he not extend his initial idea and make it effective for once?

[Mr Osborne]

First, as I have said, we have used the money available to us in the balanced Budget to cut the small companies tax rate, which the hon. Gentleman wanted to go up. [Interruption.] He says, “Additional to that”; Labour’s policy was to increase the small companies tax rate. We have not done that. We have cut national insurance across the board for low and middle-paid employees by getting rid of Labour’s jobs tax—that applies whether they are employed in small or larger companies—and we have frozen business rates for smaller companies. So, we have done all those things, but I completely agree that we need to do more to help smaller companies by reducing the red tape burden on them and by helping to get credit to them. That is what the national loan guarantee scheme that was launched at the end of March is doing right now.

[Graham Evans]

I am a proud Manchester United supporter. The players proudly wear “Aon”—the name of one of the world’s biggest insurers—on their shirts. Can my right hon. Friend tell us why that fantastic international company is closing its headquarters in the USA and moving it to the UK?

[Mr Osborne]

I am reminded that the players used to wear “AIG” on their shirts. Perhaps it is a sign of how things are improving that they now wear the name of a major Chicago-based insurer that has chosen to move its headquarters to London. We remember all the stories of companies that moved their international headquarters from Britain a few years ago; now they are coming back.

I want briefly to say something about the eurozone crisis.

[John Hemming]

Will the Chancellor give way?

[Mr Osborne]

Of course I give way to my Liberal Democrat colleague.

[John Hemming]

In 2006, Lord Turnbull, who was at one stage Tony Blair’s Cabinet Secretary, said that borrowing

“crept up on us in 2005, 2006 and 2007, and we were still expanding public spending…You might have thought that we should be giving priority to getting borrowing under better control, putting money aside in the good years—and it didn’t happen.”

Does the Chancellor think the Opposition have learned anything since?

[Mr Osborne]

I suspect that the shadow Chancellor did not listen to Lord Turnbull when he was at the Treasury, and he certainly does not listen to him now.

[Tony Baldry (Banbury) (Con)]

May I take this opportunity to ask my right hon. Friend to pick up on something from the Budget? The Chancellor said that he hoped that the VAT on alterations to listed buildings would not have an impact on listed places of worship. The Churches estimate that the tax will cost them £20 million a year. Would my right hon. Friend be kind enough to update the House on what he is proposing to do to assist listed places of worship?

[Mr Osborne]

First, I pay tribute to my hon. Friend for his work as Second Church Estates Commissioner. He has been in discussions with me and the Treasury about how to make sure that we live up to the commitment I gave in the Budget that churches and other places of worship would not be impacted by the introduction of VAT on alterations to listed buildings. Of course, it is already charged on repairs to listed buildings. I have been in discussions with my hon. Friend and with the Bishop of London, whom the Churches asked to lead on that work, and I confirm that we have reached agreement. The Government will provide £30 million of grant to the listed places of worship scheme. That will be 100% compensation, exactly as we promised in the Budget, for the additional cost borne by churches for alterations. It should also go a long way towards helping the situation on repairs and maintenance, where in recent years they have not been able to get 100% compensation. We think it will deliver 100% coverage for repairs and maintenance. I thank my hon. Friend and the Churches for working with us on delivering what we promised in the Budget.

[Mr Frank Field (Birkenhead) (Lab)]

I am grateful to the Chancellor for giving way, and even more grateful to him for his statement. I congratulate him on the way he dug himself out of the hole into which he placed himself. May I use this opportunity not only to draw attention to those outside the House who campaigned on the change, but to the Second Church Estates Commissioner, who played his role in the negotiations superbly?

[Mr Osborne]

I certainly pay tribute to the Second Church Estates Commissioner. We were clear in the Budget that we wanted fully to compensate Churches for the impact of the change and I am glad that we have done so.

[Mr David Hanson (Delyn) (Lab)]

Now that the Chancellor has dug himself out of that hole, will he turn his attention to another one—the caravan tax? In my area of north Wales, the North Wales tourist board estimates that a 30% drop in sales, on the Chancellor’s figures, will lead to job losses and a reduction in the tourism industry. In the constituencies of my right hon. Friend the Member for Kingston upon Hull West and Hessle (Alan Johnson), and my hon. Friends the Members for Kingston upon Hull North (Diana Johnson) and for Kingston upon Hull East (Karl Turner), caravan manufacturing will go because of the tax. How will that help the growth economy the Chancellor seeks, and will he review the tax urgently?

[Mr Osborne]

As the right hon. Gentleman well knows, there is already VAT on caravans towed by cars, but there is a consultation on the change. It finishes tomorrow. It is partly due to the good work of my hon. Friends the Members for Beverley and Holderness (Mr Stuart) and for Boston and Skegness (Mark Simmonds), who urged longer consultation, that the period was extended. I propose to allow it to finish and then we will set out our response.

[Ed Balls]

rose—

[Mr Osborne]

I will give way once more, but then I want to say something about the eurozone.

[Ed Balls]

In this moment of honesty, perhaps the Chancellor will explain how he is going to dig himself out of the hole on the charities tax, the pasty tax and the top rate of tax? We should get it all out on the table.

[Mr Osborne]

I have spent the last 35 minutes explaining how I am digging the country out of the hole that the right hon. Gentleman put us into.

Let me say something about the eurozone crisis. When eurozone central bank governors and Finance Ministers openly speculate on the possibility of Greek exit, the genie is out of the bottle. That and the Greek elections make this a perilous time. We are clear about the three steps the eurozone needs to take if its currency is to function properly.

First, countries in the periphery with high deficits and uncompetitive economies need to confront their problems head-on, as Governments in Ireland, Spain and Italy are. We are doing it in Britain too, but the adjustment our country must go through is made easier by loose monetary policy and a flexible exchange rate. The countries of the eurozone do not have that to help them, so the core of the eurozone, and the European Central Bank, need to do more to support demand and share the burden of adjustment.

Of course, ideas such as the project bonds put forward by the new French Government are worthy of serious consideration, but, fundamentally, the German Finance Minister is right when he says that rising wages in his country and increased domestic demand there can play a substantial role.

Secondly, the eurozone needs to follow what I described a year ago as “the remorseless logic” of monetary union that leads to greater fiscal union. As I said in the same interview, forms of collective support and responsibility must be developed. I echoed the view in many eurozone countries when I spoke of the possibility of eurobonds.

Thirdly, all of us in Europe, including the United Kingdom, need to address our continent’s lack of competitiveness. That involves structural reform to welfare, pensions and labour laws, and completing single markets in services and digital. It means all Europeans, including Britons, rediscovering the ambition and the ethic that made our continent the dynamo of the world economy for so many centuries. It is not that dynamo today. As the Prime Minister says in his speech today:

“The eurozone is at a cross-roads. It either has to make up or it is looking at potential break up.”

No one should underestimate the huge risks of the latter, but Britain will be prepared for whatever comes. We are making the necessary contingency plans. We will take the steps needed to secure our economic stability and protect our financial system. Above all, we will go on with the progress we have made in the last two years on reducing the structural deficit, keeping our credibility in the bond markets and keeping our interest rates low.

[Mr Alistair Darling (Edinburgh South West) (Lab)]

The Chancellor seems to be setting out quite a significant shift in the Government’s policy on what should be happening in Europe, in particular urging the German Government to do things in relation to promoting growth that many of us have argued for several months. Interestingly, they are not to apply to this country. Will he confirm that this is a significant shift, and will he add to his list that it is now desperately important that the eurozone looks at the health of some of the banks in Europe? The Spanish started last week. I do not know whether they have the strength to do what is necessary, but unless the banking system is significantly shored up, if the problems spreading from Greece continue—contagion and so on—we could have another major banking crisis on our hands. That would be an utter disaster.

[Mr Osborne]

I very much agree with the sentiment that the former Chancellor expresses. In the autumn of last year, and indeed before that, the Prime Minister, myself and others in the Government did consistently say, in public as well as in private, that surplus countries in the core of the eurozone needed to do more; that the European Central Bank needed to do more—I said it in the House and we said it in the ECOFINs and European Councils that we attended.

What has changed this week is that, first, the Greek elections have brought back the fear of contagion that had never really quite abated, despite the action of the European Central Bank over Christmas. Secondly, over the weekend and at the beginning of this week, central bank governors and Finance Ministers in the eurozone itself were openly speculating on Greek exit, and that has, as I said, let the genie out of the bottle. Some of the things that we were happy to say in private we are now also willing to say in public, because the issue is out there—on the agenda. We have not put the issue out there in the public domain, but now it is out there, put there by other people. We have very clear ideas of what the eurozone needs to do to make their currency work.

[Mr Darling]

The Chancellor is actually confirming what I thought. It is good that they are saying these things in public, but it does suggest that perhaps there is an opportunity to change direction in Europe. I know we will not agree about what is necessary in this country, but does the Chancellor agree with me that we need to be explicit now that austerity on its own will not work—we need policies of growth to go with it?

[Mr Osborne]

I completely agree that austerity alone is not enough, and that is why I have just been explaining how we have cut business taxes, set up enterprise zones, set up the national loan guarantee scheme and reformed the labour market. We have done all these things so that car companies expand their production and investment in Britain and choose Britain as a place to do business. Of course those countries in Europe need to undertake structural reforms to go alongside their efforts to get their public finances under control, but we have to ask ourselves this question: if you are running a high budget deficit in a single currency zone, and you do not have the support of loose monetary policy, you do need support from the core of the eurozone but to abandon a commitment to austerity will expose you to even greater pressure on the international money markets than those countries are already exposed to.

[Jessica Lee (Erewash) (Con)]

Is not another facet to this recovery very much the investment in apprenticeships that this Government have made, with 177,000 new apprenticeship places taken up in the last year, including ones in my constituency of Erewash?

[Mr Osborne]

First, my hon. Friend is absolutely right that one of the successes that we have had is the apprenticeship scheme, which is now working across all constituencies and supporting many hundreds of thousands of people. We will see what the facts are after the debate, but the information that we have just had says that what the shadow Chancellor was alleging in his intervention on me a few minutes ago is not true. The number of hours worked in this country has actually gone up over the last two years—up by 20 million hours. So on that note, there is a difference—

[Several hon. Members]

rose—

[Mr Osborne]

Let me say this. Over the last years—

[Ed Balls]

Two years.

[Mr Osborne]

It is over the last two years. But this points to a greater truth: the right hon. Gentleman had 13 years to prove to the country that he had the right policies to run the British economy, and he delivered the greatest economic disaster in this country’s modern history.

[Several hon. Members]

rose—

[Mr Osborne]

I will finish now by saying this. We are reducing the structural deficit, keeping our credibility in the bond markets and our interest rates low. We are reforming our banks, helping our unemployed, supporting our businesses, and giving back to our country the prosperous future that the Labour party so cruelly snatched from them.

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I remind all Members that there is now a six-minute time limit on all contributions to the debate. A great number of Members wish to participate, so the limit does not have to be used in its entirety; that might ensure that more Members get in.

13:38

[Alison McGovern (Wirral South) (Lab)]

I shall start my remarks by talking about the announcement by General Motors about Vauxhall at Ellesmere Port. I represent many, many people who work there and I pay tribute to that excellent work force and the community around them who support them. Whilst I recognise the commitment of all politicians who have helped back Ellesmere Port, in Wirral all of us know somebody—a family member or a friend—who has worked incredibly hard for this, and it is those people I am thinking of most and congratulating today.

I would like to make a few remarks about unemployment. Our commentary on employment, I am afraid, often shows the limits of the way we do our politics. The news, and we ourselves, often obsesses about the figures—the monthly movement up and down—and whilst those are important indicators, of course, it is the trend that really matters. We often worry about the weather when we should be thinking about the climate that we are in, and sadly, the unemployment figures are worse than those for this time last year. According to the Library, the number of people claiming jobseeker’s allowance is now 106,000 higher than in April 2011. That is incredibly worrying. The Chancellor mentioned the figures for two years ago. Unemployment plateaued in 2010. It is growing again now and we need to worry about why.

To add to the problem that we have, our understanding of the impact of unemployment and the lack of the necessary jobs in our economy is limited. I recently tabled a parliamentary question, asking the Treasury what assessment the Department had made of the medium and long-term cost to the Exchequer of the current level of unemployment. That matters because unemployment has a wide range of impacts. The Treasury did not give me as full an answer as I would have liked. I would have liked to know how unemployment impacts on the health budget in the form of increased costs; how much funding is being made available for the regeneration that is needed; and the impact of unemployment on crime levels.

[Andrew Bridgen]

In the shadow Chancellor’s speech, he made much of the apparent increase in long-term youth unemployment. Is the hon. Lady aware of the cynical way in which the last Labour Government manipulated the figures for long-term youth unemployment by cynically bringing people in for a one-week training course and then restarting the clock immediately after, to keep the figures down? That was a cynical measure, which this Government have stopped.

[Alison McGovern]

I thank the hon. Gentleman for his intervention. I have thought a lot about youth unemployment over the past years. The former Government oversaw radical improvements, such as our intervention in the labour market with things like the new deal. I find it hard to characterise any of that work, which has been recognised around the globe, as cynical. I find that very difficult to believe.

[Bill Esterson (Sefton Central) (Lab)]

I wanted to agree with my hon. Friend about the important and welcome news about Ellesmere Port, because like her, I have constituents who rely on the work that comes from Ellesmere Port. In her excellent speech, might she comment on the tax cut for millionaires that is paid for by pensioners? Does she agree that if that tax cut were reversed, the money would be better invested in jobs and growth of exactly the kind that she is calling for?

[Alison McGovern]

I thank my hon. Friend and Merseyside neighbour for his question. Like my constituents, I cannot understand this Government’s decision to give tax breaks to millionaires.

[Sheila Gilmore (Edinburgh East) (Lab)]

In light of the earlier intervention, I thought my hon. Friend might be interested to hear figures, provided to the Work and Pensions Committee yesterday by the Department for Work and Pensions, on the issue of people who had apparently been off benefit. In March 2010, there were 18,000 young people who could have been put in that category, and there are now 4,000 in terms of training allowances. That is a difference of 14,000. As I think my hon. Friend would agree, that hardly explains the rise in youth unemployment.

[Alison McGovern]

I thank my hon. Friend for that helpful and informative intervention.

When the Chancellor talked about a growing economy, one of my hon. Friends shouted, from a sedentary position, “Not in the north-east.” We need to recognise that worklessness does not impact equally on all communities. That is why when we think about the growth we need, policy needs to be tailored properly to the economy in each and every part of the country, so that the GDP growth we all hope for represents the whole of the UK. I suppose it is entirely possible that the UK will recover, but leave behind heavily blighted areas of our country.

A study of unemployment reveals a key flaw in the Government’s thinking. They have talked about “expansionary fiscal contraction”—in other words, to achieve growth, the Government need to slash their budgets and investment will flow in from foreign shores. I do not believe that that is consistent with the Government’s other stated aim: to rebalance the economy. Finance for those parts of our economy that have strengths in manufacturing but need regeneration is necessarily long term. Government industrial strategy should shelter our industry from global headwinds, not leave us vulnerable.

Fiscal contraction at the pace we have seen has harmed blighted areas that had only recently started to recover from the impact of previous Conservative Governments’ attitude to industry. In my area, I see the impact of the withdrawal of central Government from regeneration and the stopping of regional growth via regional development agencies. The responses built into local government that were designed to target deprivation, which clusters in particular parts of our country, were stripped away in the financial settlement.

In the Budget, the Chancellor introduced measures that took money out of the pockets of people on low and middle incomes in those parts of the country where we want to rebalance. That will not help. Someone in the Treasury has to take responsibility for looking at the macro impact of all the measures that are affecting those places that stand to be the worst affected by this Government. We have had a botched Budget and then a next-to-nothing Queen’s Speech, I am sorry to say. The Government will be judged by the people in Wirral and Merseyside not merely on the GDP figures, but on the actual development we see in our city. We must take account of the differential impacts of Government measures on different parts of the country with different economies; we must not focus only on the national picture.

My question for the Government is: will they meet the test of real economic development? Only that will promote the widespread employment that people want. People will judge this Government on the basis of whether or not they see their friends and family in employment.

13:53

[David T. C. Davies (Monmouth) (Con)]

We are all aware, of course, that the Government are having to make some very tough and difficult decisions. Some of them may question some of those individual decisions, but let us be in no doubt about why we are in the present situation. In 1997, we handed over an economy with no deficit and a national debt of £350 billion that was being paid off. By 2007, before any banking crisis had taken effect, the debt had risen to £650 billion, because supporters of the previous Government were spending, at a rate of £30 billion to £40 billion a year, money that they simply did not have. We all know what happened then: after the banking crisis, they went on the biggest spending spree in financial history, which left us with a debt of £1 trillion on the books—probably twice that when private finance initiative commitments are included—and a deficit of £160 billion a year.

[Several hon. Members]

rose—

[David T. C. Davies]

I am happy to give way to a Labour Member who wants to answer some of those points.

[Paul Murphy (Torfaen) (Lab)]

The hon. Gentleman has said that the people of his constituency are pleased with the performance of his Government and his Chancellor. Is that why they actively rejected the Conservative party and the Liberal Democrats, so that they lost control of Monmouthshire county council?

[David T. C. Davies]

Monmouthshire county council will have a Conservative-led administration, with help from our great friends in the Liberal Democrat party, with whom it is always a pleasure to work. They were not responsible for causing the mess left by Labour.

I want some answers from Labour Members. I want to know why they left us with a debt of £1 trillion and what exactly they intend to do about it. It seems to me that the basis of their economic theory is Enid Blyton’s “The Faraway Tree”, which children climb to find a land where everything is free and nothing has to be paid for. To me, that is a fairytale; to them, it is an economic theory. They think they can just carry on borrowing and borrowing, and put off until tomorrow what needs to be done today.

[Huw Irranca-Davies]

Can the hon. Gentleman explain why he felt it necessary to write in to his local paper apologising for the incompetence of his Cabinet colleagues? I thought for a moment that he was describing them, not turning his guns on us. Surely it is they who are incompetent—that is what he stated, in black and white.

[David T. C. Davies]

I would never apologise for doing my job as a Back Bencher, which is to scrutinise and to point out that, on occasions, some Cabinet members have done things or prioritised certain policies with which I disagree. What Opposition Members should do is start to apologise, and not only for the £1 trillion debt. What about selling gold at $200 an ounce—400 tonnes of it? What about the £5 billion raid on private sector pensions, which has plunged people who worked in the private sector into poverty? Only one of them has apologised—the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), who left a note saying, “Sorry, we’ve spent all the money.” That is not good enough.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

Will the hon. Gentleman give way?

[David T. C. Davies]

No, I have no more time to give way.

I want to know why Labour Members still maintain that the banks are to blame, when, in all, just £120 billion was given to the banks out of a total debt of £1 trillion, almost 10 times more. They are following the policy of fools, knaves and despots throughout history started by Edward I, who blamed everything on bankers. The reality is that, every year, we are borrowing more from banks than we have given them. We get 10% of our revenue—£50 billion a year—from the banking industry. If Labour Members are allowed to destroy it, they will have to find cuts 10 times greater than the ones that we, unfortunately, have already had to make.

This Government are taking proper and concrete steps and I think that most Members present support almost all those measures. I totally agree with the decision to reform welfare spending, so that people have to go out to work, and at the same time to cap immigration, which has held down wages for the lowest paid, as even Opposition Members have been the first to accept. As one who has experience of trying to run a small business, I am delighted that the Government will do something to reduce the red tape of employment legislation, which makes many businesses reluctant to take people on. It is, of course, a pleasure to read about cuts in corporation tax and, yes, even the cut in tax for top rate taxpayers. We know that that is politically difficult to defend, but there is a strong economic argument for the measure, which is why Labour Members were not prepared to vote against it and will not now say what they would do.

In Wales the public sector is very large, and the Army forms a large part of that sector. I am worried to learn of proposals to amalgamate the Queen’s Dragoon Guards with another regiment. Many Welsh people are employed in the Queen’s Dragoon Guards, which is an excellent regiment. Since the battle of Agincourt, Wales has supplied men and women who have fought loyally for Britain, as I would have been happy to do in the Territorial Army—I saw no active service. I hope that the Chancellor will bear that in mind when the decisions are made.

I hope that the Chancellor will forgive me for expressing the hope that he will also look carefully at the carbon tax. I am one of a growing number of people who worry about the fact that there has been no increase in temperature for the past 12 years. It took me a while to get the figures from the relevant Government Department, but Members should have a look at the Met Office website. I worry about imposing on the manufacturing industry a tax that is not being imposed elsewhere in the world. I am not absolutely certain whether global warming is taking place or not, but I am certain that if we start imposing measures that are not imposed elsewhere, all that will happen is that manufacturers will go elsewhere and there will be no overall decrease in carbon dioxide emissions.

I am coming to the end of my little piece. I want to assure the Chancellor that we are his most loyal supporters, even if we occasionally quibble on certain issues. We are determined to face down the forces of financial chaos on the Opposition Benches. We know that every Labour Government have ended in utter financial catastrophe, whether because of Attlee using war loans to build the NHS on the back of American credit, Harold Wilson devaluing the pound and telling us it would stay the same, Jim Callaghan having to go cap in hand to the International Monetary Fund, as the Greeks are now doing, or the previous Prime Minister, himself a former Chancellor, who told us that he had ended boom and bust and then created one of the biggest booms in history, on the back of lax lending regulations and lax immigration controls, and then the biggest bust in history, which we now have to sort out.

We know, as do most people in this country, that, whether one is a nation, a company or an individual, it is impossible to go on spending more money than one earns. That is why Government Members will be loyally supporting the Government on the Queen’s Speech and making sure that we can build a better Britain, built on real growth, not debts that our children will have to pay off at some point in the future.

14:01

[David Miliband (South Shields) (Lab)]

I want to make two points in this debate. The first is about youth unemployment. I will present some figures showing the rising cost of the Government’s economic failure. The second is that the neglect in respect of youth unemployment is mirrored by a misguided response to the storms in the eurozone.

I do not think that we need to debate whether youth unemployment is a big problem; it is a massive problem. As the Chancellor and others have said in previous debates, long-term youth unemployment is the greatest danger to not only our economic future, but our social future. Today, according to the Government’s own figures, 260,000 young people have been unemployed for more than a year, which means long-term unemployment. Another 200,000 have been unemployed for more than six months. The interesting, depressing and worrying thing is that the situation is getting worse. As recently as 2008, 6,000 18 to 24-year-olds had been claiming jobseeker’s allowance for a year. By April last year that figure had tripled. Over the past year—just 12 months—it has tripled again, to 55,000. In my constituency, this time last year there were 15 18 to 24-year-olds who had been claiming jobseeker’s allowance for over a year, but now the number is 250, which is a 1,500% increase. The total figure for youth unemployment is 1.3 million or 1.4 million, which comes from the labour force survey, but these are JSA claimants, because that is a claimant count figure.

As for the costs, in February this year I chaired the Association of Chief Executives of Voluntary Organisations commission on youth unemployment. We costed the levels of youth unemployment on the basis of the figures for the first quarter of 2011, which showed a net present value cost of some £28 billion. I asked the university of Bristol to rerun the figures for the last quarter of 2011, which it has done, and the calculation now stands at £30 billion. In the space of 2011, the net present value cost has gone up by £2 billion. That seems to me to be 2 billion reasons for a greater degree of urgency and effectiveness in Government policy.

The Minister responsible for employment says that we should be pleased with stability, but stability in this policy field means that the problem is festering and getting worse. The deputy leader of the Lib Dems, the right hon. Member for Bermondsey and Old Southwark (Simon Hughes), said we should celebrate the “huge success” of Government policy. The wage subsidy that was introduced in April is at best unproven. The majority of jobs under the apprenticeship drive are the result of jobs for the over-25s being rebadged, not new apprenticeships for the under-25s. The expertise in the voluntary sector is being squeezed out by the Work programme. Some 20% of voluntary sector providers have stopped providing under the Work programme. There is a gaping hole in Government policy on transport costs for people to get to interviews, never mind getting to work.

I make no apology for repeating this very basic fact: the Work programme, which is the Government’s flagship programme, helps one in 10 of the youth unemployed. Its success rate is 20%, according to the Government’s own figures. That means that one in 50 of the young unemployed are getting a job as a result of Government interventions. I say to the Chancellor—I am grateful that he has stayed for the debate—that there are three steps that he could take now. First, he could require all public contracts over £1 million to offer apprenticeships to young people. In his autumn statement last year he announced infrastructure expenditure, which is a good thing, but where are the apprenticeships to go with it? Secondly, he could bring forward from 2014 money to raise the size of the wage subsidy or the number of young people helped. In 1995, when his predecessor, the right hon. and learned Member for Rushcliffe (Mr Clarke), tried a wage subsidy, it helped only 6,000 young people. He will have to boost the effort to get take-up. Thirdly, he should bite the bullet and recognise that every study anywhere in the world has shown that for the long-term unemployed only a part-time job guarantee can ensure that one year’s unemployment does not become three, four or five years’ unemployment.

[Mr Spencer]

The right hon. Gentleman is making a compelling case, and I know that he has worked very hard on this matter in the past, but surely he recognises that the best way to solve this is to increase the number of apprenticeships, which the Government are doing, and that his Government encouraged young people to try to aspire to university and many of them, when they did not meet that aspiration, found that deflating.

[David Miliband]

I am grateful to the hon. Gentleman, who makes a perfectly intelligent point. It seems to me to be a good thing to raise university participation levels up to international standards, which is between 45% and 50%, but it is crucial for those who do not go to university that we have high-quality options for them. High-quality apprenticeships are an important part of that.

[Dr Phillip Lee (Bracknell) (Con)]

Will the right hon. Gentleman clarify what he means by international standards?

[David Miliband]

The leading countries of the world for higher education are, first, the United States, which has a 55% participation rate, and, secondly, France, which most people would recognise as having an outstanding higher education system. It has 48% participation. Korea, one of the new countries growing up in the world, has 80% participation in higher education. By the way, Scotland already has over 50% participation in higher education, so I do not believe that somehow English or UK young people are unable to benefit from higher education in the way that people in other countries can.

The Robbins report of 1963 said that higher education should be open to anyone with the ability to benefit, and that seems to me to be the right test. For the 50% who do not go on to higher education, we of course need high-quality apprenticeships, but I say to the hon. Member for Sherwood (Mr Spencer) that he should work with us to raise the quality of apprenticeships, because too many apprenticeships are at too low a level and are not leading to the kinds of life chances that we want to see.

It is true that our levels of youth unemployment are not the levels of Spain and Greece—thank God for that —but in 600 wards in this country one in three young people are not in education, employment or training. It is not the 50% or 55% of the Greeks or the Spanish, but one in three. I do not believe that Europe should be the benchmark for levels of youth unemployment.

I also say to the Chancellor that Europe cannot be the alibi for the collapse of our economy at home over the past 18 months. If we look at the growth measures since his first spending review in the autumn of 2010, we will see that we are actually doing worse than comparator countries, and I do not just mean Germany. In the 18 months since the 2010 spending review, we have had worse growth than France, Poland, Sweden, Austria and Slovakia. I will compute the Spanish figures announced today, but until those figures were announced we even had lower growth than Spain. Our growth was worse than the EU 27 average, the eurozone average and the G7 average.

The Chancellor’s claim about the problem that the eurozone mess is causing for our economy is actually undermining his own promise to rotate our economy from domestic demand to external demand. The question is: what should we do about that? He says that the lesson is to stay the course. I say that when the external environment changes, we should change course. The storm in Europe is not a reason for us to stick to plan A; it is a reason to shift to plan B. There is a warning in the travails of the eurozone, but not the one that the Government claim there is. Debts are rising today in Spain, Portugal, Italy and Ireland because fiscal policy is exacerbating the downturn in the economic cycle. The Prime Minister said in his speech today that we are “on track”, but Conservative austerity is not working at home and collective austerity is not working in Europe.

I believe that our absolute requirement in the light of the real and serious risks we face is to pitch policy—fiscal policy, monetary policy, industrial policy and banking policy—against the tide of the economic cycle. We need to argue for that abroad and at home. We heard a shift today from the Chancellor about what should happen abroad. We should be embracing President Hollande, not snubbing him. We should be anti-austerity and pro-reform. That is the right position for Europe and the right position for Britain, because there are no islands in the modern economy. It is not ideology; it is maths. And judging by the Gracious Address, it is time for the Government to go back to the classroom.

14:15

[Mr Brian Binley (Northampton South) (Con)]

I welcome the overall thrust of this Queen’s Speech and, in particular, the fact that it concentrates on the need for growth, more jobs and private-sector, wealth-producing buoyancy, which we did not see for a very long time under the watch of the previous Government. I must say that, yes, I do my best to be honest with the people I represent—

[Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)]

Yes.

[Mr Binley]

I do—they will tell you that, Sir—as you did when you said that there was no money left. We are both honest men.

I wish that the shadow Chancellor would welcome some of the achievements that the people of this country welcome; it is foolish of him not to do so when there are considerable signs of recovery. It simply lowers the esteem in which all politicians are held, and I urge him, and the Opposition Front Bencher who responds to this debate, to take that into account.

There are welcome signs of recovery. The private sector has created more than 500,000 jobs since the general election; the International Monetary Fund forecasts that the UK will grow at twice the speed of Germany and three times that of France; borrowing costs have fallen, investment has been increasing and only yesterday we saw a drop of 45,000 in the number of unemployed people in the first quarter of this year. All those things are welcome, but it would be refreshing to hear Opposition Front Benchers greet them with some enthusiasm—although I doubt that they will.

The truth of the matter is that consumers and businesses are saying, “To hell with it; we’ve got to get on with life,” and that is one reason why we are seeing some of the green shoots of recovery. Now we need to nurture them and ensure that they continue to grow and bear fruit.

The situation is fragile, and no one would say otherwise. Consequently, I urge the Government and the Chancellor to do more. We will not achieve growth with new laws. The previous Government tried that for 13 years, and we saw what happened. This place does not create the growth; it simply sets the atmosphere and ambience for it. So I appeal to the Chancellor to recognise that we need to change the culture regarding entrepreneurialism and the attitude to small businesses, and indeed serious and important recommendations on doing so are coming forward from various parts of the House.

We must also understand the needs of small businesses, because therein lies our best chance of growing jobs and the well-being of this nation.

[Richard Fuller]

Does my hon. Friend agree that there is nothing that a small businessman would like to do more than to employ a young, new worker? What would my hon. Friend suggest to the Chancellor can be done with employment regulations, so that we get our businesses employing people more easily?

[Mr Binley]

I welcome that important point, because I was about to turn to that very area. More can be done, and we do indeed need to reduce the regulatory burden and to strengthen the business environment.

I welcome in the Queen’s Speech the proposed measures to deal with executive pay and employment tribunals, but I still do not understand why the Government are obsessing about maternity and paternity leave, especially for very small businesses. I simply point out that many people meet in the workplace and set up a family life together, and, if a small business employing 10 people loses 20% of its work force for six months, temporary labour cannot be used as a replacement. That simply does not happen.

[Kate Green (Stretford and Urmston) (Lab)]

One trend in the employment figures over recent months has been that female unemployment has risen faster than male unemployment, and that it is decreasing less quickly. Detaching women from the labour market, as the hon. Gentleman seems to suggest we do by weakening maternity rights, will surely make the situation worse.

[Mr Binley]

I do not suggest that at all. What I suggest is that we understand the real needs of small businesses. If we want them to grow and create jobs for both men and women, we need to ensure that they are released from much of the burden that they face at the moment. I ask the hon. Lady to consider that burden, because it is a considerable one for small businesses—I have worked in the sector pretty much all my life and founded two such businesses. We need to release small businesses from that burden, so I would particularly welcome their being excluded from the sort of burdens that paternity leave suggests. The Opposition need to get real in that respect.

I turn to the attitude of the banks and financial services.

[Jim McGovern (Dundee West) (Lab)]

Will the hon. Gentleman give way?

[Mr Binley]

No, I am not going to give way. I have given way twice, so the hon. Gentleman will respect the fact that time is of the essence.

Small businesses have not had the support and understanding of the financial services sector. Again and again the banks tell us that 85% of applications for money are met, and of course that is true.

[Jim McGovern]

Will the hon. Gentleman give way on that point?

[Mr Binley]

My time is running out; I know the hon. Gentleman understands.

Yes, 85% of those applications that are finally made are met, but many people go along to the bank and are told before they reach the application stage that they are not going to get the money, so they never apply. The figures are twisted, and we need to understand that.

On regulation, I welcome the Government’s attitude to one-in, one-out, but they could do much more for small businesses by recognising that they would be the great engine of growth if they were only released. They could be excluded from many of the regulations that apply to business generally, and I urge the Chancellor to press that point in Cabinet.

Members will not be surprised that I now turn to my constituency. We are trying to create a new approach to jobs and development by establishing Northampton Alive, a project involving 15 major developments, part of which is the enterprise zone that, thank God, this Government allowed us to create in Northampton—the largest in the country. We have also introduced, however, a forum for the leading 60 to 80 people in the town, so that every six months of this major project, which lasts for 15 years, they get the opportunity to provide their input and to take ownership of their town, the new developments affecting it and the new job opportunities that will ensue.

Finally, local measures matter. We can do more locally, and I encourage the Chancellor to urge local authorities and local people to take up that challenge.

14:15

[Mr George Mudie (Leeds East) (Lab)]

Before I begin my remarks on the Queen’s Speech, I should like to compliment my right hon. Friend the Member for South Shields (David Miliband) on his very good speech. We all have opinions, but to put the facts in such a clear fashion that cannot be argued with proves why he is a loss sitting on the Back Benches. I am not a natural supporter of his, as he knows, but the Front Bench is his place, not the Back Benches—[Interruption.] It is a shame; that is absolutely right.

This Queen’s Speech is almost a re-run of the Budget speech. There are three financial Bills: the pensions Bill, the banking reform Bill, and the enterprise and regulatory reform Bill. This last has parts that may be acceptable, although they will have to be teased out and looked at, but other parts are worrying. Of the remaining Bills, some are good or desirable in their own fashion. In the context of the dangers and difficult problems facing the British economy and the need to get growth and a rebalancing of the economy, the Queen’s Speech offers very little. That is very disappointing, and it will make the public, who are worrying about their families, their homes, their futures and their children’s futures, wonder about how out of touch the House of Commons is with their worries.

The Queen’s Speech projects our spending the majority of our time on a Bill to reform the House of Lords. How sensible will that seem to the families out there who are treading water financially? We must remember that 80% of the public sector cuts are still to come, so we are not at the worst stage; we have almost not even started. Yet this Bill, on which there is no consensus in the House and which is fiercely opposed by Members from all parties, will take up a lot of time here and in the House of Lords. One wonders why we are doing it. The public will ask, “Have they nothing better to do?” As a result, we will not have a social care Bill in this Session—that is a disgrace—and nor will we have a higher education Bill, which would be crucial to the growth strategy. No one can say that the Government have got their priorities right.

My right hon. Friend the Member for Edinburgh South West (Mr Darling) got something that Labour Members have long wanted—an acceptance from the Chancellor that growth is necessary to run alongside the cuts. That was quite an achievement and quite good news. The sad news, however, is that when the Chancellor read out all the measures that he felt would deal with growth, they were all on the supply side, not the demand side. It is clear that the big corporates are flush with money and could invest today and tomorrow, but they are not doing so because they have no confidence in the economy and there is no demand in the economy. The sooner that confidence is brought back, and the sooner the Chancellor understands that he has to put demand into the economy to get people into jobs with money and the confidence to spend, the better.

[Jim McGovern]

I thank my hon. Friend—a fellow former Lawside RC academy pupil and Dundonian—for giving way. From 2005 to 2010, I never had any business people coming to my surgery. Since 2010, an ever-increasing number of have been coming to tell me that they are not getting a fair deal from the banks. Does my hon. Friend share that experience?

[Mr Mudie]

As a member of the Treasury Committee, I can tell my hon. Friend that we argue every month with the Governor of the Bank of England and appeal to him to do something about the banks, which are not lending to small businesses at the level that they promised and have been allowed to get away with it without any complaint from the Government.

If Government Members think that it is partisan to say that there is no plan for growth and no understanding of growth, let me read out what the Secretary of State for Business, Innovation and Skills said in a letter to the Prime Minister regarding industrial policy. He wrote:

“I sense however that there is still something…missing—a compelling vision of where the country is heading beyond sorting out the fiscal mess; and a clear and confident message about how we will earn our living in future.”

He clearly and comprehensively set out five areas where there should be investment, the final one being investment in the construction of houses, which he said would get people into work and have an effect on the supply chain. None of those issues appears in the Queen’s Speech or was addressed in the Budget. If the Government cannot trust and listen to their own Business Secretary about how to get an industrial policy for growth, what chance do the people of this country have?

14:25

[Mr Tobias Ellwood (Bournemouth East) (Con)]

It is a pleasure to participate in the final day of the Queen’s Speech debate, where we focus on the economy. Occurring as it is just after the May elections, there is a tendency not only to look at the new policies that have come forward but to take stock of the Government’s performance to date.

An important match took place at the weekend—the Chancellor may have taken an interest as his constituency is not far away—which determined the outcome of the premier league. If we had taken the half time score to be the final outcome, we would have drawn very much the wrong conclusions. The same can be said of the economy. We must work towards a full programme across the Parliament, and at the moment we are halfway through that political cycle. Let us be fair: the 3 May local elections represented a tough result for the Government. I am sure that whole House will unite in delight at the re-election of Boris Johnson. [Interruption.] I am glad that everyone concurs. We look forward to his waving the Olympic flag once again, having seen him do that in Beijing.

[Paul Uppal (Wolverhampton South West) (Con)]

Does my hon. Friend agree that it is important that the Government are taking long-term decisions and looking at the long-term interests of UK plc?

[Mr Ellwood]

I am grateful for that intervention.

Labour Members may be rejoicing in their election results, but before they start measuring the curtains for No. 10 it is worth noting that they fell well below the magic number of 40%. That suggests that those results were more about sending a message to the Government of the day than voting for an alternative. Of course people are worried about jobs, the cost of living, rising fuel prices and generally making ends meet, and we must not lose sight of that. The results therefore reflect a backlash against the establishment which is having to implement these very difficult decisions.

Three observations can be drawn from the results. First, such backlashes are often witnessed. Back in the days of Margaret Thatcher, she went down to 24% in the polls but then continued to win general elections. Likewise, in 2000 the Tories managed to get 40% only to lose the general election in 2001. Secondly, the electorate should be cautious about listening to Labour’s alternative economic strategy of spending more, because it is that sort of irresponsible stewardship that got us into the financial crisis in the first place. Thirdly, the Government need to listen and must not be distracted by less important issues. They must focus on the priorities of the economy, education, welfare, reducing crime, and the NHS.

[Mr Stewart Jackson (Peterborough) (Con)]

My hon. Friend is making a compelling case. I know that he has a great interest in tourism and leisure. Does he agree that it is imperative that the Government make a decision soon on airport capacity in the United Kingdom, in particular in the south-east, to drive economic growth, jobs and the renaissance of our economy over the coming years?

[Mr Ellwood]

My hon. Friend makes an important point. This is a busy year for tourism in Britain and we must get those aspects right. This is not the first time that those points have been mentioned in this debate, and I think that the Chancellor has taken them on board.

The other thing I would like to point out about the local elections—this will be the same in future elections—is the deluge of news that has been thrown at us by the 24-hour news industry. We must think about how the message is managed, not just about the message itself. The Budget is remembered more for Labour’s sensationalist catchphrases, which have been heard again today, than for its game-changing announcements, such as the increase in the personal allowance, which will affect 24 million people; the largest single rise in pensions ever; and the cuts in corporation tax, which make us the most competitive country in the G8.

The latest phrase that Labour is peddling, which has leaked into the media, is “double-dip recession”. If I took my son, Alex, to the fairground and we went on a rollercoaster called “The Double Dip”, he would be pretty disappointed—even at the age of three—if the second dip was eight times smaller than the first. Labour is being disingenuous with the figures and undermines our economy by constantly peddling that phrase. [Interruption.] I hear Labour Members grumbling, so perhaps we should look at the figures. The Q1 results for 2012 were better than the GDP growth results for 2011, which suggests that the graph is going in the right direction.

[Mr Byrne]

The hon. Gentleman is certainly making a case. Will he tell us the cash value of the decline in GDP in the last quarter? How much did it cost our country in lost production?

[Mr Ellwood]

I remind the right hon. Gentleman that the recession that lasted for five quarters, for which he was directly responsible, gave us a GDP growth figure of minus 2.3%. The figures that we are dealing with now are minus 0.3% and minus 0.2%. That means that we are heading in the right direction. It might technically be a recession of two quarters, but Labour is talking down the economy, which is not what the British electorate want to hear.

It is thanks to the measures that this Government are implementing that our economy is growing faster than that of the eurozone, twice as fast as Germany’s and three times as fast as that of France. Our borrowing costs have fallen to record lows, and thanks to the management of the deficit, we are able to retain our triple A rating. And yet, Labour are keen to peddle the idea that there is no plan for a recovery. That argument has just been put forward by the hon. Member for Leeds East (Mr Mudie).

I will give some examples of what the plan is. I have mentioned how we are managing the deficit so that borrowing costs are low. We are also creating one of the most competitive business tax systems in the developed world; cutting red tape by scrapping unnecessary and out-of-date regulations, which are costing UK businesses more than £350 million; and creating one of the most educated and flexible work forces in Europe by creating apprenticeship schemes and energising our schools system through the academy programme. Of course, we are also boosting investment and exports to rebalance the economy by setting up enterprise zones across the country, developing regional growth funds and replacing the regional development agencies with the more effective local enterprise partnerships. I certainly welcome the one that has just been launched in Dorset, which is already starting to release faster broadband and upgrade the county’s infrastructure.

[Karl Turner (Kingston upon Hull East) (Lab)]

What does the hon. Gentleman think the imposition of VAT on static caravans will do for jobs, growth and exports?

[Mr Ellwood]

Again, the hon. Gentleman is repeating a point that has been made by Labour and that the Chancellor has already heard.

To be fair to other Members who want to get in, I will conclude by saying that we need to remain firm on our plan. We need to focus on where we want to be in 2015. It was courageous of the Government to set out a plan for growth and I commend it to the House.

14:33

[Katy Clark (North Ayrshire and Arran) (Lab)]

It is a great pleasure to speak in this debate, which is definitely the most important debate on the Queen’s Speech as far as my constituents—and, I suspect, all of our constituents—are concerned.

The constituency where I live is considered to be in the top 10 unemployment blackspots in the country. In north Ayrshire, there are currently 5,555 claimants chasing 313 jobs. The position that my constituents face is similar to that faced by the constituents of many hon. Members, irrespective of which part of the country they live in, but if we listened to Government Members we might think we are living in a very different economic situation. Yet again, they have used the occasion to show their complacency on the economic situation and how out of touch they are with many of their constituents, who they well know are struggling.

I am disappointed by the Queen’s Speech. Like many, I was underwhelmed when I listened to the announcements by the lack of proposals for legislative measures to try to address the serious problems that our country faces. Many of the speeches have repeated the speeches on the Budget we heard not so long ago. The Government had an opportunity to offer a grand vision of how they will move us forward, but they have failed yet again to make any significant proposals that will help to get us out of this dire economic situation. My hon. Friend the Member for Leeds East (Mr Mudie) has already quoted the Business, Innovation and Skills Secretary, but I agree with the latter that something important is missing, namely a “compelling vision” of where the country is heading.

I shall not necessarily talk about specific proposals in the Bills included in the Queen’s Speech, because the point I am making is on the lack of necessary measures. The hon. Member for Northampton South (Mr Binley), with whom I sit on the Business, Innovation and Skills Committee, spoke about the concerns of businesses and the banks’ failure to lend to small businesses. Yet again, there are no significant measures in the Queen’s Speech to force banks to lend to small businesses. Small businesses come to MPs’ surgeries because they are having difficulty getting loans from banks, but some no longer see the point of contacting politicians because they have done so many times, and the Government’s attempts to get banks to lend, such as Operation Merlin, have completely failed.

There was a lengthy debate yesterday on the decrease in living standards up and down the country, the collapse in wages and the Government’s failure to address the problems that our constituents face. In almost every area of Government policy, there is a failure to focus policy to help businesses to survive and develop.

On green jobs, the Proven wind turbine factory, which operated until last autumn, was a success story for Ayrshire. There were technical problems with one of the wind turbines that the company operated, but the company was one of the first in that field and very much a success story for Scotland. However, its future is uncertain. It had to fold—an Irish company has taken it over, but it will not continue as substantially as before. Those who set up and ran Proven say that the problem that led to its demise was the failure to get funding from the banks, because the banks failed to accept that there was a long-term future for the business because of the Government’s feed-in tariff policy and their approach to solar power.

The Government need to do better. They need to come forward in every area of policy with a plan that will get this country on its feet again.

14:39

[Ian Swales (Redcar) (LD)]

The key to jobs and growth is wealth creation. We create wealth by digging it up, growing it or making things. Everything else is just moving it around. That is why I welcome the Government’s focus on real wealth creation, especially manufacturing.

Labour has been highly critical of almost everything done by the Government, but it is hard to discern what its programme or vision would be. I suppose we can tell a lot about its vision from what it did when it had its hands on the levers for 13 years. It had 13 long years in which to create the society it wanted, so what did it look like in the end? It loosened bank regulation, and further to help its friends in the City it scrapped the public interest test on takeovers in 2002, meaning that many of our cash-generative businesses are now foreign owned, especially in utilities and infrastructure.

Labour decimated manufacturing, taking it from 22% to 11% of the economy, which had knock-on effects for many other sectors, such as logistics. It left Hartlepool, Middlesbrough and Redcar and Cleveland in the weakest 10 of the 324 local economic areas. It widened the gap between the north and the south and the rich and the poor, and widened health inequalities. It created a benefits culture in which work did not pay for many people and having children became almost a career option in towns such as Redcar.

What about the tax system? Today, we again heard from the Opposition the mantra, “Tax cuts for millionaires.” I do not think that friends or even enemies of the right hon. Member for Wokingham (Mr Redwood) would describe him as left-wing, yet in his alternative Queen’s Speech the other day he called for a return to the former Prime Minister’s favoured tax levels—a top rate of income tax of 40% and capital gains tax at 18%. So how did millionaires fare under Labour? They had a 40% top tax rate until the last month of its 13 years. After the recent cut, it stands at 45%. It levied an 18% rate on capital gains—a lower rate than their cleaners and drivers would pay on their income. This Government have lifted that to 28%.

Under Labour, millionaires could put £250,000 a year into a pension scheme and get tax relief. The cut to £50,000 by this Government has raised £4 billion from the rich. They received child benefit and paid 2.5% less tax on their spending. They could get unlimited taxpayer support for gifts to charities, including family- controlled trusts, public schools such as Eton and, as in the case of Andrew Lloyd Webber, a huge art collection, some of which he rents back cheaply to his own house. Add to that numerous loopholes, and millionaires must want Labour back as fast as possible. Meanwhile, people on the minimum wage were paying £700 a year in tax.

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Will the hon. Gentleman remind me who introduced the minimum wage?

[Ian Swales]

It was one of Labour’s great achievements and one I totally support, but I do not support a tax level of £700 a year on the minimum wage, which was in place when the previous Government left office.

What do all these failures in Labour’s vision have in common? Apart from the takeover test, they are all being tackled by the Government. Of course we are doing a lot more than that to stimulate jobs and growth. We are dealing with Labour’s shocking education legacy, as a result of which employers, even in high unemployment areas such as mine, say they cannot find the people they need. We are starting from the bottom. The pupil premium is proving such a help to children in deprived areas. We are encouraging science study in school—it is already up 80%. The National Citizen Service is giving young people confidence in those all-important softer skills. We have made huge investments in apprenticeships, the number of which has more than doubled in my constituency.

We are dealing with Labour’s neglect of manufacturing. We have heard the good news today about Vauxhall and the Business Secretary’s involvement in it. He has also intervened recently in the bioethanol industry, and we will shortly see the restart of a plant in my constituency on which 2,000 jobs depend. We are also pushing green technology. I can look out my office window in Redcar and see 27 giant offshore wind turbines being constructed. Construction is about to start on a £500 million biomass power station at Teesport. The other day I met representatives of the Forewind company, which is starting a massive project on the Dogger bank and wishes to bring power ashore through my constituency. I thoroughly welcome the announcement in the Queen’s Speech of the green investment bank, which will bring more jobs and growth to this vital sector.

The Government are investing in technology and innovation centres, including a centre for process innovation in my constituency. They are investing to improve rail freight infrastructure from Teesport and have created enterprise zones, including three in my constituency at Wilton, Kirkleatham and South Bank. The regional growth fund has already given more help to manufacturing in the Tees valley than we ever saw under the north-east’s regional development agency, and I welcome the extra £1 billion that has been allocated. The work is being co-ordinated by the excellent new local enterprise partnership for the Tees valley.

The Government are beating the bushes to generate international trade, and we are beginning to see the fruits of that activity. Exports to non-EU countries are at record levels, and we now have the first net trade surplus on cars since 1976. The north-east region is already in trade surplus, and the figures will soon include the £20 million-worth of steel a week that is being exported to Thailand from the newly reopened Redcar steel works. The first ship left yesterday.

Private sector jobs are being created—there have been about 500,000 since the general election—but unemployment is still way too high, especially in the north- east and especially among the young and the long-term unemployed. My constituency still has the second highest unemployment level among those of Government Members, and that remains a high priority for me. I was therefore delighted to see a drop of another 85 in the figures yesterday.

As we watch the Olympics, the carbon fibre bikes, the Kevlar canoes, the space-age swimsuits, the polyurethane footballs and the Paralympian equipment will be a reminder of the vital role that chemistry and the process industries play, and will play in the recovery. There is optimism in the north-east’s process industries, and the position could be made even stronger by a Teesside carbon capture and storage network. I look forward to the result of the call for bids for that project. Large UK companies are ready to invest billions in it.

Times are tough for the economy as a whole, not least because of the debt burden. The eurozone is in chaos and there is still a lot more to do, but this Queen’s Speech contains more steps in the right direction and I commend it to the House.

14:46

[Margaret Hodge (Barking) (Lab)]

Today’s debate on jobs and growth is of huge importance not only to the constituents of Redcar but to those in Barking and Dagenham in my constituency. All too often, particularly in this Chamber, people believe that London’s streets are paved with gold, and that there is little poverty or joblessness in the capital. All too often, again in this Chamber, people believe that the challenges facing Londoners are concentrated in the inner boroughs. Sadly, and with a strong sense of anger and frustration, I must tell the House that the reality for families in Barking and Dagenham demonstrates that those beliefs are not only misguided but just plain wrong.

Any set of statistics will demonstrate a high level of joblessness in my constituency and, under this Government’s legislative programme, there is little hope for the future. A datablog published by The Guardian shows that Barking and Dagenham is ranked eighth out of 326 local authorities for long-term unemployment, and 11th for child poverty. If we look at the latest unemployment figures, we see that the unemployment rate in my constituency, across all people of working age, is almost double the national average, and that the number of people on jobseeker’s allowance for 12 months or more has doubled in the past year.

Growth and jobs are vital for my constituents, yet they have become the victims of the Government’s stubbornly blinkered and highly ideological approach to the economy. This involves putting tax cuts for the rich before job creation for the poor, putting deficit reduction before poverty reduction and putting the interests of the few before the well-being of the many. Without active Government intervention, my constituents will find it harder than most to find the jobs that they need to pull themselves out of poverty. Almost 60% of 19-year-olds do not have a level 3 qualification, nearly half the people of working age who are out of work have no qualifications at all, and one in four of my constituents work in the public sector. Faced with cuts in public sector jobs, cuts in training and employment opportunities, a failed growth strategy, little business investment and miserable levels of bank lending, the future for them is bleak.

As Chair of the Public Accounts Committee, I also know that when the Government talk about private sector job creation, the reality is something else. Many of the new private sector jobs are simply public sector jobs that have been transferred to the private sector as a result of the Government’s privatisation programme. We have only to look at the Audit Commission, at the privatisation of the Work programme and of prisons, and at private contractors providing health care to NHS patients to see that many of the so-called new private sector jobs are jobs funded by the public purse. That is scarcely a surge in private sector growth.

The Government claim that they are running the biggest-ever welfare-to-work programme with the Work programme. Let us inject a bit of reality into that claim. I shall look at the Work programme both as a constituency MP and as Chair of the Public Accounts Committee. I have always been an optimist, but I have grave concerns about whether this will be an effective value-for-money programme. Ministers claim that it is value for money because it is paid by results, but surely the programme’s purpose is to get people into work, not to cut the welfare-to-work budget. If we end up spending less, we will do so by achieving less. A detailed look at the programme shows that one in four of those referred will get a job anyway, with public money being spent both on the attachment fee and on the placement. Unemployment is much higher, so referrals are greater and more money is going to private providers, but with fewer people placed in a job.

[Stephen Lloyd (Eastbourne) (LD)]

The right hon. Lady talks about value for money, but does she not agree that the prime providers of the Work programme will be paid only if, first, they get people into jobs and, secondly, they sustain those people in jobs for two years, which will provide the bulk of the money. That sounds like good value to me. Does she disagree?

[Margaret Hodge]

I have two points on that. First, it is not good value if people do not get into work, which is the whole purpose of the programme, and, secondly, one in four of those who get into work would have done so anyway without any intervention at all. Given the black box nature of the programme, we will not know whether people have actually been given support. All the indications I have seen suggest that that is highly unlikely. We are beginning to get evidence to show that the more difficult cases are being parked, simply because all the money is focused on those most likely to get into work.

[Kate Green]

Does my right hon. Friend share my concern that Work programme providers are reporting that when they do succeed in getting people into work, it is usually short term and temporary? If people are cycling round and round the programme, that is certainly not good value for money.

[Margaret Hodge]

We have been looking into the issue of whether short-term or part-time work is being provided. When I tried to meet prime providers locally, they would not tell me how many people had been referred to them, how many people they had got into work or how long those people had been in work. The Government claim to be committed to transparency, but any decent assessment of the Work programme is greatly inhibited by such lack of transparency.

Finally, I shall speak about Barking and Dagenham as an excellent example of where opportunities exist for the Government to stimulate jobs and growth. We might have lost many Ford jobs over time, but we have massive potential for expansion, with Barking Riverside, Dagenham dock and Barking town centre. The lack of public sector investment in infrastructure and services, however, is the major barrier to achieving growth and jobs. There is potential in Barking Riverside, with planning permission granted by the local council for 11,000 new homes, but at the current rate of building it will take 50 to 60 years before the scheme is completed. If those homes were built, it would stimulate jobs and help to tackle housing need.

We cannot get the school that we need in order to assure families who move into the area that their children will have a school place; we cannot get the transport infrastructure we need through the docklands light railway extension, because there is no money there; and we cannot get the Mayor to do anything to stimulate private sector house building. What we need is action, not words. Not a penny of the regional growth fund moneys has come to an area like ours, which needs a huge amount of resources.

I am conscious that many Members want to speak, so let me briefly say in conclusion that although the hon. Member for Redcar (Ian Swales) devoted about half his speech to the previous Government, we are now two years into this Government—and things have got only worse. During the two years on their watch, living standards for hard-working families in Barking and Dagenham have declined. Since they came into office, people’s hopes for a better future—with jobs for their children, homes for their families, and economic growth for their children and grandchildren—have been smashed.

The Queen’s Speech has nothing to say to the people of Barking and Dagenham. It does nothing for a community where needs are great. It fails the hard-working families of my constituents, it fails the businesses in my borough, and it fails to meet the aspirations and needs of future generations who will make Barking and Dagenham their home.

14:55

[Paul Uppal (Wolverhampton South West) (Con)]

The right hon. Member for Barking (Margaret Hodge) used the term “victim”, and also spoke of a lack of hope. That is a theme to which I shall return later. I think that we should be very careful in our choice of words, given how corrosive they may be in the world out there—the real world, not the Westminster bubble.

In difficult economic times, we should not be seeking quick fixes. It is important that we continue to build the foundations that are necessary for economic recovery. The solution to a debt crisis should never be more debt.

[John Stevenson (Carlisle) (Con)]

Does my hon. Friend agree that part of the Government’s problem is the fact that the last Government borrowed in good years, and had borrowed some £40 billion before we even entered the recession?

[Paul Uppal]

That is an excellent point, and it is not made only by Members of Parliament. Hamish McRae, the acclaimed journalist, made it in The Independent during 2003 and 2004. He regularly asked readers what had happened to those golden economic rules—but that is by the by, and we cannot change it.

I want to raise an issue which I spoke about during the Budget debate. We are right not to allow protectionist rhetoric to creep into our political system, and continually to challenge protectionism abroad. That is crucial to the rebalancing of our economy to change it from an economy that spends on imports to one that earns through exports. I am encouraged to note that British exports rose by £50 billion last year, and that unemployment has fallen by over 45,000 in the first quarter.

I believe that there are two areas in which the Gracious Speech can make a real difference: the creation of the right conditions for private sector investment, and investment in our work force and the work force of tomorrow. Analysts have estimated that UK businesses have cash assets of more than £750 billion, equating to nearly half our GDP, and that investing just £20 billion of that in the UK could deliver a 1% increase in growth. We need to ask the difficult question: why are these cash-rich institutions not investing domestically?

The answer begins with the boom that preceded the recession. Unlike booms preceding earlier recessions, that boom was financed by public and private debt, which has continued to depress household borrowing and spending. The IMF’s analysis of advanced economies over the past 30 years concluded that recessions preceded by an unsustainable increase in household debt tended to be more severe and protracted. That is because as long as households pay down debts and increase savings, demand will remain weak.

One explanation for the weakness of private investment is concern among companies about the future availability of bank finance. They are becoming more reticent in their investment strategies, and are using cash as an insurance against a crisis. The situation is not helped by fears of contagion, or by the lack of liquidity in the banking sector. A solution to the problem would be the creation of a banking system that improved lending and the supply of credit. The introduction of a ring fence around retail banking separating retail banking services—such as deposit holdings and lending—from investment would pave the way for a more competitive banking system.

Tellingly, the removal in 1999 of the Glass-Steagall Act, which separated deposit holdings and lending from investment, changed the landscape of banking in America. It allowed larger investment institutions to enter the deposit and loan markets, creating a grab for small banks. In 1999, there were 19 significant large banks in America; today there are four. The picture in the UK is similarly worrying. Although there are smaller banks in the UK and the US, large banks have consolidated their position, creating market dominance. The consolidation of banking on such a scale is bad for businesses and bad for lending. With only a handful of lenders, concern arises about the availability of credit. We often talk about how banks are too big to fail, but rarely do we talk about banks being too big to be effective. Banks can only be described as quasi-public institutions, and will be accountable to the public long after they are sold. They are the engine of any economy, as they provide credit, investment and savings. We need a banking sector that not only serves shareholders, but benefits the wider economy.

I would also like to discuss how investing in the UK should involve our work force today and the work force of tomorrow. On a personal note, I recently held a jobs fair in Wolverhampton. We had more than 1,500 young people attending and more than 30 employers. One conversation I had on that day still sticks in my mind. It was with a young person from Wolverhampton who said, “I want to thank you, Mr Uppal, for organising this. You’ve given me hope.” When the Leader of the Opposition stands up and says that there is no hope in the Budget or the Queen’s Speech, the effect is deeply corrosive. I know that the situation in places such as Wolverhampton is challenging, but to dismiss people and just wipe away their dreams so quickly and flippantly is very damaging. Sometimes politicians in this House need to think carefully about the terminology they use.

We all appreciate that the Opposition have a job to do in holding us to account. However, it is important that we do not respond with knee-jerk reactions, but instead always look at the broader picture of what we are doing for the economy and not look to make political capital out of the situation. Investing in the work force of tomorrow means preparing young people for work today. Careers events in schools, inviting local companies to speak at schools, and lessons on interview and presentation skills could all help, and not just in year 11, but early on, when children are starting to think about options and subjects. It is not about getting young people to pick a career early on; it is about them knowing that their options will help them to make the right choices and give them goals for the future. If young people know that maths and science are essential for accessing the type of job they are considering, such subjects will seem more beneficial.

Ensuring a skills base for the future to drive Britain’s industry and manufacturing is evidently important, and recent reports point to a skills gap. It is disappointing to hear companies say that they cannot find the skilled people they need, especially when that is coupled with high unemployment. The west midlands is a great base for manufacturing, and, with the introduction of the i54 site, we can only improve on this. Taking the long-term view on jobs and growth—helping young people to get the best possible start early on—can only be beneficial in preventing them from ending up not in work, training or education.

Let me finish by saying, for the second time in this Chamber, that when it comes to the difficult decisions, at least those of us on the Government Benches are walking the walk, whereas Opposition Members are just talking the talk.

15:00

[Ian Mearns (Gateshead) (Lab)]

If I had been standing in this House a month or even a fortnight ago to speak about the prospects for jobs and growth, I might have expressed the opinion that the entire credibility of the Government now stood at a crossroads. A month on, however, I believe that we are well beyond that point. The Budget, followed by the local government elections and the collection of sideshows that make up the Queen’s Speech, have made it clear that the Government have abdicated any responsibility for trying to generate any real growth in our economy.

As Labour Members warned when the coalition came to power, the policies adopted by the Government were effectively an enormous gamble with the future of our nation’s economy. We also warned that whereas the richest and most privileged in our society would be spared the costs of that gamble, the poorest and most vulnerable would be expected to pay the costs. We predicted that the experiment—the gamble—was doomed to failure. However, heedless of the warnings, and driven by an ideological desire to shrink the state, the Government pressed ahead, determined to use the excuse of the budget deficit to drive through their political agenda, oblivious to the damage to our economy.

[David T. C. Davies]

Is the hon. Gentleman simply following the mantra that we should have borrowed even further, on top of the £160 billion that we were already borrowing when his colleagues left office?

[Ian Mearns]

I can tell the hon. Gentleman what I would do: invest to save to grow, and then reap the benefits of that growth through the taxation system.

We warned that the Government’s policy was wrong, but I do not think any of us predicted just how wrong, just how disastrous its impact would be and just how much more difficult things would become in regions such as the north-east of England. The impacts on the young, as so clearly outlined by my right hon. Friend the Member for South Shields (David Miliband), are much greater in regions such as the north-east, yet Government Members seem completely oblivious to what is happening in these regions.

The UK economy has returned to recession, after shrinking by 0.2% in the first three months of 2012. A sharp fall in construction output is said to be behind the contraction, but it is not the only factor. BBC economics editor Stephanie Flanders says that the situation

“adds to the picture that the economy is bumping along the bottom”.

At Prime Minister’s questions, the Prime Minister has said the figures were “very, very disappointing”—that is perhaps the understatement of this Parliament. He went on to say:

“I do not seek to excuse them, I do not seek to try to explain them away…there is no complacency at all in this Government in dealing with what is a very tough situation that, frankly, has just got tougher.”—[Official Report, 25 April 2012; Vol. 543, c. 944.]

He said it was “painstaking, difficult work”, but the Government would stick with their plans and do “everything” that they “can” to generate growth.

I am surprised that the Prime Minister was disappointed —what did he expect? The economic outcome of his policies was completely expected by many commentators. The outcome was highly predictable. The Prime Minister needs to recognise that it is his Government who have caused this recession in Britain and that it is his policy that has taken us back into recession. He needs to accept responsibility, and to accept that cutting deeper and deeper is the problem, not the solution and that to continue blindly will only damage our economic prospects yet further.

The Leader of the Opposition hit the nail on the head when he said the economic figures were “catastrophic”. He said that

“this is a recession made by”—

the Prime Minister—

“and the Chancellor in Downing street.”

He went on to say that it is their

“catastrophic economic policy…that has landed us back in recession”.—[Official Report, 25 April 2012; Vol. 543, c. 944.]

The Office for National Statistics has said that the output of production industries decreased by 0.4%; construction decreased by a full 3%; and output of the services sector, which includes retail, increased by only 0.1%, after falling a month earlier. Those figures are slightly worse than many expected, but the fact that the UK is now technically back in recession should not detract from the underlying reality, which is very much as predicted.

The UK economy has been bumping along the bottom for more than a year and is struggling to gain any momentum. The preliminary figures from the ONS are consistent with the messages coming from official and private data, which say that the UK was once again relying heavily on services and consumption by households. That suggests that the recovery will continue to be weak. Demand is very weak. UK business is sitting on a cash mountain but will not invest because there is no demand in the domestic market. So we very much welcome the growth of exports in the car sector, but the fact that such exports are outstripping the domestic market is not really that great news, because the depression of the domestic market is the real problem. We do not have demand.

The ONS figures also demonstrate clearly that the fall in Government spending has contributed to the particularly large fall in the construction sector. Some Government Members have tried to question the ONS figures and argue that the position is not so bleak, but they are burying their heads in the sand. Joe Grice, chief economic adviser to the ONS, has vigorously defended the figures. He said the construction data were based on a survey of 8,000 companies and had been carefully checked and double-checked.

We are in a very difficult situation. All across Britain and Europe people are rallying to challenge the consensus on austerity, because it is nonsense. The election of the new President in France, who is committed to a policy focused on growth, challenges the failed orthodoxy of austerity; the election and protests in Greece, the protests in Spain and the state elections in North-Rhine Westphalia in Germany last Sunday are shouting to us that a change of direction is absolutely necessary.

The Government could, if they so chose, focus on growth, but they do not do so. The fact that they choose austerity—that they choose destruction rather than investment—is wilful, and it is clearly a political choice. But there is an alternative and I beg them, on behalf of regions such as the north-east and on behalf of my constituents, to change tack—we need growth.

15:09

[Chris White (Warwick and Leamington) (Con)]

I am grateful for the opportunity to speak in this important debate. All too often, when we talk about the economy we speak in terms of GDP figures, confidence indices and the like, and they are very important, but we should always remember that this is about people’s lives and aspirations.

Employment in Warwick and Leamington has held up well over the past few years. In May 2010, 2,002 people were claiming jobseeker’s allowance. In March 2012, that had fallen to 1,646. Warwick and Leamington has climbed nearly 100 places and has gone from having the 414th highest level of unemployment among constituencies in the UK to having the 507th. I believe that that is a tribute to the inventiveness of our local businesses, the hard work of our local jobcentres and the determination of local residents to find work. However, while there is reason for optimism, we must also be aware of the challenges.

The number of those claiming JSA over the past 12 months has risen from 265 to 310 and although that figure has fluctuated, it makes it clear that we need to continue to build an economy that can create long-term and sustainable jobs, particularly for our young people. It will not be surprising to Members to learn that, as the co-chair of the associate parliamentary manufacturing group, I believe that manufacturing is the key to creating that sustainable labour market.

Although we all agree that there needs to be economic growth, we do not wish to achieve that through just any type of growth. We should not think of our situation merely as a short-term problem that needs short-term solutions, whether that involves stimulating demand or supporting the supply side.

Manufacturing is best placed to support the objective of increased employment for a number of reasons. First, manufacturing is strongest in those areas where private sector employment has been weakest. In the midlands, the north, Scotland and Wales, manufacturing occupies a bigger part of the economy than in London and the south-east. If we can increase manufacturing growth, it is likely that employment gains will be better spread across the country and we will tackle those parts that have traditionally suffered from structural unemployment.

Secondly, the nature of manufacturing is changing. It requires greater skills and higher levels of education. The UK Commission for Employment and Skills estimates that by 2017 the percentage of manufacturing jobs in high-end occupations—mostly degree-level employment—will rise from 27% today to 37%. That means there will be about as many people in high-end occupations in manufacturing as there will be in low-end occupations.

Thirdly, work within manufacturing is often higher paid than that in services. Average weekly earnings, including bonuses, in the manufacturing sector were £532 compared with £449 in the services sector. Finally, manufacturing jobs have a significant spillover effect into other parts of the economy. They enable the creation of services and other sectors around those jobs and help to provide pillars on which other parts of the economy can build. That increase in manufacturing employment presupposes manufacturing growth, and while I do not have the time to consider that in this speech, it is something to which I hope to return in the near future.

If we want to prepare our work force, and particularly our young people, for work in manufacturing, we need to ensure that we take steps now to support that aim. One of the best ways that we can do that is to support apprenticeships. However, we must ensure that they are the advanced and higher levels of apprenticeships so that we meet the increase in the number of higher level positions. According to the latest data, there were 200,300 apprenticeship achievements in 2010-11. However, only 1,000 were higher level apprenticeships. The number of advanced level apprenticeships completed was around 33% of the total and we need to ensure that, as we increase the total number of apprenticeships, that figure is not diluted.

The best way to support jobs and growth, however, is to give more support to our small and medium-sized manufacturers so that they can take on new employees. More grants should be given to small and medium-sized enterprises and manufacturers to train the new staff they hire, particularly those who have been long-term unemployed or who are aged between 18 and 25. Unlike larger businesses, SMEs often are not able to rely on the economies of scale that can reduce training costs. This presents a significant barrier not only to increasing employment but also to growth. I hope that the Government will look at ways of increasing the support we can give to SMEs in this regard with greater financial incentives for those higher-end qualifications that will become more important in the years ahead.

I believe that any long-term improvement in our economy has to be built on manufacturing if it is to be sustainable and create the kind of jobs we need to diversify our labour market. Increasing our manufacturing sector and reskilling our labour force will not be quick or cheap but that does not make it any less necessary. Although we face times of public stringency, we should not defer investment. That will only mean that we have to wait longer for the rebalancing to happen. I am confident that if both sides of the House can work together, support the manufacturing agenda and provide the long-term political buy-in that the industry wants in order to make long-term investment decisions, we can achieve the outcomes that we all want.

15:15

[Stephen Timms (East Ham) (Lab)]

One reason why there has been such a negative reaction to the Queen’s Speech, particularly from business, now that we are again in the midst of recession is the absence of measures to boost growth. There was a particularly exasperated reaction from the director general of the British Chambers of Commerce, which my right hon. Friend the Member for Morley and Outwood (Ed Balls) quoted at the beginning of the debate, straightforwardly accusing the Government of playing short-term politics instead of boosting the economy. A lot of people thought there would be a boost to the economy in this Queen’s Speech, but it simply was not there. The problem is that the Government’s policy has not delivered. We were told after the election that the policy being introduced would deliver a steady and sustained economic recovery with low inflation and falling unemployment. Unfortunately, that simply has not happened. The shadow Chancellor and the former Chancellor, my right hon. Friend the Member for Edinburgh South West (Mr Darling), warned that the policy put the recovery at risk. They have been proved right and Ministers have been proved wrong.

There are other reasons for the Government’s dramatic loss of popularity, one of which is a sort of policy incoherence across government, with different Departments going in contradictory directions. Let me give an example: people receive tax credits only if they work more than a certain number of hours. The previous Government set the threshold at 16 hours per week, but the Minister who is winding up the debate has announced that when universal credit is introduced in October next year there will be no hours thresholds. Support will be available only for people working very few hours, and the Secretary of State for Work and Pensions has perfectly fairly presented that as one of the virtues of his new system. However, the Chancellor, who opened the debate, has gone in the opposite direction. He has raised the threshold from 16 hours to 24 hours a week and more than 200,000 households have lost out. They cannot both be right, although one of them might be. The announcement from the Department for Work and Pensions goes in the opposite direction to the Treasury’s. No. 10 ought to have spotted that and sorted it out. People see that incoherence across government.

My right hon. Friend the Member for Barking (Margaret Hodge), who chairs the Public Accounts Committee, made some telling observations about the Work programme. We know remarkably little about what is happening in that programme because the Government have banned Work programme providers from publishing any data. When under pressure in January, the Minister with responsibility for employment promised guidance to allow them to publish, which they want to do. When he was pressed again he said that the guidance would appear by the end of April, but we are now in the middle of May and it still has not appeared, so providers in the Work programme have no way of comparing their performance with that of others. My right hon. Friend said that she could not find out what was happening in her constituency and every other MP is in the same boat. Jobcentre managers have no idea what is happening in the Work programme in their area, and the effectiveness of the Work programme is being weakened as a result.

This week, a very good charity working with homeless people, St Mungo’s, has resigned from the Work programme. It had three separate contracts with three Work programme prime providers, but in the 11 months since the Work programme started the charity has not had a single individual referred to it by any of those three prime providers.

[Mr Gordon Marsden (Blackpool South) (Lab)]

I am listening with great interest to my right hon. Friend, not least because I have heard similar things in my constituency, not just about the voluntary sector but about experienced private providers. Does he think it is time that the Government started doing a proper job for the third sector? They want to involve it in the big society, but they are cutting its legs off.

[Stephen Timms]

My hon. Friend is absolutely right. Step one would be to allow the data to be published. Instead of banning everybody from saying what is happening, the Government should let us have some numbers so that we can see what is going on. That would offer the chance for clarification.

[Michael Connarty]

I am grateful to my right hon. Friend for making those points about St Mungo’s. I took the trouble to visit the project in Hackney, and I was very impressed by what was being done for people with long-term dissociation from society to give them skills and jobs. It is a tragedy if the charity has decided that the Government have nothing to offer them. The project is wonderful and the Government, given all their rhetoric, should be supporting it wholeheartedly.

[Stephen Timms]

My hon. Friend is right. Not one person has been referred to St Mungo’s since the Work programme started. If the homeless are not being referred to St Mungo’s, we can be very confident that they are not being helped by anybody, and that is at the heart of what is going wrong. We certainly need guidance so that people can start telling us what is going on in the Work programme.

The hon. Member for Wolverhampton South West (Paul Uppal) is rightly concerned about the challenges of securing investment. I am disappointed that no communications Bill was announced in the Queen’s Speech. A year ago yesterday, the Department for Culture, Media and Sport announced the first stage of what it described as a

“comprehensive period of consultation that will inform a Parliamentary Bill.”

Unfortunately, no such Bill has been announced.

The Communications Act 2003, which I was responsible for, is excellent, but technology has moved on and the regulation needs updating. The problem is clearly highlighted by the failure on 4G mobile services. Capital Economics estimates that a go-ahead for 4G in the UK would trigger private sector investment of more than £5 billion and raise gross domestic product by the end of the decade by half a percentage point. It says:

“The UK is off the international pace. The technology has already been deployed commercially by more than 50 operators in over 30 countries.”

In the UK, we still do not know when the spectrum auction, and liberalisation of restrictions on existing spectrum, will go ahead. We cannot afford further delay. The destructive promotion, which we have unfortunately seen, of the narrow interests of individual operators must now give way to the speediest possible implementation, allowing investment to be made. One of the benefits will be viable access to superfast broadband for a significant part of the country where landline services will not be available in any reasonable time scale.

We shall need new legislation and I hope that Ofcom and the DCMS will press ahead to make sure that the changes that are needed—the auction and liberalisation of the existing spectrum—proceed without further delay. We have waited long enough already.

I welcome the inclusion in the legislative programme of the draft Groceries Code Adjudicator Bill, following the initiative of the previous Government.

[Jim Shannon (Strangford) (DUP)]

As the right hon. Gentleman is aware, small firms have suffered at the hands of the giant supermarkets for far too long. The Bill lacks the teeth to allow the ombudsman to fine large supermarkets. Does he agree that the ombudsman needs those enforcement powers?

[Stephen Timms]

The hon. Gentleman makes a telling point. The legislation will have to be scrutinised closely and we will need to make sure that it delivers on the purpose for which it is being introduced.

I have to express my regret at the lack of a Bill that would put into law the commitment to raise the international development budget to 0.7% of GDP. The Secretary of State for International Development has made that promise and I hope it will come forward.

15:24

[Richard Fuller (Bedford) (Con)]

Mr Speaker, I draw your attention and that of other Members to the fact that I am an adviser to a venture capital fund and also to my other entries in the Register of Members’ Financial Interests.

I support everything in the Queen’s Speech that will deal with improving jobs and achieving growth in our country. I hope that is the only partisan point that I shall make because I would like to talk a little bit about the use of language, and then advise hon. Members about a very practical way that Members of Parliament can play a role in achieving the goals that we all seek in terms of enhancing jobs and creating growth.

Let me start, if I may, with language. It is always important, in trying to solve a problem, to use words in the correct way and in ways that make sense, because if we do not do that, of course we will not solve the problem. Sadly, we have a major problem with the language when it comes to jobs and growth, starting with the word “austerity”, which has been much used today in a number of speeches.

A dictionary definition of austerity, in its economic context, is:

“An economic policy by which a Government reduces the amount of money it spends by a large amount.”

In popular discourse that is a description of the coalition Government’s economic policies. The trouble is that it is not a correct description of the coalition’s policies. Over the period of this Government, total public spending will increase, not decrease, from £670 billion to £734 billion. If we choose to measure it in terms of public borrowing as a percentage of GDP, the reduction in the UK will be significantly less than that of Greece, Portugal and Ireland. “Austerity” is therefore a good catch-phrase, but it is not an accurate way to describe coalition policies. That is compounded by a false choice that is presented to the public: austerity versus growth. I think that is a false and misleading set of alternatives to present, because growth is an objective that all policies seek to achieve, and a better description of the policy alternatives that are being put forward is, on the one hand, growth based on living within our means, and on the other, growth based on borrowing.

The BBC, if I may say so, is particularly noteworthy in its use of these false comparisons. On 12 May Gavin Hewitt, who is the BBC’s European editor, had a column entitled “Growth versus austerity”. On 4 May, Stephanie Flanders, the BBC’s economics editor, commented:

“It’s not only Labour politicians who say this”.

in the debate about the trade-off between austerity and growth.

Yesterday evening, a debate on BBC’s “Newsnight” featured a huge animated set of scales with “austerity” on one side trying to be balanced with “growth” on the other. That is not the BBC bias of which the Mayor of London has recently spoken, but it is misleading propaganda being put to the British public.

I now turn to a practical idea that all Members of Parliament should consider in their constituencies. I am drawing on some of my experience in Bedford, and on Monday at 3 o’clock I shall be holding a workshop to describe that in more detail to hon. Members. I looked at the comparative advantages that Bedford had in terms of economics. We do not have much. We do not have a university science park, we do not have a lot of inward investment, and we do not have a big employer, but people have a willingness to invest in and grow local businesses. We are in the process of creating a Bedford business enterprise investment scheme fund—a policy introduced by the Labour Government and enhanced by this Government. That is an excellent scheme, to encourage people to invest in local businesses. The idea of the fund is to get people to put money into their local business because they want to see them grow. There is a sense of civic duty that motivates people, and the fact that they have idle balances sitting in the banks, earning very low interest rates, is a very good economic incentive for people to do that.

A Member of Parliament can act as a great initiator, champion and cheerleader for this initiative, drawing together a local advisory board of business people to run the fund, seeking out partners for the fund to help to popularise it in the community, and finding new businesses that the fund can invest in. In Bedford, we have set a target of raising £500,000, and we are well on our way to achieving that.

I believe that if other hon. Members engage in that sort of action, it will mean that MPs, who are often criticised for lacking real world experience and being out of touch, will be seen in their local communities doing something practical to help people. If we put a network of projects together, we could seek support for this excellent initiative from the regional growth fund so that we have a constellation of local groups across the country where local people come together to support—commercially—the growth of local businesses in their community. If people would like to learn more, I shall be happy to explain on Monday at 3 o’clock in the Thatcher room.

15:30

[Austin Mitchell (Great Grimsby) (Lab)]

To say that the Queen’s Speech was disappointing is not quite to plumb the depths of the inadequacy it demonstrated. Without being able to speak for Her Majesty, I am solidly assured that she would not have made the long and arduous journey from Buckingham palace had it not been for the certainty that I would be taking her photograph as she arrived here. Really, it was not worth her while to come down here for such a rag-bag of petty measures.

The Queen’s Speech was pathetic. It was pathetic because it is now about all the coalition can agree on. The glad confident morning of 2010 has given way to the bleary bickering, downward slope and near break-up of 2012. It was pathetic because it contained nothing about growth, the major problem in our economy, except for the ability to fire people, adding to the unemployment rolls. It was pathetic because it ignored the damage that two years of this Government’s disastrous economic policies have already done. My right hon. Friend the Member for Morley and Outwood (Ed Balls) set that out admirably.

Two years in, here we are in a double-dip recession, with youth unemployment reaching one in four—the rate is higher in Grimsby. The Office for Budget Responsibility is having to spend all its time revising its predictions downwards because they are no longer adequate for this Government’s failures. “I’m walking backwards for Christmas” should be the OBR’s theme song, were it not for the fact that it mentions Christmas—there is no Christmas at the end of this process. The economy has shrunk by 4%, and that is cumulative over the period, so the total shrinkage must be about 10% or more. A much smaller economy is bearing the same burden of debt, so our ability to pay it has shrunk and the standard of living of everyone in this country has shrunk. Hard-working families—non-working families, as well—are facing a burden of cuts and high inflation.

For me, sitting here today is a re-run of 1980-81, watching Conservative Members clutching at any pathetic straw, any pathetic glimmer of hope in the encircling darkness, to cheer themselves up. Margaret Thatcher had the Falklands to rescue her from that dilemma, but I doubt that this Government will have a Falklands to save them, because what they are producing is a decline—a shrinking—of the British economy and of everybody’s standard of living, all in the name of a neo-liberal ideology of rolling back the state. That ideology is plainly inadequate, wrong, prejudiced and damaging, because the only way out of our current situation is growth—economic growth, which increases our ability to pay off debt, as our Government paid off debt between 1997 and 2000. It is growth that revives the economy, growth that generates jobs, and growth that the people now want, but we will not get it if we follow this Government’s agenda.

I have done extensive research and can pronounce, with real authority, that the economy now needs three things: first, demand; secondly, demand; and thirdly, demand. Without the prospect of demand, business will not invest; the banks will not lend; closures on the high street and in the productive economy will continue; and firms will not spend their resources. No one will create jobs without demand to ensure the prospect of profit. Lack of demand clouds every prospect in this nation today.

How can we best achieve demand? My right hon. Friend the Member for Morley and Outwood has set out a five-point plan, which I heartily agree with. I would go further by borrowing more and spending more. I would give a two-year national insurance holiday for the employment of young people and for areas of the country in recession. I would boost the regional growth fund, whose achievements are pathetic, particularly in Yorkshire and Humberside, which got only 6,300 jobs, or about the same as the south-west and less than the north-west, both of which have lower unemployment rates than we do.

I would also borrow to build houses. We need a big housing programme of the kind that took us out of recession in the 1930s. The housing report published this week showed the problems and how they are accumulating. We cannot solve them unless we build houses for people who cannot afford to buy, who now make up the great majority of the population. To do that we can raise money through housing loans for councils, or we could take some of the money that is put into the banks through quantitative easing and give it to housing contracts instead, which will then be paid off over a period of time. The message to the Government that I wish the Queen had given is simply, as Bob Dylan put it: “Turn, turn, turn.”

15:36

[Stephen Barclay (North East Cambridgeshire) (Con)]

It is a pleasure to follow my colleague on the Public Accounts Committee, who I always feel puts the “Great” in Great Grimsby.

A number of Members raised the issue of credit for small businesses. The hon. Member for North Ayrshire and Arran (Katy Clark) focused on that, without wanting to give a specific solution, as did her colleague, the hon. Member for Leeds East (Mr Mudie), and, on the Government Benches, my hon. Friend the Member for Northampton South (Mr Binley). But the debate so far has not focused on one of the chief impediments to credit for small businesses: the high capital requirements imposed on banks, which makes it expensive for banks to give credit to small businesses, particularly those deemed to be high risk. To put that in context, at the moment around one quarter of Royal Bank of Scotland’s corporate book is designated as high risk.

It is not just a small sector of the small business and corporate market that is having difficulty accessing credit. The reason for that really goes back to the financial crisis. I think that the right hon. Member for Edinburgh South West (Mr Darling) was correct, following the collapses of 2008, to take a more risk-averse approach to capital requirements, and that led to the requirements we see today. The point I want the House to focus its attention on is whether we can bring greater urgency to the resolution mechanisms that apply to banks, including looking at living wills so that purchasers are in place if a bank gets into trouble, enabling others to step in and take the liability on and away from the taxpayer. If we take the liability from the taxpayer and give banks greater security by pooling assets through insurance mechanisms, we can take a less risk-averse approach to capital requirements. That, in turn, means that banks will be under less pressure to call in loans.

One of the consequences of banks calling in loans is the forced sale of assets, with businesses selling at a time not of their choosing and when the price is not right. Currently, when businesses seek credit to expand, often only short-term credit is available. Banks do not want to lend for the long term in case there is a deterioration—the eurozone is the most visible risk—and by lending short term they can churn loans and impose brutal charges. The impediment to businesses that want to expand and take on additional staff—a business’s biggest overhead is usually employing staff—is the lack of capital. Seeking that capital is therefore difficult. Banks do not want to lend because of the costs that they incur, and if they do lend they pass the costs on to small businesses through brutal charges and wide spreads in interest.

If our Front-Bench team can accelerate some of the special mechanisms that are available through the pooling of risk, through living wills and through identifying purchasers, we will avoid some of the risk that we saw with the Royal Bank of Scotland. Scandalously, for example, after the Treasury undertook 10 months of intensive work, Sir Nicholas Macpherson could not rely on what the balance sheet said the assets were valued at. The scale of the regulatory collapse that we faced and the continued uncertainty of the risks means we now need to put in place those resolution mechanisms if we are to get credit flowing into the small-business sector.

Let me give an example from my own constituency to bring this issue to life. Just this week, a business got in touch, telling me that its site was cramped and that it had borrowed just under £2 million to expand. Its turnover is up, and its profits are up, to £500,000 a year, but it can get only short-term loans on that £2 million. It cannot therefore expand its staff, despite the opportunities its new site offers, because of the spread of interest and the brutal charges attached to that £2 million loan. So I say to our Front-Bench team, let us speed up the resolution mechanisms, reduce the charges from banks lending to high-risk businesses and, as a result, let the credit flow to those businesses so that they can expand and deliver the jobs and growth that Members on both sides of the House seek to achieve.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

To accommodate more Members, the time limit is being reduced immediately, by one minute to five minutes.

15:10

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

Given that the economy is in recession, with the first double dip for 37 years, that long-term unemployment is at its highest since 1996 and that 1 million young people are out of work, it is shocking that the Queen’s Speech contains no measures to deal with those problems and, therefore, utterly fails to address the crisis that millions face.

I wish to focus my remarks on unemployment and, in particular, on youth unemployment and the Government’s failure to understand that there is an unemployment emergency in our country. We have had a Budget and a Queen’s Speech that have failed to deliver on jobs and desperately needed economic growth. Not only is that complacent; the Government do not seem to understand that every day they waste in failing to take comprehensive action to get our economy moving again, and our people into work, represents a tragic waste of talent, aspiration and confidence for more and more of our citizens.

My constituency has the highest rate of unemployment in the country, at 21.6%, and youth unemployment is at 11.2%—that is, 2,200 young people looking for work. From March last year to March this year, there was an 84% increase in the number of young jobseeker’s allowance claimants out of work for more than six months, and a shocking 91% increase in the number of unemployed young people out of work for one year or longer. Youth unemployment alone is set to cost Birmingham as a city £400 million in the coming decade.

Behind each statistic is a young person, bruised and battered by their experiences of job hunting under this Government and terrified that they will be part of the lost generation. They tell me that they have worked hard, overcoming difficult social and family circumstances to get qualifications, only to find that none of it matters. It is depressingly normal for young people in my constituency to tell me that they might as well not have bothered, that their effort has been wasted and that they do not know where to turn.

A climate of fear is already brewing among young people still at school, who despair that their chances of getting on have been kicked away by the cuts to education maintenance allowance and the trebling of tuition fees. They watch their older siblings getting into debt and sending off CV after CV with no luck and no hope, and fear that they will end up in the same boat.

Yet the Government do nothing but create more damage. They cut the future jobs fund, which was making a real difference in my constituency, as soon as they came into office, saying that, at £6,500 per job created, it was simply too expensive. Last week, the National Audit Office told us that the Government’s flagship regional growth fund will create 41,000 jobs, not the 500,000 that the Government originally claimed. The NAO also said that most of these jobs would have been created in any event and that each of them will cost us £33,000, with a cost, in some cases, of as much as £106,000 per net additional job. So the Government got rid of something that was making a real difference, saying that it was too expensive, and brought in something that is even more expensive but is not making the difference they said it would. That proves that they are not only out of touch and complacent but incompetent.

Unlike Labour’s proposal for a real jobs guarantee, the Government’s youth contract does not guarantee a job; it is merely a subsidy to an employer who is hiring a young person which covers only half their wages and does not create a new job. Labour’s plan for a real jobs guarantee would go much further, guaranteeing a job after 12 months of unemployment and covering the full wages for the employer.

In failing to deal with youth unemployment, the Government are storing up problems for the future, because if we allow the young unemployed of today to become a lost generation, they will be the long-term workless of tomorrow. As I have seen in my own constituency, which already suffers from long-term worklessness, getting back into work people who have been out of work for significant periods, or who have never been in work, is a significant challenge that costs huge sums. Problems that have been a generation in the making will take at least that long to fix, so it is far better, on every measure, to stop us getting to that point in the first place.

The young unemployed in my constituency and across our country were looking for a change of course and a sense of hope, but I am afraid that in this Queen’s Speech there is neither change nor hope—just a confirmation that this Government do not listen, do not care, and do not have a clue.

15:47

[Guto Bebb (Aberconwy) (Con)]

I had intended to speak about a number of issues in relation to the Queen’s Speech, but I will concentrate on three specific points because the time limit has been curtailed.

Before I do so, I should like to respond to a comment by the hon. Member for Linlithgow and East Falkirk (Michael Connarty), who said that the changes to public sector pensions would demand of some workers a 13% contribution towards their pensions. I entirely accept that a 13% contribution would be a significant sum of money. It is important to say, however, that our proposed changes to public sector pensions will protect those pensions. Labour Members should contrast the 13% requested in relation to public sector pensions with the equivalent contribution of about 38% that would be required of a private sector worker. I honestly believe that our proposed changes to public sector pensions will be the saviour of the system rather than its enemy, because people working in the private sector—taxpayers working extremely hard to try to pay their way—will feel increasing resentment unless there is an increased level of fairness between those in the public sector and those in the private sector.

On jobs and growth, I want to talk about two issues. First, there is a serious problem in relation to bank lending for small businesses. My constituency in north Wales is extremely dependent on small businesses—more so than on the public sector. There are not many constituencies in Wales where one can say that private sector employment is greater than public sector employment. People from those small businesses come to me time and again complaining that they are not getting support from the banking system. We have a Bill in the Queen’s Speech to deal with banking reform, but it is absolutely crucial that any changes do not make it even more difficult for small businesses to attract finance. Following on from the comments by my hon. Friend the Member for North East Cambridgeshire (Stephen Barclay), in my experience the problem has been not only a lack of long-term support from the banking system but an unwillingness even to offer short-term support.

I heard the bizarre example recently of a business in the tourism sector that employs more than 40 members of staff and that, despite the recession, has increased its turnover and its profitability by taking important steps to deal with its cost base, and yet its bank expects it to renew its overdraft facility monthly. It would be a challenge for anybody running a business that employs 40 people to plan for the future if they had to deal with their bank on the basis of a monthly renewal of their overdraft facility. The bank in that example is 94% owned by the state. I find that situation unacceptable.

When we consider the reform of the banking system, it is therefore imperative that we ensure that support is available for the small business community. In my constituency, growth will come from the small business community or it will not come at all.

Secondly, I will talk about the need to reduce regulation. I take exception to the comments of the hon. Member for Great Grimsby (Austin Mitchell), who complained that there was not enough in the Queen’s Speech. In my view, the important thing for a Government is not to legislate all the time. I assure him that nobody comes into my constituency office saying, “Please, please, we want more legislation.” What they want is for us to enact the promises that we made in the first Queen’s Speech and to deliver on behalf of the country. One thing that we said we would do for the small business community was to deliver on the burden of regulation.

In the Budget, the Chancellor made an effort to deal with some of the VAT anomalies. On the back of the two months that he has enjoyed as a result of some of the proposed changes, he might not want to visit VAT again. However, I say to him that there are anomalies in the VAT system that need to be dealt with, some of which affect the ability of small businesses to grow. The anomaly that I want him to deal with, which would boost growth in constituencies such as mine, is the way in which the VAT threshold damages businesses that aspire to grow. A small business that hits the £76,000 threshold has to get its turnover up to £100,000, otherwise it will be worse off as a result of being successful. If a small business turning over £76,000 decides not to grow because the implications for its bottom line would be bad, it will not employ more people and it will not contribute to economic growth. We need to deal with VAT anomalies, but let us start with one that is a barrier to growth.

15:52

[Paul Murphy (Torfaen) (Lab)]

The hon. Member for Bournemouth East (Mr Ellwood) hinted that the local elections results in May were not bad for the Conservative party. It strikes me that the loss of 1,000 council seats is not a ringing endorsement of the Government’s economic policy. What people were talking about in those polls was, of course, the economy.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Will the right hon. Gentleman give way?

[Paul Murphy]

I will not, because there is not enough time.

People were also talking about unemployment in those polls. Unemployment in my constituency is at 8.2%. That compares with 3% when the Labour Government were in power.

I will address my short remarks to the alternative. The Government have taunted the Opposition, saying that we do not have an alternative. Opposition Members have been arguing the case for an alternative. The Labour Government in Wales are giving us an alternative. For the past year, they have been doing the sort of things that are necessary to stimulate the economy and provide jobs.

The hon. Member for Warwick and Leamington (Chris White) talked about small businesses. If he came to Wales, he would see that there is a small and medium-sized enterprises investment fund of £40 million. We have talked about the two-year-old regional growth fund in England, which has spent £200,000 to create just one job. In Wales, there is the £15 million Wales economic growth fund, which has already received 500 applications, including from my constituency, where a leading precision engineering company has invested nearly £800,000 in machinery, of which £250,000 came from the Wales economic growth fund. There is a £40 million stimulus package for young recruits and the skills growth Wales programme. There is capital investment for schools, social housing and energy efficiency. In England, the future jobs fund has been scrapped. In Wales, it continues as the jobs growth Wales fund, which will benefit 4,000 young people a year. Wales has its first ever national infrastructure plan, under which £90 million will be spent on capital projects.

Wales is also encouraging the third sector. In my constituency, the First Minister opened the Marie Curie Cancer Care national support call centre, which has created 140 jobs. This very morning, all Welsh Members of Parliament were invited to a meeting with Welsh university vice-chancellors. The universities in Wales are working with the Welsh Government, the UK Government and local government to create jobs. The contrast is between what the UK Government are not doing and what the Welsh Labour Government are doing. Why on earth cannot the Government here in England have the same sort of schemes we have in Wales to stimulate the economy and growth and ensure more jobs?

The mood is shifting. It shifted in the local government election results in England, Wales and Scotland. It has shifted in the United States, and in Europe with the election of François Hollande. The message that comes loud and clear from those countries and our own people is that we must change. The winds of change, as a Conservative Prime Minister once said, must now be heeded. Unless the Government understand the need for that change, it is simply not credible that any sort of growth will occur in the next few years.

The alternative is there, but the Government are reluctant, stubborn and foolish enough not to accept it. Unless they do, we will go deeper and deeper into recession.

15:56

[Mark Pritchard (The Wrekin) (Con)]

I welcome the measures set out in the Queen’s Speech to address jobs and growth, particularly the banking reform Bill and the enterprise and regulatory reform Bill. I also welcome the rise in employment announced yesterday, and I hope we will see a rise in full-time as well as part-time employment next month.

The Government are doing a lot to address long-term unemployment among the young—a problem that beleaguered and bedevilled the previous Government—but I agree with the right hon. Member for South Shields (David Miliband) that far more needs to be done. The Government have done a lot on apprenticeships, which is to be welcomed. I congratulate the Government overall on trying to rebalance the economy. We should have more people in our economy creating wealth rather than spending it, so we need to get the balance right between private sector and public sector employment.

It is questionable whether the current tax regime for business will be sufficient to grow the economy in the way that all hon. Members would like. I welcome the Government’s announcement on corporation tax, but my view is that it might not be enough to create the growth the country needs. Perhaps they need to look again at the corporation tax rate and the timetable for introducing it. I would like to see a 20p corporation tax rate introduced from April next year, and the higher rate—not the alternative rate—to be reduced from 40p to 36p from April next year.

That would affect revenue in the short term—some might say that that will add to the deficit—but in the medium term, and quite quickly, as people are rewarded for their risk, entrepreneurship, creativity and innovation, and as the economy grows on the back of that, revenues for the Exchequer would increase. We need more courage and less timidity in the Government’s tax plans and strategy.

I would like the business rate freeze extended for small businesses and our struggling high streets. I welcome the fact that the Government have extended it again for this year, but we must look again and probably extend it to the following year.

The Chancellor rightly mentioned the eurozone—I am moving away from my notes, which is quite dangerous. I have spoken out before on the International Monetary Fund. Whatever has been said, there is absolutely no doubt that some IMF contributions have been used as a back-door bail-out for the euro. Why do I say that? What is the evidence? Three eurozone countries have received bilateral loans from the IMF because their economies are failing, and they are failing in part because of their membership of the euro. A one-size-fits-all monetary policy for the whole of Europe was always a political project. It cannot be right to apply an interest rate in Germany reflecting the unique circumstances of the German economy to the unique and particular circumstances of, for example, the Portuguese economy or—perhaps more on our minds today—the Greek economy. That is the fundamental point. The euro is a political project that has gone horribly wrong, as many people warned that it would. We have heard a lot about new, bigger firewalls, but those will not deal with the underlying structural problems of a lack of competitiveness in Europe and the failed political dream—or, some might say, nightmare—that is the euro.

Finally, the European Investment Bank, although an important institution, should not be used as a new, indirect bail-out mechanism for a failing euro or eurozone. We are one of the four largest contributors to the EIB. Yes, it is important, but it should not be used as a back-door mechanism to save a failing euro. We want the euro to succeed. At the moment, we need to address the underlying problem.

16:01

[Mr Michael Meacher (Oldham West and Royton) (Lab)]

The Government now appear to have two central objectives only. The first, as stated at the start of the Queen’s Speech, is to achieve economic stability, and the other, of course, is their own survival. It is all the more astonishing, therefore, that they seem fixated on pursuing a path that is wholly opposed to both those objectives. Virtually no one among UK economic commentators or in the EU, IMF or US Administration believes that the Chancellor’s oxymoronic expansionary fiscal contraction will work or that prolonged austerity will lead to growth. Exactly these policies have been tried twice in the past 100 years in this country—with the Geddes axe in the 1920s and the May committee of businessmen in the 1930s. And what happened? Exactly what is happening today: a decade of anaemic growth and a rather little cut to the overall level of national debt.

The Chancellor has only three defences of his policy. The first is that, even at this stage, he can still use fiscal manipulation. Of course, that is what he said in last year’s growth Budget, and it led straight to this double-dip recession. In this Budget, the only growth provision was his cutting of workers’ protection against unfair dismissal—as though making it easier for employers to sack their workers will somehow stimulate growth. Now we see, from the press, that he is surrounded by the Tory think-tanks, all of which are telling him to cut taxes as a way to growth. Well, the fact is, as I have said already, that the big corporations are sitting on a mountain of cash. They already have the cash; they do not need cuts in taxation to produce more funding. The problem is the lack of aggregate demand.

The Chancellor’s second defence is quantitative easing, which he seems still to think will keep the funds going to business and produce the pick-up that the country needs. It has not. We have already put £325 billion into QE, but industry is still not stimulated. Indeed, the M4 money supply to business is still obdurately negative, because the banks have overwhelmingly used it to consolidate their own balance sheets, rather than to lend and get the economy going. The primary purpose of QE is to assist Governments with low long-term interest rates—that is very sensible—and debt repayment pressures, but it has no direct stimulus on the level of demand. That is why it will not work.

The Chancellor’s third and rather plaintive defence of his policy in the House has always been that were he to borrow to invest, he would be punished in the bond markets. I think that if he came to the House with a serious, plausible growth plan, the markets would be deeply relieved and very supportive.

Even if we leave that aside, as I would, there is one other source of funding that has not been tapped and that does not involve any increase in public borrowing. That is the taxation of the seriously rich. According to the latest edition of The Sunday Times rich list, which was published three weeks ago, the gains of the wealthiest 1,000 persons—who represent 0.003% of the population; an absolutely tiny proportion—amounted to no less than £155 billion over the past three years. That is actually rather bigger than the entire UK budget deficit. If that were taxed at the capital gains tax rate of 28%—I am not suggesting that it should be done just like that—it would raise more than £40 billion. That would be enough to create 1.5 million jobs through public investment in house building and national infrastructure. So why will the Government not do that? It is because the Chancellor and his Government have a deep ideological prejudice against any role for the public sector in driving the economy. This is a Government who believe—if they believe in anything at all—in the privatisation of anything that moves. That is a deeply reactionary idea, however, because when the private sector is flat on its back, as it is at present, there is no other way to provide an effective stimulus to the economy than through public investment.

16:06

[Mr Marcus Jones (Nuneaton) (Con)]

It is an absolute pleasure to follow the right hon. Member for Oldham West and Royton (Mr Meacher). I must admit that I did not really agree with much of what he said, but I did agree with his comment about low interest rates. It has not been acknowledged enough that, without low interest rates over the past four or five years, the economy would be in a far poorer state than it is today. In the light of that, we need to be careful. At the moment those low interest rates are a foundation on which we can build. I acknowledge that we are going through difficult times, but I am convinced that the Government must stick to their guns, use some gumption and keep making the tough decisions to reduce the deficit. It is good news that we have already reduced it by 25%, but we must keep showing the world that we are serious about getting on top of our debts, reducing the deficit and dealing with the mountain of debt left by Labour. I have listened to some Labour Members’ speeches today, and they still seem to think that we can borrow and spend our way out of recession. If it were that easy, we would be doing that—[Interruption.] We are not taking the easy route, and that is not for ideological reasons. It is because we want to protect those people with mortgages and business loans, and keep as many jobs as possible.

[Mr David Anderson (Blaydon) (Lab)]

rose—

[Austin Mitchell]

rose—

[Mr Jones]

I am not going to give way, because I do not have much time.

It is tempting to change course, but the low interest rates vindicate the Government’s strategy to date. The problem is that, while we are laying that foundation, the next area that we need to build on is being greatly restricted, owing to extremely low levels of confidence among the business community and consumers. Most people in this country are caught in the headlights of the oncoming eurozone crisis. We can all see it coming, and at the moment we are holding back. We desperately need a resolution to that crisis. It is going to be difficult but, one way or another, we need the certainty of knowing what is going to happen when we go into it and come out the other side. Only when we get over the problems that are undoubtedly coming down the track will confidence levels really start to shift.

In the meantime, the Government are working hard to create growth domestically, but that cannot afford to be based on short-termism. It must be based on long-term sustainability, and we need to rebalance the economy. We cannot simply rely on the service and retail sectors. They are massively important to the UK, but they have been completely sustained by private debt and Government spending. I know that the Opposition still think that that is a sustainable option, but we certainly do not.

We need to concentrate on sectors that can create real wealth within the economy so that it can be distributed and we can create jobs from it. We need to concentrate on sectors such as agriculture and manufacturing. I welcome the inclusion in the Queen’s Speech of the proposal for the Groceries Code Adjudicators Bill, which I hope will make the farming industry more sustainable as we go forward.

We need to build on what the Government have done for industry by reducing corporation tax and introducing an extension of above-the-line research and development tax credits. The regional growth fund and enterprise zones are starting to build on the resurgence of British manufacturing, and we are starting to see a real build in R and D investment in our manufacturing companies, which was previously lacking. We now have that factor working in our favour. We also have far better management than we have ever had in our motor manufacturing companies, while we also have far more moderate unions than we had in the past.

Those three factors help to explain why we are seeing this resurgence and are now in a positive surplus with our car manufacturing exports, which has not been achieved since 1976. Back in 1976, as many Members will know, we were absolutely blighted: we were blighted by difficult industrial relations; we were blighted by poor management; and we were blighted by a real lack of investment in R and D. In the short time available, I urge the Government to try to maintain this resurgence in British car manufacturing industry, so that we can see the west midlands go from strength to strength, while supporting jobs in the retail and wider service sector as we go forward.

16:11

[Steve Rotheram (Liverpool, Walton) (Lab)]

I was supposed to attend an event hosted by Her Majesty this afternoon on her visit to Liverpool to celebrate her diamond jubilee, but I thought this debate was too important to miss—even for the Queen. I suspect that she was as unimpressed as were Labour Members on having to deliver a speech last week that was more to do with renewing coalition vows than it was about restoring the economic future of her country, which she serves so dutifully.

Liverpool Walton has seen a 165% rise in youth unemployment in the last 12 months, while total unemployment in the constituency has risen to more than 5,000, making the unemployment count the fifth highest in the country. I know that thousands of people in Walton, and millions around the country, are having conversations about their own lives. What are they thinking? They are thinking: “Do we have enough money for the weekly shop?”; “Do we have enough money to put petrol in the tank?”; “Who is going to tell the kids that they can’t do extra-curricular activities any more becausewe can’t afford the weekly subs?”. Some are even having to explain why their gas and electricity have been cut off.

The Government are simply wrong when what they do results in tearing families apart, providing tax breaks for the very rich and hitting the poorest families hardest. That is the human cost of Tory-Lib Dem policies. In Parliament, however, the Lib Dems still blindly walk through the voting Lobby with their Tory masters.

In the short time available, I would like to challenge a particular Tory-Lib Dem myth—the one suggesting that the only economic factor that relates to improvement in the living standards of lower-paid workers is raising the income tax threshold. Let me make it absolutely clear that that is not a bad ideal in itself, but here are the facts. I will paint an upbeat picture based on average earnings of £30,000, to which many of my constituents could only ever aspire. For the current financial year, 2012-13, the personal allowance is £8,105. That means that that anyone earning up to £30,000 will be £186 better off this year, making people better off by the grand total of an extra £15.50 in their pockets each month. In the next financial year, the personal allowance will rise to £9,205. That means people will be £346 a year better off, working out at a whopping £28.83 a month in people’s pockets.

That sounds great, and nobody is arguing that putting more money in pockets of the lower-paid is not a good thing. But—and there is a big “but”—there is a snag. The Liberal Democrats allowed the Tories to raise VAT to 20%, despite their manifesto pledge and the “VAT bombshell” posters that all Opposition Members probably remember. That 2.5% rise is estimated to cost each household with children an average of £450 a year.

The Institute for Fiscal Studies has estimated that by 2015—even if the tax income threshold has been lifted to £10,000—the Government’s tax and benefit reforms, as a package, will result in an average 4.2% reduction in the incomes of families with children during the current Parliament, which means that a couple with children will be £1,250 a year worse off by 2015. That is simply not acceptable, and it is not the full story. An extra £28 a month is clearly no recompense for such a disproportionate hit on families and their living standards.

The sober eye of history will view this Queen’s Speech more for what was not in it than for what was in it. There was nothing for the young unemployed, nothing for families struggling to get by, and nothing for the record number of women who are waiting and wanting to work. There was not even a single mention of the word “jobs”.

16:16

[Jackie Doyle-Price (Thurrock) (Con)]

Let me begin by emphasising that the priority that the Government are making of dealing with the deficit remains definitely the right one. Some of my hon. Friends have drawn attention to the emerging view that there is a choice between pursuing growth on one hand and pursuing austerity and dealing with the deficit on the other. The simple fact is that deficit reduction and the pursuit of growth are not mutually exclusive; indeed, we lay the foundations for lasting growth when we go back to living within our means.

Jobs and growth rely on investment by individuals and businesses, not on Government spending. We must not be complacent about the economic challenges that face the country, which, as many Members have recognised, are being exacerbated by the uncertainty and lack of confidence prompted by the eurozone crisis, but the need to hold our nerve and pursue measures that will strengthen our competitiveness is more important than ever at this time of economic turbulence.

Let us look at the realities of what is happening in the economy. Of course unemployment remains a great challenge. It is currently too high, and we need to do much more to ensure that everyone who wishes to work can find a job. However, it is also true that employment is on the rise and new jobs are being created. Many thousands of jobs are appearing on the horizon in my constituency. The Lakeside shopping centre is to be expanded, which will create new retail jobs. The new London Gateway port will create many thousands of new jobs, and is beginning to recruit for them. It is one of the largest inward investments in the country. The existing port of Tilbury, which has just celebrated its 125th anniversary, is also being expanded, with the promise of a further 10,000 jobs. Despite the global challenges, there is good news in our economy.

I was struck by the comments of the right hon. Member for Barking (Margaret Hodge), whose constituency is next door but one to mine. We are linked by the A13 and the c2c rail link. A 15-minute journey for her constituents will give them access to the new jobs that are being created on my patch. Let me say to all Members that when times are difficult, it is our role as leaders to inspire and encourage, not to tell our constituents that there is no hope.

In order to maximise the opportunities afforded by investment, the Government must remain vigilant in playing their part in building a competitive economy. Ministers must not be complacent about the growth that we are experiencing; additional measures are still needed to enable us to maximise the potential of that growth. That applies in two specific areas: we need to continue to invest in skills to ensure that our work force has the skills that employers need and want, and we need to ensure that our infrastructure is fit for purpose.

I have talked about the massive growth in the port facilities in my constituency. Within this decade, more cargo will be landed in Thurrock than anywhere else in the country. However, in order for that cargo to go where it needs to be—and, equally, to move the new manufacturing products that we will be exporting—we will need sufficient capacity in the road network to enable those items to be moved around the country. With that in mind, I welcome the recent announcement by the Under-Secretary of State for Transport, my hon. Friend the Member for Hemel Hempstead (Mike Penning) that we are finally looking at designing and working up proposals to improve junction 30 of the M25. That single project alone will unlock so much economic capacity in south Essex and will be a big tool in sustaining future growth. However, having made the announcement, my hon. Friend must do absolutely everything he can to ensure that the solution is fit for purpose. We cannot afford a sticking plaster; it has to deliver additional capacity. To be frank, the measure is a long time coming. It should have been done by the last Government when they widened the M25, but as usual when it came to infrastructure, they were very short-sighted.

The second issue I would like to address is that of skills, particularly for the younger unemployed, who remain a significant challenge for us. I welcome the expansion of apprenticeships that we have witnessed—they have doubled in Thurrock, from 400 to 830 this year—but we also need to consider self-employed apprenticeships.

[Several hon. Members]

rose—

[Mr Deputy Speaker (Mr Nigel Evans)]

Order. To enable more Members to contribute to this debate, the time limit is now four minutes.

16:21

[Kate Green (Stretford and Urmston) (Lab)]

I want to make a few remarks about unemployment. Despite the modest fall in unemployment yesterday, we still have the highest rate of long-term unemployment since 1996, with 650,000 people in part-time work because they cannot get full-time work and 2.625 million people unemployed.

I want to highlight two groups of losers in the labour market for whom there were absolutely no policies in the Queen’s Speech. The first group are women. Whereas male joblessness increased by 5.4% over the past year, the increase in female joblessness was nearly double that, at 9%. The second group are people from ethnic minorities. White British women and men are more likely to be employed than those from any ethnic minority. A report by Elevation Networks in March revealed that more than half of young black men are unemployed and that the youth unemployment rate for black people has increased at nearly twice the rate among white 16 to 24-year-olds. There was nothing in the Queen’s Speech to deal with those inequalities.

When I asked the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling) in February what steps were being taken to address black youth unemployment, he answered that “Get Britain Working measures” operated “irrespective of ethnicity”. There was nothing in the Queen’s Speech to address the structural drivers of black youth unemployment; no attention paid to, for example, guaranteed jobs for long-term unemployed young people, as recommended by the Riots Communities and Victims Panel; no ethnic monitoring of the Work programme or apprenticeships; no targets for black unemployment; and no mentoring of young black people. Indeed, despite the Prime Minister promising before the general election that there would be a massive programme of mentoring, nothing has materialised.

As for women, the Government have, I am pleased to say, recognised the importance of affordable and reliable child care, although I am alarmed by reports in the Daily Mail this week that Ministers think that the way to boost child care supply is to strip back regulation. Reducing bureaucracy is all very well, but deregulation that dilutes quality and compromises children’s well-being is simply unacceptable. The Netherlands saw a steady deterioration in the quality of child care as a result of introducing measures similar to those that we understand the Government might be contemplating. Indeed, the Dutch Government have now decided to reverse their deregulation policy.

Finally, let me talk about something that actually was mentioned in the Queen’s Speech, albeit only cursorily: the Government’s proposal to introduce measures to promote flexible parental leave. We have yet to see the details of exactly what will be on offer, but I warn Ministers to be cautious. An alliance of organisations, including Maternity Action, the Royal College of Midwives, the Royal College of Obstetricians and Gynaecologists, the National Childbirth Trust, Bliss, the Child Poverty Action Group and Citizens Advice, have warned of the need to protect adequate leave for women to secure the health and well-being of new mothers and their babies, and to select measures that actually ensure that a share of parental leave is taken up by fathers. Policies that have been shown to be effective in doing that include the meaningful replacement of a father’s lost income, and protecting leave for fathers, rather than eating into mothers’ leave. We need to ensure that the modern workplaces consultation proposals, which seem not to address those kinds of concerns, are carefully re-thought.

I am grateful for the opportunity to contribute to this debate. There is much more that I would like to say, but I will pass on to colleagues.

16:25

[Jessica Lee (Erewash) (Con)]

I thank the hon. Member for Stretford and Urmston (Kate Green) for her contribution. Although we do not perhaps agree on policy points, I always find her contributions in this Chamber thoughtful and well researched.

Having a broader view about how we tackle the issue of jobs and growth in this country for the longer term is crucial in getting this country back on its feet and continuing to do well. We need to weave together a number of different policy areas, and have a long-term vision and a commitment by the Government to achieve that. Various themes are involved: infrastructure, apprenticeships and training, and help at a very local level for small and medium-sized enterprises. All that has to be achieved against a backdrop of a strong deficit reduction programme, which the Government must stick to .

I see infrastructure as an important theme in allowing and helping people to be mobile, to reach new job opportunities and to reach their goals, be it through training or work. In my constituency we have a long-term project, which is now being considered by the Secretary of State for Transport, to reopen the train station in Ilkeston. We are pleased that the Government are considering the project in great depth, because Ilkeston used to have three stations until the 1960s, and it now has none. We are trying to get one reopened, which will give many young people many more job opportunities, as they will be able to get to Derby, Nottingham and further afield. In many ways, my constituency is well placed. It is right in the heart of the country, with the M1 running through it and the East Midlands airport nearby. However, it is the smaller projects that add to and feed into the wider infrastructure of the country that will really help.

I was able to participate in national apprenticeship week, as I am sure many hon. Members did. The personal experience of meeting young apprentices, such as Martin at Derwent Analytics, means that we see how young people are progressing and benefiting from such schemes, but I am not being complacent. Nobody in this House is being complacent about the challenges involved in tackling long-term youth unemployment. We must support those young people who are making progress. I applaud what the Government are doing on apprenticeships: 177,000 new places in the past year is no mean feat. My area has a proud, long history of apprenticeships, and as the local MP I will continue to champion their worth.

I also wish to discuss—briefly, given the time—local help for small and medium-sized enterprises. Although I welcome the changes in the local planning regulations, this is also about local enterprise partnerships. Erewash is lucky because its partnership is extremely strong. It particularly supports start-up businesses and helps with training and mentoring. Let me provide other examples. Prostart, in my constituency, also helps young people with training and with the encouragement and support they need to move on in the world. Women entrepreneurs are also doing well in my constituency: I was delighted to be there when Kirith Richards recently opened her photography suite and I wish her well for the future.

Time is against me so I will leave it there.

16:29

[Mr David Anderson (Blaydon) (Lab)]

We are two years in: two years since the rose garden, two years of failure, two years of intransigence and two years of incompetence. Over those two years, the public have seen that the coalition parties are, quite simply, not up to the job that the nation has given them. The last eight weeks have seen them exposed: the reverse Robin Hood budget, the devastation at the polls and the dampest of damp squibs disguised as a Queen’s Speech. Surely somebody should apologise to Her Majesty for wasting her time.

This country is going backwards, for three reasons: the joint incompetence of the coalition, the simpering connivance of the Liberal Democrats and the ignorance and arrogance of the leadership of the parties on the Government Benches. They were going to sort out the mess that they blame us for and, yes, there is no doubt that the country was in a bad state, as were many others, but that was because of the failure of the global capitalist system. It needed repairing, but, sadly, the Government’s remedy is worse than the disease. The real sadness is that it was so predictable because the Tory boys use exactly the same methods as their predecessors in the 1930s, 1980s and 1990s. They, like those who went before them, decided to make the workers, the poor, the old, the young, the sick, the disabled and the vulnerable pay for the failures of the rich, the wealthy, the billionaires, the bankers, the tax evaders and avoiders, the market traders and the money movers who believe that they are entitled to live in a different universe from the rest of us.

How else can we explain why workers are being made redundant, having their pay frozen and their pensions cut, and being made to work longer and harder for less, while the chief executives of the FTSE 100 companies have seen an average 11% rise in the past year alone? While ordinary folk struggle to make ends meet, the masters of the universe receive an average of £3.65 million a year—an annual increase in the past year of more than £1,000 a day. That is not pay at £1,000 a day, but a rise of £1,000 a day. All in this together? If only.

That all comes only weeks after we were told that the richest 1,000 people in this country own £414 billion, but of course the leaders of the coalition believe that the fairest way to get our country back into balance is to give those rich folk even more money by giving them a tax handout while freezing pensioners’ tax allowances.

The facts are there to be seen. Under the previous Government, we saw a genuine mixed economy in which the public and private sectors worked together in partnership to the benefit of all concerned. Nowhere was that more marked than in the north-east of England, where we had a decade of growth led by our regional development agency. What do we have now? The regional growth fund. My hon. Friend the Member for Birmingham, Ladywood (Shabana Mahmood) referred earlier to the damning report on that subject and she said exactly what a mess the RGF has been. We should remember that the RGF is supposed to make up for the 710,000 public servants whom the Government have decided to get rid of to pay for their policy. What a farce. What a mess they are in.

For their next trick? Let us make it easier to sack people, make it harder for people without money to seek justice in the workplace and cut so-called red tape around health and safety. Where does that leave us? It leaves us as a nation with mass unemployment, with 1 million or more kids on the dole, with a work force facing insecurity, pay cuts, worse pensions and unsafe conditions, with an economy that has gone from stagnation to recession and a Government who have no strategy. They have been in government for too long and they have been flushed out. It is time for them to go, and to go now.

16:33

[Alok Sharma (Reading West) (Con)]

In the lead up to the general election, I spent a lot of time talking to business owners and managers in my constituency and their verdict, after 13 years of Labour government, was that they felt that business was over-taxed, overburdened by regulation and overstretched by ever-growing tax legislation. Many businesses felt that the previous Government were on their backs, not on their side, stifling their growth, not encouraging it and limiting their job creation, not expanding it. In contrast, we have seen from the coalition a raft of policies that are laying firm foundations for sustainable future growth, cutting corporation tax to the lowest level in the G7, cutting red tape and simplifying our tax system. New Bills, such as the enterprise and regulatory reform Bill, will go further in reducing burdens on business by repealing unnecessary legislation.

I want to focus on exports and inward investment. Economic uncertainty in the eurozone will undoubtedly impact on our exports, but as many hon. Members have pointed out, our exports outside Europe have recently been growing. That is where our export opportunities lie in the short, medium and long term: exports to new growth markets such as India and China.

A few weeks ago in departmental questions, I asked the Business Secretary about our bilateral trade with India. He informed the House that he would shortly be leaving to take a delegation of small and medium-sized enterprises to India, pointing out that this was his third trip to India since May 2010. That caused some amusement among Opposition Members, suggesting, I assume, that they thought the Secretary of State was off on some sort of jaunt. That is exactly the sort of attitude that demonstrates why the Labour party does not get business and does not understand what is needed to grow our exports. Business is not won by sitting and whingeing from the Opposition Benches. In a global marketplace, if one is fighting for global contracts against global competitors one needs to sell and market across the world. I am rather pleased that we have Ministers across many Departments getting on planes and batting for British business abroad.

According to statistics from the Library, in 2000 the UK was the third-largest source of imports for India. By 2010, after 10 years of Labour government, that ranking had dropped to 22nd. The absolute level of bilateral trade has gone up, but not fast enough. Given our shared democratic values, history, language and cultural and family ties, there is much to suggest that we should have been doing a lot better on bilateral trade. I am very pleased that the UK aims to double bilateral trade with India by 2015, but given the slow-down elsewhere we might need to be even more ambitious. We are making progress and the Indian companies that I speak to see the UK as being open for business with a Government who welcome inward investment. British jobs are being created by inward investment from Indian companies, whether household names such as Tata or Infosys or less well-known but no less important companies such as Mastek, which has its UK headquarters in Reading and supplies IT solutions to the public and private sectors. Time is short, but I want to mention education, which is a huge growth area in India. British universities are highly respected, which again presents a great export opportunity.

Finally, I note that UK Trade & Investment has been doing an absolutely fantastic job and has really upped its game. Its contribution is appreciated by British exporters and companies in my constituency. We often talk about special relationships with other countries but in future we also need to talk about essential trade relations with certain nations. I hope that our bilateral trade will grow.

16:37

[Huw Irranca-Davies (Ogmore) (Lab)]

This Queen’s Speech, like previous Budgets, was an opportunity for the coalition to promote growth, but the scale of the jobs and growth challenge facing the UK is matched—thanks to this Chancellor directly and to this Government—only by the scale of paralysis and inaction. Over the previous six quarters, four of which, including the past two, have been negative, the UK economy has contracted by 0.2%. This is a double-dip of the Chancellor’s own making. He has told us that he was acting in our best interests and that, “We’re all in this together; honest Guv’nor, I share your pain.” He told us that he was pursuing his austerity policies to prevent us from becoming like Greece, which was sheer baloney. Instead, he has made our growth more like that of Spain, which has just followed us into recession. Just to illustrate this point further and to show that there was and remains an alternative, I point out that under the Labour chancellorship of my right hon. Friend the Member for Edinburgh South West (Mr Darling), the UK economy grew by 3.2% between quarter 3 of 2009 and quarter 3 of 2010. Under the current Chancellor, the Bank of England’s forecast for growth has again been slashed to 0.8% from 1.25% in 2012 and reduced further for the following year, and many economists are saying that even that is wildly over-optimistic.

The recession is now stretching out to historic proportions, trying to match the extent of the great depression, which lasted for more than 12 quarters. The facts are stark: output is now 4.3% below the level at the beginning of the recession in 2008 and the UK’s position on the world stage has contributed to that, because it has been pitiful. In the UK, it was made clear that everything must be sacrificed to the god of deficit reduction—jobs, growth, and creating confidence in the economy. The process continues, somewhat inevitably now, as the Prime Minister and the Chancellor daily talk up the chances of meltdown in Greece and across the EU in order to show how helpless little old UK can do nothing in the face of those events.

The crisis in Greece and the eurozone has become the stock excuse for this Government to do nothing. “Sorry Miss, the big black dog ran off with my homework” is now “Sorry Miss, the big black Greek storm clouds ran off with my jobs and my growth strategy. It wasn’t my fault.” That is not good enough. The Prime Minister and the Chancellor have to listen. They have to take lessons. They must do better.

It is true that the solutions lie at international level, but that is a reason for taking action, not for hiding from the storm. For the last two years, instead of sitting on the sidelines like Johnny no mates, we should have been leading by example, encouraging policies of growth as well as policies of deficit reduction. What is tragic is that the UK, which has previously been in so many ways a progressive force in the EU and globally, has now become a showcase for austerity and zero growth.

Let us be clear: if Labour had won the election, we would have had to deal with the deficit, but we would have done it in a more measured way, promoting growth, not just pain. We could not have escaped the pain, but it would have been distributed more fairly, not dumped on the backs of children, the disabled, women, the poor and hard-pressed middle-income families. Because our approach would have prioritised growth, we would even have got the deficit down, rather than increasing it as the coalition Government have done.

The Government do not get it. They are way out of touch. They never really believed we were all in it together—certainly not bankers and Cabinet Ministers. In areas where jobs could have been created, deficit reduction has blinded them to all sense. The Queen’s Speech has done nothing to change that. This is government for the privileged and the very wealthy few, not for the hard-pressed and the wealth-creating many.

16:41

[John Hemming (Birmingham, Yardley) (LD)]

In a hurricane, even turkeys can fly, and I will come to that later.

Rather than talking about growth, I like to talk about the national cake. The country bakes the national cake. Some shares of the cake are taken by the Government in tax and given to those without any cake. Other people work on baking their own parts of the cake. Then we have the deficit. That is where we make a time machine and snaffle a few slices of the cake baked by our children in years to come to eat today.

When 40% of GDP is being spent on public services, it is about two fifths of the national cake. That, which is the objective at the end of this Parliament, is higher than under the first two Blair Governments. Anyone who wishes to argue that the coalition Government are an extreme right-wing anti-public services Government has to explain why the Blair Government were more anti-public services than the current Government on that measure.

The growth we search for is the first differential with respect to time of the size of the national cake. The question to look at is the one about what the ingredients are. One ingredient that does not get sufficient attention is the energy used to cook the cake. It is possible to compare different countries’ national cakes and the amount of energy required to bake them. Using as the denominator the total energy supply in million tonnes of oil equivalent—not a ton as in a ton of bricks—we see that from 2006 to 2010, the UK’s energy intensity of GDP in 2005 dollars was 1.58, 1.64, 1.62, 1.66 and 1.74. That was a gradual improvement in energy efficiency in terms of bucks for bangs. The OECD average is 1.06, Switzerland has an amazing 4.74 and South Korea a low 0.45, while the US runs at 0.89.

Although the stock market is unreliable at predicting a recession, a spike in oil prices does cause a recession. A recession causes a drop in energy usage: total OECD energy usage dropped from 5,553 through 5,481 to 5,238 between 2007 and 2009, and then went up again to 5,413 in 2010. According to the International Energy Agency oil market report, OECD demand for crude oil peaked in 2007 at 49.09 million barrels of oil a day, then went through 47.5, 45.84, 46.17 to 45.63 in 2011. Brent bottomed out at just over $40 in December 2008 and has increased since. More recently, it peaked at just over $126 and today has come below $110. In the Budget, it was forecast at $110, so it has risen above Budget figures. To that extent, therefore, one would expect to have a constraint on growth in 2011 and early 2012, as oil prices have increased. Lo and behold, we have it: 10 of the 17 eurozone countries contracted in the last quarter of 2011. The lack of certainty does not help, but energy costs are part of this. The USA has the advantage that West Texas Intermediate has been cheaper than Brent.

Politicians are not all-powerful. We are affected by the global energy picture as well as the eurozone crisis. When the business climate is good, it is easier for bad managers to produce a good return—hence the US saying, “In a hurricane, even turkeys fly.” However, in difficult circumstances, such as those that we face today, the outcome can still be disappointing even though the policy choices are the right ones. The time we could have changed policy without paying was between 2005 and 2008, when Government spending was accelerated at exactly the wrong time, as was noted by Tony Blair and Lord Turnbull. It remains the case, however, that if we are to find ways forward we need to increase our energy-intensity of GDP and find more ways of having economic activity that uses less resources. A lot of all this is already being done, but there is a greater need for the future, as the old certainties of continual growth and resource consumption no longer apply.

16:45

[Jonathan Edwards (Carmarthen East and Dinefwr) (PC)]

Diolch, Mr Deputy Speaker.

I shall focus my comments on some very technical points, due to the lack of time. In relation to jobs and growth, Wales suffers from having no control over the major economic levers, as well as from a lack of information about our economy. There is no Welsh equivalent of GERS—the annual Government Expenditure and Revenue Scotland report. The Welsh Government, therefore, are fighting blindfolded and with one hand tied behind their back.

As the Chief Secretary to the Treasury informed me in a written response prior to Prorogation, Wales only has an annual update on the gross value added for each of the nine English regions and the other nations. The most recent update was made in December 2011 and covered the 2010 calendar year. Those results for the NUTS 1 regions were published at the same time as the more detailed breakdown for the NUTS 3 regions for 2009—figures which showed that the GVA per head in west central London is 10 times that in the Gwent valleys of south Wales. The gap between the richest and everybody else is growing, both regionally and individually, no matter the colour of the ruling clan here in Westminster.

That time lag means, of course, that information on which to base our economic decisions in Wales is retrospective. We are not getting the up-to-date information that is needed for accurate Government economic intervention. Equally, that can be seen in the index of production and construction and the Welsh index of market services, which the Office for National Statistics provides to the Welsh Government. Whereas the UK-wide GDP first-quarter figures were released midway through April, the Welsh figures for the same time frame will not be provided to the Welsh Government until the end of July 2012, when the Assembly will be in recess and the third quarter of 2012 will be well under way.

If the Welsh Government are responsible for economic development, as claimed by the Treasury, they need the up-to-date information on which they can make economic decisions, as well as key economic levers and tools in the form of fiscal powers. For good economic governance we need that data for Wales in good time, so that the Welsh Government can make proper, accountable decisions with the best available information. I would like to ask the UK Government to request that the ONS make that data available within the same time frame as applies for the UK-wide GDP figures, so that Welsh Government decisions are not made at a disadvantage.

During the opening years of this economic crisis, the Oxford Economic Forecasting think-tank estimated that London and the south-east would return to its pre-slump situation by around 2012, but that Wales would not do so until 2025 at the earliest. Given the continuing stagnation of the UK economy, those timetables might have slipped. The Welsh economy needs an end to the proposed cuts of public sector jobs and regional pay, a stimulus through a series of infrastructure investments and support for the private sector to develop and nurture our own small businesses. We need control over job creation levers such as income tax and corporation tax and we need accurate data, allowing us to see the effect of Government policy and broader economic shifts upon the Welsh economy immediately, so that we can change course when required. Diolch yn fawr.

16:48

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Thank you for allowing me to speak, Mr Deputy Speaker. This is an important debate in relation to my constituency, which has a low-skills, low-wage economy. Before I go any further, I declare an interest. I still retain interests, although I no longer have an executive role, in a public relations communications company that I set up some 10 to 15 years ago. That company deals with community consultation and encouraging inward investment into inner cities and job creation.

As I said, Plymouth is a low-skills, low-wage economy, and 38% of the people who work in the city do so in the public sector. In my opinion, in their 13 years, the Labour Government created unsustainable public sector employment, which crowded out the private sector. It is difficult for a private sector business to compete for workers with good skills, because it cannot match the funds and wages available in the public sector. That is a very big problem. Unfortunately, from as early as 2001, the Labour Government were creating a structural budget deficit, which became increasingly apparent.

I am delighted that we in Plymouth have the third largest university in the country. It has established a really good reputation for marine science engineering. Earlier this week, upstairs, people might have seen the public exhibition run by Plymouth Marine Laboratory demonstrating exactly how our reputation for marine science engineering will be able to create jobs, as we need to do. As a country and as communities, we need to develop a clusterisation approach—that is, work to our strengths—but we must also develop our skills base. I pay tribute to two organisations: Plymouth university of course, but also Plymouth City college, which is doing an enormous amount of work in apprenticeships. A business that wants to set up and go into new areas needs the right skills base to sell its products.

We must stop looking only at Europe and the continent and start to look at the wider world—India, Brazil and, of course, China, but also the Commonwealth, with which we have great historical ties and where there are enormous opportunities. We need to concentrate on trade. We need to be like Muhammad Ali, who, as the House will remember, floated like a butterfly and stung like a bee.

16:54

[Ann McKechin (Glasgow North) (Lab)]

Last week, I travelled with the Business, Innovation and Skills Committee to Brazil, as part of our new inquiry into our export trade with that developing nation. I wish to put on the record our appreciation of the work of the UK Trade & Investment team in Brazil and the efforts they are making to meet the Government’s ambitious targets. What struck me time and again, however, was that we were visiting a country that had a clear and unambiguous industrial strategy. That is not to say it is perfect—in fact, in terms of ease of doing business, our countries are poles apart: the UK is fourth and Brazil 121st on the list—but everyone I spoke with appreciated the ability to work within a political environment that is firmly focused on job creation and growth. I noticed a sense of purpose and momentum that is totally absent here at home.

The previous Labour Government recognised—later than they should, but with unequivocal passion from our last Business Secretary, Lord Mandelson—the need to form a convincing industrial strategy, with a relentless focus and wholehearted support from Government at all levels. The result was developments such as High Speed 2, carbon capture and offshore wind, with science and innovation at their heart and a recognition that we must take risks if we want to be leaders in new industries. Two years on from the election, we are still waiting for the coalition’s strategy. HS2 has been kicked into the sidings of potential oblivion; there is yet more equivocation about airport capacity, as planes stack up waiting to get into our major airports; carbon capture has been put back several years at least; and offshore wind receives only cursory support.

Where are the big ideas? Where is the narrative that allows industry and finance to make the necessary commitments? Where is the financial support to allow us to enter those new industries? The establishment of the Green investment bank is welcome, but as one leading figure in the renewable energy sector told me this week, it must not be the bank of last resort. It needs to lead the way, not take the cast-offs that no one else wants to touch. It needs to be big enough to meet the challenges and opportunities we face. Instead, we have had a painfully slow start. The original concept has been watered down and now the bank will not have full borrowing powers until 2016. It is not fast enough or deep enough to do the job.

Our international competitors will not be sitting idly by. We need to learn the lessons of why we lost out on onshore wind production and ensure that that is not repeated. Since 2010 the UK has dropped from third to seventh in the world ranking for green growth investment. Our competitors know that investors need a stable environment, not the farce we witnessed over feed-in tariffs earlier this year. We also need to address the lack of capital grants, which are vital in forming the new supply chains of the future. Cuts in corporation tax are the wrong priority at this time.

As the Business Secretary correctly pointed out in his leaked letter to No. 10, we need to address the lack of confidence in the business sector. UK companies have some of the largest cash reserve ratios of any advanced economy, but there was nothing in the Budget to encourage the release of those funds. At the same time, we have many companies that are not cash rich, particularly in the SME sector, which cannot find affordable finance. The case for a business investment bank has never been stronger, yet there is more silence.

16:56

[Eric Ollerenshaw (Lancaster and Fleetwood) (Con)]

I am grateful to follow the hon. Member for Glasgow North (Ann McKechin). She mentioned an industrial policy, which we are of course looking at, but the problem she must face is that Lord Mandelson’s industrial policy came far too late. The north-west experienced 13 years in which her Government allowed the gap between north and south to increase, and it increased according to any survey chosen. Ultimately, the only investment that came into the north-west was rapid public sector investment in either construction—the so-called affordable housing that turned out to be one or two-bedroom flats, not real houses for families—or an ever-expanding regional development agency that could do nothing about the expansion of London and the south-east, when compared against the contribution of the north-west or any other region. I am pleased that this Government, through part of the Queen’s Speech, are consolidating the missing links and dealing with the failure to invest in infrastructure over 13 years.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

Will the hon. Gentleman give way?

[Eric Ollerenshaw]

I would love to, but I have less than three minutes. I am sorry.

This Government are committed to: an M6 link road around Lancaster, which has been on the stocks since 1948 but nothing was done about it in 13 years of the Labour Government; the northern hub investment, which will improve connectively between the northern cities and enable them to compete; and investment in broadband through Broadband Delivery UK. People talk about superfast broadband, but a third of my constituents do not have access to normal broadband, and that is the failure of real investment over the past 13 years. I believe that the Government are now doing something about that and that things are happening to build that environment and infrastructure so that the north can compete like any other region of the country. Labour Members talk about a lack of vision, but the vision came from the coalition in the very first months. The commitment from my right hon. Friend the Chancellor was that we deal with the deficit but, at the same time, attempt to restructure and rebalance the country not only between sectors, but between regions. That is the vision of the coalition.

[Karl Turner]

Will the hon. Gentleman give way?

[Eric Ollerenshaw]

I have no time to give way.

Members have talked about the regional growth fund, which is now committed to making the majority of its spend in the north. That will add to the balancing out through real jobs for real factories. At the same time, while the Government are listening, I suggest that too much of the regional growth fund is still concentrated on metropolitan areas. There is a lot more to the north-west than Greater Manchester and Merseyside, and many businesses need to access the fund, so I hope that it will increase as it develops.

I also look forward to the Local Government Finance Bill returning to the House, because I believe that the freedoms that that will give local authorities through business rate retention will be a truly local way of improving investment and contributing to businesses. I welcome the commitment that the Local Government Association and my county council have made to looking at local government bonds as a way of raising investment for local businesses. The key is to unleash the regions and give them the infrastructure to compete not only on the national stage, but on the international stage, and that means superfast broadband and the ability to use our own money to invest in our own business. I congratulate the Government on what they have done about this so far.

17:00

[Fiona O'Donnell (East Lothian) (Lab)]

This is less a speech, more a postcard from East Lothian, but I am grateful for the opportunity to contribute to the debate, because I want to send Government Members a message from East Lothian about how we create jobs and growth. We rely heavily on the small and medium-sized enterprise sector, and the message from such businesses is clear: they are lukewarm about a lot of last month’s Budget, but they say that what would make a difference is a cut in VAT. I hope, therefore, that Ministers will listen.

I also want to talk about jobs. Many aspects of job creation in Scotland, including in my constituency, are devolved to the Scottish Parliament, and this House and the Government here need to work more closely with the Scottish Government. I have written to the Secretary of State for Work and Pensions—[Interruption] —whose attention I do not appear to have right now—about a constituent of mine. He is a 19-year-old man who finally had the chance of a job in a community bakery in Dunbar, but he was not allowed to apply for it because he was on the Government’s Work programme and the job was funded by the Scottish communities job fund. When a young man has the opportunity of the perfect job in his own community, it is simply inadequate to give him the response, “You cannot have it because of the double funding.” It surely cannot be beyond the wit of this Government and the Government in Holyrood to work together to address the issue. I understand that that is not a problem in England or Wales.

I went to see the providers of the Work programme in East Lothian, and they told me that they would be perfectly happy to consider transferring funding from their stream into the Scottish communities job fund in order to prevent a similar situation happening again, so I hope that Ministers will open discussions with the Scottish Government to address the problem. There is already enough pressure on young people trying to find work in my constituency. Figures last month showed an increase of 467% in youth unemployment, and that simply is not good enough.

Tourism is very important to the East Lothian economy, but unfortunately it is suffering and will suffer further, as I will find tomorrow when I visit the owner of a caravan park in North Berwick. So if the Government want to promote tourism and growth in my constituency, I ask them to look again at the introduction of VAT on static caravans.

I was also disappointed that in the Queen’s Speech we did not see any proposals on offshore gambling. Musselburgh race course recently won its third award this year, as the finest race course in the UK, and it is a driver of growth and innovation in a community that is struggling in so many ways. I am sorry that we did not see the issue addressed, but once I have heard the result of the private Members’ Bill ballot, I might find that I am able to do something about it myself, for my own constituents.

None of the barriers to business, growth and job creation was addressed in the Queen’s Speech and, as many others have said, it has been a missed opportunity. Telling people to work harder is not good enough, when inflation for the poorest 10% is at 41%, and for the richest 10% is at only 3.3%. This is a Government who choose to help that richest 10%, and that says it all.

17:03

[Andrew Selous (South West Bedfordshire) (Con)]

Up until 2007, the Government were running unsustainable deficits and had an escalating level of debt, and that was before the financial crisis hit. Governments have a choice: they can either run their finances sustainably or give up the right to economic self-government, and there are lots of examples of that in Europe at the moment.

In tough times, this Government have created 600,000 new private sector jobs. There are 370,000 more people in work now than there were at the general election and 70,000 fewer people on out-of-work benefits than when we were elected. As from last month, we have the youth contract coming into play, which will also make a difference. Furthermore, we have made progress on the deficit, which we have already cut by a quarter. That has led to low interest rates; and we should remember that every 1% increase in interest rates puts £1,000 on an average family mortgage.

Business taxes are coming down to 22%, which will be one of the lowest rates in the G20. With the patent box, we have, in effect, 10% corporation tax rates on patents that are exploited here in the UK.

I am glad to see the Minister of State, Department for Education, my hon. Friend the Member for Bognor Regis and Littlehampton (Mr Gibb), on the Front Bench. I pay tribute to the work that he is doing to improve school standards. What with his work, the 457,200 extra apprenticeships—an increase of 63%—and the new university technical colleges that are being rolled out, we are well on the way to building up the educated, flexible work force that this country will need for it to be an economic success in future.

People need hope and confidence in tough times, and I, for one, am fed up with the diet of gloom coming from the media about the eurozone. Yes, 48% of our trade is with the European Union, and therefore it matters, but the EU comprises only 19% of the world economy, and we need to remember that the other 81%—Asia, the Americas and Africa—is growing strongly, in some cases by 10%. The world economy is due to triple over the next 30 years, and that provides fantastic opportunities. I pay tribute to the work of UK Trade & Investment and the role of the Foreign Office in helping exporters. Last week, I spoke to people from local businesses in my constituency, and they confirmed that that help is real, practical and available on the ground.

I am well aware of the difficulties that businesses have trying to raise credit to expand. That is why the £20 billion loan guarantee scheme is helpful. I heard only yesterday that Santander will be putting 650 managers back into local branches to take local decisions. That link between the local manager and local business is very important. It has been broken by many banks in the past, and I am glad that that is being dealt with. New methods of raising finance for business, including crowd-financing and websites such as Kickstarter.com, can help as well.

The UK is one of the most entrepreneurial countries in the EU. We have 4.5 million small businesses; in 1989, there were only 2 million. However, if we were as entrepreneurial as the United States of America, there would be another 900,000 small businesses in the UK, and many of the Government’s problems would be over. We need to make the UK an enterprise hub for the whole of Europe. There is evidence that many of the small businesses that are being created naturally end up exporting, which they can do very easily through the power of the internet.

Finally, I pay credit to the Government for focusing on infrastructure funding. As I look at my constituency, I see roads being built for which we have waited years, a new busway coming, a business innovation centre, and a new university technical college.

17:07

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

Last week’s Queen’s Speech was my first as an MP. Although nobody does pomp and pageantry better than we do, I was deeply disappointed with its content: lots of style but no substance.

When this Government came into office two years ago, we were in economic recovery. Since then, we have been bumbling along the bottom with very little growth, and now we are back in recession again. This is not due to the worst global financial crisis since the 1930s; it is due to the mismanagement of the economy by the current Downing street incumbents. Yesterday, the Bank of England yet again had to downgrade forecasts for economic growth, from 1.2% to 0.8%, and the outlook for inflation is well above the 2% target.

Yet this not the experience of every other country. The US, which was at the centre of the global crash in 2008, started to recover, like us, in 2009-10, and it is continuing to recover. Similarly, the rest of the G7 is performing better than we are. Our economic performance is one of the worst in the G7, with Italy coming up just behind us. Brazil has now overtaken us as the sixth largest economy. The austerity measures that this Government have introduced are clearly not working.

The impact on unemployment in the public and private sectors is already being felt. Last year, the public sector lost 276,000 jobs. Some have estimated that the figure will be as high as 700,000 by 2015. In Oldham, £24 million has been cut from next year’s council budget, meaning 400 job losses. That is not the end of it. My local hospital trust, Pennine Acute Hospitals NHS Trust, recently announced a statutory consultation on a further 160 redundancies. It has to find savings of £45 million this year. That comes on top of 600 posts that have already been lost. In spite of the Government’s reassurances that jobs will be created in the private sector, large and small businesses alike are closing, including BAE Systems in Chadderton, Warburtons Bakery in Shaw, Long’s Plumbing and, of course, Remploy.

Although I welcome yesterday’s unemployment figures that show a reduction in the previous quarter, I am afraid that the trend in long-term unemployment is upwards, as we have heard. In Oldham, more than 8,000 people are out of work across the borough, with 11 people chasing every job. The number of women out of work is the highest since 1995. There has been a 25% increase in long-term unemployment among the over-50s. In my constituency, the number of jobseeker’s allowance claimants has increased by 20% since June and doubled since 2006. Young people in my constituency have been particularly badly hit, with a 288% increase in long-term unemployment since last year. Worryingly, young black and Asian men are disproportionately affected, with 56% and 23% respectively being unemployed. Those figures have doubled since 2008, so we should be very worried about that problem.

What was there in the Queen’s Speech for those people? Absolutely nothing. At the Select Committee on Work and Pensions yesterday, I was profoundly disappointed by the apathy and complacency about what is going on and about how it can be addressed. The youth contract is not geared towards focusing on these problems and only quick fixes have been introduced. There are inequalities not only between different population groups, but on a geographical basis. The urban heartlands of Greater Manchester, Liverpool, Newcastle, Glasgow, Cardiff and parts of London are most affected. The Government’s talk about fairness is just that—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. I call Mr Mark Spencer.

17:12

[Mr Mark Spencer (Sherwood) (Con)]

I am delighted to be called to speak in this debate. The number of Members who want to speak is an indication of how important it is that the economy runs smoothly and allows the Government to do the exciting and generous things that they want to do in their programme. The economy is fundamental to that process. The same is true in our communities. In Sherwood, the fundamental issue is jobs and how we can create them.

The last Labour Administration created many jobs in the public sector, expanding it to such an enormous degree that we reached the point at the last general election—[Interruption.] The shadow Secretary of State for Work and Pensions says that they created jobs in the NHS. That is true—they were people walking around with clipboards who restricted our doctors and nurses. The last Government created jobs within quangos that restricted the private sector. Those jobs became unsustainable, to the extent that when the previous Administration left office, £1 in every £4 that was spent was being borrowed.

This is the fundamental argument. We need growth in our economy, but it must be sustainable for the long term. The Government have grasped that the only way to create sustainable jobs is to have an even-keel economy. That involves having low interest rates. Anybody running a small business in one of our constituencies who has an overdraft or a long-term loan with a variable interest rate understands how important low interest rates are. Once interest rates start to climb, the pressure on one’s cash flow and the pressure to reduce one’s wage bill become unsustainable.

So what have the Government done to create jobs? Our record is pretty good. One of the first things that the Government did was to reduce corporation tax to attract investment from overseas. That is just starting to show fruit, with companies relocating to the UK. We are using the planning system to try to make it easier for companies to establish themselves, and trying to ensure that the system works to create new businesses. For small businesses, we have looked at reducing business rates, which have a crippling effect. Anyone who runs a small shop and pays enormous local business rates will understand how important rate relief is in allowing their business to flourish. Reducing the burden of employment law on such businesses is also very important. Small businesses fear taking on new staff. If we can remove some of that fear, those businesses will be more likely to take on more staff.

What is happening in Sherwood? The good news is that unemployment is slowly coming down, which I welcome. There is still a long way to go, but the good news is we finally have a Government who understand business and how to run the economy. We are on the right course. We need to hold our ground and ensure we keep interest rates at their current level.

17:15

[Mr Gordon Marsden (Blackpool South) (Lab)]

The Government have done little to promote jobs and growth for towns such as Blackpool. They scrapped the regional development agency, which helped us to renew our tramway and our key visitor attractions, including the tower and the Winter Gardens. They also scrapped the area-based grants that targeted our pockets of severe deprivation.

The Government seem incapable of understanding the challenges faced by Blackpool and other second-tier towns, particularly in seaside and coastal areas. They have done no strategic targeting of the regional growth fund by industrial sector, which was highlighted by David Marlow, who has said:

“Blackpool has not yet had a distinctive RGF success despite benefit and public sector ratios 80% and 60% above national averages, and private sector ratios at about 65% and 25% below average.”

Any narrow focus on city regions risks ignoring surrounding areas. We suffer from imbalances not only between regions, but within them. We need growth in second-tier towns and cities, seaside and coastal towns, and suburban areas.

Just what are the Government delivering on the ground for young people in terms of jobs and growth? I have seen first hand the positive impact the education maintenance allowance had in encouraging young people in Blackpool to go to colleges, where we have struggled to improve our skills levels. Given our pockets of extreme deprivation, that assistance was vital, but it is now gone, along with opportunities for thousands of young people from my sixth-form college and Blackpool and the Fylde college, which were jeopardised at one stroke of a pen in the Department for Education, the same Department that cut off the dedicated money—£200 million—available to schools for careers advice.

Yesterday’s unemployment figures also illustrate that that problem is not budging. In my constituency, one in 10 of the active population is out of work, including more than one in five young people, which is 8% higher than this time last year. Those figures disguise the work shortfall for young people and key groups such as women, a point strongly made by my hon. Friend the Member for Houghton and Sunderland South (Bridget Phillipson) earlier in the week. Thirty-four thousand women nationally gave up work altogether in the last quarter.

The previous Government had imaginative schemes such as the future jobs fund, through which Blackpool football club, which will battle for premier league status again at Wembley this Saturday, gave young people real opportunities. The Deputy Prime Minister’s belated youth contract promised to create half a million new job opportunities for young people, but we have seen no indication of it in Blackpool yet. If his figures are as reliable as the ones so recently demolished by the National Audit Office, I will not hold my breath.

This story is not just about statistics, but about individuals’ blocked hopes and frustrations. Wherever I talked to young people—not just in Blackpool, but in places such as Crawley, Reading and Milton Keynes, which I visited during the local election campaigns—I have found that they are in “it” together: they are in the mire, north and south, thanks to our Chancellor.

What about our small businesses, which are critical to our economic recovery and prevalent in my constituency? The Government have talked a good game, but my case work shows that many small businesses are being let down by the banks. When will the Government tell the banks to give support rather than telling people to stop whingeing?

We need proper activity on VAT, but we are not getting it, not on tourism and regeneration, or on repairs and renewals. The Government believe not in active and intelligent government but in scapegoat Britain. They scapegoat everybody except themselves, but their growth and jobs policies have failed.

17:19

[Richard Graham (Gloucester) (Con)]

Today’s criticisms seem to be based on a familiar litany of three core ingredients: first, that the Queen’s Speech should have been the length of a speech by Fidel Castro at his peak; secondly, that it should have launched lots of new initiatives; and thirdly, that the Labour years represented a paradise lost. We have heard many of those points made today, and I commend to the Opposition the damning obituary given by the right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett) in one of his earlier books. He wrote that a day without a new initiative was a day wasted for new Labour. We do not need lots of new initiatives day after day; we need a series of cool, strategic policies that are well implemented.

All of us and our constituents have to win our jobs. Last year, I encouraged EDF energy, whose operational headquarters are in my constituency, to create 10 new apprenticeships there. One of them was won by an 18-year-old who came from Sheffield to Gloucester. He was interviewed, he moved down, he left his comfort zone and went for it, and now he is thriving in one of the most successful companies in our country. What he did is a great example to all our young people, not only in Gloucester but elsewhere in the country. We should learn from his determination to go and win a job.

In our city there are many new apprenticeship opportunities. In 2010-11, businesses in our city created 1,050 new apprenticeships. For the first half of 2011-12, we are up 20% and on target to create 2,200 new apprenticeship starts over the whole year. I visit two companies a week to see what the opportunities are, to encourage them to create new apprenticeships and to see whether those who have never done so are taking advantage of the Government scheme incentivising small companies with £1,500. I do a jobs fair every three months, on average, and I try to link our youth groups to trainers and the opportunities they can access with companies.

All of us can do our bit in our constituencies to help the policies along. I want to discuss the core policies on which we should be focusing. How many businesses have had loans from the national loan guarantee scheme, which is 80% guaranteed by the Government? Have they applied for this source of capital, which could help them to expand? How many of them have signed up to the youth contract and are offering Work programme work experience to our young people coming out of schools and colleges? How many of our manufacturers have applied to the regional growth fund manufacturing fund, which is available to them? Under the previous Government, manufacturing’s share of GDP was halved while benefits doubled, but in my constituency manufacturing is still 20% of our output. We have lots of good, thriving, small and medium-sized engineering companies, but they need help to access capital, and I need to help them to access the opportunities the Government have made available.

Today’s youth have the skills—or lack of them—that they gained predominantly under the previous Government. One secondary school in my constituency had the second-worst GCSE results in the country. Today, under the new Gloucester academy, those results have improved from 11% to 33% and, this year, to 40% of pupils achieving target grades. This type of long-term planning for improved opportunities will provide the young in my constituency with better opportunities and jobs in the future.

17:23

[Anas Sarwar (Glasgow Central) (Lab)]

Like thousands of my constituents, I am deeply disappointed that after taking us back into recession this Government have failed to come forward with a substantive plan in the Queen’s Speech to get the economy back on track. In the fourth quarter of 2011, growth dropped to minus 0.3%, and to minus 0.2% in the first quarter of this year. Long-term youth unemployment has risen by a shocking 264% in the last year alone. What might be described as an embarrassment by the Chancellor is a tragedy for families up and down the country. Nothing announced by the Government in the Chancellor’s Budget and certainly nothing in the Queen’s Speech will address the problems that hard-working families face across the country.

We all know that business lending is a vital part of any healthy economy. That is why the Opposition wanted the Government to tackle what the Business Secretary himself described as a “yawning mismatch” between the demands of small business for finance and the banks’ reluctance to lend. Instead, we got a small sticking plaster to cover a massive business funding gap that is estimated to reach £150 billion by 2016.

We have a coalition Government who have completely the wrong priorities. They are more interested in papering over coalition cracks than getting Britain back into work. Instead of helping hard-pressed families and small business owners, the Government decided in the Budget to give a tax cut to those earning more than five times the average salary.

I was disappointed not to see any mention in the Budget or the Queen’s Speech of families struggling with the rising cost of child care, which is higher in Scotland than anywhere else in the UK. It is no surprise that 10% more women are in employment in countries such as Norway and Denmark, where parents have access to affordable child care, than in the UK.

I was even more disappointed to see nothing in the Budget about supporting disabled people into work, following the Government’s shocking decision to close the majority of Remploy factories. According to the Government’s own figures, about 500,000 disabled people will lose their benefit entitlement when the disability living allowance is replaced by the new personal independence payment. Case studies conducted under the Government’s consultation on the PIP suggest that blind and visually impaired people who are judged to have adapted to their disability will not qualify for the higher rate. That ignores the reality that the difficulties, the barriers and, most importantly, the costs continue regardless of the length of time a person has lived with sight loss.

I urge the Prime Minister to look for inspiration to my home city of Glasgow, where the Labour council that was re-elected last week with a commanding majority —a feat that is almost impossible under a proportional representation voting system—has managed to lower unemployment in the past year in the face of this Government’s economic failures and the Scottish Government’s swingeing cuts. In Glasgow, people voted for a manifesto that put investment in jobs, growth and education first. They voted for the £25 million investment in the Glasgow guarantee, a programme that will use the Commonwealth jobs fund, the Commonwealth apprenticeship scheme and the Commonwealth graduate fund to create a lasting legacy of employment from Glasgow’s proud hosting of the Commonwealth games in 2014.

The people of Glasgow rejected the scorched earth policy of mass austerity and the imagined magic wand of separation in favour of investment to create jobs—investment such as that proposed by my right hon. Friend the shadow Chancellor in our five-point plan. We want to see the establishment of a state-owned British investment bank, similar to the bank for small and medium-sized enterprises that John Longworth, the director general of the British Chambers of Commerce, has been calling for, to help businesses to create the jobs that our country needs. We also want to see a jobs Bill that would ensure that money raised from a tax on bank bonuses was used to provide real jobs, with real wages and responsibilities, for more than 100,000 young people aged 18 to 24.

We have an out-of-touch Government at Westminster who are repeating the mistakes of the 1980s and a distracted Government at Holyrood who are concerned more about a separation referendum than about the real issues affecting the lives of ordinary Scots, and people up and down the country can see right through them. That is why we saw the elections results that we did last week.

17:27

[Emily Thornberry (Islington South and Finsbury) (Lab)]

When I speak as a representative of Islington South and Finsbury, I feel that I always have to begin by dispelling myths. People know about our cappuccino bars and our Georgian squares, but they do not necessarily know that 44% of my constituents live in social housing, or that my constituency has the second worst child poverty rate in the country. The very rich and the very poor live in Islington. We live cheek by jowl, and we like it that way. The recession has affected all of us, but some much more than others.

One thing unites people, however, no matter what their background. I have spoken to women, including aspirant Somali mothers, a middle-class mother whose child has just left Oxbridge, and a woman whose child has just left school, and we are all really scared for the next generation. Although we have brought up our children as best we can and put everything into equipping them for the world as perfectly as we can, we are really scared that, when we push them out into the world, the world will say, “No, sorry. We don’t need you. We might be interested in your little brother or sister one day, but you have entered the world of work at the wrong time. Come back in four or five years’ time.” What will happen to those kids in the meantime if we do nothing about unemployment among young people?

In Islington, we have had a massive increase in long-term unemployment among 18 to 24-year-olds, and I know that that has been replicated across the country. In Islington, it has gone up by 88% in the past year. I hear Government Members say, “Well, of course it is because they haven’t got the right qualifications”, or “It’s because the Labour Government didn’t educate them well enough”, but it does not matter what qualifications a young person has now; they simply cannot get a job. There is a generation now who are finding it exceedingly difficult. The hon. Member for Gloucester (Richard Graham) shakes his head, but if he were to advertise for an unpaid internship in his office, I suspect he would get at least 300 applicants from youngsters desperate to get employment. The problem is nothing to do with young people not being sufficiently educated; it is because the recession, which hits all of us, hits our children, teenagers and those in their early 20s the hardest. The older generation and Members here who represent our communities have a duty to do something about it. Frankly, the complacency of Government Members, to which I have had to listen over the past five and a half hours, is quite astounding.

I see in his place the Secretary of State for Work and Pensions, and I hope he will listen to what I have to say about other groups of people. I know the Conservatives say they are on the side of those who work hard and do the right thing. I know they want to change this country so that once again it rewards people who work hard, want to get on and play by the rules. The Conservatives want to represent the strivers, the builders, the family raisers, the community builders. Good, so would Conservative Members please consider the working poor in my constituency, who are being adversely affected by cuts to working tax credits, the housing benefit cap and universal credit? I hope the Secretary of State understands that they are badly affected by the price of housing and the extraordinary price they have to pay for rent. We must do something about that. Unless and until that is done, it will be impossible to have a mixed community in which people will be able to work at all levels.

17:31

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

This Queen’s Speech can be summed up by the Prime Minister wandering around the country saying that he is not for turning. I remind him and his party that the last person who said that—Lady Thatcher—was tossed out by the country when people found out that they were getting uncaring Conservatism once again. [Interruption.] Yes, she was, of course, tossed out by her own party.

This is a Government who continue to attack, with ingrained unfairness, the personal income of all apart from those in the super-rich bracket. They boast of attacking citizens’ and workers’ rights. With 100,000 public sector job cuts, it is good to see the Secretary of State for Work and Pensions in his place. How many of the present employees of Remploy will, to his shame, end up on the unemployment list? Only 50% of the jobs have been replaced by the private sector, and many of them are part-time and temporary jobs. Of 16 to 24-year-olds, 21% are in part-time jobs, while analysis suggests that 40% are on temporary contracts.

The national debt is higher, not lower, and the UK is in a double-dip recession for the first time in 30 years. Of course I welcome investment in car manufacturing from US companies. Their choosing a UK work force in a flexible trade union environment and our being near the EU market has nothing to do with the Government, and it follows the investment of Japanese and other international companies that invested under the Labour Government.

I am an economics graduate, so I know that economic growth is based on confidence in business and in consumers. The Chancellor is a one-trick pony, with low interest rates. His stated aim is that interest rates are being held low for the sake of the Government’s bond sales, but this has the effect, for example, of attacking the disposable income of pension funds and investment funds, thus hitting the mainly frugal elderly. Quantitative easing has also hit their income and made them poorer. This signals to UK businesses that the Government believe that the economy has to be held in check, as it is fundamentally too fragile to grow without creating threatening levels of inflation. This is caused by a failure to expand the resource base of the economy so that growth can be inflation-proofed for the future.

I looked at the “Prospects for inflation” chapter of the inflation report of May 2012, which states:

“Output has barely grown since the middle of 2010, and is estimated to have contracted slightly in each of the past two quarters.”

That is what this Government have delivered through their policies. Human resource expansion is required to deal, for example, with training and skills shortages. The ageing population needs to be replaced in industries with which I am involved. There is OPITO—the Offshore Petroleum Industry Training Organisation, which deals with offshore oil, and the subsea employers association—talk about 44% of its vacancies being in non-graduate technical jobs, with an additional 20% in technical graduate jobs. The Chemical Industries Association says that it fishes in the same pond for staff, and it demands science education in schools to provide a base of people who can be skilled up for growth. Mike Mack, the world president of Syngenta, says that he fears he cannot sustain his investment in this country because of the shortage of skilled labour. He steals from other companies, and they steal from him. We need technical apprenticeships. Forget the boasts about the number of apprenticeships that have been started; how many have been concluded? How many newly qualified technicians have we got? The SNP Government falsify the statistics. They say that there are 25,000, and write to companies asking them to include people who are doing part-time work as apprentices in order to supplement the figure.

Business investment is 6% lower than the target set by the Chancellor. There is £950 billion in company accounts that is not being invested. Companies are holding on to it: they are afraid to invest, because the signals are all wrong. The Chancellor has gone for corporation tax reductions, but they are a blunt instrument. VAT increases hit the supply chain for customers, for business and for personal consumption, whereas VAT reductions—a targeted programme such as the one that the French use, reducing VAT—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. The hon. Gentleman’s time is up.

17:35

[Jonathan Ashworth (Leicester South) (Lab)]

I shall make only a few brief points.

I thought that the Queen’s Speech was extraordinarily flimsy, given that it emanated from a party that is in its second year in government and has been out of power for 13 years. When we compare it with the greatest Queen’s Speeches of the Labour Government in their second year and, indeed, those of the Thatcher Government in their second year, it is apparent to us that the present Government are running out of steam after only two years.

There was nothing about jobs in the Queen’s Speech. As my right hon. Friend the Member for South Shields (David Miliband) demonstrated so eloquently in his speech, the Work programme is entirely unsatisfactory. It cannot possibly deal with the youth unemployment crisis. The Queen’s Speech should have been seen as an opportunity to put right the mistakes that the Chancellor had made in his Budget. I am glad that he has dug himself out of the hole of the churches tax, but I wish he would dig himself out of the hole of the pasty tax and the caravan tax, and, indeed, his £40,000 giveaway. I believe that the Prime Minister’s former speechwriter Ian Birrell described it as

“a missile into six years of Tory modernisation.”

I could not have put it better myself.

Unemployment in Leicester South has increased over the past 12 months. Although I welcome the drops in unemployment announced yesterday, I must tell Ministers that in Leicester South it fell not by 1%, but by one. If the Government do not produce measures to deal with the youth unemployment crisis soon, I fear for the future of many of the communities we represent.

The Chancellor expected growth of 2.5% this year, but we are now in a double-dip recession. Some of the contributions from Government Members were rather complacent on that front. Many people warned the Chancellor that a fiscal consolidation of this scale and pace, along with a collapse in demand and consumption, would lead to a recession. Indeed, the Business Secretary, when he was in opposition, gave him that very warning before the general election.

What are we given in the Queen’s Speech? We are given what appear to be proposals for the further erosion of workers’ rights. I must tell the Chancellor that downward pressure on workers’ rights will not lead to the growth in the economy that he wants. What a turnaround this is for the Business Secretary. He started his career co-authoring “The Red Paper on Scotland” with my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), but it appears that in the twilight of his career he will become the Twickenham strangler of rights at work.

Government Members have talked about trade and exports. I agree that the patterns of international trade are changing. As many Members will know, the city of Leicester, which I represent, has deep and extensive links with India, Bangladesh and Pakistan, and I want us to build on those links and to trade further. The hon. Member for Sherwood (Mr Spencer) referred to food manufacturing, in which we in Leicester have expertise. We export British Asian food to Europe, to the middle east and, indeed, to India. However, I must tell Government Members that although the reports that I hear of UK Trade & Investment have improved, they are patchy at times.

We need more support for export finance in Leicester. It would be greatly to the advantage of the Business Secretary, when he and the Prime Minister go on trade missions to India, to take with him not the great and the good, but some of the small business people from Leicester who understand how to enter challenging markets in India, Pakistan and Bangladesh.

Let me finish by simply saying that we have a Government who promised us growth and jobs; what they are delivering is recession and unemployment.

17:39

[Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)]

It is a privilege to wind up a week of debate and speeches on the Gracious Speech. However, let me start by saying what a disappointment it was to hear not a word of recognition, humility or apology from the Chancellor for a litany of Budgets that have put this country back in recession and given us a Queen’s Speech with nothing to dig us out.

We have, however, had something very significant this afternoon. We have had an admission—a confession, in fact—from the Chancellor. He finally forced himself to say it, in response to the intervention from my right hon. Friend the Member for Edinburgh South West (Mr Darling), although he had to choke it out. He said that austerity is not enough. The Chancellor finally said it. However, confession is not enough; redemption will demand a change of course. He has U-turned this afternoon on his policy for Europe; he should now U-turn on his policy here in the UK. Instead, what we got was a lot of jokes. Most people in this country now feel that if he focused more on economics and less on jokes, perhaps the country would not be in quite the mess that it is. The customary advice is: “Don’t give up your day job”, although most of us probably feel that the sooner he gives up his day job, the faster Britain will be back on its feet.

This is the Chancellor who told us a year ago that he was putting fuel in the tank of the British economy. What has happened? Where has the fuel gone? It has somehow been siphoned off into the jerry cans in the Cabinet Office. Instead, what we have got is £150 billion of extra borrowing, 1 million young people out of work, fewer hours worked this year than last, and a fall in our national output in the last quarter of £700 million —a development that the hon. Member for Bournemouth East (Mr Ellwood) said was a step in the right direction. This is the first double-dip recession since 1975, the year of “Monty Python and the Holy Grail”, the story of a bunch of incompetent chancers, supposedly running the country, chasing after something that they had somehow misplaced. What an allegory of this Government’s pursuit of growth!

All week we have seen an unedifying witch hunt for the culprits—the people who have somehow misplaced Britain’s growth. This week the Government found someone else. The fault, it now seems, lies with those in the British business community, who just need to be working harder. My advice to them is that they should not take the attack personally. Indeed, they join illustrious company: we have had “the weather”; we have had “the wrong type of snow”; and we have also had the royal wedding. When it comes to their failure, this Government will blame only others.

[David T. C. Davies]

Will the right hon. Gentleman give way?

[Mr Byrne]

I will not give way, because there are so many points to respond to.

We know that this recession was not made by British business. It is not down to the weather, the snow or the royal wedding; it is down to the failed policy of this Government. Despite the good news we had on unemployment this week—there was a glimmer of hope—Britain’s jobs crisis has now gone on for too long. We now have more people working part time or becoming self-employed, because they will do anything to make ends meet. Long-term unemployment is surging towards the 1 million mark, the number of people out of work for two years is up to 500,000, 100,000 more people are signing on than last year, redundancies are up by 50,000, and vacancies are down by more than 10,000. Families all over Britain are facing a disaster, because of the failed policies of this Government.

This afternoon we heard those stories from all over Britain. The point was made forcefully by my hon. Friend the Member for Liverpool, Walton (Steve Rotheram), and it was a story repeated by my hon. Friends the Members for Ogmore (Huw Irranca-Davies), for East Lothian (Fiona O'Donnell), for Blackpool South (Mr Marsden) and for Leicester South (Jonathan Ashworth). We heard in the debate this afternoon that we need growth and demand—a point made by my hon. Friends the Members for Oldham East and Saddleworth (Debbie Abrahams), for Gateshead (Ian Mearns), for Great Grimsby (Austin Mitchell) and for East Lothian. We heard how higher unemployment is hitting some communities and some regions harder than ever—that was the point made by my hon. Friend the Member for Wirral South (Alison McGovern). It is hitting ethnic minorities harder than ever—that was the point made by my hon. Friends the Members for Stretford and Urmston (Kate Green) and for Oldham East and Saddleworth. It is now hitting young people harder—that was the message we heard from hon. Members from all parts of the House, and it was a point made with particular force by my hon. Friends the Members for Islington South and Finsbury (Emily Thornberry) and for Birmingham, Ladywood (Shabana Mahmood).

That is why what we needed in the last Budget and in the Queen’s Speech was not excuses, but action. We needed action on bank lending—that was the point made by my hon. Friends the Members for Leeds East (Mr Mudie) and for North Ayrshire and Arran (Katy Clark), and by the hon. Members for North East Cambridgeshire (Stephen Barclay), for Northampton South (Mr Binley) and for Aberconwy (Guto Bebb). We needed action on infrastructure spending, too—that point was made with great force by my right hon. Friend the Member for Barking (Margaret Hodge), the hon. Member for Erewash (Jessica Lee), and my hon. Friends the Members for Glasgow North (Ann McKechin) and for Glasgow Central (Anas Sarwar). This absence of action is now costing this country a fortune.

[Andrew Selous]

rose—

[Mr Byrne]

Perhaps the hon. Gentleman will tell us just how much the benefits bill is increasing as a result of that failure.

[Andrew Selous]

When the right hon. Gentleman wrote his famous note saying that there was “no money” left, what did he think the implications of that were?

[Mr Byrne]

The hon. Gentleman speaks for a party that has now put up borrowing by £150 billion more than projected. Does he know why? It is in large part because the benefits bill is not being capped by this Government—the benefits bill is going through the roof. It is set to be £25 billion higher than was projected by the end of this Parliament, with the cost of unemployment benefit set to be up by £5 billion and the cost of housing benefit set to be up by £6 billion by the end of this Parliament. I really do not know how he has the temerity to say what he has just said, given that it is his Government who are putting up debt.

The problem is that this Government have not learned the lesson that the way to bring the benefits bill down is by getting people into jobs—that is where this Government are failing. It is no wonder the people all across Britain are saying that this Prime Minister and this Chancellor have no idea how ordinary people live. The Prime Minister is riding on horses with editors of newspapers who are charged with perverting the course of justice while our young people cannot even afford a bus fare to college. We heard this afternoon just how much that bill has now become in a powerful speech from my right hon. Friend the Member for South Shields (David Miliband). We heard that youth unemployment will cost our country £30 billion over the years to come. When are this Government going to heed that lesson?

When will they look at the hit now being taken by working parents, who are struggling with child care? These parents are now losing £500 this year. No wonder 32,000 women have already had to give up work this year because they cannot afford the child care. We should look at what this Budget means for working parents—a point made with some eloquence by my hon. Friend the Member for Islington South and Finsbury and by my right hon. Friend the Member for East Ham (Stephen Timms). Such is the incompetence and such is the incoherence that families in this country are now better off on benefits than they are in a job—what a catastrophic failure of policy and what a catastrophic failure by this Chancellor.

Look at what these proposals mean for savers—people doing the right thing. Alongside the granny tax, the Government tried to sneak out in the Budget small print another £900 cut for pensioners by getting rid of the savings credit. Look at what the proposals mean for workers with disabilities. Some 11 million people in this country have disabilities. Disability Rights UK says that 25,000 people with disabilities have had to give up work this year because their support and help are being cut away from them. This Secretary of State for Work and Pensions is now administering reform of the incapacity benefit system with all the finesse of border control at Heathrow airport. It is now taking people up to 11 months to get a hearing and then, when they reach that tribunal, half the decisions are being overturned. That is not a result that he can be proud of.

Worst of all is the treatment being handed out to workers at Remploy. These are workers indirectly employed by the Secretary of State himself. Worst of all—worse than anything I have heard over the past few months—are the reported comments that he made to Remploy workers. Apparently he told them that they “are not doing any work at all. Just making cups of coffee.” That is not compassionate conservatism; it is the conservatism of contempt. The Secretary of State should apologise to those workers this afternoon. When he should have been launching a war on poverty, he has launched a war on decency.

This Government have no idea how these young people, these parents, these working mothers and these workers with disabilities are now living. They are failing on jobs, they are failing on growth, and they are out of touch, out of their depth and out of steam. We need a change of direction and Labour’s amendment today offers that. I commend it to the House.

17:50

[The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)]

I welcome the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) back from a potential sojourn in Birmingham as mayor—his announcement that he wanted to stand was so powerful that Birmingham, on the spot, rejected the whole idea of having a mayor. I have got to know him well over the past couple of years and he has been heavily involved in designing the policy framework for the Opposition. He talked about part-time work and, as a result of his leader’s decision, he will experience it himself. I am sorry about that, because I am sure that he would have done a very good job had he been allowed to continue—I certainly suspect that he would have done better than some of his colleagues.

Today is about the Queen’s Speech, and I want to welcome a number of Bills: the Crime and Courts Bill, the children and families Bill, the draft care and support Bill to modernise the care system, and, importantly, a pensions Bill to provide once and for all a decent single-tier state pension to reward those who save. Let me say a few words about that matter and in tribute to the Minister of State, Department for Work and Pensions, my hon. Friend the Member for Thornbury and Yate (Steve Webb). He and I have worked very hard together and I hope that when we publish the White Paper both the House and the country will see that we are proposing a genuine and serious reform that should improve the quality of retirement for everybody in the future. We will reform the state pension system, creating a fair, simple and sustainable foundation for private saving. The main benefits of the Bill will be that it will enable individuals to take responsibility for meeting their retirement aspirations in the context of increasing longevity and create an affordable and sustainable pension system for future generations.

Let me respond to a few of the comments made by hon. Members on both sides of the House. The right hon. Member for South Shields (David Miliband), who I see in his place, made an elegant speech, as ever, in which he referred to a number of different issues. In particular, he mentioned youth unemployment, and I want to ensure that we establish the baseline on that point. The trouble was that the previous Government gerrymandered the figures on youth unemployment. When somebody had been unemployed for six months, they put them on one of their programmes—the future jobs fund or whatever—and took them off the unemployment register. They were not put back on to the register until they fell out of that programme—[Interruption.] Members might want to hear this. If we add together the figures, we see that the total number of claimants aged 18 to 24 on jobseeker’s allowance or other forms of temporary support is lower this month than it was in May 2010. Under the previous Government, during a period of growth, youth unemployment rose every year from 2006.

[Sheila Gilmore]

The Secretary of State appears to be unaware of a briefing that his own Department gave to the Select Committee on Work and Pensions yesterday, which exposed the lack of rigidity in the figures. Apparently, the correct figure shows that in March 2010 the number of people who were taken off benefit on a training allowance was 18,000. It has come down to 4,000, but will he accept that that does not explain the rise in youth unemployment?

[Mr Duncan Smith]

Labour gerrymandered the figures, and that was a long suicide note about what they tried to do to change those figures. The hon. Lady can try as much as she likes but the truth is that the previous Government set in place every single mechanism to ensure that they did not count young unemployed people.

[David Miliband]

The figures that the right hon. Gentleman’s Department have put out show that in the past year—under his Government—long-term jobseeker’s allowance claimant figures have gone up threefold to 55,000. How does he explain that?

[Mr Duncan Smith]

As I said to the right hon. Gentleman—his point was about youth unemployment—the reality is that the figures I have given today are correct. His Government created a major crisis by putting us into a great big slump. That is what they did. Whatever else he wants to say in an attempt to defend the Labour Government, we are having to dig them out of a hole and we are the ones producing better youth programmes such as the youth contract. Those unemployment figures are very simple. When you add all the details together, you find that unemployment among young people was higher when we took office than it is now.

I want to move on to what other hon. Members said. The hon. Member for Leeds East (Mr Mudie) said that he wanted to see the right hon. Member for South Shields on the Front Bench. I wonder what role he would see the right hon. Gentleman in if he got him there. I congratulate my hon. Friend the Member for Bournemouth East (Mr Ellwood) on his speech. He reminded us that we had some great news the other day because Boris won again in London. That is very good news for all of us. [Interruption.] I wonder what Opposition Members are saying. The reality is that their candidate, Ken Livingstone, failed, and I note that a lot of them did not even bother to turn up to support him.

The hon. Member for Redcar (Ian Swales) attacked Labour very effectively. I should like to pick up a point made by the right hon. Member for Barking (Margaret Hodge), the Chairman of the Public Accounts Committee, who said that the welfare-to-work programme is unlikely to be good value for money. I differ from her on that. The big difference with the welfare-to-work programme is that we will not pay the providers unless they get someone into work. Under the future jobs fund and everything else that was going on under the previous Government they threw money at providers ahead of any kind of outcome, caring only to tick the boxes to say that they had done something rather than that they had done something reasonable.

A large number of people spoke in the debate, including my hon. Friend the Member for Warwick and Leamington (Chris White), the right hon. Member for East Ham (Stephen Timms) and my hon. Friends the Members for Bedford (Richard Fuller) and for North East Cambridgeshire (Stephen Barclay). The hon. Member for Liverpool, Walton (Steve Rotheram) made an interesting speech. I notice that he wants to put his name forward to be manager of Liverpool. I wish him the best of luck in that endeavour. As a Tottenham supporter, I am looking forward to him running Liverpool next season.

The Opposition approached this debate believing that they had the right to criticise our Government for what they call our failures, yet not once have they ever apologised for putting the economy in the worst possible state—the biggest bust. They try to compare themselves to other countries. It is worth noticing that the US economy is set to fall faster—

[Ms Rosie Winterton (Doncaster Central) (Lab)]

claimed to move the closure (Standing Order No. 36).

Question put forthwith, That the Question be now put.

Question agreed to.

Question put accordingly (Standing Order No. 31(2)), That the amendment be made.

The House divided: Ayes 213, Noes 312.

17:59

Division 2

Ayes: 0

---

Labour: 205
Scottish National Party: 5
Plaid Cymru: 3

Noes: 0

---

Conservative: 267
Liberal Democrat: 44

Amendment proposed: at the end of the Question to add:

“but respectfully request that your Government recognise that its programme fails to include any meaningful measures to deliver growth in the economy, which is the most pressing issue facing the UK; and therefore call on your Government to bring forward a plan for growth to include measures designed to increase bank lending to small and medium-sized enterprises, to build confidence in economic recovery, to bring forward a programme of direct capital investment and to tackle unemployment.”—(Stewart Hosie.)

Question put forthwith (Standing Order No. 33), That the amendment be made.

18:12

Division 3

Ayes: 213

---

Labour: 207
Scottish National Party: 4
Plaid Cymru: 2

Noes: 311

---

Conservative: 267
Liberal Democrat: 43

Main Question put.

18:25

Division 4

Ayes: 310

---

Conservative: 268
Liberal Democrat: 41

Noes: 212

---

Labour: 204
Scottish National Party: 5
Plaid Cymru: 3

Resolved,

That an humble Address be presented to Her Majesty, as follows:

Most Gracious Sovereign,

We, Your Majesty’s most dutiful and loyal subjects, the Commons of the United Kingdom of Great Britain and Northern Ireland in Parliament assembled, beg leave to offer our humble thanks to Your Majesty for the Gracious Speech which Your Majesty has addressed to both Houses of Parliament.

Address to be presented to Her Majesty by Members of the House who are Privy Counsellors or Members of Her Majesty’s Household.

Business without Debate

Thursday 17th May 2012 Commons Chamber

Delegated Legislation

Ordered,

That the Motion in the name of Mr Peter Lilley relating to the House of Commons Members’ Fund shall be treated as if it related to an instrument subject to the provisions of Standing Order No. 118 (Delegated Legislation Committees) in respect of which notice of a motion has been given that the instrument be approved.—(Mr Heath.)

John Lawton

Thursday 17th May 2012 Commons Chamber

Motion made, and Question proposed, That this House do now adjourn.—(Greg Hands.)

18:36

[Fiona Bruce (Congleton) (Con)]

I am extremely grateful personally to Mr Speaker for affording me the opportunity to secure this debate and to raise the case of the disappearance of my constituent, Mr John Lawton. John’s wife Lynda, his son Steve and daughter-in-law Rachel are in the Gallery this evening, at what is a deeply worrying time for them. I pay tribute to the dignity and commitment they have shown throughout the period of some five to six weeks since Mr Lawton disappeared in Greece. They have spent much of the past five to six weeks in Greece and are back in the UK while the search for John continues.

John Lawton went missing on 8 April—Easter Sunday—while participating in the Taygetos marathon in Greece. The race started at 8.30 am. The organisers have confirmed that John passed through checkpoint 4 at 1.17 pm, which was about halfway round the course, 21 km from the start of the race at the start of the Viros gorge, but he never reached checkpoint 5, at 26 km—or at least he was never checked in there. Some new information in that connection has just come to light, and I will refer to it later in my speech.

Since being made aware of John’s disappearance, I have been assisting the family and trying to maintain awareness of the case. I heard about the matter within three days and made immediate contact with the Foreign Office to call for assistance. I know that the Under-Secretary of State for Justice, my hon. Friend the Member for Huntingdon (Mr Djanogly), also made immediate representations to the Foreign Office in his capacity as the constituency MP of Mr Lawton’s son, Steven. My hon. Friend spoke with the Foreign Office no fewer than three times on Easter Monday, and his intervention contributed to the provision of a helicopter search for about an hour on the following day. The family are appreciative of my hon. Friend’s active interest in the case.

I first raised the matter in the House at my earliest opportunity, at Foreign Office questions on 17 April, when the Minister for Europe kindly confirmed in response that he had spoken with our ambassador in Athens, called for further representations to be made at the highest level of the Greek Government, and made arrangements for a member of the consular team in Greece to visit the Lawton family to discuss their concerns and what support they required. At that time, one key thing that the family wanted—they still want it on an ongoing basis—was a well-resourced, professionally co-ordinated search directed at the highest possible level by the Greek authorities.

I wish to put on the record my thanks to the Minister and the staff in his office for their ongoing assistance. I thank him specifically for taking the time to speak directly with Steven Lawton a few weeks ago and for his continuing agreement to meet representatives of the Lawton family at any stage. It is also important to thank British officials in Greece who have continued to press the Greek authorities on behalf of the family. Dialogue with the police and the Greek Ministry of Foreign Affairs remains crucial. It is particularly important because at present, as the family told me a few minutes ago, the search in the area is no longer continuing, other than through the occasional tourist who might see the posters placed in the area advertising John’s disappearance.

Over the past five or six weeks, I have received dozens of e-mails not only from constituents but from people across the country who know John, Lynda, Steve and other family members, and I have been struck by the affection and respect in which they are held. One typical e-mail read: John

“is a man who worked with people with learning, physical difficulties and challenging behaviour”

whom

“he never gave up on. His wife, Lynda, is the nicest person you could meet and they are totally devoted to each other”.

John and Lynda married when they were 18-years-old and have been happily married for 42 years. The family tell me that there is no reason John would have voluntarily disappeared. They have lived in the local area, in my constituency, for almost all their married live, and their two children, Steve and Sara, attended school in Sandbach. The local community has rallied to support the family, and yellow ribbons have been worn by many people to show their concern following John’s disappearance. The local media, too, have been extremely supportive. I spoke on BBC Radio Stoke most recently this morning about the matter, and the Crewe Chronicle and the Sandbach Chronicle have made this a headline issue for several weeks, which has been crucial, not least in helping to raise funds to support the search for John.

John Lawton is a popular and active member Sandbach Striders running group, three of whose members have been out to Greece to help in the search. I have been particularly impressed by the lengths to which members of the group have gone to support the family. Six members—husband and wife duo, Jason and Jo Bulley, Perry Wyatt, Terry Coppenhall, Robert Kettle and Steve Treweeks—participated in the London marathon to raise funds for volunteers to go out to Greece as part of the search team. A JustGiving page, in the name of John Lawton, has also been set up by Missing Abroad. The last time I visited the site, 300 people had generously donated more than £13,500. That money, however, has all but been spent on the cost of the 15 Cheshire search and rescue team volunteers who also went out to Greece to help with the search, and on other expenses. I hope that the recently revised target of £25,000 for these costs can be surpassed as soon as possible and that publicity generated, not least as a result of this debate, will help in that process.

In the immediate aftermath of his disappearance being reported, the Greek authorities initiated a search conducted and led mainly by the local Gaia volunteer rescue group. People from the local villages were extremely helpful, closing their businesses and searching throughout their Easter holidays. The search was joined at various points by the police, fire service, search dogs, local mountain rescue teams and the Greek Red Cross. The official search, however, was called off by the Greek authorities about two and a half weeks ago. The family have asked me to express their gratitude that it lasted 20 days, but since then only local volunteers, family members and volunteers from Cheshire have been on the ground looking for John. The 15-man team from the Cheshire search and rescue group returned just a day or so ago, and the family are now particularly keen that I emphasise that there is now no ongoing, active, professional search, and have asked that the Minister ask the Greek authorities that the search be reconvened, not least because information has come to light that leads us to believe that not all the relevant areas have been searched.

The family have engaged privately commissioned UK investigators to review the evidence that has been amassed in respect of John’s disappearance. A detailed timeline chart has been prepared and was sent to the Minister earlier this week. The chart is an analysis based on interviews conducted by UK investigators directly with Greek and British witnesses. The police investigation into John’s disappearance has confirmed that there were eight athletes behind John at the fourth checkpoint, but there has been no formal indication that they were all interviewed and asked whether they saw him between the fourth and fifth checkpoints.

An English witness who lives near the fifth checkpoint on the course apparently approached Gaia to say that she recalled seeing John running past her home close to the fifth checkpoint at about 2 pm. A gel packet, of the English brand that John used and certainly had with him at the time, was found on the course just before the fifth checkpoint. It was found some four weeks ago, but it has not yet been established whether it belonged to him. The family is awaiting the results of DNA tests from the Greek authorities. Any help the Minister can provide to help to secure those results promptly would be appreciated. Two other such gel packets have been found recently by the Cheshire search and rescue team.

All this information suggests that John might have progressed beyond the main area covered by the initial search, and the family is therefore requesting the Greek authorities to recommence their search efforts and to focus on the area highlighted by the new evidence. The initial search might have been conducted in the wrong area, and it is for that reason that the voluntary groups out in Greece have been searching the area between checkpoints 4 and 5 far more extensively. However, additional professional help would be greatly appreciated.

John Lawton is not the first Congleton constituent to disappear in Greece. The Minister might be aware of the case of Steven Cook, a Liverpool university student and former Sandbach school pupil who disappeared in the resort of Malia in Crete on 1 September 2005. I know that Steven’s parents have campaigned tirelessly for more information following their son’s disappearance, and the advice and support that they have offered to the Lawton family over the past few weeks have been greatly appreciated, especially as John’s disappearance must bring back memories of the extremely worrying time during the aftermath of Steven’s disappearance.

I have highlighted a very sad case tonight. It is a case that continues to cause the Lawton family an immense amount of worry and distress. I know that the Foreign Office has been as active as possible, here in London and out in Greece, but I would be grateful if the Minister could confirm what further action can be taken at this time to continue and extend the search for John. Will he also tell me how the discussions with the Greek authorities are progressing, and will progress in the future, and what further steps will be taken to ensure that John’s family receive the ongoing support that they require from all the relevant authorities, here and abroad, and in particular, to ensure the re-engagement of the official search?

I would also be grateful if the Minister could use this opportunity to clarify what assistance the Government can give through the Foreign Office to families who find themselves in a similar predicament. Could he, for example, review the literature that is provided by our embassies to families who find themselves with a missing relative abroad to ensure that it is clear? The disappearance of a loved one at any time is a tremendously distressing situation to have to contend with, but it is made much worse when it happens overseas. I am sure that it would be of considerable help to receive some guidance from the Minister in this respect. This would be of benefit not only to the families who find themselves in this predicament but to Members of Parliament who want to advise their constituents as well and as expeditiously as possible in such circumstances.

I want to close as I began, by paying tribute to the immensely dignified and committed way in which the whole Lawton family—not only Lynda and Steven, but Lynda and John’s daughter Sara, who has also been supporting them—have behaved, and to the commitment that the whole community in my constituency has shown in this situation.

18:49

[The Minister for Europe (Mr David Lidington)]

I congratulate my hon. Friend the Member for Congleton (Fiona Bruce) on securing this debate, and I pay tribute to the consistency and tenacity with which she has represented the interests of the Lawton family to me and my officials in the Foreign and Commonwealth Office. I also want to acknowledge the presence in his place this evening of my hon. Friend the Member for Huntingdon (Mr Djanogly) who, as Mr Steve Lawton’s MP, has been extremely active in making representations to the Government on behalf of the family.

I want to take the opportunity to respond to my hon. Friend the Member for Congleton by outlining the consular assistance we have provided to the family and the contacts we have had with the Greek authorities since Mr John Lawton was reported missing, and by trying to provide at least an initial response to some of the newer questions that she posed this evening.

As my hon. Friend said, Mr John Lawton had been taking part in the Taygetos mountain marathon challenge in the Kardamyli area of Greece on the morning of 8 April, Easter Sunday. He started the race, but did not show up at checkpoint 5 en route. Local search efforts began immediately it became clear that he had missed a checkpoint, and he was formally reported missing on Monday 9 April, Easter Monday. Following this, a more intensive search and rescue operation started on 9 April and lasted for 18 days before being officially called off on 26 April. To date, Mr Lawton remains missing. I am sure that the entire House will appreciate and sympathise with the anguish and sense of frustration and anxiety that Mr Lawton’s family and friends will have felt ever since the day he disappeared.

In these circumstances, expectations of consular staff are extremely high. In the overwhelming majority of cases, consular staff throughout the world perform their duties with care and compassion, doing all they can to help families to keep up to date with developments and get the information they need in order to make properly informed decisions as things progress. The primary role of consular staff is one of welfare: it is to assist, where they can; to obtain information from relevant authorities where possible; and, where appropriate, sometimes to raise more detailed issues with those authorities. What our consular staff cannot do themselves is to investigate missing persons overseas, and, as I know my hon. Friend understands, they cannot instruct the local authorities how they should handle a search or investigation in their own country, just as we would not expect other countries to attempt to instruct us how to carry out a missing person search in the UK.

Consular staff in Greece and London have been very active in this case since Mr Lawton’s disappearance was first reported. On the same day as the report was made, consular staff in Athens were in contact with the local chief of police who was supervising the search, to register our concern and see whether there was any assistance we could offer. The chief of police asked if we could intercede with the central authorities in Athens to try to secure the use of a helicopter with thermal imaging equipment. As a result of the direct intervention of the British embassy in Athens with officials at the Greek Ministry of Foreign Affairs, such a helicopter was dispatched to the search site during Tuesday 10 April —just over 24 hours after Mr Lawton was officially reported missing.

In the early days of the search, consular staff were able to support some other strands of the search operation, including attempts to locate John Lawton through his mobile phone or through the Garmin watch with GPS facility that he was wearing at the time. Unfortunately, the mobile phone was later found to have been left switched off at his hotel, and the watch could only receive a signal—regrettably, it could not transmit details of Mr Lawton’s location.

Our consul in Athens was also in direct telephone contact with Mr Steve Lawton, John Lawton’s son, on the evening of Easter Monday, and has remained in contact ever since, with a face-to-face meeting when she visited the area on 19 April.

Our embassy staff in Athens maintained regular contact with the Greek authorities at both senior and local operational level in both the Foreign Ministry and the Ministry of Citizen Protection, which has responsibility for the police and related emergency services, to support the efforts of Steve Lawton himself at the search site. Normal practice in Greece is for such a search to last for 72 hours, as was the case in March this year when a Greek national went missing in the same area. As my hon. Friend acknowledged, in this case—in large part, I believe, as a result of the that high level of contact from our staff—the Greek authorities maintained the search for nearer to three weeks. During that time they deployed a variety of resources, including specially trained search and rescue teams, other manpower—both official and volunteer—and trained dogs and a thermal imaging helicopter.

In the most recent high-level intervention, our ambassador in Athens has spoken to both the Minister and the Deputy Minister for Citizen Protection, acknowledging the efforts of the authorities so far and encouraging them to continue to consider whether there was anything more that they ought to be doing. The Minister confirmed that the investigation should continue, and obviously I will ask our embassy to follow up that conversation in the light of what my hon. Friend has said this evening.

My hon. Friend mentioned some of the findings of the privately commissioned investigation. Having received the report earlier this week, we have passed it on to our ministerial contacts in Greece, together with the family’s request that the search should recommence on the basis of the timeline analysis and the findings of the investigation. I note what my hon. Friend said about the time that it has taken to obtain the results of the DNA test that was promised for the gel samples. As she will understand, I cannot speak with any detailed knowledge of how the system of pathology tests operates in Greece, but I will ask our consular team in Athens to look into the matter as well.

I hope that my hon. Friend and the Lawton family will be reassured that we maintain, and will continue to maintain, a high level of contact with the Greek authorities. Inevitably, given the current economic and political situation in Greece, Ministers and the officials who are political appointees will be preoccupied with the forthcoming general election, but we will continue to do all that we can to maintain the profile of this case with them and with the operational authorities at a more local level.

I am grateful for the fact that my hon. Friend was able to arrange for me to speak directly to Mr Steve Lawton by telephone when he returned to the United Kingdom for a few days to accompany his mother home. That enabled me to explain our role in a little more detail, and to assure him that we would continue to maintain our close contact with the Greek authorities as the case progressed.

I completely understand why the Lawton family and John Lawton’s friends felt frustrated that the Government could not intervene and send UK search specialists to bolster the Greek effort, as we sometimes do in the case of natural disasters overseas. As I said to Mr Lawton when we spoke, it is the Greek authorities that have the local expertise and the legal responsibility and powers in their own country and locality, and they were co-ordinating the search on the ground. Official offers of support from the UK would normally be made only if the local authorities in the country concerned lacked the equipment, resource or experience to conduct a search, and requested such help from us. Those circumstances did not apply in this case. However, in the event that the family, friends or UK search teams wanted to be actively involved in the search on a volunteer basis—either independently or in support of an official search—we would help to facilitate contact with the relevant authorities in Greece if that were asked of us.

We have recently been in contact with the Cheshire search and rescue team in that regard. I understand that it had been invited to continue the search by the Lawton family and the Greek volunteer search teams. Although our assistance was not required in this case, we stand ready to help, should that be required in any similar deployments in future. As my hon. Friend has said, the funding for the Cheshire team has come from the JustGiving page set up by Missing Abroad, a charitable organisation set up by the Lucie Blackman Trust in 2008 to provide practical and in some cases financial support to families and friends of people who have gone missing overseas. Missing Abroad can supplement consular support by offering additional services, including supporting or co-ordinating searches for missing people in other countries. It also provides valuable emotional support to families. FCO consular staff, both in this country and abroad, regularly encourage people to contact Missing Abroad. My Department also provides some funding to Missing Abroad, as its services clearly complement the support that our consular teams offer. Details for Missing Abroad are available via the Foreign Office’s public website and in the FCO publication “Missing persons abroad”.

Let me respond to the point my hon. Friend made about the provision of information. Although there is inevitably an inherent tension between the wish to provide a concise and clear account and the need to provide answers to the detailed questions that families facing many different circumstances might have, we are always keen to learn from the experience of people who unfortunately have to make use of such literature. I would be very happy for my officials to talk directly to my hon. Friend and to members of the Lawton family to see whether improvements could be made in the light of the experience in this case.

The main help that the FCO can give in such cases is to assist families in understanding how systems work in other countries—although we cannot provide professional legal advice—to liaise with local authorities where necessary and, if appropriate, to act as a bridge between those authorities and families. That is the kind of support that our staff in Crete have provided to the family of Mr Steven Cook, in the other case that my hon. Friend mentioned. Steven’s family have been in close contact with consular staff in Crete since he first went missing in 2005.

I freely acknowledge that our efforts and those of the Greek authorities will never be enough for as long as Mr John Lawton remains missing. I believe that our consular staff have worked hard to provide the family with consular assistance during every stage of the case. More important, we stand ready to continue to offer support to the family and to maintain our contact with the Greek authorities for as long as necessary.

Question put and agreed to.

19:03

House adjourned.