Mr Umunna
My hon. Friend is absolutely right, and I was just about to come on to that. The Business Secretary, soon after making that statement in favour of our regulatory framework, said:
“Like the Conservative Opposition, we shall approach the issues constructively. There is no reason to hold back the Bill.”—[Official Report, 28 June 1999; Vol. 334, c. 58.]
My hon. Friend the Member for North Durham (Mr Jones) is absolutely right: neither the Conservative party nor the Liberal Democrats voted against that Bill in opposition, and yet we have had no expression of regret from them for supporting the regulatory framework that we put in place. It is about time that we heard some mea culpa from Government Members.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
Just so that the record is absolutely straight, the hon. Gentleman might like to remind us who were in government when the economy went over the edge of a cliff. Would he now—[Interruption.] The shadow welfare Secretary should just calm down. I think the hon. Member for Streatham (Mr Umunna) is capable of dealing with this himself; he does not need the shadow welfare Secretary’s assistance. Let me ask the hon. Gentleman a simple question, which my right hon. Friend the Business Secretary posed to him at the beginning. On the basis of humility, will he now get to the Dispatch Box and say to the British people that the Labour party is deeply sorry for the shambolic mess in which it left the economy?
Mr Umunna
With the greatest respect to the welfare Secretary, let me say two things. First, I have said that we have expressed regret in terms of the way in which we regulated the banking sector. However, let me also remind him that in the last two quarters of our term in office, we saw growth of 1.1%. During his time—[Interruption.] He should let me finish my sentence. If he does that, I might answer his question—I presume he wants to hear it. Did we leave him with a double-dip recession? No. Did we leave him with 2.5 million people out of work? No; so I will take no lectures from this welfare Secretary about the management of the economy.
After that excitement, let me return to banking. Reform is obviously needed, in particular to ensure that the sector provides finance to the profitable and successful small businesses that want to expand and take on more employees, but cannot access the finance that they need. That is crucial, because so many of those businesses are the ones we look to to create jobs. We know that under this Government lending to businesses is falling month on month, including a fall of £4.8 billion in the three months to February, according to the latest Bank of England figures. We know too—my hon. Friend the Member for Hackney South and Shoreditch (Meg Hillier) mentioned this—that the Government’s schemes, from Project Merlin to the national loan guarantee scheme and, now, funding for lending, have simply failed to get credit to those businesses.
Every other country in the G8 has a state-backed investment institution to tackle the problem and ensure that their small businesses can access the finance they need. That is why we have argued since early in this Parliament for the establishment of a proper British investment bank and a network of regional banks, based on the German Sparkasse model, to work alongside a British investment bank to transmit those schemes to small businesses. Those are two sensible ideas that would bring us into line with our international competitors. Indeed, I am pleased to hear that the Business Secretary agrees that it is a good thing to re-establish regional banking in this country.
We would have introduced a Bill in the Queen’s Speech to establish those bodies, yet the Government have failed to do so. Instead, what have we got? Last year, rather late in the game, the Business Secretary announced, to much fanfare at his party’s conference, that he was establishing his small business bank. The British Chambers of Commerce and the Federation of Small Businesses have said that he must get on with setting it up. Last year he came to the House and told us that his bank
“has already been established, and it will be up and running next year.”—[Official Report, 20 December 2012; Vol. 555, c. 988.]
So where is this bank? The IMF is currently in town inspecting the wreckage of the Government’s failed economic plan. I know how keen the Chancellor is to rely on its pronouncements, so I went on its website to discern how it defines what a bank does. The IMF says that the primary role of a bank is to
“take…deposits…from those with money, pool them, and lend them to those who need funds.”
I suspect that most Members would expect such a bank to be established on a stand-alone basis, with its own building like any other bank—I remember all the questions put to the Business Secretary about the location of the green investment bank, for example. However, what do we find buried in the back of one of his press releases, issued just before the Easter recess? We are told that his business bank
“is expected to become a fully operational new institution in the Autumn of 2014,”
but before then any references to his business bank
“refer to the team within BIS responsible for the development and operation of its policy and programmes before it becomes a fully operational new institution.”
Mr Kevan Jones (North Durham) (Lab)
The hon. Member for South Basildon and East Thurrock (Stephen Metcalfe) has just spoken about talking the economy down. I know it was three years ago, which seems a long time, but we need to remind people of who in 2010 was talking this country’s economy down—it was the Chancellor of the Exchequer and this coalition Government. They expressed the ridiculous notion that without the draconian cuts that they brought in, which the Business Secretary said earlier they now recognised were a mistake, we would end up with an economy like that of Greece. We heard the nonsense, which was repeated by the hon. Member for South Basildon and East Thurrock, about the fact that we had the largest debt in the developed world.
Let us look at the facts. In 1997 the Labour Government inherited a debt to GDP ratio of 42%. At the beginning of the financial crisis in 2008 that had been reduced to 35%, so irrespective of the Prime Minister’s claim in opposition that we were not mending the roof while the sun was shining, that is exactly what we were doing, which left us in a strong position to weather that financial crisis. The deficit that we inherited in 1997 was 3.9%. That was nearly halved by 2008 to 2.1%. The hon. Member for South Basildon and East Thurrock throws around figures suggesting that we had the largest debt. In cash terms, yes, but for the millionaires in the House— I do not know whether there are any in the Chamber today, although there are plenty in the Front-Bench team of the Conservative party—
Mr Jones
I accept that.
If one looks at the debt of a millionaire in cash terms, of course it will be larger than that of someone who is earning the minimum wage. To compare the size of the UK economy to that of Greece takes no account of that.
We need to recognise who talked the economy down and who took the disastrous decision in those early days to take demand out of the economy. We were growing, as the shadow Business Secretary, my hon. Friend the Member for Streatham (Mr Umunna), rightly said. That destructive early cut, along with talking the economy down, sucked confidence out of the economy. Getting that confidence back is very difficult. Clearly, many people, and certainly those in my constituency, are very cautious about what they are spending.
Let us have this debate based on the facts. I accept that we in the Labour party missed a trick. We were self-obsessed for nearly six months as we selected a new leader of the party, so we did not rebut the nonsense that was put out at the time.
The Business Secretary said, strangely, that the Queen’s Speech is not the mechanism for getting the economy going. I find that remarkable. This is a lost opportunity. The Queen’s Speech was so thin on substance that it could be marketed by WeightWatchers. There is nothing in it that will help the 20% of young people who are in long-term unemployment. My hon. Friend the Member for Poplar and Limehouse (Jim Fitzpatrick) spoke about a lost decade. That is so, and we need to remind the House that that has consequences for individuals. The 20% who are now unemployed—and their number is increasing—will have their lives affected for ever. We must recognise the human cost behind the statistics. The problem will not be solved for those individuals in the short term and will have long-term implications for constituents such as mine and those of my hon. Friend that will need to be addressed in the long term.
Mark Hendrick (Preston) (Lab/Co-op)
I rise to speak about jobs and businesses, and in particular about those serious issues in our country that the Queen’s Speech has done—and will do—little to alleviate. Unemployment in Preston is currently about 7%, and a great deal of existing employment is low paid. With the measures that the Government are trying to introduce to make issues of health and safety less important and make things easier for employers, being in employment will clearly be a risky business. We recently commemorated the international recognition of workers who have lost their lives or fallen ill while in employment, yet we also have a Government who are making it more likely that employees will fall ill while in work.
At its lowest point, about 1,400 people in Preston were on jobseeker’s allowance. There are now about 4,000, which is very bad. Lots of young people are coming to my surgery complaining about being sanctioned, supposedly for not trying hard enough to find a job, but in fact very few vacancies are available in Preston. For those who are applying for jobs to be told that they are not trying hard enough is, in my view, adding insult to injury.
There are good industries—the hon. Member for Burnley (Gordon Birtwistle) mentioned aerospace, which is a good industry in north-west England, focused particularly on Lancashire. It is doing great things to train young people and get them into work. Westinghouse provides nuclear rods for the nuclear industry, but there are not enough such companies. Although I welcome the Government’s aerospace strategy and we are doing well in that area, we have unfortunately seen a gradual decline in many industries, particularly in consumer electronics and for a lot of consumer goods, and those industries and jobs have left this country to go to other shores.
The Business Secretary said that we cannot legislate our way to economic growth, but is not the Enterprise and Regulatory Reform Act 2013 a way of legislating to promote economic growth? We must be able to create the conditions to allow that growth, and the Business Secretary’s earlier response on the creation of more than 1 million private sector jobs was interesting. Why has that not resulted in any significant growth? He did not say—this was left to one of my colleagues—that it is because many of those jobs are low paid or part time, and that is why they are not contributing to the growth we would like to see in this country.
As we teeter, as we saw, on the brink of a triple-dip recession, let us cast our minds back to before the general election in 2010. The Labour party had a programme that would have got rid of the deficit over two terms, and halved it after the first. This Government promised to wipe out the deficit in one term. What we saw beforehand was a programme that would have benefited this country in a great way being pooh-poohed. When we said there would be a double-dip recession—[Interruption.] The Minister is chuntering from a sedentary position. If he would like to intervene, I invite him to do so.
The Minister of State, Home Department (Mr Jeremy Browne)
I am grateful for this unexpected opportunity. I was pointing out that the previous Prime Minister promised the House that he had abolished boom and bust. I therefore do not understand how the hon. Gentleman can be talking about a bust, given that the previous Government eradicated the possibility of Britain ever having a bust again, according to the previous Prime Minister.
Mark Hendrick
I thank the Minister for his intervention and he will, of course, note that the last recession in 2008—[Interruption.] Again, he is chuntering from a sedentary position, but I will try to answer his question. He will remember that the economic crisis and recession in 2008 was caused by external shocks, principally starting in the US housing market where financial products were wrapped up in very unsafe debts. That caused financial contagion around the world. The recession was an international one, not a home-grown one, such as the ones under previous Conservative Governments and the coalition Government. That is how the deficit came about. In the Labour Government’s wisdom, they thought it right to bail out the banks. Otherwise, people would have gone to cash tills and no money would have come out, and there would have been no finance to keep the economy moving. They now get the blame for an international problem—the problem was not home grown, unlike the recessions under the previous Conservative Government.
The Labour Government were accused—[Interruption.] The Minister chunters again from a sedentary position, but I will let him intervene.
Mr Browne
I am grateful for a second opportunity to intervene. The previous Prime Minister did not say, “I have abolished boom and bust,” adding in brackets, “Unless there are people who lend irresponsible mortgages in the United States of America.” He said, “Labour has abolished boom and bust.” I remember sitting in the House hearing him make that boast the whole time. We now hear that boom and bust is all about international factors. Why does the Labour party not take responsibility for building up the massive deficit when it promised it had abolished boom and bust, no caveats, full stop?
Julie Hilling (Bolton West) (Lab)
A few weeks ago I sat in the Chamber listening to the Budget debate. My overwhelming memory is of the Chancellor sitting on the Front Bench looking like a little boy lost, with no idea what to do about a flatlining economy, the loss of our triple A status or the level of borrowing, and no idea how to balance the books. So he delivered a Budget that did none of that, sitting on his hands, hoping that things would just happen.
After that disappointment, one might think that I would learn, but sadly not. I listened to the Queen deliver the Gracious Speech, hoping that she would tell us about the action Her Government would take to improve life for my constituents. It seemed to start pretty well:
“My Government’s legislative programme will continue to focus on building a stronger economy”.
I frowned a little at the word “continue”, because after three years they seem to have failed to build anything, but still I sat in hope. She continued:
“It will also work to promote a fairer society that rewards people who work hard.”
Well, we all agree with that. She went on:
“My Government is committed to building an economy where people who work hard are properly rewarded. It will therefore continue to reform the benefits system, helping people move from welfare to work.”
I frowned a little at that, too. As I see it, their reforms of the benefits system are not helping people to move from welfare to work; they are making them move to food banks and to skip meals so that family members can eat. If they are even more unfortunate, they might be one of the families who have been made homeless.
Even so, I waited to hear what the Government would actually do to build our economy. I waited and waited—I did not have to wait long, because in less than 10 minutes the speech was over—but there were no answers and no relief for my constituents. There was a little tinkering, but it was yet another wasted opportunity from this failing Government. They are out of touch and out of ideas.
How much evidence do the Government need that their policies are failing? The International Monetary Fund says that growth in the UK is slower than in 23 of the 33 advanced economies it monitors. Olivier Blanchard, its chief economist, warned the Chancellor that he is “playing with fire” by refusing to change course. However, there was nothing in the speech to address the IMF’s call to boost growth and rethink the speed of the deficit reduction. Starting to build HS2 in a few years, welcome though that is in Bolton West, will do nothing to build the economy now.
On the same day that the Queen delivered that terribly thin speech, the Institute for Fiscal Studies said that 1 million more children will descend into poverty as a direct result of benefit policies. Simply saying that people should work hard and blaming the poor for the situation they find themselves in is an insult. The Joseph Rowntree Foundation says that 6.1 million people living in poverty are in working households, 6.4 million people lack the paid work they want and 1.4 million part-time workers want full-time work, the highest figure in 20 years.
The Government like to boast that they have created over 1 million new jobs, but they do not tell us how many of those jobs are a direct transfer from the public sector or how many are unpaid. Unbelievably, workfare jobs, where people work for their dole, are counted as jobs created. Despite the Secretary of State’s denial, according to the Office for Budget Responsibility unpaid work experience and work placements make up 14% of those so-called new jobs. The Government do not tell us how many of those jobs are on are zero-hour contracts or how many are part time, and they do not tell us how many of them no longer exist because the business has failed or downsized.
The Government like to peddle the myth that the 2.5 million people who are out of work and the 1 million young people who do not have jobs are skivers and shirkers. The reality is that millions of people are desperate for work and there is a substantial churn of people in poverty or out of work. Although 18% of people are on a low income at any one time, one in three of us experience at least one period on a low income in a four-year period, and 11% of people are on a low income for more than half of those four years. More people are out of work under this Government than were when they took office, and the flagship Work programme gets only two in every 100 people into work—fewer than if the Government had done nothing at all.
Tax credits have been cut so hard that a previous Work and Pensions Minister revealed that some families with children could be £728 a year better off if they were out of work. The Department for Work and Pensions impact assessment reveals that universal credit will fail to make work pay for 2.1 million workers and that real wages are down by £1,700 since the election. The welfare bill has continued to go up since the financial crash and is increasing in real terms by 2% each year. Borrowing is going up and unemployment is set to rise even higher.
Of course, the Government like to blame Labour for everything. According to them, the Labour Government caused the global economic crash—a crash that started in America and spread to the rest of the world. They like to say that we did not fix the roof while the sun was shining, but they forget that the Labour Government paid off the second world war debt, built hundreds of new schools and hospitals, and invested more in the railways than the so-called record spending that this Government currently claim. At the time of the general election we had growth of 0.7%, unemployment was falling, and the deficit was coming down.
The Government need to start to take responsibility for a double-dip recession, for soaring borrowing, and for failing to meet every one of their predictions on growth, borrowing and deficit reduction, yet they carry on with their failed policies. Have they never heard the old adage, “You can’t cut your way out of a recession”? They need to take action to grow the economy. Building homes would be a good place to start, as would ensuring that businesses get the finance they need with a British investment bank.
The Minister of State, Department for Work and Pensions (Steve Webb)
I do not know whether the hon. Lady is aware that when she stood for election in 2010 her party set out spending plans for this Parliament that involved substantial spending cuts.
Julie Hilling
Absolutely; I am well aware of that. In fact, we said that we would halve the deficit over this four-year period. The Government said that they were going to cut it completely in one term, but they are not even three quarters of the way there yet. They told my local council that it would have to find £20 million-worth of cuts over the course of the Parliament. It has already had to find £100 million-worth of cuts. That is the difference between a planned deficit reduction and planned action for growth and a Government who sit there saying, “If we cut, something miraculous will happen to grow our economy.”
Rushanara Ali
The Government’s record in tackling poverty domestically is risible, and their inability to stick to the commitment to enshrine in law the commitment of 0.7% of GNI is deeply disappointing. I hope they will act on that. It is disappointing that the commitment was not in the Queen’s Speech, and that it was not in previous Queen’s Speeches.
I want to return to the Government’s failure to take child poverty seriously. In my constituency we also have some of the highest rates of youth and graduate unemployment. If the Government were serious about lifting families out of poverty, they would increase the number of training opportunities to help graduates into work and increase the number of apprenticeships. We have 10 young people chasing every single apprenticeship opportunity—that is completely unacceptable. The money spent on the millionaires’ tax break could have been used to create more apprenticeship opportunities. We cannot go on like this, with 1 million young people out of work.
Steve Webb
The hon. Lady said that half the children in her constituency are living in poverty. She will know that the official published figures on child poverty show a fall since the general election. Presumably, after 13 years of a Labour Government, half the children in her constituency were in poverty. Will she apologise for that record?
Rushanara Ali
The hon. Gentleman’s Government should apologise for their failure to reverse the increase. Child poverty in my constituency has gone up consecutively in the past three years. He ought to apologise for that and he ought to act. He should have lobbied his Government to propose measures in this Queen’s Speech to tackle child poverty. He ought to apologise and I give him the opportunity to do so today.
Rushanara Ali
I was about to come on to that. Clearly the legislative programme in the Queen’s Speech is riveting, given the extraordinary presence on the Government Benches—just four Government Members, including Front Benchers. That says it all. The Government cannot even pull together more than a handful of Members to defend their legislative programme. [Interruption.] There are five of them now. The Secretary of State for Work and Pensions is here. Perhaps he can defend it singlehandedly on behalf of the two parties in government. It says it all that so few people are in the Chamber to speak up for the Government’s legislative programme—or, rather, the lack of it.
I want to focus on unemployment, which, yet again, the Government’s programme—or lack of it—fails to address. In constituencies such as mine, long-term and youth unemployment continue to soar. The lack of opportunities remains significant; the lack of sufficient numbers of apprenticeship programmes to meet the demand is a real problem and a real challenge. If young and other unemployed people were given the opportunity to get a foot on the employment ladder, we could reduce not only the level of deprivation in constituencies such as mine, but the burden on the taxpayer of welfare costs. The way to reduce the deficit is to ensure that we get people back into work and economic activity.
The Government’s Work programme has managed to find work for only 2% of participants in my constituency. It is a scandalous waste of public money that only 2% of people are in jobs through that programme. Will the Business Secretary and the Work and Pensions Secretary look again at why their programme has had such little impact? Why not consider improving the system for getting people into work so that we can give people, in particular young people, hope and a chance to make a contribution to our economy? That kind of wasted talent cannot be good for our society or communities, and is certainly not how to recover from the economic troubles that we continue to face.
One suggestion that my party has made, but which the Government have failed to take on board, is the compulsory jobs guarantee. We know that having training programmes with a genuine guarantee of a job works. We demonstrated that it worked when we were in power, through the future jobs fund and apprenticeship programmes. I believe that the Business Secretary and the Work and Pensions Secretary want to get people into work. What I do not understand is why, if a programme does not work properly and manages to get only 2% of people into jobs, the Government will not reform it. When the Secretary of State for Work and Pensions went on his journey in opposition to discover poverty in constituencies such as mine, I thought he might have learned a thing or two about how to get people out of poverty and into work, but he clearly has not. He is too busy focusing on punishing people, rather than giving them hope and the opportunity to get a job.
Mr Duncan Smith
The hon. Lady is wrong about the Work programme. In fact, I will show her later that the UK Statistics Authority has taken her party and others to task for their use of the statistics, which it says is incorrect. The reality, as she will see when we come forward in June, is that the programme is a success, and it is cheaper than anything that Labour produced.
Rushanara Ali
Perhaps the Secretary of State can also explain why he got a slap on the wrist today—and previously—for meddling with the statistics, because people—
Rushanara Ali
No, I will not give way until I have finished my sentence. I will give way when I am done; then I will listen to the Secretary of State’s response.
The Secretary of State is damaging public trust in statistics—there is that old phrase about “damned lies and statistics”. That will lead to further distrust, not just of politicians such as him, but of important institutions that are there to provide independent, credible statistics. He should not be meddling with his figures. The fact that only 2% of participants in my constituency managed to get jobs through his Work programme is an absolutely appalling indictment of his performance in his role and shows his failure to get people into work. I find it deeply disappointing, because I happen to have admired his work with the Centre for Social Justice, which he set up before he got into government. Although I was a sceptic about his conversion to understanding poverty and deprivation and wanting to reform and improve society, I was willing to give him the benefit of the doubt, but no longer, because he has returned to the approach that the Conservatives have always taken and failed to do anything to give people genuine opportunities. That is summed up by his Department’s failure to get people into work in constituencies such as mine. The facts speak for themselves. I am afraid that he does not have much to offer, other than trying to rewrite statistics.
Unless the Secretary of State has something else to add, I will move on.
Rushanara Ali
The Secretary of State has forgotten, but I am happy to give way.
Mr Duncan Smith
I hope that the hon. Lady will withdraw the idea that I am rewriting statistics. She will see from the letter written to me today by the UK Statistics Authority that no mention is made of that. I continue to believe, absolutely correctly, that the work of the cap will help and will lead to people getting jobs. That was the whole purpose, which is why we left those on tax credits off the cap. I believe that people are moving into work, and will continue to do so, as a result of the cap, and I will be able to demonstrate that.
Rushanara Ali
Perhaps the Secretary of State could start by demonstrating now and explaining why only 2% of participants have got jobs in my constituency. What is the reason for such a ridiculously small number, when there are so many people chasing apprenticeships and job opportunities? How can that be acceptable? Why is he so complacent? I thought he was interested in getting people off welfare and into work. It seems that he is interested only in attacking people, rather than helping them to get back into work. That is deeply disappointing. I had more hope that he would do something constructive to get people into work, given his track record in opposition and his efforts to get to know communities in our country and understand where the barriers were, but perhaps I should not have given him the benefit of the doubt.
The Secretary of State for Work and Pensions (Mr Iain Duncan Smith)
It is a great pleasure to conclude this debate on the Gracious Speech. I congratulate hon. Members on both sides of the House and will deal quickly with some of the points they made.
My hon. Friend the Member for Tamworth (Christopher Pincher) made a good speech in which he supported the changes in the Deregulation Bill. I agree with him that it will be excellent for small businesses. As my right hon. Friend the Secretary of State for Business, Innovation and Skills stressed in his opening remarks, our record on small business creation is very good.
I have known the hon. Member for Poplar and Limehouse (Jim Fitzpatrick) for some time and am glad to see him back in his place. He was a very good Minister and talks a lot of common sense. His comments about the overseas aid budget were well made and are well taken. I know that there is some disappointment that we have not legislated on that, but the Government’s record of reaching the 0.7% obligation and sticking to it is second to none. It has been said at the United Nations that we have given a lead to the rest of the world. I am pleased that he supported that. I recognise his concerns about youth unemployment and will return to them in a second.
My hon. Friend the Member for South Basildon and East Thurrock (Stephen Metcalfe) reminded us of the record deficit that Labour left us with and made the strong point that everything stems from that. Labour’s spending, borrowing and taxing left us with a bust economy. As a man who has set up and run his own small business—it is not so small now, but it is certainly a good business—he knows everything about small businesses.
I congratulate my hon. Friend the Member for Burnley (Gordon Birtwistle) on his comments about manufacturing industry. He has been very good at supporting manufacturing in Parliament and beyond. He made the very good point that the last Government ran manufacturing down. Under the tenure of my right hon. Friend the Secretary of State for Business, Innovation and Skills, we are doing our level best to rebalance the economy after manufacturing was destroyed by the Labour party.
The hon. Member for Preston (Mark Hendrick) said that international factors caused the 2008 slump and that he was pro our membership of the EU. I had assumed that everybody was pro that. It is all well and good for him to say that everything was somebody else’s problem before 2010 and that now everything is our problem, but that means that Labour, somehow, bears no responsibility for anything.
When I asked the shadow Secretary of State for Business, Innovation and Skills whether he would like to apologise for the economic shambles that Labour left, he did a delicate dance around the words, “I am sorry.” He can say that now if he wants to intervene. I know that sorry is a hard word, but perhaps he would like to lead for once for the Government and say—[Interruption.] They were in government. He should lead for them and say that he is sorry for the shambles and the mess that they left. I am ready to give way if he would like to say sorry for the mess that the Labour Government left.
Mr Umunna
I am happy to remind the Secretary of State that we bequeathed a situation in which unemployment was falling, growth was rising, and stability had set in. As I said earlier, we expressed regret for not better regulating the banking system, and I look forward to hearing his apology in that respect as well.
Mr Duncan Smith
I think it is shameful that an individual who represents a party that when in government ran up the biggest deficit and, as my right hon. Friend the Business Secretary said, created the biggest bust since the first world war, cannot genuinely say to the British people, “I am sorry. We got it wrong.” They did get it wrong and will bear the consequences of that all the way to, and including, the next election.
Mr Duncan Smith
I will finish a couple of quick points and then I will happily take more interventions.
The hon. Member for Washington and Sunderland West (Mrs Hodgson) made a point about unemployment in her area and the north-east in general. Employment and unemployment are big issues for us all, but I say to the hon. Lady, and to others, that since the election employment in every single area and region of the UK is up from where we found it. Employment is up—I will return to that point in a moment—and what the Government have done has helped that.
The hon. Member for Bristol East (Kerry McCarthy) complained about the absence of legislation on overseas aid, but I thought she might have been a little more generous about the fact that this Government are the first to make such a commitment— stay static, get to 0.7% of GDP, and implement it. It would be more helpful to say, “Yes, this is the right thing to do.” We can by all means debate whether we need to lock that commitment into legislation, but the reality is that we have locked it in because the Government have made it clear that we will not depart from it. We can debate the realities of the legislation, but we are spending more as a proportion of our gross domestic product than any other Government have previously done, and that has shown a lead to the rest of the world.
Let me turn to the Gracious Speech, which I feel has set the tone for a real change to society. I am proud that my Department will be initiating and taking through the Pensions Bill, which is the most important reform and change. It follows a series of reforms and changes that my hon. Friend the Minister of State, Department for Work and Pensions (Steve Webb) has taken through with me: automatic enrolment and ensuring that consultants will not be able to overcharge people for that; making the necessary changes; and, finally, the single tier pension, which I know is close to his heart. I take this opportunity publicly to congratulate my hon. Friend on the hard work he has put in. Without it, the Bill would not exist and it is a very good thing.
With the Immigration Bill we are picking up the pieces of Labour’s immigration strategy that saw net immigration of more than 2 million people between 1997 and 2010. New legislation will ensure we have the power to limit access to public services and housing, attracting people who will contribute, and deterring those who will not. As contributions from Government Members have made clear, we are already making progress towards that business-led recovery, and out of the mess left by the previous Government we are creating jobs and helping people get into work.
That brings me to a series of points about labour market stats. Let me run through a few of the realities, even though sometimes it does not help the Opposition. Since the last election, the number of people with a job is up by well over 750,000. There are 1.25 million more private sector jobs since the election, meaning that over the past year, six private sector jobs have been created for every job lost in the public sector. The number of people of working-age—
Mr Duncan Smith
I want to get through this point because I think it is important. The number of working-age people without a job is down—I stress that—by 350,000 since the 2010 election, driven by falling inactivity. Inactivity is now at its lowest level for two decades; the Labour party left us with a high rate of inactivity, and we have lowered it. There are now fewer people and fewer young people on jobseeker’s allowance than when Labour was in office. The number of claimants aged 18 has fallen for the 10th consecutive month. In April, we had the lowest number of new jobseeker’s claims for four years, alongside falling redundancies. Let me deal with Opposition Members’ suggestion that those people are moving not into real work, but into part-time work. That is not true. In fact, full-time employment is up more than 500,000 since 2010—it is up 64,000 on the last quarter alone.
My final point on that is that Opposition Members need to lift their heads up occasionally and look elsewhere. My right hon. Friend the Secretary of State for Business, Innovation and Skills compared our situation with that of France, which has 11% unemployment. That comparison bears out very well what the Government are doing. The UK’s overall employment rate is growing at almost double that of the US, and faster than the rate in any other G7 country. That is because the Government have taken the tough decisions to ensure that we have the flexibilities and that people can get back to work. The private sector is now creating jobs, whereas under the previous Government, it was shedding jobs.
Let me remind Labour Members that, for all their crocodile tears, long-term unemployment nearly doubled in two years under the previous Government—from 400,000 in 2008 to 800,000 in 2010. That was a failure on their part. They gerrymandered the figures on youth unemployment, but when we take the gerrymandering out, we find that youth unemployment is now lower than when the Labour Government left office.
The Work programme is a success. In fact, the Office for National Statistics wrote the other day to a number people correcting how they interpreted the figures. It made it very clear that what the right hon. Member for Birmingham, Hodge Hill and others have said about the statistics was completely wrong. The ONS has said that the reality is that the figure of 2% or 3% that he has been using, which is below the minimum performance level, is incorrect. It went on to say that the realistic and more relevant figure is that 8.6% of those referred to the Work programme are in sustained employment in the first six months. That was ahead of the previous position. By the way, I remind him that, unlike all his other programmes, people do not get paid unless they get people into sustained work. That is unlike what happened under the future jobs fund and the flexible new deal, when the Labour Government paid up ahead and wasted the money.
Mr Duncan Smith
The figure was there and we told the right hon. Gentleman, but he refused to listen—[Interruption.] Yes, it was. The ONS has pointed that out. The point I am making to him is that, when we produce the next figures, the Work programme will show that it is dramatically improving and getting more people back into work. [Interruption.] I will deal with that point, because the right hon. Gentleman believes he has an alternative. He spoke of introducing a new programme. His new programme is a real mess—it has changed on a number of points. When he first referred to it at, I believe, the last Labour party conference, he was offering those who had been unemployed for one year or more a guaranteed job for 12 months.
Mr Duncan Smith
Hang on a second. As I pointed out to the right hon. Gentleman at the time, that programme sounded rather familiar, so I looked up the programme the previous Government were considering—it was called “step up”. That programme, which was piloted in 20 areas and which bore an uncanny resemblance to his latest programme, gave paid employment to new deal failures who had been out of work for two years. It was never rolled out nationally because it was discredited, even within the Labour party, as not giving value for money. For those nearest to the labour market and those under 25, “step up” had a negative impact on work prospects and came in at a massive cost of £10,000.
After the programme he announced at the party conference was discredited, the right hon. Gentleman went away, fiddled with his plans and came back with a new plan. He will now mandate people to a job for six months, which is half the length of time he previously advertised. Even as recently as April, the Opposition seemed to be in a mess. There is complete confusion. The shadow Chancellor spoke of a guarantee of one year for young people and two years for adults.
Mr Duncan Smith
I will give way in one moment. The shadow Chancellor gets in a real mess, so I say simply to the right hon. Member for Birmingham, Hodge Hill that the Labour programme will cost huge sums of money. Like the future jobs fund, it will be good only for the public sector, and there will be a net cost to the Exchequer. He will compound all the failures they ever made. They left us with the biggest deficit. We are cutting the deficit by a third and borrowing is down by £38 billion. We have the fastest growing employment rate in the G7. This Queen’s Speech builds on our success, not on Labour’s failure.
Ordered, That the debate be now adjourned.—(Greg Hands.)
Debate to be resumed Monday 13 May.