Financial Implications for the Next Generation

Tuesday 4th December 2018 Westminster Hall

17:00

[Richard Drax (South Dorset) (Con)]

I beg to move,

That this House has considered the financial implications for the next generation.

It is a pleasure to see you in the Chair, Mr Hollobone, and to give this speech. It is also a pleasure to see my friend and colleague the Minister in his place. I have huge respect for him and I know that he has gone to considerable length to help with this debate.

As the Member of Parliament for South Dorset, over the past eight and a half years I have had the great pleasure of getting to know many of my constituents. I have always undertaken to represent them without fear or favour, whatever their political beliefs, which is why I have called this debate to discuss the appraisal of our nation’s finances by Mervyn Stewkesbury. He is a well-respected and successful businessman from Weymouth, in my constituency. Mr Stewkesbury owns and runs his property company Betterment Homes and he is in the Public Gallery to listen to this debate.

From the very outset some years ago, Mr Stewkesbury has had an agenda. His concern, which he has expressed repeatedly to me, Ministers and various party leaders since 2010, is the economy. In particular, he believes that our national debt and deficit are too high. He has been an assiduous correspondent since my election in 2010, and indeed briefly ran against me in his genuine desire to make these facts known. His manifesto, as a matter of interest, was based entirely on his financial predicament. He had no other agenda, so keen was he to make his point. I am delighted to say that I won and he did not, despite a very honourable attempt to do so.

Put simply, Mr Stewkesbury believes that we are going to hell in a handbasket, and that he has the figures to prove it. He does not think that any of the responses he has received since 2010 have been adequate. I have therefore taken the opportunity to bring this matter before the Minister and my fellow MPs, in the hope that Mr Stewkesbury may receive a satisfactory answer. If that is not achieved, I hope that this debate will at least serve our country by airing a subject that should be aired repeatedly.

Of course we should live within our means, and Mr Stewkesbury is not alone in suffering sleepless nights over the size of our national debt. The most recent quarterly report from the Office for National Statistics confirms that our national debt at the end of March 2018 stood at around £1.8 trillion. This is equivalent to nearly 86% of our GDP, reaching the reference value of 60% set out in the Maastricht treaty excessive deficit procedure.

However, let me be clear that there is no solace here for the Opposition. It is worth noting that we first exceeded the 60% limit in March 2010, at the end of Labour’s 13-year rule, when debt was just shy of 70% of GDP. On the plus side, our deficit or net borrowing in the financial year to March 2018 has dropped by £5.9 billion for the second consecutive year, indicating that the tide has—we hope—begun to turn. Also, although the debt has increased by nearly £44 billion, as a percentage of GDP it has fallen by 0.9 percentage points, from 86.5% to 85.6%. This fall in the ratio of debt to GDP implies that GDP is currently growing at a greater rate than Government debt—again, movement in the right direction. However, as I am sure you understand, Mr Hollobone, this remains a mighty tanker to turn.

A most informative letter from the former Economic Secretary to the Treasury, my right hon. Friend the Member for North East Cambridgeshire (Stephen Barclay), in August 2017 confirmed that when we inherited the largest budget deficit since the second world war in 2010, we were borrowing £1 in every £5 that we spent. Now we borrow £1 in every £16 we spend, as a result of reducing the deficit. The Minister also confirmed that over the same period debt rose as a share of GDP, although by less than it would have risen had the deficit not been reduced. In the same letter the Minister accepted that Mr Stewkesbury was correct in pointing out that the overall public sector net debt had risen. That, of course, is Mr Stewkesbury’s main concern, and one that we cannot afford to brush under the carpet.

I personally believe that, in view of the recent Budget spending increases, claims that austerity is over and the promise of billions more pounds for the NHS—which I do not think we have—it is time to bring this private citizen’s concerns into the public domain. I cannot vouch for all of Mr Stewkesbury’s points, nor his figures, but they form part of his profoundly and sincerely held belief that our country is heading to financial ruin. I am told that Mr Stewkesbury’s figures are all taken from Government and Treasury publications, which are publicly available.

I would like to point out that Mr Stewkesbury’s ire is not exclusively reserved for the current Government. His research dates back many years. His graph, interestingly, shows how national debt began to soar just as we joined the EU in 1973. He says that for 25 years before we joined the EU our debt increased on average by 1.4% year on year, but from the moment we joined, and for the next 45 years, it increased on average by 9% every year. He claims that had we not joined and maintained that 25-year borrowing record, our debt would now be £66 billion instead of £1.8 trillion.

As I have said, Labour receives equal scrutiny. Mr Stewkesbury was amazed to hear the shadow Chancellor, the right hon. Member for Hayes and Harlington (John McDonnell), tell the BBC on 18 March:

“Austerity is a political choice, not an economic necessity.”

Mr Stewkesbury asks:

“How can he possibly say this, when we are overspending and borrowing around £300 million every day?”

He is not enamoured with the economics of the Leader of the Opposition either, adding that his pledge to

“spend our way out of debt”

is nothing short of ridiculous.

As I have mentioned, when David Cameron’s Conservative Government were elected in 2010, the financial black hole in which we found ourselves was bequeathed to us by the departing Labour Government. Who can forget the note left by the departing Chief Secretary to the Treasury, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), which read, “I’m afraid there’s no money left”? Perhaps it would have been funny, had it not been true. Certainly, that is Mr Stewkesbury’s view. He says that over the past seven years he has spent more than 5,000 hours studying Government finance and that we are “on course to bankruptcy”. He says that it is an indisputable fact that Government cannot go on overspending and borrowing forever without ending in bankruptcy, but that, according to him, is precisely what we are doing. In a letter to me earlier this year, he explained that it had taken 100 years to rack up a debt of nearly £450 billion by 2005, when the debt was £446 billion, and that is taking into account two world wars. Then, Mr Stewkesbury says, over the following years of Labour, coalition and Conservative rule that figure has more than quadrupled to £1.8 trillion. Sobering figures; sobering stuff.

Mr Stewkesbury adds that many of our assets, not least our gold—thanks to Labour—have been sold and an additional £375 billion has been printed. He claims that one asset sold, for £757 million, was the UK’s stake in the channel tunnel. He believes that allowed us to go for three days, five hours and 36 minutes without having to borrow any money. I would be grateful if the Minister could help on that point.

Mr Stewkesbury’s graphs show that in the seven years from 2010 our debt increased by £719 billion. He then explains the consequences. He says that in 2010 the debt for each living person was £16,231, with interest at £9 per person per week. By April 2017 those figures had risen to £26,526 and £14 respectively. He goes on to say:

“For 40 years our debt on average doubled every five years. Do the same again and by 2026 our debt will be more than £50,000 per person, with interest in the region of £30 per week per person. This is not sustainable.”

Neither is the fact, he says, that the Government, on average, overspent and borrowed £338 million every single day during 2016-17. Last year, he adds, the Government increased the debt by £123 billion. Government spending now equates to £231 per week for every living person, at a time when two in five work in the private sector, which, in the main, pays for our public services, including pensions, through tax.

Mr Stewkesbury believes that our children’s future is at risk, and he claims that party politics—of all parties—has played a significant role. For more than 40 years, he says, parties of all colours have attempted to buy voters with unaffordable promises. Here I will add my own two pennies’ worth. I absolutely agree that too often Governments of all colours have promised things that we simply cannot afford and have attempted to buy the voters. I hope that disingenuous habit will not continue in future. I most humbly suggest that what voters actually need is the truth, and if that is financially unpalatable, they need to hear it.

Last month, in his most recent communication with me, Mr Stewkesbury wrote that our debt interest payment alone is circa £50 billion. People outside this place, whether they are in the private or public sector, ask, “Richard, why aren’t you doing this? Why aren’t you doing that?”—always about money, of course—or say, “Spend this, spend that; do this, do that,” but when I tell them the rather sobering fact that before we do anything we have a massive debt interest to pay, a remarkable quiet comes over them when that sinks in. Before we progress anywhere, we have to pay £50 billion—every year. It is a terrifying sum of money, which we have to reduce. I hear cries of austerity, but I am not sure that austerity is working in that sense, because we still have a vast debt interest.

Mr Stewkesbury thinks it is totally irresponsible to claim that austerity is over when we are still borrowing £155 million every single day. Furthermore, he opines, it is irresponsible of the Government to claim that austerity is over until we are living within our means and repaying our debt. He is concerned that, according to Government figures, they expect to borrow a further £52 billion this year and £44.1 billion in 2019-20, so our debt will exceed £1.8 trillion by 2020. That equates to £28,371 for every living person.

Mr Stewkesbury has consistently sought clarification on one particular piece of historical accounting, but has never had a satisfactory answer. Labour’s actual debt in 2010 was reported as £759 billion. Later that figure was increased to just over £1 trillion. Mr Stewkesbury would be most grateful if the Minister could explain why those figures seem so different.

Finally, on Brexit—I thought I might get through one contribution without mentioning that word, but unfortunately Mr Stewkesbury has not allowed me to do that—he quotes an interview I gave, in which I said:

“We want to be in control of our destiny and I am baffled by anyone who cannot understand why.”

He, too, wants us to be in control of our destiny, but feels that that is impossible if we go on overspending and borrowing about £300 million every day.

Despite the many letters Mr Stewkesbury has received from the Treasury, he believes that the truth—or perhaps the facts—has yet to be explained to him. He dismisses the many letters he has received as pages and pages of waffle. He particularly resents being told that we are in a stronger financial position than in 2010, and believes that the figures prove otherwise. He says that one Minister wrote to say that Government debt is expressed as a share of GDP and that, in reducing the deficit, the Government have made significant progress in improving the health of the public finances. With the current debt at 85.6% of GDP compared with 69.6% in 2010, his concern is understandable. He and I very much look forward to hearing the Minister’s response, when he can hopefully allay Mr Stewkesbury’s concerns.

[Mr Philip Hollobone (in the Chair)]

We will move straight on to the Front-Bench contributions. The guideline limits are five minutes for the Scottish National party, five minutes for Her Majesty’s Opposition and 10 minutes for the Minister, but we can be flexible.

17:17

[David Linden (Glasgow East) (SNP)]

As always, it is a pleasure to see you in the Chair, Mr Hollobone. I am reliably informed by WhatsApp that Divisions are imminent, so although we have a degree of flexibility, I will try to be mindful of that. I warmly congratulate the hon. Member for South Dorset (Richard Drax) on securing the debate.

I sometimes come to these debates feeling a bit like William Hague. The Order Paper says that the debate is about the financial implications for the next generation, but I realise that I am probably the youngest Member in the Chamber at the moment. I do not want to sound like William Hague by saying, “It’s all right for you: you won’t be here in 40 years’ time,” but in reality, hon. Members will not.

It is somewhat remarkable that the hon. Member for South Dorset managed a good 15 minutes or so without touching on Brexit, because the reality is that Brexit is the biggest financial threat to the next generation. As I will touch on, it will cost each person £1,600 by 2030. I will also touch on what we are doing at home in Scotland to support first-time buyers, and on the recent Sustainable Growth Commission report.

Opportunities for young people, such as the freedom of movement and the ability to study abroad, will be severely limited as a result of Brexit. All those things are helpful in terms of social mobility and increasing people’s spending power. The Scottish Government’s analysis found that, by 2030, GDP would be £9 billion lower under a free trade agreement than if we had stayed in the EU. Of course, that decision was expressed by the people of Scotland, 62% of whom voted to remain in the EU. That £9 billion is the equivalent of £1,600 per person in Scotland. That is deeply disappointing, although we see that in the main Chamber the UK Government are still refusing to admit the true cost of Brexit, with the Treasury analysis not covering the Prime Minister’s deal; it covered no deal, the European Free Trade Association, the European economic area, the situation without a customs union, and Chequers. This is all quite important for the country’s direction of travel in terms of our finances and what we will leave to the next generation.

The Bank of England’s analysis suggests that the Prime Minister’s deal, which is clearly about as popular in this House as a cup of cold sick, will take between 1.25% and 3% from GDP by 2023, with a no-deal Brexit cutting between 7.75% and 10.5%. So the idea that we can have a debate about the financial threat to the next generation and ignore these figures really beggars belief.

I also want to touch on what we are doing in my own country to make sure that we have an economy for future generations. Some of it is about what we are doing to invest in housing. I remain incredibly concerned, almost as an observer down here, about the fact that the UK Government do not necessarily see the need to invest in social housing. There are things that they are doing around stamp duty, but stamp duty limits for £500,000? I do not know a huge number of 27-year-olds who are able to go and lump down £50,000 for their first home. There is some good stuff being done in Scotland, which I commend to the Minister, about what we can do to invest in housing while also ensuring that young people can get on the property ladder.

Finally, I will touch on the issue of the growth commission, whose report was published by Andrew Wilson on behalf of the Scottish Government. That report looks at the finances of an independent Scotland, and what it is absolutely clear about is that an independent Scotland can leave behind the broken economic model of the UK and actually benefit future generations with inclusive, sustainable growth. I will finish with this point: if the approach to spending recommended by the commission had been applied by the Westminster Government over the past decade, the £2.6 billion in real-terms cuts to Scotland would have been completely wiped out.

So I commend the hon. Member for South Dorset for initiating this debate. It is very difficult to have a debate such as this one, about the next generation, when we are quite literally pulling the rug from under their feet by the retrograde step of leaving the European Union and denying them the right to love and live elsewhere, and the opportunity to get on in the world.

17:22

[Lyn Brown (West Ham) (Lab)]

It is an absolute pleasure, Mr Hollobone, to serve under your chairmanship.

I am very grateful indeed to the hon. Member for South Dorset (Richard Drax) for giving us the opportunity to discuss the very real financial implications for the next generation of this Government’s continuing austerity policies.

We have had eight years now of claims that we have to tighten our belts for the sake of the future. Where has it got us? We are simply storing up problems for the future by destroying the public services on which so many people depend. Last month, the United Nations sent its special rapporteur on poverty to the UK and one of the evidence sessions was held in my constituency. I was there, and I have to say that it was really hard to sit and listen to that evidence. We heard about mums whose young children were not learning to crawl because they were confined to a bed in a small, rat-infested room; the mums could not let the children on to the floor. We heard from parents who had to move their children many times in a single year, from hostel to hostel, preventing friendships and bonds from being created in any community, and forcing the children either to move schools, which would severely disrupt their education, or to face hours of travel every morning and afternoon to get to school and back.

We also heard from vulnerable mums who had survived violence inflicted by people they were living with; they were forced to stay where they and their children were, although they were at significant physical risk, because they simply had nowhere else to go. The services that they needed had simply been cut.

What kind of physical, emotional and developmental problems are we storing up for these children’s future? For me, it is obvious that this kind of poverty is an absolute calamity for their life chances. And it is not just me who is saying that; it is what the UN rapporteur concluded. He noted that 14 million people in the UK are living in poverty today, and that 1.5 million people in the UK are utterly destitute, unable to afford essentials such as shelter, food, heating or clothing. These essentials keep a body and mind healthy and productive, but 1.5 million people—including 365,000 children—do not have access to them.

As we all know, health is extremely important to life chances. The Food Foundation has shown that the poorest quarter of households in the UK would have to spend more than 25% of their disposable income to follow the Government’s “Eatwell” guidelines. That is a quarter of their disposable income going just on food, and more than half of the households that are deprived of food include children.

Let me tell a story from my constituency. I met a young girl at an event where food was provided. Her plate was piled high, and I looked at her and said, “Whoa! That’s an awful lot of food for a small person!” “Yes,” she beamed. “It’s not my turn to eat tonight.” She was young and she had adapted, so for her such circumstances were normal. How will she and all the others in the same desperate situation feel when they realise that it is not everybody’s “normal”?

Some families are struggling to eat, let alone eat healthily; the increasing reliance of so many families on food banks is clear evidence of this. The Trussell Trust has released figures showing substantial increases of take-up of food banks year on year on year, and it is predicting bumper usage this Christmas.

When families cannot afford to eat, it has an impact on their health. Poor physical health or poor nutrition in childhood impacts upon a child’s physical, mental and educational growth. As a basic, how can a child concentrate in school if they are hungry? How can they make the most of their education? How can they develop the skills that they need for a prosperous adulthood? And how can they provide the skills that we need for a prosperous economy?

A sickly or malnourished child takes health risks and medical risks into their adulthood, costing the NHS much more than if they had been given a decent start in life. Reducing support to children today is a false economy; the state of tomorrow will have added costs because of it. The title of this debate is absolutely right—the next generation faces a financial threat from today’s austerity policies. That is one of the reasons why Labour is committed to universal free school meals, so that no child goes hungry in term-time, and it is also why we are committed to a real living wage and a social security safety net that keeps families out of poverty.

Let us have a quick look at the Government’s investment in the future economy through schools, further education and adult education, to give the next generation the skills and opportunities that they will need for the future. Investment in further and adult education has been cut severely. Spending per student in FE colleges is 21% lower than in 2010; the number of adult learners has fallen by a million; and overall spending on skills for adults has been cut almost in half. Now, 60% of small and medium-sized enterprises say that poor skills are their biggest challenge, and eight in 10 FE college leaders say that funding cuts are preventing them from filling that skills gap.

So there is a skills crisis and it is already affecting productivity and growth, but in the October Budget the word “college” did not appear once. I say again—how can this Government claim to be investing in future generations when they refuse to invest in the skills that businesses are demanding?

17:28

Sitting suspended for a Division in the House.

17:50

On resuming—

[Mr Philip Hollobone (in the Chair)]

The new finish time for the debate is 6.22 pm.

[Lyn Brown]

Let us face it: schools are faring badly. The Chancellor’s gift of £400 million in the Budget for some “little extras” was frankly insulting in the context of billions of pounds of cuts. If the Institute for Fiscal Studies is right, capital spending on schools has fallen by £3.5 billion—a 41% real-terms cut. I can see it in my constituency every time I visit a school. They are struggling, and they are also struggling to keep their students safe from grooming and crime at a time when young people’s services are disappearing, again due to cuts. Violent crime is rising and destroying the futures of increasing numbers of young people in my constituency, but the Treasury’s only response is to announce £170 million for our neighbourhood police services. That sum would cover less than 40% of the police pensions black hole, so it is unlikely to stop the fall in the number of officers on our streets. Reports suggest that half of that £170 million will have to come from elsewhere in the massively overstretched Home Office budget, so what will be cut to make up for it? Will it be firefighters? Will it be Border Force?

The next generation will not thank us if we leave them more vulnerable to fire, crime and terrorism. The cuts to councils have ensured that children’s services are under threat. Sure Starts and libraries are closing. We are charging for sporting activities in communities that help keep children healthy. There is not enough money to employ the youth workers that we need to teach my children resilience against the groomers.

Since 2010, the Government have claimed that austerity is working to bring down the debt and make spending sustainable, but that is simply wrong. They have missed every deficit target they have set themselves. They said they would eliminate the deficit by 2015, but now the Office for Budget Responsibility says that even eliminating it by 2025 will be challenging with the current approach. To the extent that the central Government deficit has reduced, much of that has been done by passing debt and problems to the future, where they will require more spending to fix. The Government are passing problems into the lap of our underfunded schools, hospitals, local councils and police forces. That does not make the next generation more secure or our public debt more sustainable.

Future generations are not being protected by austerity; they are being harmed by it. We need public investment to repair the safety net, to improve the public services that underpin the life chances of the many and to drive growth that benefits the whole country. In fact, we need a Labour Government to rebuild Britain.

17:51

[The Economic Secretary to the Treasury (John Glen)]

It is a pleasure to serve under your chairmanship, Mr Hollobone. I thank my hon. Friend the Member for South Dorset (Richard Drax) and acknowledge the assiduous way in which he has communicated with the Treasury over recent years, sharing the correspondence of his constituent. I welcome this opportunity to address, in as detailed fashion as possible, the points he has raised in his eloquent speech. I pass on my sincere thanks to his constituent for raising his concerns with the Government. I respect those concerns, and it is rare and gratifying to have a member of the public who takes quite such an assiduous interest in the public finances as to spend 5,000 hours studying them. I also thank the hon. Members for West Ham (Lyn Brown) and for Glasgow East (David Linden) for their contributions to the wide-ranging discussion this afternoon.

The Government share the concerns expressed today about the level of debt and recognise the importance of reducing it so as not to pass on an unfair burden to the next generation. I am anxious to reassure the constituent of my hon. Friend the Member for South Dorset that the Government are taking this matter seriously and are committed to getting debt down.

It may be helpful if I start with a few points of clarification. My hon. Friend observed a number of statistics relating to general Government gross debt. The Government’s chosen metric for debt is public sector net debt, which is a more complete and transparent measure of debt, incorporating a wider range of public institutions than general Government gross debt. Looking at net debt rather than gross debt also provides a more accurate picture of the health of the public finances, as it nets off our liquid assets.

My hon. Friend also stated in his opening remarks that the Government had reduced the deficit so that we now borrow £1 in £16, compared with £1 in £5 in 2009-10. He may be pleased to know that the figure is actually better than that: the Government now borrow only £1 in every £20 we spend.

An important point has been raised about how we measure debt, which I would like to address. The observation is that debt has increased in cash terms since 1973 and that that relates to us joining the European Union. I reiterate that looking at debt as a percentage of our national income—that is, GDP—is a more helpful way of assessing the public finances as it recognises our ability to afford debt as a nation. Looking at debt as a percentage of GDP adjusts for inflation and our ability to service that debt. It also paints a different picture from the nominal figures and shows that our debt level fluctuated between 20% and 50% from 1973, before significantly increasing at the time of the financial crisis. The fall in debt that we are now seeing as a percentage of GDP, rather than in cash terms, is an important distinction as it recognises that GDP is growing faster than debt. As my hon. Friend says, that is a movement in the right direction.

My hon. Friend also observed that, although we have significantly reduced the deficit since 2010, debt rose as a share of GDP over the same period before it peaked in 2016-17. That increase to debt in cash terms and as a percentage of GDP is principally due to the high levels of borrowing that we inherited from the last Administration—a post-war high of 9.9% of GDP, to be exact—which added to our overall debt burden. That could not be fixed overnight. As it was, there was significant resistance to the measures we took to reduce that deficit in the early years in government. We have now reached a crucial turning point, and the deficit has been reduced by four-fifths, from 9.9% when we came in to 1.9% of GDP at the end of the last financial year in April.

Thanks to the work of the British people to reduce the deficit, debt peaked at 85.2% of GDP in 2016-17 and has now begun its first sustained fall in a generation. It will reach—or, it is anticipated to, given the inherent difficulties of forecast—74.1% of GDP in 2023-24. That progress means that we are in a much stronger position with the public finances than we were in 2010.

While it is correct that debt rose after 2010, without the Government successfully reducing the deficit to the extent we have, debt would have been even higher and would still be rising. As my hon. Friend observed, there is a keen contrast between the Government’s balanced approach to paying down the deficit and paying down debt and the Opposition’s proposals to spend £1,000 billion if they assume office.

My hon. Friend also mentioned debt figures in cash terms for 2010, which his constituent Mr Stewkesbury rightly points out have changed. That change is due to a large number of reclassifications, the largest of which was adopting the European system of accounts 2010, which increased debt by around £100 billion due to the inclusion of Network Rail’s debt and the asset purchase facility and the treatment of public sector bank shares as illiquid. Reclassifications are necessary in the course of following international standards, which are themselves in constant evaluation.

The Government’s commitment to responsible management of the public finances was shown this summer, as we published our response to the OBR’s fiscal risks report, providing a detail account of the actions that the Government are taking to address risks to fiscal sustainability. That report provides a mechanism for Parliament and the public to assess the Government’s strategies for managing the risks, and to hold us to account for their implementation.

The report’s publication reaffirms the UK’s place at the international frontier of fiscal transparency and accountability, and supports the Government’s long-term fiscal strategy. The report set out a range of reforms that we are pursuing to reduce risks to the fiscal outlook, including actions to reduce our inflation exposure and tighter controls over the issuance of Government loans and guarantees. Such reforms will enhance the UK’s resilience to future economic shocks and aid in helping to keep debt falling.

It is right that actions taken by the Government today do not unjustly impact the next generation. In 2010, the Government inherited a very difficult position in the public finances, with debt having nearly doubled in two years and the budget deficit at its largest since the second world war. We have made significant progress. The deficit has been reduced by four-fifths and debt has begun its first sustained fall in a generation. However, the Government recognise that the job is not yet done, and share the concerns raised today.

We must continue to reduce debt to reduce the burden placed on the next generation. The OBR’s October forecast confirmed that the Government are on course to do that, and that we have met our near-term fiscal rules three years early. We will continue with our balanced approach, keeping debt falling while supporting public services, investing in the economy and keeping taxes low.

My hon. Friend raised a specific point about the sale of the Channel tunnel. The Government’s approach to such matters is that we sell public assets where there is no public policy reason for retaining them, but all asset sales must meet the value-for-money tests set out in the Green Book at the time.

It has been difficult to respond fully to today’s debate, given the range of speeches. My hon. Friend made essentially a macroeconomic critique of the Government, while the Opposition Front-Bench Members made a different set of observations, which are perhaps best left to another time. I sincerely acknowledge the need for the Government to come to terms with the fact that in 2019-20 we will still spend £43 billion on net debt interest, which is more than the amount spent on our armed forces. We need to be clear about the imperative to bear down on the challenge of getting our public finances into a position where we do not add to that debt burden, so that the next generation is in a better situation than when we came into Government.

17:59

[Richard Drax]

I am most grateful to the Minister, to the hon. Member for West Ham (Lyn Brown) and the hon. Member for Glasgow East (David Linden) for their contributions, and to you, Mr Hollobone, for listening to a debate that was full of figures. Such debates are perhaps not always the most gripping, but they are nevertheless important.

The hon. Member for West Ham made some very relevant points. The only point that I would like to make generally to the Minister is that it seems to me that one can look at it as Baroness Thatcher did—and gosh, how we miss her. She always used to say that it is like running a household: if the household spend more than it earns, it goes bust. If a shop—which is where, of course, she came from—makes more than it spends, that money can be reinvested in the business, and perhaps the staff can be paid a bonus, or whatever it may be. That is how she explained running an economy. I know that is very simple, and it is more complicated than that in real life, but the basics are true. Perhaps I can leave the Minister, and the Opposition, with that thought.

I did not agree with the representative of the Scottish National party, the hon. Member for Glasgow East, who said that by leaving the EU we would go to hell in a handcart economically. I would say that the opposite is true, because it will give our country the chance to generate more income. We need to earn more, so that those who earn more pay more tax and those taxes can pay for all the public services that the hon. Member for West Ham rightly pointed out are in urgent need of more money. I would totally concur with that, but we cannot just produce money from nowhere.

We cannot keep printing money; we have to earn it as a country. I hope and pray that when we leave the EU, and I hope that we do—fully—we will be free to generate such an economy, and to give our entrepreneurs, and the businessmen and women in this country, the chance to get out there and generate wealth for the services that we need to pay for.

I thank everyone who has taken part, and I thank you, Mr Hollobone, for chairing the debate.

Question put and agreed to.

Resolved,

That this House has considered the financial implications for the next generation.

18:04

Sitting adjourned.