Northern Rock

Andrew Bridgen Excerpts

Monday 21st November 2011 Commons Chamber

[Mr Hoban]

I just point out to the hon. Gentleman that the mandate for UKFI was to maximise value for money for taxpayers, and that mandate was set by the previous Government.

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

Has the Minister noted that the deal agreed with Virgin Money represents 80% of the book value of Northern Rock, whereas RBS and Lloyds are currently trading at only 40% of book value? Does not the deal represent good value for the taxpayer?

[Mr Hoban]

My hon. Friend is absolutely right. If we measure this deal against the values at which other banks are trading at the moment, it is very clear that it is good value for money for the taxpayer. Rather than carping and criticising, Labour Members should welcome the fact that at a difficult time for the global economy we have been able to sell Northern Rock and get such good value for money.

Public Service Pensions

Andrew Bridgen Excerpts

Wednesday 2nd November 2011 Commons Chamber

[Danny Alexander]

I do not believe that that is a correct use of the term “accrued rights”. Of course we will protect the accrued rights in full. The RPI to CPI switch will have the effect that I described in my statement. That is the subject of a legal dispute at the moment, but it was the right decision by the Government.

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

Has the Chief Secretary received any constructive representations from the Labour party regarding this important topic or has its involvement been limited to the irresponsible words of the shadow education spokesman, who is no longer in his place, condoning teachers’ strikes?

[Danny Alexander]

I am yet to receive a constructive suggestion from the Labour party, but I live in hope.

Jobs and Growth

Andrew Bridgen Excerpts

Wednesday 12th October 2011 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

As ever, it gives me great pleasure to follow the hon. Member for Monmouth (David T. C. Davies), who talks about learning lessons. Following the erudite economic contributions that we have heard from many hon. Members, I am going to talk about the real lessons of human life in my constituency.

First, let me give some numbers. Over the past year, claims for jobseeker’s allowance in London increased by 10%, compared with the UK as a whole at 8%. Those figures are pretty bad, and today’s unemployment statistics underline the general trend. In my constituency, the figure increased by 18%. If one looks more closely, it gets worse. The number of claimants under the age of 24 increased by 18.1% in the past year, and for someone who is over 50 the outlook is bleak. The increase in the number of claimants in that group was 29.2%. That is right—nearly a third more over-50s are seeking work than a year ago.

I will focus on people and their lives, and on the families who are affected by this Government’s policies. About one in three residents in the borough of Hackney, which I represent with my hon. Friend the Member for Hackney North and Stoke Newington (Ms Abbott), are under the age of 24. Therefore, as well as the percentage increases, a significant number of young people in both constituencies are affected by the Government’s reckless programme.

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

Will the hon. Lady explain how abandoning our deficit reduction plans, losing our triple A credit rating, and forcing up interest rates to UK plc, homeowners and business will lower unemployment?

[Meg Hillier]

That question demonstrates the detachment of this Government and their Back Benchers from the reality of human lives. If the hon. Gentleman will let me develop my argument, I will point out that there are real challenges for people. There is an alternative plan, which my right hon. Friend the shadow Chancellor and his colleagues have laid out, and I back it.

I have met young people who have already been made redundant in their early 20s and others who have done everything that the Government have asked of them, such as working hard at school. Our borough has seen huge improvements in schools and education, and its results are improving. Our young people are increasingly going to university, which was pie in the sky for many young people when I was first selected for my seat. And still, there are no jobs. We risk having a lost generation, although not like the lost generation that the hon. Member for Sevenoaks (Michael Fallon) spoke about, because we made great strides in government, although there is still more to do on skills. We risk a lost generation of young people who have achieved a lot and still cannot get a job.

--- Later in debate ---

[Jake Berry]

I never said it was a fake Ponzi scheme, I said it was a real Ponzi scheme. That is the basis of the Opposition’s entire policy.

The markets believe in our plan and want us to stick to plan A: actually, so does every hard-working family in my constituency. They are struggling with personal loans and do not want interest rates to go up. Like so many of us, they are struggling with mortgages and cannot afford that to happen. The Prime Minister has offered real leadership throughout this, and the Chancellor of the Exchequer has been honest. That is in stark contrast to the Labour party’s constant line of “too far, too fast”.

What is the Opposition’s alternative? This five-point plan is simply too little, too late. They believe, “Why repay borrowing today when we can have business as usual and bankrupt Britain tomorrow?”

[Andrew Bridgen]

Does my hon. Friend agree that, like a compulsive gambler believes that one more big bet will solve all his problems, the shadow Chancellor and the Labour party believe that one more credit splurge will get us out of a debt crisis?

[Jake Berry]

I do, and for all addicts the hardest thing to do is admit that they have a problem. When this Government came to power in May 2010, we admitted that we had a problem with debt. Even if we fall off the wagon temporarily, we know we have that problem and so we get straight back on it. The Labour party has not even admitted it—it thinks it gave us a golden economic inheritance.

--- Later in debate ---

[Sajid Javid (Bromsgrove) (Con)]

It is always a pleasure to follow the right hon. Member for Holborn and St Pancras (Frank Dobson). Before I begin, may I, too, congratulate the hon. Member for Leeds West (Rachel Reeves) on her promotion?

I am glad that the right hon. Member for Holborn and St Pancras mentioned Alice in Wonderland, because that is exactly where Labour is. What we have heard from the shadow Chancellor today suggests that it believes that we can solve a debt crisis by taking on more debt. Let us remind ourselves of the position that this country was in when the Government changed 18 months ago. We had a national debt of £940 billion, up from £350 billion when the Labour Government entered power.

The hon. Member for Wolverhampton North East (Emma Reynolds) mentioned the debt to GDP ratio, and in terms of net debt that is at 62% today. She is right that it was lower—it gradually went up as the previous Government came to their end—but she missed out the fact that the markets do not just look at the official national debt but take into account the unofficial national debt. The good thing is that now this Government are in power we have started to have a transparent process to assess what that debt is. Before the market was all based on estimates.

I can tell the hon. Lady that the £940 billion is not even half the story. In fact, it is one third of the story because it represents one third of the total national debt of this country. The whole of Government accounts published in July by the independent Office for Budget Responsibility said that the public pension liability of the UK is £1,100 billion. PFI liabilities increased tenfold over the 13 years of the previous Government to £40 billion according to the OBR. The Office for National Statistics reported in the summer that the cost of financial interventions because of the bank bail-outs is £1,300 billion of additional debt. If we add all those numbers up, they come to £3,380 billion—a mind-boggling number equal to 225% of GDP.

Let us look at the five-point scam suggested by the shadow Chancellor. Four of those five policies would lead to a direct increase in our debt and one, the bankers’ bonus tax, would raise less than the levy that the Government have already imposed. I spent 20 years trading Government bonds. I advised Mexico, Brazil, Indonesia, Russia and Argentina when they were at default or close to default and I can tell anyone who cares to know that the way out of a debt crisis is not to borrow more money. Investors have a choice. They do not have to buy anyone’s bonds. They can look at any country or corporation in the world and there is no way to force those bonds down their throat. That was exactly the point we had reached before the last election and if the Government had not changed, we could very well have been in the same predicament as countries such as Greece, Portugal, Ireland and Iceland.

It is not just our triple A rating that shows that the Government’s policy in dealing with the debt is the right one. It is not just the gilt deals, as my hon. Friend the Member for Spelthorne (Kwasi Kwarteng) mentioned, although our 10-year gilt yield is at 2.6%.

[Andrew Bridgen]

My hon. Friend might recall that the previous Government created £200 billion-worth of quantitative easing just prior to the general election. However, that money was not pumped into the banking market to give liquidity—98% of it was used to buy Government debt because nobody else wanted to buy it at that stage.

[Sajid Javid]

I quite agree with my hon. Friend. The 10-year gilt yield today is 2.6%—one of the lowest we have ever had in our history—versus 3.8% when this Government came to power. That number is not just important to the financial markets: it makes a big difference to the amount of money this Government have to spend on servicing our national debt, to the amount that corporations have to spend when they borrow and then invest, and to the amount that ordinary households need to spend on things such as their mortgages. It makes a real difference to the cost of living.

Let us consider another indicator. I always like to look at the credit default swap spread, which is the amount that the markets charge for insurance against a potential sovereign default. Today, Britain has, for the first time, the lowest CDS spread of any large European country. According to Bloomberg, of the 157 sovereigns that trade in the CDS market, Britain has the fifth-lowest CDS spread in the world. That, again, is a reflection of the policies of this Government.

I should like to finish by picking up one positive point that the shadow Chancellor made to his party conference, which was the only thing I heard with which I agreed. He said

“we will set out for our manifesto tough fiscal rules that the next Labour government will have to stick to”.

I am glad that he has recognised the need for tough fiscal rules that are independently monitored by the Office for Budget Responsibility, as that is exactly what I suggested in a private Member’s Bill in July, the National Debt Cap Bill, which will have its Second Reading on 20 January 2012.

My proposal is that we should have an independent, tough cap on the net outstanding national debt as a proportion of GDP, monitored by the OBR. That would not be a magic bullet for dealing with potential future debt problems, but it would force the House to have a national conversation every time any Government wanted to increase debt beyond a certain point. If they had a good reason for doing that, the House could support them and Members might have an opportunity to discuss the issue with their constituents. If the House did not accept the Government’s reasons, it could prevent our country from becoming more indebted. I say to the shadow Chancellor that there is no point waiting for the next Labour manifesto because there may not be another Labour Government—at least, not any time soon. It would be far better for him to take action now, put his money where his mouth is and support my Bill, which is coming to the House in just a few months.

In conclusion, there is nothing in the motion that would help to generate investment and create jobs. In fact, if it were implemented in any form, it would destroy jobs. I urge the House to vote against it.

Eurozone

Andrew Bridgen Excerpts

Monday 10th October 2011 Commons Chamber

[Mr Osborne]

We have not done that calculation, but my hon. Friend has given me a very good idea for Wednesday’s debate. We know, because we have all experienced it, what Labour policies lead to: a completely uncontrollable budget deficit; a negative outlook for our nation’s credit rating; and interest rates that were tracking Spain’s. We have been there under the Labour party, and it is remarkable that when it cleared out the shadow Treasury team, it did not clear out the man most responsible in this Parliament for getting Britain into this economic mess.

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

In his statement, the Chancellor quoted the sage remarks of the former Minister, Lord Jones. Perhaps it is the Chancellor’s modesty that prevented him from quoting these remarks that Lord Jones made about the fact that we are sticking with plan A:

“The markets of the world will say, ‘well done George’. That will mean that interest rates are low”,

that we keep our triple A rating, and that we do not become Greece.

[Mr Osborne]

We should certainly listen to the sage words of the former Labour Trade Minister.

Regulatory and Banking Reform

Andrew Bridgen Excerpts

Thursday 16th June 2011 Commons Chamber

[Mr Hoban]

My hon. Friend makes two important points. The first is to recognise the role played by the Financial Services Compensation Scheme in protecting depositors up to that £85,000 limit. The other point is that there is collective amnesia among the Opposition about their role in the financial crisis. Yes, Northern Rock took place before the global financial crisis—and they were the champions of light-touch financial regulation and introduced the tripartite system of regulatory reform that was shown to fail during the crisis. The Opposition need to recognise their responsibility; until they do so, it will not be possible for them to move on.

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

Does my hon. Friend agree with the recent report from the other place saying that the tripartite authorities

“failed to maintain financial stability and were found wanting in dealing with the crisis, in part because the roles of the three parties were not well enough defined and it was not clear who was in charge”?

[Mr Hoban]

My hon. Friend makes an absolutely vital point. The failure of the financial regulatory system put in place by the Labour party when in government was hard-wired into the system. It was destined to fail because of the failure to identify a clear match between the people who had the power and those who had the responsibilities for managing financial stability. My hon. Friend is absolutely right. The previous system was destined to fail. We have learned the lessons from that crisis; I am not sure that the Labour party has.

Amendment of the Law

Andrew Bridgen Excerpts

Monday 28th March 2011 Commons Chamber

[Caroline Flint]

They still had people living in them. The hon. Gentleman should come to the constituencies of Labour Members to see the investment in social homes, and the partnerships that were developed with the private sector to ensure that we had social homes alongside private developments. The previous Government were putting an end to the division whereby social homes were in one part of the community and private homes were built in another. That is the Labour way, and I am very proud of it.

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

The story the right hon. Lady tells is not one that I recognise in my constituency, which had the worst quality council housing in the whole country. Seventy per cent. of our housing was not up to the decent homes standard, and it has taken a Conservative-led coalition Government to deliver the £21 million to bring them up to standard over the next four years.

[Caroline Flint]

People throughout the country benefited from the decent homes programme and other housing initiatives that helped them to get on to the property ladder and to ensure that they had choices. In the first six months of 2010, before the election, the number of new homes built went up by more than 20%, but in the last six months of 2010, after the election, the number of new homes started fell by nearly 20%. If the Secretary of State wants that debate, I am always happy to have it with him—or with any of his colleagues.

The country wants to know what the Secretary of State and his Government will do to help to build the homes for which communities up and down the country are crying out. Whatever he pretends, the reality is that the Budget brings very little good news. It promises help for first-time buyers. The Opposition welcome the Government’s U-turn—their decision to bring back Labour’s homebuy scheme, which they insist on calling “Firstbuy”—but less than a year ago, the Minister for Housing and Local Government described that policy as an “expensive flop”. That was not what thousands of first-time buyers thought about it or what the housing industry made of it. The Home Builders Federation said that it

“was judged a major success by the industry”.

Only a matter of months later, with his customary humility, the Minister has been forced to admit that he called it wrong. We have wasted 10 months in which we could have ensured that people had a better opportunity to own their own homes. He has done too little, too late, and the measure does not go far enough, because while more than 3 million hopeful first-time buyers try to get a foot on the property ladder, the measure helps only 10,000 of them.

No one is convinced that the new homes bonus is the panacea to the housing crisis that the Government believe it to be, least of all the 21 Tory council leaders from the south-east who wrote to them earlier this year warning that they were not convinced that the plan provides enough of an incentive to communities for them to welcome development. The Budget was crying out for measures to support housing, but they did not happen. All it comes up with is the idea of allowing commercial properties to be turned into homes without requiring planning permission. When the Government get around to establishing exactly which sort of commercial properties will be allowed to turn into residential properties and under what conditions, we will look at their proposals carefully, but if the Secretary of State really believes that the answer to the country’s housing crisis is turning some empty offices into luxury penthouses, or asking people to live in disused out-of-town business parks or derelict industrial estates, he had better think again.

The biggest disappointment is the failure to address the deeper problems of housing supply and the lack of available mortgages. In their submission on the Budget, the Home Builders Federation is absolutely clear that mortgage availability

“is the biggest immediate constraint on demand and house building.”

Figures from the Council of Mortgage Lenders published as recently as 18 March show that mortgage lending has stalled. It says that lending is

“weaker than a year ago”

and that the housing market is “stuck in a rut”, but on that, the Budget is silent.

Before we move on from housing, let us remind ourselves of another matter on which the Government have not lived up to their promises. Just a few weeks ago, the Minister for Housing and Local Government told the Zero Carbon Hub annual conference:

“The commitment to Zero Carbon remains in place—there’s no ambiguity about that”,

but when reading the small print of the Budget, we discover that that is just another broken promise, because from 2016, new homes will no longer have to source all their energy from carbon-neutral sources, which goes back on a commitment that the Conservatives made in opposition and repeated in government. Those standards were about not only protecting our environment, but driving innovation and creating new jobs in the green economy. The Government’s failure on that undermines not only their green credentials, but the ability of our economy to compete for new jobs, new investment and new industries.

Let me deal with the underlying economic nonsense at the heart of Government policy. They hope that the UK economy will be saved by an export-led recovery, which I call Osborne’s see-saw, because the Chancellor views the public and private sectors as opposite ends of a see-saw. He thinks that the harder, deeper and faster he cuts the public sector, the sooner the private sector grows to fill the space and suck up the unemployment. One does not have to be an economist to know that there is no reason why cutting home helps, police officers and council cleaners will lead to the UK selling more electrical equipment, cars or IT services abroad. However, I do know that if we cut public investment in roads, regeneration and house building, and shred the school building programme, the private sector takes a huge hit. The construction industry nose-dives and hundreds of thousands of skilled workers and those who manufacture and supply to them lose their jobs.

--- Later in debate ---

[Mr Campbell]

Of course that is right, and that is part of my point. I would like the zones to be targeted in unemployment blackspots, which we have in the north-east. Unfortunately for Blyth Valley and Wansbeck—my hon. Friend the Member for Wansbeck (Ian Lavery) is not here—those zones did not come into our areas. If they are going to be in Tyneside, we have to get the people from our area into Tyneside, but the only transport we have is buses and people’s private cars—we have a rail link, but we do not have a train on it. If we target those blackspots, the enterprise zones might see some success.

Let me turn quickly to what I have heard since this Government came to power about how the last Government are to blame for the mess we are in. We hear all the time—we have heard it this evening—about the bankers’ mess, and that is indeed what I would call it: the bankers’ mess. The one thing that we never hear from the Government Benches is any criticism of the banks and the crisis that the bankers put us in. This country was going on wheels until 2008, when the bankers created the crisis. Government Members are not blaming the last Labour Government for the crisis in America, the crisis in Greece, the crisis in Spain, the crisis in Portugal or the crisis in Ireland. They are not blaming the Labour Government for all that—or would they in fact want to blame them for it?

I will tell the House why Government Members are not blaming the bankers: because since the Prime Minister was selected as a candidate for the leadership of the Tory party, the City has put £42 million into the Tory coffers to fight elections. That is why we do not hear anything from the Government side about the banks. That is why the banks and the bonuses are allowed to flourish, because the Tories are in the pay of the bankers. Make no mistake about it: that is a fact. The fact is that the Conservatives are in their pockets, and the banks are in their pockets.

[Andrew Bridgen]

rose—

[Andrea Leadsom (South Northamptonshire) (Con)]

rose—

--- Later in debate ---

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

I welcome this Budget as the first step in a much overdue reform of our economy and our tax system. It is not a sustainable position to expect the private sector, at 50% of the economy, to support itself and the other 50%, which is the public sector. The rebalancing of our economy is not a nice optional extra or a Government whim: it is absolutely essential to our country’s current and future economic survival in an increasingly competitive world. It will be by promoting enterprise that we grow our way out of the disastrous position left behind by the last Labour Government and their debt-fuelled economic model, which has been proven to be totally unsustainable. They borrowed even in the boom years of 1997 to 2004, when the national debt rose by an eye-watering £74.9 billion.

I welcome the announcement of the extra 1% cut in corporation tax to 26% this year, making it the lowest corporation tax rate in the G7, which is accompanied by commitments to reduce corporation tax further in future years. That positive move will let international businesses know that Britain is truly open for business. In addition, there are many signposts that if someone is prepared to take risks to generate wealth and pay taxes, the rewards will be worth while. The doubling of the size of the entrepreneur’s relief, for instance, ensures that if someone creates wealth and employment, they will not be overly punished by the taxman when they exit their business.

Other measures taken in this Budget are a welcome start on the road to regulatory reform and will be of encouragement to employers in my constituency and across the country, especially those with fewer than 10 employees—90% of the businesses in this country fall into that category. The announcements on incentives for charitable giving and the rise in personal allowances should be welcomed and supported by Members on both sides of the House.

I also welcome the announcement that the 50p tax rate is to be reviewed by Her Majesty’s Revenue and Customs, and the revenue raised from the new rate calculated. I have written at length about the damage the measure has done to our economy. Hon. Members will recall that when Nigel Lawson cut the top rate of tax from 60p to 40p in 1988, the tax take rose and the top earners actually paid a larger share of it. When the Treasury recently decided to set the rate of capital gains tax at 28%, it stated that studies it had conducted concluded that this was the rate that maximised the tax take. If that is correct and the optimum rate for unearned income is about 28%, it is very unlikely that the optimum top rate of income tax should be nearly double that level. I look forward to the report in due course.

On a personal basis, on behalf of North West Leicestershire, I very much welcome the news that the per plane tax plan is to be dropped. East Midlands airport is in my constituency and the jobs dependent on both the airport and air distribution are a significant part of my district’s economy and employment base. There is nothing more international than air transport and if we had acted alone with the per plane tax, those jobs would have been threatened. Cuts in fuel duty are also particularly welcome for North West Leicestershire, as one in three of our private sector jobs are either in distribution or distribution-related.

I believe the Budget will act as a signpost that the Government will take action to reform our taxation system and our economy. Labour left our economy in a totally unsustainable state—imbalanced in so many ways, whether that meant the proportion of the economy made up by the public sector, our decline in manufacturing or our reliance, or over-reliance, on financial services and housing bubbles. There is no doubt that Labour’s economic model was and still is unsustainable. The attitude of the Opposition to the record deficit they bequeathed the coalition Government is both startling and opportunistic. In opposing all the coalition Government’s saving reductions but still claiming to be in favour of deficit reduction, they are failing to act in their duty of being a credible Opposition on this topic.

This is a good Budget for growth, a good Budget for jobs and a good Budget for North West Leicestershire, and I support it enthusiastically.

Budget Responsibility and National Audit Bill [Lords]

Andrew Bridgen Excerpts

Tuesday 22nd March 2011 Commons Chamber

I shall conclude by making two further points, the first of which relates to the myths about this country’s level of deficit and national debt.

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

I welcome the fact that the OBR is in place. Does the hon. Gentleman think that if it had been formed back in 1997, it would have advised the Labour Government against increasing the national debt by a stonking £74.9 billion in the boom years between 1997 and 2004?

--- Later in debate ---

[John Mann]

We, like other countries in the western world, are losing manufacturing jobs because of our refusal to deal with Chinese imports and the consumer myth of buying ever cheaper from China. The inherent trade imbalances and problems that accrue as a result will come back to haunt us, and while I know that the Government will want to allocate time to discuss that vital subject in the near future, it is slightly outside our present debate.

The hon. Gentleman is partly right and partly wrong. While it would be wrong to discuss policy issues relating to the economy now, if the statistics had been broken down at that time to allow his assessment to be made more accurately, it is rational to assume that the situation could have been debated more regularly and in a more informed way. That might have had a positive impact for Opposition Members such as him as well as Labour Back Benchers. Indeed, such information might also have informed the previous Government’s policy making, which explains why amendment 1 is in the Government’s favour.

We need to know about job creation and what jobs are available not only in London and the south-east, but in other parts of the United Kingdom. I have talked about immigration, but there is an equally vital factor for economic and social policy: the blurring, albeit for rational reasons, of retirement age. We have to consider early retirement, late retirement and the retirement age itself, as well as the vital question of pensions. Some employers in areas such as mine have deliberately targeted getting the over-60s back into employment. That is perfectly rational, and it is good for those people, for the social economy and, perhaps, for the economy overall. We need the information, however; not because that is a bad thing, but because we need to know whether the new jobs in our regions and constituencies are getting those people who are deemed to be retired into the labour market, as opposed to people who are not working—whether they want to work or not. If we are to crack the problem of those who choose not to work, or who are incapable of getting work—again, the rational employer goes for the person with work history—such understanding will be vital to our economic and social policy. I put it to hon. Members that the rational employer is far more likely to employ a 67-year-old with an excellent work history who is re-entering the labour market, perhaps in a part-time job, than a 57-year-old who has been unemployed for 10 years.

The decisions taken by employers and those individuals who wish to re-enter the labour market are not necessarily matters for us, but the consequences of their decisions are important to us, and especially to economic policy making. An understanding of the precise breakdown of new jobs and job losses is fundamental to economic policy making. Several of the economic assumptions that can be made about consumer behaviour, pensioners and wage demands flow from such analysis. That is why, as a slight aside, it would be foolhardy not to give the Treasury Committee a role in all five OBR appointments, because such a role would ensure that if a Chancellor were so foolish as to skew the appointment process towards people with a certain mindset or from a certain discipline in economics, as opposed to trying to achieve a balance, that Chancellor could be corrected through appropriate cross-party decision making. I am talking about any Chancellor—the present one, whoever replaces him in future reshuffles and our Chancellor, when we are in power. It is vital that there is an evidence base that stands independent of the Government so that we can all decide how to vote on the various measures that the Government bring forward. How can we possibly make an informed decision otherwise, except by political instinct, which is important but insufficient compared with having all the information?

I am therefore puzzled by why the Government are not leaping to thank my hon. Friend the Member for Nottingham East for tabling the amendment. Labour Members might see the fact that his approach would help out such a Tory Government as somewhat treacherous, but this is clearly the new politics. It is coalition gone mad when a Labour Front Bencher is putting forward a proposal that would help Conservative Back Benchers, the handful—a tiny number—of Liberals who are anywhere near government and the Government themselves.

Let me give another example about policy making. Who knows what will be determined about petrol policy tomorrow, but that is a good example of something that should be covered by the OBR’s analysis. We need to know what has happened, including in the past, so that we can assess the impact of VAT on petrol, as well as on petrol duty, and the changes to petrol duty itself. The Chancellor might decide not to cut the price of petrol and yet not to increase it further, even though the price paid by drivers such as myself has gone up by ten quid since he became Chancellor. If he decides not to increase the price further, we will need to see a breakdown of the relevant information. We could go back through history, although I can guarantee that such a consideration will not be in the report that the OBR produces tomorrow. I could assist the office, however, because I have statistics that demonstrate that 70% of the existing tax on petrol was brought in by Conservative Chancellors since 1973. One might ask why Conservative Chancellors pick on the motorist to such an extent, but that is a debate for tomorrow rather than today, although I know that you, Mr Deputy Speaker, and others in the rural community will want to know why that is the case.

The point, in the context of the amendment, is that we must know precisely what is going on. I imagine that Conservative Back Benchers would be shocked to find out that Conservative Chancellors are responsible, as of today, for 70% of the tax on petrol. If the OBR had the mandate, however, those statistics could be laid out for us at every Budget and the pressure would be on. The pressure would, of course, be on Labour if the reverse had been the case and Labour Chancellors such as my right hon. Friends the Members for Kirkcaldy and Cowdenbeath (Mr Brown) and for Edinburgh South West (Mr Darling) had been responsible for the rise.

[Andrew Bridgen]

I applaud the hon. Gentleman’s honesty in saying that Conservative Chancellors are responsible, because there is no doubt that Labour Chancellors have been extremely irresponsible. [Interruption.]

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[Geraint Davies]

I am grateful for your guidance, Mr Deputy Speaker, because I would not want to be tempted in the least. I will resist temptation.

The focus of the amendment is very much on the important area of growth. As I have mentioned, the important opportunity is to refocus our entrepreneurial activity on export-driven growth. For example, in the Budget tomorrow the Chancellor might announce tax breaks for investment in small and medium-sized enterprises, which I would welcome. I do not think that he will, because he does not particularly care about SMEs; he will just say something about not giving mothers and fathers rights to see their children. The fact is that, with regard to the engines of growth, the liquidity has been taken out by the banks, which are just rebalancing their balance sheets. They should be pressurised into providing the fuel to allow the entrepreneurial engine to move forward, because so many companies have full balance sheets but no cash flow because the banks are letting them down.

It would also be a good idea to have a tax break for investment in SMEs in order to push things forward, as that way people could put in their own money and it would produce a better rate of return from the point of view of the business and venture capitalists. I do not think for one moment that the Chancellor will announce such a tax break—he does not have the imagination—but if he did, that could be factored into the growth figures for the OBR, because obviously the money we would spend on the tax break would be recovered from business growth, particularly if it was targeted at export-driven, high-quality manufacturing.

[Andrew Bridgen]

Will the hon. Gentleman give way?

[Geraint Davies]

I will give way to the man with the badge.

[Andrew Bridgen]

Does the hon. Gentleman believe that the OBR, had it existed before the financial crisis, would have been able to tell the previous Government that much of the growth they were claiming was actually a mirage? That growth was driven by a Government who were spending more than they were gaining in taxes and so creating a deficit. To pick up on a point made by the hon. Member for Bassetlaw (John Mann), they were also exporting manufacturing jobs to the far east and importing cheap goods, which was having a deflationary effect on our economy, allowing interest rates to be kept artificially low and feeding a housing bubble that was getting ever bigger. When it burst, that was when it all happened.

[Geraint Davies]

I am glad that the hon. Gentleman is wearing a badge saying that he has a GCSE in economics, but I doubt it.

On a serious point, I have already accepted that prior to the financial crisis there was a marginal deficit to be confronted, and it was going to be confronted through growth initiatives. We have since had the financial crisis, and the important thing now is to move forward with ideas for investing in growth. Clearly, there are big questions on tax and spend and where those will be deployed. Many new ideas might emerge in the Budget, such as a windfall tax on the energy giants, whose profit margins have suddenly increased by 38% because they did not adjust their prices when costs changed and so ripped off Britain’s consumers. That is obviously a legacy of the previous Conservative Government’s privatisation and the lack of controls.

There is money available to invest in growth and services and to close the deficit gap. The point about the amendment is that we must put growth centre stage, as that will enable us to move forward in a balanced way, rather than in the narrowly defined way that the Government prescribe. With those thoughts, I will give other Members the chance to make their own unique contributions.

Fuel Prices and the Cost of Living

Andrew Bridgen Excerpts

Wednesday 16th March 2011 Commons Chamber

[Ms Eagle]

I was saying that the Office for Budget Responsibility has given the lie to the view that a fuel duty stabiliser mechanism can be financed by the windfall that rising oil prices give the Government by revealing that that surplus does not exist.

The Secretary of State for Business, Innovation and Skills was caught recently saying that the Liberal Democrats are in a “constant battle” inside the Government, especially over tax proposals. They are obviously in a battle over the fuel duty stabiliser. In debates on the 2008 Finance Bill, he said that fuel duty stabilisers were “unbelievably complicated and unpredictable”. He also said:

“May I suggest that there might not be any net windfall at all?”—[Official Report, 16 July 2008; Vol. 479, c. 339.]

The OBR has since confirmed that there is not. The Liberal Democrat bit of the Government is saying one thing and its Tory masters another. Together, there is total inaction on fuel prices.

The Institute for Fiscal Studies has concluded that introducing a fuel duty stabiliser would inject more uncertainty into the public finances rather than less. Analysis by the Policy Studies Institute found that if a stabiliser had existed for the 12 months to last December, when the price of petrol rose by 13p a litre, it would have cost the Exchequer a staggering £6 billion. The Government’s flagship policy on fuel, which they used cynically before the election to generate so many favourable headlines and to gather votes, is not only late in arriving, but looks shambolic and incoherent.

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

rose—

[Charlie Elphicke]

rose—

[Ms Eagle]

It is clear that the policy can be introduced only at the risk of injecting huge and dangerous uncertainty into the public finances. I give way to the hon. Member for North West Leicestershire (Andrew Bridgen).

[Andrew Bridgen]

The Labour party’s apparent damascene conversion on fuel taxes will amaze and intrigue the bulk of the electorate. Will the hon. Lady confirm whether she supported the crafty action of the previous Chancellor of the Exchequer, who effectively excluded fuel from a VAT reduction in 2008 by raising duty, and then put the VAT on fuel back up to 17.5% in January 2010?

[Ms Eagle]

One minute Government Members say that we have no plan to deal with the deficit, and the next minute they complain that we had a plan that would have raised money. They really do try to have it both ways and are not remotely coherent.

The time for action is now. The Chancellor should take immediate action on fuel prices to ease the cost of living crisis in Britain. He does not even have to wait until the Budget. We are calling on him to reverse immediately the 2.5 percentage point increase in VAT on petrol that he imposed in January.

National Insurance Contributions Bill

Andrew Bridgen Excerpts

Thursday 13th January 2011 Commons Chamber

[Stephen Timms]

This is what the Prime Minister called for in November:

“The right framework, so it’s easier for new companies to start up”.

That is what he wants to happen in the east London tech city initiative. My question to the Minister is why is the Bill not doing that which the Prime Minister has so clearly called for? If it were my right hon. Friend the Member for Delyn appealing to the Minister to do that, I could understand why he would not be willing to do it, but it is the Prime Minister, who appointed the Minister to his job. Why is the Minister not doing what the Prime Minister said?

I commend to the Minister the Prime Minister’s speech of 4 November, in which he went on to describe what different parties are doing to help to secure this vision of a new high-tech city in east London:

“But what about here—in the heart of east London where there’s already so much to work with? We’re working with business to make sure the infrastructure and advice you need is in place. Imperial Innovations, the venture capital arm of Imperial College London”—

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

Does the right hon. Gentleman welcome the coalition Government’s reintroduction of the enterprise allowance scheme, which we have opened to people the length and breadth of the UK who have been unemployed for six months or more to help them get into self-employment?

[Stephen Timms]

I have always taken the view that self-employment is a very important vehicle for helping people not in work to get into work. That is why the new deal for self-employment, as an element of the new deal in the past, was so valuable, and I welcome other initiatives to achieve the same thing.

The Prime Minister went on to say that Imperial Innovations

“is going to advise on making sure this accelerator space is attractive to spinout companies from academia and beyond. Indeed, they will be encouraging some of their own brilliant companies to be based here.”

I very much welcome that. I look forward to those start-up companies being established.

Bank Bonuses

Andrew Bridgen Excerpts

Tuesday 11th January 2011 Commons Chamber

[Mr Osborne]

I do remember exactly that story of the Labour Government; indeed, I was reminded of it recently when I saw Tony Blair, that well-known consultant for J. P. Morgan. We are trying to sort out the situation that we inherited—a complete mess with no plans to put it right. Now, seven months in, the Opposition still have no serious economic policy to put forward.

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

Is the Chancellor of the Exchequer as appalled as I am by the mock anger of those on the Opposition Benches, which is a blatant attempt to mask the fact that they completely failed to regulate the banking industry that amounts to no more than blatant opportunism, and smacks of canting hypocrisy?

[Mr Osborne]

It is blatant opportunism, and it is a substitute for a serious economic policy. People will have long memories about what happened when Labour was in charge of our economy.